Australian box productivity reform success

29 Jan 2014

The pay back for the waterfront reforms Australia embarked on in 1998 can be seen in significant improvements in container productivity – and the opportunity exists for a new phase of reform.

That is the view of the latest Container Stevedoring Monitoring Report, published by the Australian Competition and Consumer Commission (ACCC).
It says the reforms have achieved better productivity from both labour and capital, positioning the stevedoring industry to benefit from fast growth in container volumes over the past 15 years.

This has led to lower real average unit costs and higher industry profits, as well as better service levels for shipping line customers. Now, incumbent stevedores are facing increased competition, with new terminals being added at the three largest ports.

More aggressive competition will give customers greater choice and stevedores will have stronger incentives to deliver improved service. However, targeted investments to improve road and rail connections to container terminals will be needed, along with reforms to the way in which roads and rail tracks are funded, says the ACCC. Without landside reform, Australia risks missing out on the full benefits of expansion and competition.

Development during 2012/13 saw a large increase in investment in stevedoring, with the value of the industry’s asset base growing by 34.8%. DP World and Patrick have invested in most terminals and are rolling out automated technology, while Hutchison Ports has made its entry into the Australian sector.

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