Christmas warning: Australian strike will worsen shipping woes

New Zealand container importers and exporters are being warned to expect increased shipping delays and costs in the run-up to Christmas due to industrial action at Australian ports and the China coal power crunch.

Shipping costs are likely to go up as container lines impose congestion charges, said the Customs Brokers and Freight Forwarders Federation.

Maersk, the world’s biggest container shipping line, has told customers it expects average delays of 5-6 days for its vessels calling at Melbourne alone.

Notice of rolling nationwide strikes at container terminals operated by Patrick, which handles more than 40 per cent of all container freight in Australia, come on top of China’s coal power crunch, which is affecting Chinese manufacturers and will likely affect import flows to New Zealand.

New Zealand’s own maritime union, which is not involved and does not expect to be, says the impact on a supply chain system already “just about at breaking point” will be significant, due to the planned continuous rolling action at container terminals at major Australian ports.

National secretary of the Maritime Union NZ Craig Harrison said the delays to shipping operations in Australia would “choke the system up” here, and he expected container shipping lines to take vessels off some routes in response.

New Zealand shippers should be looking now for some assurances from their shipping lines as to the potential impact, Harrison said.

CBAFF chief executive Rosemarie Dawson predicted more delays in ships arriving in New Zealand, possible cancellations of port calls and shipping lines to add congestion charges to already rising container shipping costs.

A spokesperson for the country’s biggest port, Port of Tauranga, said the majority of import services to New Zealand travel via Australia from Asia so there will be additional delays as a result of the industrial action.

“Any delays in Asia, Australia or other New Zealand ports inevitably cascade to Tauranga.”

Don Braid, managing director of New Zealand-headquartered global logistics company Mainfreight expected the combined impact of the Patrick terminal industrial action and the Chinese power issue would result in more congestion for New Zealand’s supply chain and likely backlogs for importers.

China’s power issue is a result of a shortage of coal, toughening emissions standards and strong demand from Chinese manufacturers which has lifted coal prices to record levels and sparked limits on coal use.

Braid said overseas this week the number of ships waiting offshore at major ports had doubled – to 609 from 340 last week.

Such delays also locked up containers, exacerbating the global shortage and caused post-ship operational problems on road and rail transport, as the UK is experiencing now.

“All our advice is that people should be thinking about ‘just in case’ not ‘just in time’.

By this, he meant that pre-Covid, shippers could rely on shipping schedules to operate almost like clockwork, and make their product orders accordingly.

The change to “just in case” meant shippers had to order and plan for shipping schedule disruption.

“But there’s not one answer and it’s not the same answer for everyone.”

Braid said shippers had to rely on their service providers in the current situation, which he didn’t expect to unwind for some time.

“Make sure they are working for you and finding the best options for you.”

Mainfreight staff had worked hard to create and find transport options for its customers with airfreight and shipping. For example, it was working with bulk shipping lines like New Zealand kiwifruit export ship operators to bring back imports.

“It’s about thinking outside the box.”

Meanwhile, Ports of Auckland has some good news for shippers.

The swathe of red coloured blocks across its operational updates denoting severe pressure on its services has shrunk significantly as the port caught up on handling operations.

However, the latest update says the terminal is 111 per cent utilised today with continued high laden import and export empty volumes in the yard. Average container dwell time at the terminal so far for September was 2.7 days for imports and 4.9 days for exports.

The port has also warned of delays due to strike action and Covid-related restrictions at some Australian ports.

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