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Developing Issues at Melbourne Terminals

Dear Customers,

While Sydney has not been without it’s issue in the last month, shipping schedule integrity and late changes remain challenging. The repercussions are adding additional strains to not only Sydney  but Melbourne Container terminals as well, were many lines are choosing to re-direct vessels instead of Sydney. Added to this there are scheduled MUA work stoppages to add to the mix among an already arduous landscape.

Below is current update for Melbourne terminal which we would like to share with you;

DP World

DPW have advised all carriers of the expected high volume of vessels coming into their terminal from next week. They are expecting this to be felt through the terminal for at least a 2 week period. The terminal has advised that they are already at capacity for Monday’s bookings and they are likely to reach capacity earlier than normal throughout this time.

Patrick Terminal

MUA planned 8-hour stoppage of work commencing at 07:00 am on Monday 7 September and a ban on the performance of work on the vessel Maersk Semakau for a period of 8hrs commencing at 07:00 am from Monday 7 September 2020 and ban on the working of shift extensions from 07:00 am Friday, 4 September 2020. This is not a full terminal closure but will add strain the their performance while these actions take place and likely have a knock on effect.

VICT

VICT advertises import availability when the first container is discharged from the vessel, our carriers have had multiple occasions when containers are still not discharged until day 2 or 3 of availability that has been advertised. Timeslot bookings cannot be done  until containers are physically discharged from the vessel and are located in the yard adding to the difficulty. This adds further difficulty in being able to give our clients a firm delivery dates as until we source a time slot we cannot confirm these delivery dates. Added to this containers at VICT are stacked into the block system. If a crane/straddle breaks down in that “block”  they are forces to close off the “block” until this issue is fixed and this can happen without warning or even while a truck is waiting to collect a container.

We’d also like to note that in most cases Shipping lines will calculate the detention free time from 1st day of availability which may not correspond to when the container was actually discharged or accessible.

Kind Regards

SILA Customer Service

by SilaAdmin

Empty Container Management - Latest

We've devoted this update to the latest information on empty container management across Australia.

Empty container management is a vital component of the efficiency of any container port.  However, many challenges arise, access pricing is skyrocketing, and the cost of managing empty containers through the supply chain is increasing.

Landside logistics operators bear the initial brunt of these cost increases, and ultimately they impact on import and export supply chain competitiveness.

Increasing Notification Fees:

Recently, there has been a plethora of announcements in Melbourne, Sydney, Brisbane, Adelaide and Fremantle of significant increases in Empty Container Park (ECP) Notification Fees paid by road transport operators for truck arrival notification slots.

Trucks must have a notification slot to either de-hire an empty import container or pick up an empty export container from an ECP.  Otherwise, the truck will not be serviced.

Here is a compiled list of the recent announcements (as at 17 August), which can be downloaded: Here

Prior to January 2019, ECP Notification Fees ranged between $11.00 (+GST) to around $20.00 (+GST) depending on the port and the ECP.  Taking into account the latest increases being implemented in early September, in less than two years, ECP Notification Fees will have increased in the range of 268% to 590%, with the highest fee now being $65.00 per Notification.

Some increased fees (but not all) have been accompanied by announcements of additional capacity, increased opening times, investments in new empty handling equipment, and some flexibility in truck arrival times around the booked time zone without financial penalty.  (Capacity issues are discussed in greater detail below).

Pseudo Infrastructure Fees:

Along with the significant increases in Notification Fees over the last eighteen months has been aggressive contract negotiations by shipping lines with Empty Container Park (ECP) providers in all ports.

It's estimated that prior to the beginning of 2019, ECP revenue generated from shipping lines for empty container services was circa $120.00 per container.  Today, ECP shipping line revenue is estimated to be closer to $80 per container.  In addition, the increased volumes of Direct Return of Empties (DRE) to stevedore terminals have impacted on traditional ECP revenue.

As stevedores apply ever increasing and unregulated terminal access fees (infrastructure charges) to make up for lost revenue from shipping line contracts, now a sizable element of ECP Fees can be characterised as infrastructure / access charges so that ECPs remain competitive in shipping line contract negotiations.

ECP Capacity

Empty Container Park (ECP) capacity constraints have been most keenly felt in Sydney (Port Botany).

Here is a compiled montage of aerial images of prominent ECPs servicing trade through Port Botany, showing "then" photos from Google Maps, and "now" photos sourced at the beginning of August.  Pictures paint a 1000 words! The congestion levels are obvious - see: Here

Some ECP capacity has been added in Port Botany in recent weeks and months.

A new park has been leased by Tyne Container Services (operating 24/7), adjoining the existing Tyne (MT Movements) park, effectively ‘super-sizing’ the site, delivering an additional 5,000 TEU in empty container capacity.

Last week ACFS also opened e-Depot 2 in Port Botany, creating a welcomed additional capacity of 4,500 TEU.  This development came together at short notice after a strong collaborative effort by ACFS Port Logistics and NSW Ports.

However, empty handling capacity in Sydney will be further reduced in the coming month with the closure of Tyne St. Peters, while planning clouds remain over the largest empty facility in NSW, Qube Cooks River Intermodal Terminal (CRIT), given that the NSW Government doesn't seem to be listening to the industry's concerns about adequate truck connections at Canal Road onto the Sydney Gateway Project (see: Here).

What are the reasons for the congestion?A major reason for severe empty container constraints in Sydney in the last few months has been a reduction in the number of full exports and empty export repositioned by shipping lines relative to import discharges.

An analysis by NSW Ports has identified an imbalance of over 30,000 TEU between full & empty exports and full & empty imports between April to June 2020.

Several factors have contributed to this situation, including weather disruptions, berth congestion due to vessel bunching, vessel rotation changes (some vessels even bypassing Sydney), congested stevedore Direct Return of Empties (DRE) pools, and stevedore industrial disputation affecting empty bulk run receivals.

The lack of ECP capacity has led to a marked increase in empty container redirections ordered by shipping lines.  As of last week, there were over 100 redirection messages live in Sydney, with instances where some container types for various shipping lines were redirected up to five times before a de-hire location was settled.

Redirections have a significant cost impact on transport operators (see section below on performance & costs).

Overall ECP capacity constraints aren't being experienced in the other major capital city ports to the same extent as Sydney.

However, where congestion and delays can and do occur, in Melbourne and Brisbane particularly, is when shipping lines insist that empty import containers must be de-hired to only one facility, without providing any viable alternative to importers and their transport providers.  Unacceptable lengthy truck queuing delays then result if the nominated facility has no capacity to match the demand.

It is imperative that all parties in the container logistics chain work collaboratively to improve productivity levels and information exchange to assist in countering the negative impact of physical ECP capacity restraints.

Performance & Costs

Added Costs for Transport Operators:
Congestion at Empty Container Parks (ECPs), at stevedore terminals for Direct Return of Empties (DRE), and constant re-direction of empties between one facility and another have significant cost implications for container transport operators:

• A lack of available container slots for the return of empties;
• The need to stage empty containers through transport yards, including the costs of additional container lifts and yard storage;
• Additional truck kilometres travelled - made worse by constant re-directions;
• Longer Truck Turnaround Times (TTT), leading to the danger of the truck missing its subsequent time slot in another part of the supply chain and incurring penalties there;
• Added risks of No Show fees and other penalty regimes;
• Time delays which threaten the ability of transport operators to ensure that import empty containers are de-hired within container detention free times, and subsequent invoices from shipping lines to importers for container detention.
• Added administration costs.

What's being done about these issues in each State?
Transport for NSW has already calculated that inefficiencies and delays in empty container management costs the economy over $49 million per year, which could rise to over $100 million if nothing is done about it (see: Here)

In NSW, CTAA is advocating strongly for change and performance improvements through the recently convened NSW Empty Container Working Group, a sub-group of the NSW Port Transport Logistics Taskforce (PTLT).

The matters being pursued through the Working Group include:

• Key performance data measurement, including empty container slot supply and demand at ECPs and stevedore terminals across all time zones, slot take-up statistics, truck arrival patterns, and truck turnaround times.
• The number of redirections, and how these can be better managed through greater notice, and the honouring of valid slot notifications made prior to a redirection being called.
• The percentage of electronic messaging from shipping lines with de-hire information, which has been below 40% in Sydney.  There are still several shipping lines that provide zero electronic data, which impacts information visibility and efficiency.

In Victoria, the Government was pursuing a Voluntary Port of Melbourne Performance Model (VPPM).  However, these developments have been overshadowed by Victoria's response to the COVID-19 pandemic.

In Fremantle, empty container management issues are dealt with comprehensively through the WA Port Operations Taskforce convened by Fremantle Ports.

In Brisbane, there is far more work to be done on the inefficiencies in the empty container management chain.  CTAA is currently liaising with the Queensland Government and the Port of Brisbane regarding these issues and how greater attention can be applied to seek improvements.

Improvements in empty container management efficiencies are more important than ever before, particularly given the significant increases in ECP Notification Fees which become a cost burden for all in the landside container logistics chain.

Kind Regards,

SILA Global

by SilaAdmin

Sydney: Empty Container Park Chaos

Dear Valued Clients,

Sydney empty parks are now overflowing and at breaking point. Today Empty Parks are shutting due to full compacity, over 100 redirections, shipping lines not answering phones or emails.

We are experiencing multiple redirections after booking slots into empty park’s and now on many occasions returning to our yard until an empty park has capacity. There are currently over 100 redirections in Container-chain and growing.

Please discuss with your shipping lines for confirmation on empty returns, as from tomorrow (22^nd August 2020) we will be charging for any redirection or return to our yard will incur lifts & storage.

We advise you to pass extra fee’s onto your shipping lines.

Sydney Redirection Charges as per below:

Redirection Fee:               AUD 130.00 + GST + Fuel

Futile back to yard:          AUD 160.00 + GST + Fuel

Tolls:                                 AUD 45.00

Empty Lifts:                      AUD 45.00 per 20GP

AUD 65.00 per 40GP

Storage:                           AUD 5.00 per day / 20GP

AUD 10.00 per day / 40GP

Unfortunately this is out of our control and appreciate your understanding with this matter.

Please pass this on to any staff within your business whom the notification is relevant.

Kind Regards,

SILA Customer Service

by SilaAdmin

Vessel Schedule Delays - Australia

Dear Valued Clients,

SILA Global would like to advise clients of increasing delays to vessels transiting through Australian ports, in particular Sydney. These delays are becoming a more common occurrence and we are also receiving notices from some shipping lines as to changes in Port Rotation or omitting Sydney and discharging cargo in Melbourne and onforwarding by feeder vessel.

The delays in Sydney are the direct result of repetitive heavy weather systems passing through New South Wales during the previous 4-5 weeks. The weather experienced over the last weekend was significant enough to cause the suspension of pilotage services and closure of the port.

In addition to weather, delays to vessels are also being experienced due to the Industrial Action being undertaken by the Maritime Union of Australia. This is occurring across a number of Australia's main container terminals and unfortunately remains an ongoing issue which is creating delays throughout the entire supply chain.

Kind Regards,

SILA Customer Service

by SilaAdmin

Developing issue affecting Sydney empty container parks

Dear Clients,

We would like to bring to your attention the developing issue affecting Sydney empty container parks. Most empty container parks in Sydney are at maximum capacity and are turning away containers that have been directed for dehire to their depots by shipping lines, even with a valid booking being made in ContainerChain, forcing transport carriers to take the Empties back to their yard while waiting for solution from Shipping Line. Alternatively some containers are being redirected multiple times before being able to be dehired at a depot that will accept it, at last count ContainerChain had advertised 77 re-directions

SILA have brought this issue to shipping lines on effected containers as well as Transport providers and Peak Industry Bodies who are encouraging shipping lines to work on solutions. The situation is very fluid and should your container be effected by a re-direction or futile trip SILA will advise you accordingly.   

Kind Regards,
SILA Customer Service

by SilaAdmin

M5 East / M8 Toll Increase

To Our Valued Clients,

Please be noted that due to the upgrade of roads & infrastructure in Sydney, from 1st July 2020 there will be a toll increase along the Sydney Motorway.

Trips via the WestConnex M5 East/M8 have risen to $45.00 per return trip ($22.50 one way) between Foreshore Drive & King Georges Road.

Toll charges for travel from Foreshore Drive past King Georges Road along the WestConnex M5 East/M8 will be capped at $65.00 per return trip ($32.50 one way).

If you have any questions please contact your local SILA representative.

Kind Regards,

SILA Customer Service

by SilaAdmin

2020-2021 BMSB Season - 1 September 2020 and 31 May 2021 (inclusive)

Good Day,

The Department of Agriculture has finalised measures for the 2020-2021 BMSB Season, details of which can be found on their site here. Measures are consistent with last year however of note there is 3 more countries added to the target risk category being Portugal, Ukraine and Moldova.

“The BMSB risk season is for goods and vessels that arrive in the Australian territory between 1 September 2020 and 31 May 2021 (inclusive). Goods must be treated for BMSB if exported between 1 September 2020 and 30 April 2021 (inclusive).”

As always SILA will keep you informed of any changes and  please feel free to reach out to us if you have any inquiries.

Kind Regards,

SILA Customer Service

by SilaAdmin