Logistics News

Shipping lines decry waterfront industrial disruption

Sydney presently at centre of chaos for now, as container costs continue to rise


If general inflation, rather than trade cost inflation, was an economic issue in this recession, soaring charges on transporting containers might make mainstream headlines.

But Mediterranean Shipping Company’s addition of a US$300 (A$413) per 20-foot equivalent unit of container (TEU) Sydney congestion surcharge this week has gone without notice apart from in the shipping press.

Presently, Sydney is the focus.

The most obvious spark for the MSC move is the Maritime Union of Australia’s (MUA’s) protected industrial action against stevedore Patrick in Sydney but part of a national wage action.

The charge comes into effect for US import and export containers on October 8 and for other regions on September 14.

This comes as stevedore Hutchison raises its unregulated container access charges (CACs)   from $63.11 to $88.83 this week.

After  Container Transport Alliance Australia (CTAA) raised the alarm on chaos affecting Sydney empty container logistics and calling for more flexibility from international shipping containerlines on charges facing those trying to deal with container use and transport, the lines, through their domestic industry body Shipping Australia Ltd (SAL) is holding a hard line.

Pointing out that an unnamed container was faced delay costs of $25,000 a day due to the MUA’s industrial action, SAL notes: “No container shipping company can absorb that kind of loss.

“The ship was forced to skip a port call at Port Botany in Sydney and go to the next port in the rotation, which was Melbourne. The ship had to discharge nearly 600 Sydney-destined containers at Melbourne.

“Those containers will now need to be somehow moved to Sydney from Melbourne at considerable cost and delay, possibly by truck.

“Some Sydney-based importers will be in for a shock when they find out that they will have to pay extra transport costs and that their goods will arrive days and days – maybe even weeks – after they were due.”

And it expects the situation to worsen.

“Disruption will intensify. Delay will increase. Costs will rise,” SAL says.

“The solution is for government to intervene in this nationally coordinated campaign of protected industrial action.”

 Read CTAA’s warning about a container logistics crisisin Sydney, here

However, SAL does not address any need to inject charges flexibility for those similarly affected by the congestion and chaos.

It offers the possibility that lines “may well be willing to make determinations on a case-by-case basis and come to a reasonable arrangement with the shipper”.

“Ultimately, the solution is for the waterfront to work normally again so that shipping lines are able to evacuate empties,” it says.

“However, misguided calls for blanket zero-charging for the hire of empty containers is just that: misguided.”

SAL does note that containerlines are attempting to move empty containers, despite the disruption at stevedores’ container terminals.

“We understand that ocean shipping lines are ready and willing to bring ships to Australia simply to enable the export of empty boxes,” SAL says.

“We understand that shipping lines are now also trying to evacuate as many boxes as possible on ships sailing their standard rotation.

“Normally, container terminals are efficient. But, currently, container terminals are prevented from handling extra ships and they are forced to work so slowly that ships cannot complete their planned container exchanges.

“As an example, one ship was due to evacuate 2,000 empty boxes from Australia but 500 empty boxes were left behind (due to industrial action).”


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