We had some fun with the wrap from our sales team this year, asking them to sum up how they are feeling about 2024 in just five words or less. As we write this, we can’t help wondering what you, our customers, might say? Let us know.
For Mark Duckham, 2024 is best summed up as “heading in the right direction”. For Wayne Driemeyer, it’s “on the front foot”. Braam Rust, meanwhile, summed up the year with just two words: “Stay humble.”
“That’s something that we often say to each other around boardroom table,” he added.
And for Darren Marillier? “Always good intent,” he said.
He explained a little. “Good intent is the bottom line. When we’ve been tough on credit with our customers, it’s only been for their benefit. We always want our customers to do well. Whatever we’ve done, whatever situations we’ve found ourselves in, we’ve always had good intent.”
There has been a happier mood across some of our markets than in previous years. In December last year, we reflected that 2023 had been “a year of feast for the timber treatment industry in some of the regions we serve, famine in others and, in South Africa, a period of hanging on tight”.
Champagne corks pop
In 2024, the champagne cork popped in South Africa as the general elections ended in a smooth transition to a government of national unity (GNU) and a renewed sense of business confidence.
“The mood in the regions I serve has been a lot better this year,” said Mark Duckham, speaking about customers in the mid-northern regions of South Africa. “We started seeing an improvement in June or July, soon after the national elections in May, and it carried on that way for the remaining months of the year.
“There seems to be a lot more buoyancy and optimism compared to this time last year, and people just seem to be buying more. Loadshedding stopped, which also contributed. Look, things aren’t going great guns, but they are far better than they were. We are on an upward trajectory of confidence.”
We gained a few new local clients this year, and several customers approached us needing new timber treatment plants or upgrades. The team was very busy completing one such project after another. We’re excited that these projects look set to continue well into next year.
“Look, things aren’t going great guns, but they are far better than they were. We are on an upward trajectory.”
The industry in the southern regions of South Africa has been stable, said Braam – but without the uptick experienced elsewhere.
“Customers are still saying they’re finding the economy difficult, and there is a lot of competition between them. However, there is stability. Nobody has grown that much, but nobody here went under either, which we’re grateful for considering the landscape elsewhere.”
Dolphin Bay’s customer base in these regions expanded, as we gained two more substantial customers.
Some areas of the Western Cape were earmarked some years ago for the replanting of plantation trees, but this has not begun. Due to a shortage of timber in this province, there was an even bigger movement of raw materials from Mpumalanga to the Western Cape this year.
Rising volumes in Kenya
The Kenyan pole market experienced an upswing in 2024, largely due to some substantial tenders awarded by Kenya Power. “We definitely picked up more volume in Kenya in the second half of this year,” said Wayne Driemeyer.
This was due to the country’s ongoing drive to provide electricity to all residents. While there is no certainty about why the upswing is happening now, “everybody is happy about it,” said Wayne. “Sentiment is more positive in Kenya than it has been for quite a while – so no one’s complaining, that’s for sure!”
Wayne had returned from a trip to Kenya, as we finalised this story. We’re delighted to welcome a new customer, who recently signed supply agreements, and we look forward to rolling out our services to them and others as we grow our presence in this market.
“Tanzania will hold elections in 2025 and Uganda in 2026 so hopefully this is simply the famine before the feast, as governments will loosen the purse-strings in the run-ups to the elections.
Purse strings expected to loosen
Markets are subdued in Tanzania and Uganda, but we believe we’re experiencing the famine before the feast.
“Is there still a market in Uganda? Yes. Has it been easy to navigate? Absolutely not,” says Darren, pointing to the country’s controversial timber export ban, which remains in place.
Timber treatment companies have been working around this ban as far possible. It has been a struggle, “but it seems that there are some rumblings that the Ugandan local markets could get going again,” said Darren. “It would be great for companies to have a home market once more.”
A major constraint for both Uganda and Tanzania is that US dollars have been hard to come by. This is bad news for imports and exports as the dollar is Africa’s go-between currency.
In Tanzania, the government retracted its spending on electrification projects this year, subduing last year’s strong market for treated timber. “However, Tanzania will hold elections in 2025, and Uganda in 2026 so hopefully this is simply the famine before the feast as the governments will loosen the purse-strings in the run-ups to the elections.
“We believe it’s matter of time before they start spending, which will have a knock-on effect for our customers.”
Knowing our value
Dolphin Bay’s relationships with its clients remain very positive, as our strength continues to lie in our ability to earn our customers’ trust. Although we also expect a lot from our customers, the relationship should always be a partnership.
During this year, we realised the value of having good customers. We are fortunate that we can say that while our customers pick us, in many instances it is us who pick them too. It is hard to acknowledge that a small number of customers are simply not a good fit for us.
We are proud to supply the majority of customers in almost all the markets where we operate, and those whom we serve gain a competitive advantage as Dolphin Bay remains the superior supplier of product, services, and technology in the industry.
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