Australian Steel News – Industry Insider


The Port of Sydney continues to experience flow disruptions which are likely to affect steel delivery times and costs. In August, the Maritime Union of Australia (MUA) won the right to take wide ranging industrial action against the tug provider Svitzer. It is now exercising that right and has called a month long strike for November. Meanwhile, notices received from the lines which are collecting the port congestion surcharges in Australia remain in place, with no changes advised to industry at this stage.

According to Shipping Australia, a peak industry body for shipowners and shipping agents, even though the MUA´s earlier action against Patrick Terminals has been paused, the recovery process is on-going and is causing great difficulty in putting down any solid timelines. Industrial action has ceased during the following time frames as per the Fair Work Commission (FWC) hearings: Patrick & Maritime Union – FWC orders in place until 26 October; and DP World & Maritime Union – FWC orders in place until 1 November.

Meanwhile, the empty containers issue is still causing havoc. Despite increased exchanges of empty containers evacuated onto vessels, the volumes are not keeping pace with the arrival of more containers. The upcoming closure of Sydney’s largest empty container park (24% of Sydney’s empty container capacity) to make way for construction of the Sydney Gateway road will put further strain on the situation. All these complications and any vessel redirections result in additional costs in the supply chain to importers.

At the same time, freight rates continue to increase, with more rate restoration programs proposed for November. Coupled with equipment shortages, space issues and an unpredictable economic climate, the task of moving goods is going through quite a difficult period. A case in point, there is an estimated 30% excess of cargo unable to be booked on vessels ex-China and ex China and Asia. Bookings are backlogged into the third week of November; rates are climbing, and shipping lines commenced rate restoration increases from the beginning of November.

Written by Simon Pepper
Director – Customs & Logistics

Published in Australian Steel News – Vol 4, Issue 3 – Nov 2020