Shippers query high Sydney port charges

2007-11-12

The development of Port Botany that will centralise all control of shipping entering Sydney's ports has come at a price for shippers: increased charges. Sydney Ports Corporation increased container wharfage charges on September 1, and indicated that the charges were directly related to the new development.

The US$6.29 million investment in the new control centre will be further boosted with more than $1.8 million worth of state of the art communications technology. By the end of 2008 more than 80 per cent of all shipping movements through Sydney Ports will be concentrated at Port Botany.

"With the relocation of the car trade from Sydney to Port Kembla and the ever increasing trade in containers, Port Botany will continue to grow," said New South Wales state ports and waterways minister Joe Tripodi.

The centre consolidates Sydney Harbour operations, bringing together navigation control, pilotage and communications control. Construction of the new centre is expected to start in the first quarter of 2008 with operations beginning in late 2009.

But not everyone is happy with the decision by Sydney Ports to increase charges to help pay for the new Port Botany infrastructure.

Shipping Australia Ltd (SAL) has claimed Sydney wharfage charges are the highest in Australia.

SAL said: "At $74.31 per TEU for full imports (a rise of $18.23 in one go) and $9.11 per TEU for empty containers through the port, it is certainly the highest import container wharfage in Australia. Over a 12-month period it will result in at least a 30 percent increase in revenue from wharfage for the corporation".

Llew Russell, SAL chief executive, said: "The corporation had accepted previously the argument that empty containers are really ship equipment that incur cost and no revenue. On that basis, in 1999, the corporation agreed not to charge wharfage on those containers but they have now apparently changed their mind again.

"What this means is that these charges will naturally have to be passed on but inefficiently because of added administrative costs.

"Many container imports are used in export processes so that there will be a flow-on in cost for at least some exports."

Part of the reasons given for these large increases was to support funding of the planned infrastructure investment at Port Botany, said Russell. "This poses the question whether the additional revenue raised for this purpose should not be allocated to a special infrastructure fund so that it can be monitored closely and hopefully charges reduced again when the infrastructure cost recovery is completed?''

"Regrettably, these charges come on top of announced increases in other container port charges in Melbourne, Adelaide and Fremantle," he added.

The Australian federal government has ordered an overhaul of port and airport management authorities and will look at the creation of special economic zones to overcome transport bottlenecks caused by poor infrastructure.

Source: Cargonews Asia
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