SeaRoad backs Bass Strait assistance

Cost issues to the fore in submissions to the Tasmanian shipping and freight inquiry

SeaRoad backs Bass Strait assistance
SeaRoad wants appropriate financial support for shippers

Submissions to the Productivity Commission’s Tasmanian shipping and freight inquiry are banking up, with intermodal transport operator SeaRoad backing Federal freight assistance to Tasmanian producers and manufacturers.

The inquiry’s focus is on costs, international services, possible reforms and the worth of government financial support for Bass Strait freight and passenger services.

Much of the initial heat in the debate is centred on increasing costs, with the Business Council of Australia (BCA) pointing to coastal shipping laws as a main culprit.

Shipping, road transport and logistics provider SeaRoad states that increases are mainly due to external factors, notably Victoria’s Port Licence, the Tasmanian quarantine levy, the carbon tax’s effect on bunker fuel, port authority charges and port redevelopment and improvement costs.

It believes assistance is appropriate where it:

  • is available to the broadest range of eligible participants and goods to further enhance Tasmania’s economic future
  • is provided directly to the businesses that produce the goods rather than anyone else in the transport chain
  • recognises that on the Bass Strait route, there is no government funding spent on road, rail, bridges, tunnels or vessels.

The BCA states that tonnage rates between Tasmania and Queensland charged by Australian shippers increased from $18.20 a tonne in 2011 to $29.70 in 2012, or 63 per cent. This compared with $17 a tonne being charged by international operators in 2012. Demurrage rates also rose from $14,000 in 2011 to $35,000 in 2012.

Its main target was Labor’s cabotage law, the Coastal Trading (Revitalising Australian Shipping) Act 2012 and its associatedcosts.

Focusing on costs due to the lack of direct international ship calls to the state is Veolia Environmental Services.

It notes that the former AAA service could get a container to Hong Kong for $45 a tonne but this had risen to $74 a tonne, a rise of $29 a tonne or $696 per 40-foot container.

For Port Kelang in Malaysia it was $25 a tonne but now is $74 a tonne, a rise of $49 a tonne or $1,176 per 40-foot container.

Veolia puts the lack of direct international shipping services to Tasmania down to lack of volume but it supports the BCA’s line on coastal shipping.

"Having had lengthy discussions with international shipping line [sic] another item that is lessening the interest in calling direct to a Tasmanian port is the issue of cabotage," it says.

It is also vexed by the lack of availability of empty containers in Hobart, necessitating the trucking of empties there to be filled at cost of $888 plus GST or an additional $21.50 a tonne.  

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