As outlined in our member notice disseminated on 1 November 2023, DP World have announced exorbitant incontestable charges imposed on domestic transport operators, exporters and importers - costs that are passed down the supply chain leading to inflationary pressures and restricting the international competitiveness of our local manufacturers and regional producers. |
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Source: Freight & Trade Alliance (FTA) |
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In parallel to approaches to Federal and State Ministers, Freight & Trade Alliance (FTA) and the Australian Peak Shippers Association (APSA) have commenced a media campaign referencing the "double whammy" of impacts of the Protected Industrial Action and the direct financial impost of soon having to pay DP World up to 52% more for access to terminals.
If not to pay the unions, speculation exists the massive increase is a strategic move to have a high base established in the event of the introduction of regulation (as recommended by the Productivity Commission in their review of Australia's Maritime Logistics System) that would place scrutiny on any adjustments to ongoing increases.
It will be fascinating to view the next Australian Competition and Consumer Commission (ACCC) stevedore monitoring report to see if stevedore contracted customers (shipping lines) are contributing towards stevedore investments or whether the burden is placed entirely on the transport sector that have no ability to influence service or price.
The LoadStar - 'Daylight robbery' – Fury at huge hike in terminal fees by DP World Australia
Paul Zalai, director of Australia's Freight and Trade Alliance, said: "The federal government sit back like stunned mullets, failing to act on the Productivity Commission's recommendations [the need for more terminals, to increase competition, and better infrastructure], leaving us with no option but to ramp up noise about this whole situation."
AFR - DP World's 52pc fee rise at Port of Melbourne labelled 'exorbitant'
FTA director Paul Zalai said the voluntary arrangements were "hopelessly flawed" and had not only failed to influence price, but gave stevedores' "tacit approval to rapidly and significantly inflate fees" levied against domestic transport operators.
"With less quay-side revenue from foreign-owned shipping lines, stevedores and empty container parks have resorted to a 'ransom model' forcing transport operators to pay designated fees or be denied access to container collection and dispatch facilities," he said.
Mr Zalai said while the increased fees would flow through to retailers and consumers, "an even more alarming impact will be felt by our agricultural sector".
He claimed the overall TAC, for example, was adding about $6 per tonne on grain.
"For what is a high volume/low value commodity, the exporter is making little more than $2 to $3 per tonne margin from the trade," he said.
"Current operational delays are leading to significant financial losses with the increase in landside fees rubbing salt into the wounds of our regional commodity traders," Mr Zalai said.
The Weekly Times - Port fee spike to have "alarming" impact on agriculture
The Freight & Trade Alliance, which represents importers and exporters and describes DP World's new fee increases as "exorbitant", wrote to Treasury earlier this year, warning that continued price rises were "contributing to inflationary pressures across our economy".
AFR - Why goods meant for Sydney are ending up elsewhere
DP World came under criticism recently for increasing its port charges by 52 per cent from next year. FT Alliance chief executive Paul Zalai said, "there is speculation that DP World have grossly inflated their terminal access charges to build up a reserve to meet the union's requests".
"If this is the case, we are not so sure that is such a smart move. The workers will understand there is a massive influx of funds on the way which will only strengthen their resolve to achieve their claims."
Building on this momentum, FTA / APSA will continue advocacy for reform and have earlier today disseminated the following official Media Release - refer HERE
Paul Zalai - Director FTA | Secretariat APSA | Director GSF |
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