Monday 21st May, 2018

INDUSTRY OPINION: Empty container dehires – no more happy returns?

Photo: Shutterstock
Photo: Shutterstock

LAST week’s announcement by the world’s largest container line Maersk that it will join a number of other carriers in requiring some empty import containers to be delivered to shipping terminals, rather than a designated container depot or empty container park, has raised concerns amongst shippers and landside supply chain members.

Freight & Trade Alliance (FTA) and the Australian Peak Shippers Association (APSA) continue to receive ongoing feedback from members in terms of container dehire practices and associated detention fees administered by shipping lines for late returns. This largely emanates from poor communications between shipping lines, stevedores and transport operators when shipping lines change their minds about the destination of empties. The current process requires fleet allocators to continually monitor email and respond to messages about redirections.

In this day of modern systems integration, surely we can expect a more sophisticated process.

This also brings into question whether the dehire process is being best managed by shipping lines and whether adequate industry engagement is in place looking at holistic and long terms solutions.

Maersk says the intention of its new policy, effective 1 February, is “to optimise the shipping supply chain and create operational efficiencies across industry touchpoints”.

For delivery orders requiring return to a shipping terminal, customers will need to lodge and pay for a Pre-Receival Advice (PRA) for their container against the specific release number which will be specified on the delivery order, as well as book a slot in the Vehicle Booking System (VBS). 

Maersk have trialled the changes for over more than six months in Sydney and asserts that some customers have provided positive feedback as they see an advantage in utilising both the truck legs (to return an empty and to collect a full) and enjoy the relatively competitive turn times at container terminals.

“The reason for this change is to ensure a more efficient handling of import containers which are not required for re-use to cover an Australian export shipment,” Maersk says.

Other major shipping lines are currently using or said to be exploring similar concepts. FTA members have provided a mixed response demonstrating that there are clearly operational opportunities, and also the threat of unintended consequences.

So what has prompted the change in practice?

It is our observation that the introduction of third container terminal operators on the Australian east coast and improved operational efficiency by the incumbent stevedores has provided the opportunity to use excess terminal capacity. The result is that shipping lines are now being offered competitive empty container de-hire services.

FTA and APSA question whether this service is sustainable by stevedores in the long term, particularly when import and export volumes reach projected volumes.

Will we need existing empty container parks to remain commercially viable should the need exist to pick up future demand or will any void be adequately met with new empty container park facilities at intermodal and other available sites?

We trust that there is overarching logistics planning by port operators and governments examining these matters, or are we are totally reliant on commercial interests responding to demand?

Maersk Line has provided a commitment to continue engagement with FTA and APSA on this matter. To support this process, we encourage members to share views and experiences direct to Travis Brooks-Garrett at secretariat@auspsa.com

Paul Zalai is director at Freight & Trade Alliance (FTA) and an advocate of the freight and trade sectors.
www.FTAlliance.com.au

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