A PROPOSAL from the Port of Melbourne to rebalance its prescribed service tariffs for 2021-22 is under review by Victoria’s independent economic regulator, the Essential Services Commission.

The commission said wharfage fees for exports could be reduced and fees for some imports could increase under the proposal.

PoM’s proposed tariff rebalancing only relates to wharfage fees for overseas full containers.

The proposal would do away with the current wharfage fee for full inward containers and replace it with a wharfage tariff for full inward containers “that is $10/TEU higher than the current wharfage fee”, which would apply to vessels that exceed the port design vessel of 300 metres length overall by 40 metres beam. The current wharfage fee would continue to apply to full inward containers from vessels smaller than this.

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Also the wharfage fee for full outward containers would be decreased by an estimated $3.77/TEU from the current export wharfage tariff.

The port’s application said all other prescribed service tariffs may be adjusted by inflation in 2021-22 in accordance with the tariff adjustment limit. Rebalanced prescribed service tariffs will come into effect from 1 July 2021.

PoM said the rebalancing aims to “better align its tariff signals with marginal investment costs for larger vessels that some port users are increasingly driving and to support improved port utilisation by port uses who are not driving these marginal investment costs through complementary tariff rebalancing measures to lower the price for containerised exports by reducing tariffs and keep tariffs for smaller vessels constant”.

In its proposal, PoM said it needs to undertake considerable near-term investment to accommodate larger ships that increasingly call at the port.

“Larger vessels are a growing issue for the port and there is demand from port users to provide services to larger vessels,” the port said.

“Although larger vessels can create efficiencies in shipping costs, they drive additional costs for ports by reducing the effective number of berths utilised, require berth upgrades and channel deepening, etc.”

Essential Services Commission executive director price monitoring and regulation Marcus Crudden said the commission will assess this application in line with the Port Management Act 1995.

“We are conducting extensive engagement with port users and other stakeholders in assessing the application,” he said.

Mr Crudden says the commission is seeking input from stakeholders on the application until 1 February 2021, via Engage Victoria.

If PoM’s application is approved, the new price structure will apply from 1 July 2021.

The application can be read in full here.

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