Call for port cost explanation

Call for port cost explanation


News
Aa

Victorian Farmers Federation (VFF) president David Jochinke has called for national stevedore DP World Australia (DPWA) to give a better explanation of why it has increased container handling costs, at the Port of Melbourne (PoM).

Victorian Farmers Federation (VFF) president David Jochinke has called for national stevedore DP World Australia (DPWA) to give a better explanation of why it has increased container handling costs, at the Port of Melbourne (PoM).

Aa

Victoria’s farmers will pay more to have their products shipped through the PoM, after DPWA announced a 900 per cent increase in its container infrastructure surcharge.

Mr Jochinke said the VFF was obviously concerned about any costs, which might affect producers - especially if they didn’t appear to be getting any benefit from them.

“We understand the average price of the cost of containers at other ports is higher, but that shouldn’t have been a justification for increasing the surcharge in Melbourne,” Mr Jochinke said.

“We are concerned, and disappointed, if that cost gets passed back, directly to the agricultural sector

 “We’d also like to see more evidence of why it’s being increased.”

DPWA chief commercial officer Brian Gillespie said the infrastructure surcharge, levied on containers delivered by both road and rail to its West Swanson terminal, would jump from $3.45 to $32.50 from April 3.

“DPWA has incurred material increases in the costs of occupancy of more than 60% since 2016, including higher rent, land tax and council rates,” Mr Gillespie said.

Mr Jochinke said infrastructure upgrades should alleviate supply chain costs and put downwards pressure on them.

“We want to be engaged, when they are having discussions on these decisions.

“We want to hear why and how they are doing this and how they are going to benefit users.

“While we understand the costs of shifting containers can be quite expensive, we want them to be able to justify such an increase and talk to the agricultural sector, about it.”

SURCHARGE QUESTIONS: David Jochinke, Victorian Farmers Federation president, has expressed disappointment at the increase in the surcharge, levied on containers going through the Port of Melbourne.

SURCHARGE QUESTIONS: David Jochinke, Victorian Farmers Federation president, has expressed disappointment at the increase in the surcharge, levied on containers going through the Port of Melbourne.

A spokesman for Victorian Ports minister Luke Donnellan said price increases at the PoM were a matter for DPWA and its individual customers.

DP World’s decision to increase its charges per container had nothing to do with the lease of the Port of Melbourne. 

The government understood a number of DPWA customers have written to the Australian Competition and Consumer Commission (ACCC).

Container Transport Alliance Australia (CTAA) director Neil Chambers said it was highly disturbing DPWA believed it could increase the surcharge, with little consultation with the landside logistics sector, and with less than a month’s notice.

 “These surcharges are rejected by the landside logistics sector, and CTAA Alliance companies want the issue taken up with the ACCC, and the Victorian government,” Mr Chambers said.

INCREASED LEVY: DPWA has announced the infrastructure surcharge, levied on containers delivered by both road and rail would jump from $3.45 to $32.50 from April 3.

INCREASED LEVY: DPWA has announced the infrastructure surcharge, levied on containers delivered by both road and rail would jump from $3.45 to $32.50 from April 3.

“The major customers of DPWA are the shipping lines they service contractually.

“In those contracts, shipping lines pay DPWA to load and discharge vessels, and deliver the containers to and from the landside interface.”

“All businesses face operational and infrastructure cost increases and companies resolve to deal with these cost pressures through efficiency improvements and/or renegotiating prices with their customers.”

 DPWA should be negotiating cost increases with their direct customers, the shipping lines, not unilaterally deciding to foist the charges onto the landside sector.

“DPWA also claims the need to implement these surcharges because of investment in critical infrastructure to keep pace with expected growth, and greater peaks and troughs in cargo arrival patterns.

“Surely that is a cost to build into their rates charged to shipping lines to service larger ships adequately?” 

Aa

From the front page

Sponsored by