OPINION: The landside cost shift - a practical view from the supply chain

THE CURRENT debate around port productivity and container terminal performance is important. But productivity is only one part of the equation.

For cargo owners, particularly small and mid-sized exporters and importers, the more immediate issue is how landside charges are being structured, allocated and recovered through the supply chain.

During the past eight years, there has been a clear structural shift in cost recovery.

Terminal access charges (TACs), infrastructure levies and empty container park (ECP) fees have progressively moved from relatively minor administrative charges to material cost components. These charges are generally imposed at the landside interface and are typically non-negotiable for most cargo owners.

To illustrate the commercial impact, consider a regional agricultural exporter shipping 2,000 TEU per annum (roughly 50,000 tonnes of product) in 2017:

• TAC averaged about $35 per TEU

• ECP fees averaged about $10 per TEU

• Combined cost: $45 per TEU

Annual impact: about $90,000. Equivalent to around $1.80 per tonne (assuming 25 tonnes per container).

In 2025:

• TAC averaging about $220 per TEU

• ECP fees averaging about $190 per TEU

• Combined cost: $410 per TEU

Annual impact: about $820,000. Equivalent to around $16.40 per tonne.

That is a near nine-fold increase in landside charges over the period.

For many exporters operating on tight margins, that shift is no longer incidental. It becomes a line item that directly affects competitiveness.

Importers face similar outcomes.

A mid-sized importer handling 1,500 TEU per year now faces:

• About $615,000 per annum in TAC + ECP charges
• Before transport operator margin, financing costs or administrative uplift

Downstream financing and administrative add-ons can add a further 10–15%. The key issue is not whether terminals require revenue to operate. Nor is it whether infrastructure investment is necessary. The issue is structural allocation.

Historically, stevedoring formed part of the total shipping service cost, recovered through negotiated freight arrangements. Over time, a growing proportion of landside costs have been separated from freight and imposed downstream in a way that reduces the ability of cargo owners to negotiate them within the liner service framework.

Where charges sit outside negotiated freight, competitive tension is diluted. Smaller shippers, particularly those operating via freight forwarders, effectively become price takers. The ACCC’s monitoring reports in recent years have identified persistent concentration and limited competitive constraint in container terminal services.

The question now emerging in industry discussion is whether existing legislative mechanisms, including Part X of the Competition and Consumer Act, continue to operate as originally intended when significant cost components sit outside the negotiated freight construct.

This is not about apportioning blame between carriers and terminals.

It is about whether the current landside cost architecture delivers economically efficient outcomes for Australian trade.

And if structural imbalance were formally recognised, that determination could have broader commercial implications, including potential review of historical cost allocation practices. For that reason alone, the issue warrants careful, evidence-based examination rather than rhetorical debate.

The Australian Shippers Alliance initiative seeks to explore that question through a structured and lawful pathway. The objective is not disruption, but clarity and, if necessary, regulatory consideration of whether the framework is functioning as Parliament intended.

For freight industry participants, this should not be viewed as adversarial. It should be viewed as a prudent step to ensure the system remains balanced, competitive and sustainable for carriers, terminals and cargo owners alike.

Because if landside cost escalation continues without structural examination, the burden will ultimately be borne by the exporters and importers who underpin Australia’s trade performance.