New rules discourage the use of coastal shipping and inflate international trading costs
Australias Labour government will decide how to proceed on a raft of cabotage law reform proposals in the next two months.
Although designed to boost Australias maritime industry, forwarders and carriers claim they will instead discourage the use of coastal shipping and inflate international trading costs.
Jason Wong, APL Vice-President for intra-Asia and Australia, said changes to the system for loading and unloading domestic cargo could lead to higher labour costs for carriers and force them to reduce port calls or introduce surcharges.
Fritz Heinzmann, a senior consultant with DB Schenker Australia, said any reform that discouraged container vessel calls beyond the key ports of Fremantle, Melbourne, Sydney and Brisbane would not be in the interest of forwarders and definitely not in the interest of the public.
He predicted the planned reforms would also push coastal container traffic on to roads.
Brian Lovell, CEO of the Australian Federation of International Forwarders, argued that if carriers began to reduce port calls, shippers would ultimately pay the price.
Any additional transit time or increase in costs will impact shippers and or consignees, although it will not affect the international forwarder directly.
Llew Russell, CEO of Shipping Australia, said that by increasing the cost of moving produce around Australia, the proposed reforms could even see imports replace domestic goods.
The 100-year-old coastal permit system was itself a compromise between the competing interests of the shipowners and the shippers of coastal cargo, he added.
Under the current system, if a licensed Australian flag vessel is available on the coast a permit cannot be issued. Why change a system if it aint broke?
Source: IFW
