Auckland weathers the market storm

In its financial results for 2015/16, despite both cargo and bulk volumes both declining, the port still increased both profit and dividend.

Tony Gibson, chief executive, Ports of Auckland, said: “We thought it was going to be a tough year, and so it proved, but we still increased profit and dividend. That we have been able to deliver a strong result in current conditions is a sign that our company is in good health.”

He pointed out that two factors have contributed to a more difficult market. Lower iron and steel prices have resulted in significantly lower iron sand exports.

But more importantly overcapacity in the container industry has led to a significant reorganisation of shipping services internationally, which is affecting many ports.

In New Zealand, the changes have resulted in volume leaving Auckland, which is expected to continue.

“Our strategy has been to offer great service to customers, focus on improvements we can make through technological advancements, keep costs low and extend our reach into the supply chain so we can offer better value and service to freight owners, Mr Gibson said.

Auckland is in the process of completing the container terminal infrastructure it needs to cater for larger ships and is also looking to start work on automating its container terminal, the first in New Zealand to do so.

Mr Gibson continued: “This innovation will increase capacity and reduce cost, making us even more competitive. We are continuing to build our freight hub network. We have a cross-dock under construction at Wiri, South Auckland and our Mt Maunganui Hub will open in September. We will soon lodge resource consent for enabling work at our Waikato freight hub, which will be our largest.”

As well as looking towards bettering its supply chain network, the port has also recently entered a strategic alliance with Napier port, which will strengthen the position of both companies in the supply chain.