The competition watchdog, the Australian Competition and Consumer Commission, has released its 2023 Container Stevedoring Monitoring report.
Key findings:
Supply Chain Recovery
The ACCC noted that The supply chain operated in a more predictable way in 2022–23, with improvements in vessel schedule reliability helping to reduce congestion. Global shipping container freight rates fell considerably over the course of 2022–23 and are now largely back to pre-COVID rates.
Stevedores’ industry returns remained near historical highs in 2022–23
Stevedores’ industry profit margins remained near historical highs in 2022–23 but are more moderate over longer timeframes. The ACCC warned that it will continue to scrutinise whether any structural or behavioural market impediments are contributing to higher profits and whether any policy or regulatory responses are warranted.
Shipping lines support the repeal of Part X
Referring to a joint statement issued by Shipping Australia and the World Shipping Council, the ACCC noted that there is industry support for repeal of Part X of the Competition & Consumer Act 2010 with a repeal by a more narrow class exemption. The ACCC noted our comments that the Part X registration process is burdensome and it hampers the ability of shipping lines to respond quickly to changes in market dynamics.
Cargo owners remain concerned about detention fees
The ACCC argued that shipping lines appear to have levied detention fees in circumstances where cargo owners could not return containers on time due to factors outside the cargo owners control. The ACCC argued that the detention fees process was unreasonable and that cargo owners do not have adequate protection. Shipping Australia disputes this characterisation. As we have repeatedly pointed out in a wide range of submissions to government, cargo owners can in fact take a wide range of steps to ensure that containers are returned on time and there are measures to mitigate the risks. We have also repeatedly pointed out that it is a commercial decision of the companies involved as to whether or not the choose to hire a box and they voluntarily assume that responsibility in pursuit of their own profit-making agenda. We do not believe the case for imposing controls on how shipping companies lease out their private property has been established.
Cargo owners face challenges making informed business decisions
The ACCC argued that cargo owners are often unable to predict how the landside charges they would pay to stevedores and empty container park operators will vary over the life of the their agreement.
