THE LATEST release of the World Bank Ports Performance table will no doubt elicit derision about the performance of Australian ports from the usual suspects, but is it all that bad or are we again comparing apples with oranges?
The Container Port Performance Index (CPPI) for calendar year 2024, which is developed by the World Bank and S&P Global Market intelligence, was published last week.
The development of the CPPI is based on total container ship time in port.
The calculation of the ranking of the index employs two different methodological approaches: an administrative or technical approach, which is a pragmatic methodology reflecting expert knowledge and judgment; and a statistical approach, using factor analysis.
A rank aggregation method is then applied that combines the results from the two different approaches and returns one aggregate ranking.
The results were disappointing for most Australian ports, as they were all ranked within the bottom half of the table of 400. Some went up and some went down since last year. Interesting to see that Bell Bay is again the best performing Australian port which says something about the accuracy of the ranking.
However, when put into perspective, is their performance all that bad? The fact that all four container stevedores renewed their enterprise agreements this year and last suggests criticism of Australia’s port performance based on the industrial climate is unwarranted.
Some might say this was a result of the Maritime Union cosying up to the Federal Labor government in view of the CFMEU being put under the spotlight for rorts in the construction industry (the MUA is a subdivision branch of the CFMEU) and the recent election.
Some commentators have also used the argument of excessive landside fees being charged by the stevedores in criticising their performance, although financial measures are not used in producing the report.
They’ll have to wait for the publication of the ACCC’s Container stevedoring monitoring report later this year.
While the performance at berth is measured in minutes per move in the report, I believe this to be a misleading measure.
The figure depends largely on the crane intensity (number of cranes that can effectively be used on a ship) which favours big ports that service big ships.
The average size of container ships calling Australian ports is approximately 5000 TEU which limits the number of cranes that can be used on the ship.
As I have stated in commentary on previous reports, the picture would be different if the landside performance, such as hinterland connectivity and cargo dwell time, was considered as well as the waterside performance.
Australian ports are world leaders in truck turnaround time (on average sub 40 minutes) and container dwell time (the time it takes for a container to leave the yard after being discharged or the time it takes to be loaded onto a ship after being received in the yard), of about three days.
The authors mention measures such as landside performance in the report, so who knows if this might be included in future reports. This would certainly see Australian ports improving in their ranking.
The authors also mention that under the current methodology, comparing scores between 2020 and 2023 is not a valid comparison as these scores are calculated on different scales.
The only way to make valid temporal comparisons would be to work with the raw operational data, not the normalised indices. Furthermore, port performance as measured by the CPPI is influenced by numerous factors that the terminal cannot directly influence or manage.
Thus, the CPPI score and the year-on-year changes in each port’s CPPI over the last five years are influenced by factors beyond the terminal’s control.
So, as I said before, I wouldn’t get too concerned where our ports are placed in the league table.
Do you agree with Peter? Or do Australian ports needd to lift their game? We welcome your comments. Email your thoughts to editorial@thedcn.com.au