PORT of Tauranga reported increased profitability in the first half of the 2021 financial year despite a decrease in trade volumes.
Group NPAT for the six months through December 2020 was NZ$49.4 million, a 2.3% increase on the same period the previous year, despite a 1.3% decrease in total trade volumes, to 13.1 million tonnes.
Container numbers decreased 4.6% compared with the previous corresponding period, to 612,988 TEU. Transhipment of containers also decreased, by 5.1% in TEU.
Total imports through the port increased 5% to 4.9 million tonnes, while exports decreased 4.8% to 8.2 million tonnes.
Log export volumes were 2.1% lower than in the same period last financial year, at nearly 3.3 million tonnes and dairy exports were down 10.8% to 1.1 million tonnes.
Port of Tauranga chair David Pilkington said the mid-year financial results were pleasing, considering the volatility in cargo volumes over the period and reflected the stability offered by the diverse companies in the group.
“We have managed to maintain income throughout a challenging six months. Port of Tauranga handled near record volumes of containers in the months of October and December. However, lower-than-previous demand from June to August, and vessel delays in November, dragged down the year-to-date container volumes,” he said.
“It’s a similar story when we look at overall cargo tonnes. Volumes decreased 1.3% for the six-month period, yet volumes in December 2020 were 15.1% higher than the same month in 2019.”
Delays in Auckland
Mr Pilkington said severe vessel delays out of Auckland since September had significant flow-on impacts on Port of Tauranga.
“We have done our best to accommodate diverted import and export cargoes from Auckland. However, we have had to limit our assistance as we have been constrained by the lack of availability of additional rolling stock and train drivers for the rail link between Tauranga and Auckland,” he said.
The average cargo exchange per container vessel was 21% higher in December 2020 compared with December 2019, due to the cargo bypassing Auckland.
Late arriving vessels have been slow to pick up exports, exacerbating container yard congestion.
New penalties helped portside congestion
Port of Tauranga chief executive Mark Cairns said the 1 January introduction of penalties for shippers rolling cargo or leaving their containers on the wharf for excessive time has provided some relief from yard congestion. The peak export season is now in full swing.
“We need all parts of the supply chain to do their bit and we are very grateful for the co-operation of importers and exporters in improving terminal productivity. Unfortunately, the threat of congestion remains and is unlikely to dissipate until Ports of Auckland sorts out its operational problems,” Mr Cairns said.
“We accommodated a container vessel at our Mount Maunganui bulk cargo wharves in December to try and alleviate the pre-Christmas stress for retailers. New Zealand’s ability to absorb the worldwide disruption caused by COVID-19 has been severely constrained.”
Wharf extension on the fast track
Port of Tauranga has applied for the COVID-19 recovery fast-track resource consenting process for its proposed berth extension at the Tauranga Container Terminal. The fourth berth will be created by converting 220 metres of cargo storage land to the south of the existing wharves.
Mr Cairns said the project could help ease congestion in the Upper North Island supply chain, especially with the prospect of the Ruakura Super-hub and inland port at Hamilton coming on stream. The inland port, being developed in partnership by Port of Tauranga and Tainui Group Holdings, is due to open in 2022.
The outlook for the second half of the financial year at Tauranga remains uncertain.
“We are confident we are managing any congestion challenges at our locations. However, the situation in other parts of the supply chain is far from resolved,” Mr Cairns said.
“COVID-19 precautions continue to have a big impact on our costs, as we continue to prioritise the safety of our team members and the community. There is still much uncertainty as to what the second six months of the year will bring, but we are confident we are in a strong position to tackle any challenges.” Port of Tauranga expects full year earnings to be between NZ$94 million and NZ$100 million.