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on The Waterfront

The Australian Competition and Consumer Commission has released its annual container stevedoring monitoring report, which highlights an improved performance within the industry.

Average stevedoring prices for the industry fell for the second consecutive year and, in real terms, are now at the lowest level recorded by the monitoring program.

“We are continuing to see benefits of increased competition in the stevedoring industry, with lower average prices, continued investment and reports of improved customer service,” ACCC chairman Rod Sims said.

Industry assets have doubled over the past three years as a result of investment by the stevedores. New entrant Hutchison Ports Australia has been developing terminals in Sydney and Brisbane, while the incumbent stevedores have been investing in automation, cranes and other equipment.

“These investments are expected to drive performance improvements in future years. However, we recognise that this environment presents challenges for new entrants seeking to attract customers,” Mr Sims said.

The report notes Hutchison has been operational since 2013 but is yet to attract adequate market share. Some factors contributing to the challenges faced by new entrants may be within a stevedore’s control, whilst others relate to specific characteristics of the industry.

“If there are particular obstacles to shipping lines switching to new stevedores, it is important these are overcome. Increased competition will promote the likelihood of improvements in stevedoring continuing into the future,” Mr Sims said.

The report also highlights the importance of reforms across the wider container supply chain.

“The benefit of improved stevedoring performance should be reduced costs for Australian consumers and exporters. This may be lost if port operators are not adequately regulated or if the supply chain is let down by poor transport connections,” Mr Sims said.

Most major container ports have monopoly characteristics and can have a considerable impact on the costs and efficiency of stevedores and the supply chain. The ACCC is concerned that the existence of entrenched and inadequately regulated monopoly port operators is adding costs to the economy and effectively amounts to a tax on consumers and exporters into the future.

The report also focuses on opportunities to improve road, rail and sea connections to container ports, for example through road and coastal shipping reform measures.

Source: http://www.tandlnews.com.au/2015/11/11/article/on-the-waterfront/
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