Ship and container on-time integrity declines
Container trade reliability decreased in the second quarter of the year, despite improvements in east-west trade schedule integrity, according to Drewry’s latest Carrier Performance Insight.
The quarterly report highlighted the average on-time performance of containerships dropping to 70.5% – down from 72.8% in the first quarter of the year – the worst result since the 69.3% recorded over the first three months of 2012.
Container-level data showed similar declines, with the four main container key performance indicators dropping by at least one percentage point in the second quarter and on-time shipment of cargo sliding by two points to 70%.
Drewry had expected Asia-linked routes would have struggled to maintain schedules, due to the disruption of the 40-day Hong Kong strike action, but this was not the case, said its research manager Simon Heaney.
“In many cases, carriers simply diverted scheduled calls at Hong Kong to nearby ports, which would have limited any potential knock-on delays,†said Mr Heaney.
Taiwanese carrier Yang Ming took the crown from Maersk Line as the most reliable carrier with an all-trades, on-time average of 83.7%.
Hastings needed to ensure freight advantage
Victoria risks losing its freight advantage over New South Wales if a Hastings container terminal isn’t fast-tracked, Patrick Terminals East Swanson terminal manager Damian Ryan has argued.
Speaking at the Freight Week conference in Melbourne, Mr Ryan said larger ships would visit Victoria and Australia if the terminal facilities were available.
“That is why Hastings is going to become more and more important,†he said.
“We do need an international container terminal at Hastings a lot sooner than the 15 years that people are talking about because we are knocking back ships here.
“You will see shipping volume move to Sydney.
“We have already seen movements to Sydney but you will see a lot more.â€
Mr Ryan also argued Australia could sustain three major container stevedores.
“It can, and the way it can, is by being efficient.
“That is why at Asciano we are spending so much on automation.â€
Mr Ryan’s views were in stark contrast to others such as former-Toll boss Paul Little who has argued forcefully in favour of a ‘Bay West’ option where a container terminal would be built on the western side of Port Phillip Bay, between Geelong and Melbourne.
Multi-million dollar boost for port of Geelong
Victorian premier Denis Napthine and ports minister David Hodgett have announced a “multi-million dollar investment†to improve channel access to the port of Geelong.
Dr Napthine said improvements to the channel would allow Geelong to handle greater trade volumes.
“With trade and employment at the port expected to double by 2030, it is absolutely critical that the Victorian coalition government invest now to provide for this growth,†he said.
“This is why we will shortly open an expressions-of-interest process to remove or relocate up to 130,000 cu metres of clay and mud from the City Bend area at the corner of the Hopetoun and Corio channels.
“The project will allow larger ships carrying more cargo to access the terminals at the port of Geelong.â€
The Victorian Regional Channels Authority is said to have worked closely with port users on completing a port development strategy.
It is expected to be released soon and to outline several ways to handle anticipated growth at the port including channel access improvements so larger ships can access the port.
Mr Hodgett said the channel improvements will help secure future trade, not only for Geelong but for all of Victoria.
“With planning for the expansion of the port of Hastings well underway, and the expansion of the port of Melbourne also progressing, we are taking the necessary steps to provide certainty for industry and ensure Victoria remains the freight and logistics capital of Australia,†he said.
AAX spikes butterfly
The AAX consortium will this week abandon its long-standing alternating south-east Asia-Australia fortnightly formats in favour of a standardised weekly rotation with Fremantle as first and last port of call.
Instead of first port Brisbane one week and Fremantle next, AAX (comprising ANL, APL and NYK) will sail Singapore, Port Klang, Fremantle, Sydney, Melbourne, Adelaide, Fremantle, Singapore every week.
The change has been largely made possible by the advent of the new KIX service jointly provided by ANL, APL and Hanjin, operating weekly from Singapore and Port Klang to Brisbane, Sydney, Auckland, Tauranga, Brisbane and back to Singapore.
This improves ANL’s and APL’s Brisbane coverage to/from SEA and the Indian sub-continent to weekly, compared to the AAX offering, while NYK already has weekly Brisbane coverage via the NZX service, on which tonnage has been gradually upgraded to 4250-teu ships.
AAX itself has recently completed a fleet upgrade to five vessels of up to 5042-teu and as a consequence of no longer having to transit the draught-restricted Torres Strait will now be able to load these to capacity and, when required, introduce bigger ships.
For AAX customers transit times southbound and northbound, and arrival days in all ports, will not change.
However coastal cargo moving from Brisbane to Fremantle faces a 3-4-day longer transit, with the east-west voyage now comprising Brisbane-Sydney on KIX with relay to AAX for Sydney-Fremantle.
The trade-off for business that mostly comprises heavy containers is the improvement to weekly frequency.
Confusion reigns on assembly orders
Customs and sectors of industry are digging themselves into a deeper hole on assembly order cargo reporting and clearance procedures.
Customs has outlined a myriad of reporting expectations and are enforcing compliance action in circumstances where multiple suppliers exist.
Customs has justified this stance by saying that at the November 19, 2012 meeting of the Customs and Border Protection National Consultative Committee (CBPNCC), members agreed that there should be an increase in activity to ensure compliance with legislative settings, particularly for assembly orders.
Customs has subsequently received support from other industry representatives who have publicly stated a view that a moratorium is unnecessary and would create further uncertainty for industry.
A collaborative approach between these parties has also resulted in the development of a fact sheet, titled ‘Cargo Reporting and Clearance Requirements’ and a series of workshops to form the foundation for a compliance framework.
In contrast, Freight & Trade Alliance (FTA), the Australian Federation of International Forwarders (AFIF) and the Australian Retail Association (ARA) have been united in an approach recommending that a compliance moratorium be introduced while the ICS is enhanced for sea freight LCL and airfreight to provide similar functionality to the FCL / "FCX" functionality.
The rationale for this change is that it would allow multiple cargo reports and a single import declaration to be provided against each import consignment.
This enhancement to the ICS would have the following benefits of:
• providing transparency to ACBPS of supplier detail;
• negating the need for industry to dismantle existing business models; and
• minimising any increase in supply chain costs.
While the fact sheets and workshops have provided some clarity, these issues have served to highlight the complexity of the assembly order issue, inadequacy of the ICS design and flaws in Customs policy.
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Push for new concept in promoting trade
The emerging 'Authorised Operator' concept lies at the heart of Export Council of Australia’s (ECA) call to government to update its trade policy to better compete on the global stage.
The ECA and the Centre for Customs and Excise Studies held focus groups in five capital cities last month, seeking views on a key element of the ECA’s trade policy recommendations 2013/14 – Authorised Economic Operator (AEO) – which is also included in free-trade agreement negotiations.
An AEO is a party in the international movement of goods deemed to comply with World Customs Organisation – or equivalent supply chain – security standards.
That party can be an exporter, a port entity or a service provider.
Australia is the only developed nation that does not have an AEO program.
“The introduction of a voluntary AEO program will ensure that Australian exporters are able to compete on an equal footing with overseas competitors, particularly when trading with countries that have AEO and mutual recognition arrangements in place,†ECA executive chairman Ian Murray said in a statement.
Mutual recognised national programs is the ultimate goal of AEO, because accreditations have the same value everywhere and the supply chains are secure.
Professor David Widdowson, CEO of the Centre for Customs & Excise Studies (CCES) at the University of Canberra and Bryce Blegen, manager for CCES North America, are touring the nation in effort to inform industry about AEO’s significance.
CCES will take away notes from the focus groups to provide the Federal Government with an Australian international Trade and Transport Industry view of the Accredited Operator concept.
WA ports get a budget boost
Western Australian ports have been allocated upgrade funds ranging from $2m to $21m in the 2013/14 state budget.
The WA government has allocated $7.4m for works at Dampier port and $15.5m for works at Port Hedland, including $6m for Main Street Jetty.
Geraldton Port Authority will see $12m for improvements in 2013/14.
Fremantle port upgrades have been allotted $115.1m, including $36.7m for works at Kwinana Bulk Terminal. While Kwinana Freeway upgrades will see $61.4m for the installation of freight management and intelligent transport systems.
Bunbury will receive $2.4m for improvements, plus $21.5m for continuing works on the Bunbury port access road.
The state government has also set aside $3.8m for the realignment of Princess Royal Drive at Albany Port Authority.
In addition, it has assigned $7.7m for Esperance Port Authority improvements, including $4.7m for the Hughes Road upgrade.
Esperance Port Access Road is due for completion with $45.7m, and $15m will construct a heavy-vehicle bypass route at Ravensthorpe on the South Coast Highway.
Wyndham port will receive a $50m upgrade as part of Kimberley Agricultural Investments’ (KAI) proposal to develop the sugar industry in Kimberley region.
Since this funding is not coming out of state coffers, it did not make an appearance in the 2013/14 state budget.
However, no figures have been released for Broome. Captain Vic Justice, Broome Port Authority CEO, told Lloyd’s List Australia the port is currently in discussions with the government on future upgrades. An announcement is due before the end of the month.
"Broome Port Authority has a number of ongoing projects, and we have been consulting closely with government towards bringing these to fruition," Capt Justice said.
