Sunday 22nd Apr, 2018

DPWA blames market as infrastructure levies hiked

Image: Jim Wilson and Shutterstock
Image: Jim Wilson and Shutterstock

STEVEDORE DP World Australia says a tough market has forced a hike in infrastructure levies at its Brisbane, Sydney (Port Botany) and Melbourne terminals.

From January 1, 2018, the new per container levies for transport operators (excluding GST) will be:

  • Brisbane $38.75
  • Sydney $37.65
  • Melbourne $49.20

This compares with the old levies (excluding GST) announced earlier in the year of:

  • Brisbane – $32.74
  • Sydney – $21.16
  • Melbourne -$32.50

DPWA says it will be extending its payment terms for landside operators from 14 to 28 days.

A DPWA spokesperson said the decision to increase the surcharge was a difficult one.

“DP World Australia faces one of the most difficult markets in decades. As with others, rising occupancy and energy costs (9.2% annually nationally over the past 10 years, and forecast to rise well ahead of CPI) have virtually negated recent efficiency gains,” the spokesperson said.

“The stevedores’ collective investment of more than $2bn in more efficient cargo handling quayside and landside in the past 15 years, combined with improved work practices and vastly improved truck turnaround times, have all but been negated by punishing increases in occupancy and energy costs at our terminals (electricity costs have increased 183% nationally over 10 years) and sustained pressure on volumes and pricing resulting from the global downturn in shipping.”

The spokesperson said there was a limit to what could be absorbed if they were to continue a capital expenditure and innovation program.

“Some in our industry will continue to expect us to absorb what are extremely unreasonable cost increases,” the spokesperson said.

“In any industry, businesses refine and rebalance their prices as a normal part of responding to changing market conditions. We do not think it is reasonable for any one company to absorb these costs.”

The spokesperson said the infrastructure levies would help underwrite significant investment in critical infrastructure investment during the next 10 years while meeting service expectations from customers with larger vessels and changing arrival patterns.

The introduction of, or increase in, fees by DPWA earlier in the year prompted consternation in some quarters but was largely mirrored by Patricks in following months.

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