CONTAINER DETENTION - supplementary submission to the Productivity Commission

Freight &Trade Alliance (FTA) and the Australian Peak Shippers Association (APSA) have received extensive examples from members highlighting the unreasonable administration of container detention fees.

This has been used as evidence as a part of a supplementary submission to the Productivity Commission calling for regulation to end the blatant mis-use of this practice.

Supply Chain Costs

Our industry is paying more than one billion dollars per annum for the following fees in addition to record high freight rates and a spate of surcharges: 

• Terminal Access Charges - fees to shipping line contracted stevedores and empty container parks for access to container facilities without any ability to influence service or price.
• Container detention fees - spiralling out of control, payable when delays occur in returning empty containers within prescribed periods as set by shipping lines.

What is clearly a windfall for foreign owned shipping lines contributing to their multi-billion dollar annual profits, is adding to the current cost of living and inflationary pressures being felt across Australia with charges being passed down the supply chain, adversely affecting manufacturers, farmers, rural communities, and consumers.

Container Detention

Since providing the original FTA/APSA submission on 11 February 2022, the operational environment has worsened because of "vessel bunching", limited operating hours of facilities to receive empty containers, extreme supply chain labour shortages and in many cases, the detention clock starting at a time when cargo is physically unavailable for collection from the wharf.

While FTA / APSA is actively engaging with the Department of Agriculture, Water and the Environment to improve efficiency and to meet the increasingly complex biosecurity protection task, members continue to report excessive delays to booking requests and inspection timings which is only adding to industry's woes.

This is hitting hard – everyone from major retailers through to small businesses.

Freight forwarders, customs brokers and transport companies are left with the unenviable task of trying to explain this unbudgeted and unreasonable fee to importers and exporters costing anywhere from hundreds of dollars per consignment up to hundreds of thousands of dollars in some circumstances.

NEED FOR REGULATION

The FTA/APSA supplementary submission to the Productivity Commission reinforces the original position as addressed in recommendation 5 

RECOMMENDATION 5 (regulation of container detention practices) – the need for federal government action and potential regulation, similar to US Federal Maritime Commission (FMC), to ensure reasonable container detention policies are administered.

FURTHER INFORMATION

• Original FTA/APSA Submission to the Productivity Commission and Media Release
• Supplementary FTA/APSA Submission (Container Detention)
• MEDIA RELEASE (COST OF LIVING AND INFLATIONARY PRESSURES – A NEED FOR SHIPPING REGULATION)

Paul Zalai - Director FTA |  Secretariat APSA | Director GSF