Diesel Price Surge of 32.5% Pushes Freight Industry to the Brink

South Africa’s road freight industry is facing significant strain following the sharp diesel price increase that came into effect on April 1, with industry bodies warning of serious financial and operational consequences.

The Road Freight Association (RFA) reports that the daily basic diesel cost has risen by 32.5%, marking a substantial increase in one of the sector’s primary cost drivers. Diesel typically accounts for between 35% and 55% of total operating costs, depending on vehicle type, routes, and operating conditions.

While the government introduced a temporary R3.00 per litre reduction in the fuel levy, the association noted that the relief only partially offsets the scale of the increase and may be recovered through other fiscal measures in future.

Operators now face mounting pressure, particularly as there is no certainty that clients will absorb higher transport costs. At the same time, companies must manage rising input costs while maintaining operations, placing increased strain on cash flow and access to working capital.

The South African Freight and Logistics Association (SAFLA) has also raised concern over the broader economic impact of the fuel price adjustments.

The Department of Mineral and Petroleum Resources confirmed that diesel prices increased by between R7.37 and R7.51 per litre, driven largely by higher global oil prices and a weaker rand. Brent crude rose from approximately $69 to $93 per barrel during the review period, while the rand depreciated against the US dollar.

Based on Department data, inland wholesale diesel prices are now estimated at around R26.11 per litre, significantly increasing the cost of moving goods across the country.

SAFLA CEO Dave Logan said the latest developments highlight deeper inefficiencies within South Africa’s logistics system.

“These fuel movements are a loud and immediate reminder that inefficiencies in freight corridors translate directly into higher transport costs and reduced competitiveness,” he said.

The association has called for urgent, data-driven interventions to address operational bottlenecks, including border delays, permit duplication, and inefficiencies at ports. Engagements with key stakeholders, including SARS, Transnet, and the Border Management Authority, are expected to focus on improving freight movement and reducing unnecessary costs.

Industry bodies have warned that the impact of the fuel increases will begin to filter through to consumers in the coming weeks, with broader economic effects expected to intensify as higher transport costs ripple through supply chains.