NZ Port Sector: Melbourne May Loom As Bigger Threat To NZ Ports
November 18th, 2009
A study by Auckland Regional Holdings on Port of Melbourne, the biggest container handling port in Australasia, warns it looms as a threat to NZ’s port sector unless the local industry agrees to reorganise into as few as three hub ports. The study says Melbourne is actively seeking services from larger ships, which is likely to appeal to shipping companies facing combined losses of $US20bn this year and looking to consolidate services. Hubbing NZ goods through Aust would mean a longer, more costly supply chain. For Aust ports, the additional NZ volumes would help to defray higher fixed costs.
The study shows Aust’s three biggest ports – Melbourne, Sydney and Brisbane – are anticipating larger ships and setting aside more land for containers than their smaller trans-Tasman rivals in Auckland and Tauranga. Aust has six container ports to NZ’s 11 and the average distance between them of 957km is more than three times the distance between NZ ports. The study says this means it is harder for shipping lines to play off and substitute between Aust ports.
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Auckland and Tauranga are the key candidates for upper North Island hubs, with Otago and Lyttelton the leading South Island candidates, ideally operating in an alliance. Auckland Regional Holdings, which has been forced to provide financial support for Ports of Auckland, wants the Govt to help steer the port sector toward consensus on a hub and feeder model, and to develop a ‘National Ports and Freight Strategy’ as Aust is doing. Doing nothing means there’s a “very real risk” Aust becomes the hub.
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