Australian Financial Review - Importers opt for flights and rail as pirates push up shipping costs

Monday, July 29, 2024
Further to our member notice from 19 July 2024 outlining preliminary indications of a cessation to key shipping services to and from Australia, Freight & Trade Alliance (FTA) and the Australian Peak Shippers Association (APSA) have followed up with the Mediterranean Shipping Company (MSC) and, in its capacity as being the designated peak body under Part X of the Competition and Consumer Act, with the Registrar of Shipping (Department of Infrastructure, Transport, Regional Development, Communications and the Arts).

Enquiries have confirmed MSC will stop bookings transiting via SIN and TPP until further notice.

MSC RESHUFFLES ITS ASIA-OCEANIA NETWORK

The Registrar of Shipping provided the following details to FTA and APSA:

"The From 4s we have are currently limited to some Port omissions in early-mid August. However, we do understand the situation to be that the Australia-Singapore-Europe is on hold but there is a direct Europe – Australia service that is continuing to operate."

Subsequent Part X Form 4 notices provided to FTA / APSA (inward and outward)  include the following references:

Event details – The parties have advised that all European cargo will move to their direct service into Australia. Due to the decrease in cargo loading from Singapore, 'MSC Corcovado III FC430A' will omit port of Melbourne on 10 August 2024. Cargo scheduled to be loaded at Melbourne will instead load on the 'Cali FC431A'.

Event details – The parties have advised that all European cargo will move to their direct service into Australia. Due to the decrease in cargo loading from Singapore, 'MSC Star R FC430R' will omit port of Brisbane on 12 August 2024. Cargo scheduled to be loaded at Brisbane will instead load on the 'MSC Cape III FC432R'.


FURTHER DETAIL:

Additional Part X notifications - refer HERE (FTA/APSA MEMBER LOGIN REQUIRED)
MSC website - refer HERE
MEDIA CAMPAIGN

FTA and APSA continue to lead the way with mainstream media to support our advocacy activity and importantly, to generate broader community awareness of :
  • the delays to international trade;
  • variations in services; and
  • inflationary impacts of increased freight rates and Terminal Access Charges.  
Recent coverage has included:

17 July 2024 : FTA / APSA APPEAR ON ABC COUNTRY HOUR - MEDIA COVERAGE UNDERPINS MINISTERIAL BRIEFINGS 
12 July 2024 : Channel 10 News - International Freight Rates adding to Cost of Living
12 July 2024 : Channel 7 News - Tim Lester on International Shipping
12 July 2024 : Sky News AM Agenda - Shipping and landside costs [PAY-WALL PROTECTED] 
11 July 2024 : Australian Financial Review - Shipping Crisis A "Spanner in the Works" for Inflation War 
2 July 2024 : Country Radio Rural Report - Skyrocketing International Shipping Costs
2 July 2024 : The Land : Freight fright: Red Sea rockets and trade panic hit our ag costs
27 June 2024 : Sky News - International shipping costs fuel Australian inflation results 
24 June 2024 : 9 News - Freight rates contributing to cost of living crisis

IMPORTERS OPT FOR FLIGHTS AND RAIL AS PIRATES PUSH UP SHIPPING COSTS

More important media coverage was achieved on Saturday 27 July 2024; page 2 of the Australian Financial Review "Importers opt for flights and rail as pirates push up shipping costs" makes specific reference to MSC's change in services.

A special note of appreciation is again extended to FTA member EES Shipping (Operations Manager, Amanda Bradfield) for giving 'real world' examples of the operational impacts.

The full article is available HERE [paywall restricted]

EXTRACT:
Meanwhile, MSC's decision to reduce services operating out of Singapore had the potential to exacerbate pressure Australian importers are already under, Freight and Trade Alliance director Paul Zalai warned.

"In very simple terms they're going to be reducing their services to and from Australia," he said.

"That's a reduction in capacity, which, again, we anticipate will drive up pricing just through supply and demand, with the existing volumes in the market.

"There's just such big demand now in the US and other parts of the world…Australia's national interest is very much secondary."



FTA / APSA will expand this media campaign with the intent to generate a response from the federal government on matters raised by the Productivity Commission; recommending repeal of Part X of the Competition and Consumer Commission Act (protections from Australian competition law for foreign owned shipping lines in vessel sharing arrangements) and a Mandatory Code to regulate any variations to stevedore-imposed Terminal Access Charges.

Paul Zalai - Director FTA / Secretariat APSA