Is Australian container port performance really all that bad despite Australian ports having low rankings in the World Bank’s Container Port Performance Index? It’s a fair question to ask. Critics of the CPPI have certainly used that argument.
The CPPI is a body of work by the World Bank that is based on S&P Global data derived over years from AIS signals from many thousands of collectors including shore-based systems, ships, and satellites. The CPPI indicates that Australian container port performance, based on the time vessels spend in port, is longer than the industry average. And, when ranked as a whole, the major Australian container ports are generally among the worst performing ports in the world.
Incidentally, let’s remember that, while not perfect, the CPPI time-in-port is the best comparative proxy for port efficiency currently available.
There is one outlier, Bell Bay, which we have discussed elsewhere in this Annual Review. The outlier is just that: an outlier. So, we feel confident in putting it to one side. When we talk of “all Australian container ports” we are referring to Adelaide, Brisbane, Fremantle, Melbourne and Sydney.
Not only are the Australian container ports in the bottom half of the table, three of them Brisbane, Botany, and Fremantle, are in the fourth quartile (i.e. the last 25% of ports). Botany is among the bottom fifth of all ports, while both Brisbane and Fremantle are in the bottom tenth of ports globally.
But is that a problem?
Some commentators have argued that Australian ports being poorly ranked isn’t a problem. We don’t agree with them, obviously.
The argument is that rankings only tell you where you are placed in a pack. They don’t give you insight into performance. The unspoken implication is that no, or little, attention should be paid to the CPPI report because of this alleged flaw.
The critics of the CPPI have a problem. The CPPI doesn’t just rank ports. It measures performance too.
But let’s take the claim of the CPPI opponents seriously. Their claim, paraphrased here, is that while it’s disappointing that Australian ports did not rank highly in the container port performance index, the performance is not really that bad.
Let’s unpack that.
But before we do, let’s take a moment to acknowledge that CPPI opponents also make a variety of other claims, such as Australian container ports are systematically disadvantaged because they have different geographic features, or they have different labour conditions to other places in the world.
We are sceptical of the significance of such claims – there are lots of places with geographic and labour peculiarities. And the fact that Australian ports are far away from other container ports in the world doesn’t have a lot of explanatory or excusing power. Why would that explain or excuse the fact X-time spent in Y-port is so much longer than comparators? That’s an especially pointy question when you consider that the form of container ports and shipping is similar the world over.
Container ports (or nearly all) have pilot pick-up and drop off points, channels, turning circles, berths, etc. and the container logistics system is built around a standardised piece of equipment – the ocean shipping container. It’s hard to credit claims of unique Australian seaport difficulties when they are all part of the same standardised system.
Meanwhile, the dataset of 400+ ports averages out such issues and, in any case, such factors don’t explain, multi-year underperformance relative to peers.
If anyone wants to argue that Australian container seaports are uniquely disadvantaged, then they ought to bring some pretty solid supporting evidence.
Playing with soccer statistics
Liverpool Football Club topped the English Premier League in 2024-25. Southampton Football Club occupied the last spot at rank 20. Was there really any substantial difference in performance between them?
The Mighty Reds proved worthy of their nickname. Liverpool won 25 times, drew 9 times, lost four times, earned 84 points, scored 86 goals, and had a goal difference (goals scored less goals conceded) of +45.
Now, let’s have a look at the tragic performance of the season’s loser, Southampton. Prepare yourself. For a Premier League team, this is pitiable. While there’s ‘only’ 18 spots on the board between Liverpool and Southampton, there is a yawning void between them in performance.
Southampton won 2, drew 6, and lost 30, earning 12 points, scored 26 goals, and had a goal difference of -60. No, that’s not a typo, it’s a goal difference of negative sixty.
Or, to put it another way, Southampton won hardly any games compared to Liverpool. It barely managed any draws, was absolutely smashed in terms of losses, hardly earned any points (which may possibly have been gifted to them by the League’s authorities out of a misplaced sense of pity), and scored barely one-third as many goals as Liverpool. We do not even want to comment on each team’s respective goal difference.
It’s clear then that Southampton, while literally in the same league as Liverpool, wasn’t metaphorically in the same league as Liverpool. Nor, indeed, was it metaphorically in the same league as the other teams in the Premier League for that matter. We really feel quite sorry for the poor fans of Southampton, it must have been a quite unhappy season. Relegation to a lower division probably came as quite a relief.
As it is with sports, so too it is with ports.
Let’s have a look at, say, Yokohama, Japan (we mean the port, not the soccer club), which is primarily a gateway operations port. We’re trying to exclude trans-shipment ports like Singapore in this commentary.
Incidentally, on that point, this is another way CPPI opponents carry out their attack. They argue that gateway ports (which primarily handle import-export containers) don’t necessarily stack up well to trans-shipment ports. Which is true, but it’s misleading because it’s cherry-picking the comparator.
If you want to look good, you pick a bad comparator. Likewise, if you want to say a common scale shouldn’t be applied to you, you pick a manifestly unsuitable comparator and compare yourself to that carefully chosen comparator and argue the scale is wrong.
To avoid this logical error, we will stick to comparing gateway operations ports.
Quick reminder: the CPPI 2024 is a standardized index centred at zero, which reflects the global average. The index is based on average vessel time in port, adjusted for port size and volume. Positive values equal “better than average” and negative values mean “worse than average”. For our purposes: positive numbers = better; negative = worse. Simple as.
So, anyway, back to Yokohama. It’s got a CPPI 2024 of 115. Yokohama is 123 points ahead of Adelaide or Melbourne. This points difference translates into many hours of vessel time saved, which spares shipping companies from racking up huge, wasted, costs. Meanwhile, Yokohama is 163 points better than Botany, 208 points better than Brisbane, and 210 points better than Fremantle.
Cheery cherry picking
You might now turn to us and accuse us of cherry picking by selecting the top ranked gateway operations port, Yokohama, as our comparator. Which, to be fair, we have done. We picked Yokohama because it is the top-ranked gateway operations port. It’s the best in class. Comparisons to the best in class is a commonly used method of comparison.
Remember, firstly, we were stripping out trans-shipment ports so as to pre-empt criticism that comparing trans-shipment ports to gateway port isn’t fair. No-one would want to compare apples to oranges, after all.
Secondly, we could do the same exercise again and again and again with ports that are ranked higher than Australian ports. But we can only do it relatively few times with ports ranked below Australian ports. And that’s because all Australian container ports perform considerably worse than the top-ranked ports, and some Australian ports also perform very badly when ranked against the global average of container port performance.
CPPI rankings matter because they reflect port performance
This reflection is all about examining how true it is that the CPPI rankings don’t really matter. The CPPI opponent’s argument is that being a lower-ranked port doesn’t necessarily mean that performance is all that bad. But that’s not supported.
Top ranked ports are top ranked because they’re good. They perform well. Poorly ranked ports are bottom ranked because, well, they’re not good. They don’t perform well.
The data shows – just like the scoreboards of the English Premier League – that rankings do directly reflect real world performance.
Container port performance is not an abstract and academic metric. It is derived from data on the time ships spend in port.
A low rank in the container port performance index is earned because of poor container port performance. And that potentially costs shipping companies quite a lot of cash. Rough calculations by Shipping Australia suggest that delays cost anywhere from several tens to a few hundred US dollars per minute of delay (depending upon a wide range of ever-changing factors such as the cost of fuel).
That greatly affects whether goods bound to / from move as competitively as they could and whether Australian households pay more than they otherwise could. Such costs are known to factor into the Australian economy.
Accordingly, we know that poor Australian container port performance hurts the Australian economy, and therefore also potentially harms the people who live and work within it.
Clear data, clear conclusion
The CPPI data is clear: our ports are not just low-ranked, they are serially underperforming. Australians are paying the price for that underperformance. The obvious policy prescription here is that Canberra should not allow Australians to come to harm if possible and certainly not unnecessarily.
Let’s go back to our soccer league analogy.
The top-ranked ports are like Liverpool Football Club. And the bottom-ranked? Well, they’re much more like Southampton.
Just like the rankings and performance stats in the English Premier League, CPPI rankings matter.
CPPI performance matters.
And arguments to the contrary? Well, they are unsupported.
And, worse, adverse to the interests of Australians.
Disregard.
