Monday 19th Nov, 2018

Empty container returns to the wharf may increase costs: CTAA

Photo: Ian Ackerman
Photo: Ian Ackerman

CHANGES in Maersk Line’s empty container return policies come into effect today (1 February), requiring some empty container returns to be made at a shipping terminal and not an empty container depot.

A statement from Container Transport Alliance Australia pointed out that Maersk Line is now joining other shipping lines requiring direct empty returns to terminals, including OOCL, ANL (CMA CGM), Hamburg Süd and COSCO.

CTAA has raised concerns that these policies are increasing logistics costs particularly in the Port of Melbourne, and container transport operators in the city are looking to recover these costs in the marketplace.

CTAA director Neil Chambers said Maersk has had its traditional empty container park providers issue statements to transport operators that de-hire instructions would be “strictly enforced” and that trucks would be “rejected” if operators attempt to de-hire at alternative locations.

“These strict instructions remove operational flexibility in the landside logistics sector and trigger a range of additional operational costs,” he said.

“In comparison with other Australian ports, in the Port of Melbourne some stevedore practices involved in receiving direct empty de-hires are not efficient from the point of view of the landside operators.”

Mr Chambers pointed out that in the Port of Melbourne, additional costs are generated when there is:

  • A lack of available container slots for the return of the empties to the designated stevedore terminal (day shift & night shift);
  • The need to stage empty containers through transport yards due to the lack of available terminal slots, including the costs of additional container lifts and yard storage;
  • Additional truck kilometres travelled;
  • No ability to backload full import containers (i.e. not being able to achieve two-way truck running by returning empties in conjunction with import container pick-ups) due to the operational practices and vehicle booking system restrictions of the stevedore;
  • Longer Truck Turnaround Times (TTT) at the stevedore terminal in comparison to ECPs;
  • No show & wrong time zone penalties imposed by the stevedore on transport operators for empty returns when no such penalty regime applies at traditional ECPs;
  • Additional administration costs, including in some instances the costs of administering the production of a Pre-Receival Advice (PRA) message for container receipt into the terminal; and
  • The greater chance of Container Detention charges being levied by Shipping Lines for the late return of the empty containers due to the operational delays.

“Consequently, container transport operators in Melbourne can no longer commercially absorb the additional costs,” Mr Chambers said.

“CTAA strongly believes that there is a need for genuine cost recovery to ensure business viability through the adoption of a transparent ‘direct de-hire to terminal’ surcharge levied on cargo interests (transport customers).”

Mr Chambers stressed that not all of the aforementioned inefficiencies apply to all stevedore terminals in Melbourne.

“We thank those terminals who do work closely with transport operators to ensure timely empty container de-hire slot availability, the ability to backload (i.e. take in empties when the truck is manifested to pick up import containers), and have acceptable truck turnaround times,” he said.

Mr Chambers noted that CTAA companies had not identified the same level of inefficiencies in Port Botany or Brisbane.

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