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September 2009 + Meat special feature + Profile The New Palisade Roger Fletcher + Fair Work Act providing more security more peace of mind! appeal to Gillard

• More secure harder to defeat than standard palisade + Rocky financial waters • The unique design protects the fittings from vandalisation and damage + Piracy – why should we worry? For more information contact Gryffin on www.gryffin.com.au 1800 672 066 [email protected] e p t e m b e r S 2009 Contents The official Journal of Shipping Australia Ltd Level 6, 131 York Street, Sydney NSW 2000 PO Box Q388 Sydney NSW 1230 Ph: (02) 9266 9911 • Fax: (02) 9268 0230 2 Announcements from the bridge www.shippingaustralia.com.au Reform will be no help 5 Viewpoint Published for Shipping Australia ltd SAL appeals to Gillard 6 Profile Roger Fletcher – the impossible dreamer Showcase Publications P/L 10 MEAT – RECORD PRICES, 26 Belmore Street, Surry Hills NSW 2010 UNCERTAIN FUTURE Ph: (02) 9211 7422 Fax: (02) 9211 9061 12 Brazil leads market www.showcasepublications.com.au 13 “Meat ain’t just meat” Director: Roger Conway 13 The stats 14 Hygiene sells editorial 17 Pigs in short supply Executive editor - Llew Russell 18 Feedlot challenges Feature writer - Archie Bayvel 19 Kangaroo exports 19 Crocodile menu Advertising Co-ordinator For Advertising in the next issue 20 Education Call: Steve Moxey Ph: (02) 9211 7422 20 The best way to go Email: [email protected] 23 E-learning course launched

Production Manager and Design 24 Break bulk Paul Ortiz-Gomez A forgotten sector Ph: (02) 9211 7422 Email: [email protected] 28 Abandoned cargo 28 A story with a nice ending Administration 29 New guidelines Sarah Abrahams Ph: (02) 9211 7422 32 Rocky financial waters Email: [email protected] by David de Garis of the NAB We kindly ask all readers to notify the advertisers that you saw their advertisement in Shipping Australia, as it is only by their willing 38 Unwanted passengers participation that this publication is available to you. We recommend that you use the advertisers wherever possible. Marine pests Disclaimer. Readers are advised that Shipping Australia Limited 40 Piracy and the Publisher cannot be held responsible for the accuracy of statements made in advertising and editorial, nor the quality of the Why we should worry goods or services advertised. Opinions expressed throughout the publication are the contributors own and do not necessarily reflect 44 Young Shipping Australia the views or policy of Shipping Australia Limited or the Publisher. While every reasonable effort has been taken to ensure the accuracy 46 Signal of the information contained in this publication, the publisher takes no responsibility for those relying on the information The Publisher 49 A must-have book and Shipping Australia Limited disclaims all responsibility for any Review by Professor Edgar Gold loss or damage suffered by readers or third parties in connection with the information contained in this publication. 50 Letters Warranty and Indemnity: ADVERTISERS and/or advertising The Pacific Adventurer, Grain surveys agencies upon and by lodging material with the Publisher Showcase Publications for publication or authorising or approving of the publication of any material indemnify Shipping Australia Limited the Publisher, its servants and agents, against all liability claims or proceedings whatsoever arising from the publication and without limiting the generality of the foregoing to indemnify Front Cover: each of them in relation to defamation, slander of title, breach of 1. Fletcher’s Dubbo plant copyright, infringement of trademarks or names of publication titles, unfair competition or trade practices, royalties or violation of 2. Roger Fletcher rights or privacy regulations and that its publication will not give 1 rise to any rights against or liabilities in the Publisher, its servants 3. David de Garis or agents and in particular, that nothing therein is capable of being 2 3 4. Sandblasting misleading or deception or otherwise in breach of Part V of the 4 5 Trade Practices Act 1974. 5. Dougal Gordon Announcements from the bridge by Llew Russell

Gillard reforms will be no help in weathering the storm

am sure that no one would disagree increase and this is fully recognised by the with the claim that various industry SAL membership. What they are asking sectors are experiencing the effects of for is not avoidance of price increases Ithe global financial crisis differently and forever but rather a moratorium during there have been quite different reactions to this extremely difficult period. A number meeting the serious challenges posed. of statutory authorities and commercial service providers to the industry have not Many of our container imports and motor been able to agree to that moratorium or vehicle imports (and exports) are well even to significant price restraint. down on this time last year but some of our export commodities are looking up The overall effect will be to reduce despite the fact that revenue for shipping Australia’s international competitiveness lines from containerised exports generally because a number of ports, canal is not as high as for imports. In terms authorities and service providers to the of volume, many agricultural export shipping industry overseas have exercised The Workplace Relations Minister, Julia commodities are moving in greater volume restraint and in a number of cases have Gillard (pictured) has revealed her plans and it is at least one small light on the actually reduced their prices. Regrettably, to extend the Fair Work Act, 2009 to horizon as is the cruise industry which is in Australia one could be forgiven for foreign-owned coastal permit or licensed also a bright spot in an otherwise gloomy thinking at times that governments, in ships operating on the Australian coast outlook. particular, are not fully cognisant of how and carrying coastal cargo. It is understood their actions, policies and regulations that the Minister has made regulations to Shipping companies both globally and are reducing Australia’s international extend the Act to apply to foreign-owned in Australia have been doing all they competitiveness and not helping those coastal permit and licensed ships. With can to reduce their operating costs. This who are doing all they can to weather the almost a stroke of the pen the Minister has has included reducing the number of storm. changed a long standing policy which has vessels involved through rationalisation applied to coastal shipments in Australia of international liner services, relying There are many examples but the debate for almost 100 years. The policy to date on owned rather than chartered ships, concerning the Pacific Adventurer with the has sought to balance the economic cancelling or postponing ship building Queensland Government highly critical of interests of foreign ships lifting domestic orders where possible, slow steaming to a shipping company that has met its legal cargo and the commercial interests of save fuel costs, increased scrapping of old obligations and responsibilities is a case in Australian consignors and consignees tonnage, laying up vessels not currently point. The implications of the Convention of domestic cargo with the legitimate required and reducing discretionary on Limitation of Liability for Maritime interests of Australian licensed vessels to expenditure. This has included reducing Claims to which Australia is one of the carry domestic cargo. Subject to being fit administrative costs where possible and, contracting parties, not really being put for the carriage of the cargo in question, in some cases, staff retrenchments. It has into effect in Australia goes well beyond the availability of a licensed vessel either been estimated that around 500 container our shores with a serious and potentially three days before or three days after the vessels are on standby or lying idle at ports significant impact on insurance premiums scheduled loading date means that a or offshore around the world, representing applied to all ships serving the Australian permit will not be issued to a foreign vessel over 1.4 million teu capacity. In addition, trades. paying foreign wages. many bulk and other types of vessels have The cost increases being applied in many been laid up. This important issue is the subject of our Australian ports this financial year and Viewpoint article in this edition. Not surprisingly the shipping industry by a number of service providers in those has looked to ports, service providers and ports is also of concern. The proposal by other links in the transport chain to adopt the Australian Government to extend OUR MAJOR FEATURE in this a similar approach in reducing their prices Australian workplace laws to foreign crew edition is Australia’s meat industry and, in where possible to assist in riding out this on vessels carrying domestic cargo which is particular, how meat exports are currently financial tsunami. SAL members have part of an international voyage is another faring and we assess its future outlook. been disappointed that in some cases that good case study in terms of the difficulty Our subject for our profile section is Roger plea has fallen on deaf ears. There are often of doing business in Australia. Fletcher, managing director of Australia’s good and many reasons why prices have to most successful sheep meat exporters.

2 March 2009 Email: [email protected] Web: www.mhshydro.com

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Since the last edition, we have launched been carried out elsewhere. We hope small readership survey. We would be Shipping Australia’s new e-learning course that this study will encourage debate on most grateful if readers could fill it in as on an introduction to the shipping industry the ways and means of improving the it should not take long and fax or mail it in Australia and early signs are that it is operation of break bulk ships and delivery back to us. It will help us to significantly going to indeed be a success. of their cargoes and the results emphasise improve the content and quality of the the economic impact of the industry in magazine and certainly gives you the We are fortunate in having the National Australia. The construction industry, the opportunity to have your say. Please take Australia Bank’s senior economist, environment industry, manufacturing that opportunity and let us know what you global markets research, David de Garis processes and even the production of tin think. providing an article on how Australia is plate is highly dependent on imports by travelling economically at the present time the break bulk shipping sector. Last June the chairmen of the and his likely forecasts. International Chamber of Shipping, On 23 July, the Governor of New South BIMCO, INTERCARGO and Wales, Her Excellency Professor Marie INTERTANKO urged all governments After many months of interviews and Bashir launched a history of the Sydney to support, through the United Nations, investigations, we are most pleased to Sailors’ Home, 1859-2009 written by Jan the development of a stable government present an article on the SAL break bulk Bowen and published by the Australian in Somalia which can address the problem study which has been undertaken in a Mariners’ Welfare Society. More about of pirates operating from that country. sector which is often forgotten in terms that below. In this edition, we have comprehensively of consideration of our maritime industry. addressed the subject of piracy, especially This is a first for Australia and as far as We have taken the opportunity in this off the coast of Somalia, from an we can ascertain such a study has not edition of the magazine to include a Australian perspective!

Sydney Sailors’ Home history published new book, The Sydney Sailors’ its name to The Australian Mariners’ Home (1859-2009) by Sydney Welfare Society. Nowadays it is a generous journalist and author Jan Bowen provider of ongoing financial assistance Ahas just been published by the Australian to organisations such as the Mission to Mariners’ Welfare Society, formerly the Seafarers and the Stella Maris Clubs Sydney Sailors’ Home. that open their doors to the hundreds In 1859 a committee was formed to of mariners whose work brings them build a Sailors’ Home in Sydney ‘… in to Australia’s seaports every year. Also, which seamen, while on shore, could have scholarships to the Australian Maritime comfortable accommodation, be brought College in Tasmania are awarded to under moral and religious influence and promising young Australians planning a be encouraged in sober and thrifty habits’. seagoing career. Land at 106 George Street North in The Sensitively illustrated with historic Rocks area of Sydney, adjacent to Cadmans and contemporary photographs, this Cottage, was gazetted and The Sydney book will be of interest to historians, Sailors’ Home opened its doors in 1865. librarians, seamen’s charities, and indeed After operating continuously for 114 anyone interested in shipping, our early years, having survived the impact of two architecture and the stories of the seamen world wars, the great depression and who have visited our shores. occasional periods of low occupancy, The Sydney Sailors’ Home (1859-2009) the Sydney Sailors’ Home was closed in by Jan Bowen published by The Australian 1979 following compulsory resumption Mariners’ Welfare Society, Sydney 2009. of the property by the Sydney Cove Hardback, with five-colour jacket. 96 pages Redevelopment Authority. extensively illustrated and indexed. ISBN The book also records the many challenges 9780646513614. $45.00 plus $12.00 the Sailors’ Home faced and, importantly, P/H. Download order form from how it successfully responded to change www.marinerswelfare.com.au or email over its lifetime. And it tells of how [email protected] or telephone Sydney the Home recast its role and changed 02 9605 1344.

4 September 2009 Viewpoint

SAL calls for Gillard to reconsider Fair Work Act changes by Llew Russell

f the Deputy Prime Minister, Julia but one container of domestic cargo, then Impact Statement has not been published Gillard, has her way the cost of under this proposed regulation, it is our outlining the costs and benefits of this new shipping cargo around the Australian understanding that Australian award proposal. coast could rise dramatically. conditions would apply as well as general I In Shipping Australia’s view the best provisions of the Fair Work Act. In these She has made regulations under the Fair way forward is to exempt domestic cargo situations the argument could be made Work Act, 2009, to extend its application carried incidental to or connected with that Australia is really intending to extend to vessels licensed to carry coastal cargo or international trade from the application of its industrial laws to foreign crew carrying issued permits under the Navigation Act, the Fair Work Act on the basis that such its foreign trade. 1912. cargo cannot effectively be separated from Outside of Canada and the United States, the carriage of Australia’s international The new regulations will commence from most countries do not have a restrictive trade. 1 January 2010. and protectionist policy like that now Shipping Australia has held detailed This is against a background that in being promoted in Australia for the discussions with Customs and the Australia foreign vessels paying foreign carriage of its domestic cargo. One result Australian Taxation Office on how to wages are allowed to apply for Single could well be that at least some foreign define the carriage of domestic cargo Voyage or Continuous Voyage Permits ship operators will not carry Australia’s incidental to international trade and where (the latter lasting three months) to lift domestic cargo. If so, it will reduce the there is clearly a disconnect from that coastal cargo if a vessel licensed under the utilisation of such vessels and thereby trade. Australian Navigation Act is not available increase the cost of the carriage of within three days before or three days after Australia’s overseas trade. On 17 August the Minister issued a the scheduled load date. When viewed from different angles the direction to the Australian Arbitration and Industrial Commission that included Potentially this new regulation could conclusion is still the same; that such an the requirement for the commission significantly increase the cost of domestic imposition will raise the cost of doing cargo shipped around our coast by vessels business with Australia. besides giving consideration to the modern that have been issued a permit. The range award objective to consider whether it is The Maritime Union of Australia has of potential cost increases per unit of cargo appropriate to establish award provisions been reported as saying this policy will is currently being calculated but it will for employees of the crews of permit ships end inhuman treatment of foreign crews depend on the amount of domestic cargo and their employees relating to accrued without any detailed supporting data. lifted compared to international cargo and entitlements and associated arrangements. This is also misleading as the minimum the time spent on the Australian coast. In considering this matter, it should have terms and conditions applied, for example, regard to the needs of those employers The irony is that such an increase in cost under the Asian Rates of the International and employees who may be in Australia could move a lot of that domestic cargo Transport Federation have been actively for relatively short periods or who are on to road and rail which has a much supported and policed by the MUA in regularly moving in and out of the more damaging environmental footprint the past. If the union is so concerned then Australian jurisdiction. as a result of significantly greater carbon surely international solutions to raising emissions then sea coverage. In addition these standards are preferable to the In this language lies the prospect of we could also see an increase in domestic equivalent of putting up tariff barriers in a compromise which could well meet cargo sourced from overseas because of Australia. the vital concerns of the majority of these increased costs. This would mean the The Department of Education, stakeholders. It is up to those stakeholders loss of jobs in Australia in terms of that Employment and Workplace Relations including SAL to point out to government domestic trade as well as all the service advised SAL only at the beginning of and the commission the ramifications of industries that rely upon it. July that the Minister had made these a failure to support the legitimate trading The ridiculous point is that if a vessel regulations without consultation with interests of Australian suppliers and carries approximately 3000 foreign those who will be most affected. It is receivers of domestic cargo carried around containers around the Australian coast regrettable that a detailed Regulation our coast.

September 2009 5 I Profile Roger Fletcher legend of the outback by Archie Bayvel

The impossible dream that wasn’t all that impossible after all

oger Fletcher, correction Doctor Roger fastidiously demolishes his sambo have different models for life and we help Roger Fletcher – the poor young then the apple slice-by-slice as we talk. It them bring their needs and skill together drover turned multi-millionaire is what one might call a business lunch as best as they can.” meat tycoon – is late because his son, although Farron cheerfully polishes off his R The saying in Dubbo is that when you Farron, says he has sent him on an errand. part of it in short order and hurries off; you can’t say he’s gone back to work because work for Roger you’re there for life. He No worries, it must be a problem he never stopped throughout his modest supports this with an elaborate training wondering what to do with an old codger snack. My long black was, of course, system for every employee that begins on doddering around the joint all day. A quick delicious. the day he or she joins Fletchers. More errand to downtown Dubbo’s just the than 250 of his 1300 workers have an thing to get him out from underfoot. indigenous background and policy is to The Drover’s train them for work at the highest levels “He’ll be back in about 20 minutes,” throughout the company. Farron says and makes me a quick cup of Song instant in a ramshackle area that looks like He is modest almost to the point of self- a cross between kitchen and workers’ lunch Cherrily sings the drover effacing but the longer one spends with area; it is in fact the boardroom of the With his stock so fat and sleek, him the stronger is the feeling that one worldwide Fletcher brand. Up to the border and over is in the company of a medieval general His fortune for to seek. whose leadership evolved through time Farron wonders what I’m going to talk in the field with his troops and whose Merrily sings the drover, about with Roger. I tell him I don’t know relationship with them is camaraderie and For with luck upon his side, but will just let him do the talking and see shared experience. where it gets us. Farron nods approvingly, There’ll be Mitchell grass and clover says “He’ll have no trouble with that” and And creeks ten miles wide. It’s a long, long way from the formality of leaves me while he gets on with whatever. city boardrooms but slightly reminiscent Wearily sighs the drover of the millionaire fishing czars of Port I busy myself with my coffee and assessing As he lies him down on the plain Lincoln, except where their offices are the furniture which is in the style of To sleep with his swag for a cover bizarre palaces of ostentation, Roger’s is modern party hire; a row of very ordinary Til the grass springs green again. spartan as a schoolroom with his own tables butted end to end; pulled up to space a small back office crowded with Patsy Durack ca. 1860 them are many chairs that would inspire a very ordinary furniture; no black bean or school to hold a replacement raffle; a few teak in sight. whiteboards, a few wall charts. Linoleum! Roger thoughtfully chomps the last of his You get the impression that he’s constantly People drift in and out and make apple, picks his teeth with the blade and on the run, constantly distracted, themselves a cuppa at what seems to be says: “I’m just a drover.” constantly thinking about something else. the executive sink and water jug. One of But he’s the drover everyone claims to After vainly searching his wallet for a them is a very tall man, strongly built and know; everyone in town speaks highly of business card he produces a bunch of keys, in jeans, blue denim shirt and immensely him and of Fletcher International Exports, opens a door in the kitchen wall that leads muddy boots. He mutters monosyllabically his $100 million-a-year sheep products to his personal office, makes a detour to to Farron then pulls up a chair... empire that’s the main employer here someone else’s office on his way back with a handful of cards that he shuffles impatiently. Dear Jesus, it’s The Doctor himself. At 63 in Dubbo, NSW, and at Albany, in WA. One falls to the ground where it lies he looks anything but doddering and not They see working for him as a lifelong unnoticed and I note sadly that it is mine. much like a doctor either. career with high rewards for those who are ambitious and lifetime security for all as a He says he does one or two media He produces a wrapped lunch of a single minimum reward. interviews every day. He is accessible, he thin sandwich, a shiny apple and a large “We don’t import management because says. But he still seems distracted and red-handled knife; Farron pulls out our system is bottom-up growth,” Fletcher when asked about his hobbies he says: “No something similar sans apple or knife and says. “We give young people skills and hobbies, this is my hobby.” draws up a pew a few places away at what opportunities to grow. We want them to is a very long table indeed. be satisfied in their jobs. Different people It’s been a long-lasting one because he first

6 September 2009 Profile

went into business at the age of seven as a rabbit trapper on his parents’ farm at Glen Innes. Rabbits brought 50 cents a pair and he also collected empty bottles from the roadsides in the days when there was a few cents return on them.

“It helped me raise money to buy livestock,” he says. “I’d see big mobs of sheep and cattle droving past home and I thought I’d like to do that.

“When I was older I told my father I wanted to become the biggest sheep dealer in the country. He told me that would be impossible... but I guess it wasn’t all that impossible!”

He went to school at Farrer Agricultural College, in Tamworth, NSW, where schoolmates recall him as being outstandingly clever in a regional selective high school whose pupils were by definition a long way above average.

He was a star athlete and after leaving school at 15 he went on to play country- grade rugby league. “I did it for the money,” he says. The arrangement of his nose suggests Roger Fletcher maybe that wasn’t the best bargain in his otherwise massively successful business at his railway siding career. On the other hand, maybe it was; old school mates say his nose was broken and moved off-centre when he fell off his would have covered millions of hectares. then re-sell them,“ Roger says. “I spent six bike as a kid of 12; years of league made it Today, although less than 6000 hectares in years droving and all I owned was an old neither better nor worse. Whatever! It suits NSW, they still form a vast grassy highway ute and a trailer.” him. 800 metres each side of the roads criss- Tim Fischer in his book Outback Heroes When he left the family home he used crossing the state west of an arc sweeping writes how during his time on the road his $10,000 share of the farm to buy 2000 from the north at Tamworth, south through “many of Roger’s droving jobs terminated at sheep and go on the road with them grazing Dubbo, Wagga, to Albury. Moree where his stock would be processed at the common land of the stock routes. He Those who have seen a big drove of sheep the council abattoir. Over time he struck up always drove his own sheep and when they on the long paddock of a stock route say a friendship with a telephonist at the Moree were ready he would sell them to abattoirs they seem to go on forever. exchange, Gail Allen. around the country, wherever his caravan had rested. With average progress around 10 kilometres “He invited her out but she protested saying he a day to prevent the feed being eaten out, wouldn’t want to take her out because she was In the 1970s stock routes still formed a one has time to spare. “I’d catch more an Aboriginal. He persisted and within a year trans-continental corridor across Australia. rabbits and buy horses, make them better they were married. The NSW and Queensland stock routes

September 2009 7 Profile

“Roger leased a farm and Gail took care of “The marketing process has also changed and I don’t like that because who can the books. For the next decade Roger did under the influence of things such as talk about our products better than us? I not make much money but he worked hard just-in-time and insistence that goods believe in customer relations and like to and learnt the business. Gail directed the are exactly as described. keep them personal.” finances. People who watched the Fletchers over the years say Roger didn’t do much “We try to understand all these cultures We go for a drive to his rail facility. The without discussing it with Gail. Roger – their customs, seasons, even their passenger seat of his hulking SUV is says of his wife: ‘She was the financial festivals – and create opportunities. As already occupied by a laundry basket full wizard. In the early days she did it all. The a result Fletcher is a brand recognised of crumpled shirts. He chucks it in the teamwork was fundamental.’” around the world for its quality control back; Mrs Fletcher is away in WA and and vision. his local laundromat is in for a call. Over the years Gail and Roger had three children, moved from Moree to “People today expect better food just as He mentions that he owns all the land Gunnedah and Mudgee until in 1988 people who work for us expect to become surrounding his plant and between it they moved to Dubbo and opened the better off from what we pay them. and the rail facility which is probably first new abattoir in NSW for 20 years People want more variety in their food, a couple of kilometres away. It is fine and began exporting mutton and lamb to more than rice and fish every day. All grazing land green from recent drought- four countries. people in the world now want a choice breaking rains and recycled effluent of food. Even when I was droving our from the abattoir. All-up the Fletcher Since then the young Aboriginal team wanted variety from potatoes, bread family owns more than 200,000 acres of woman from Moree and her kids have and meat with every meal; even when we farmland. shown that financial wizardry runs in changed it to meat, bread and potatoes! the family. All have worked with Roger His railway station includes a large area in the business and today Fletcher “Achieving that puts out some strong being levelled for building, a cluster of International Exports’ two plants have a challenges. grain silos, a bank of freezer slots and combined capacity of more than 90,000 a modest stack of empty containers - “It’s a major issue because we have head a week which equates to more than MSC, Maersk, K-Line, Hamburg Sud. obligations to the farmer to improve our 4.5 million a year and exports go to 90 A train of some 25 wagons has been processing, reduce costs, and improve destinations around the world. assembled and is being loaded, a silo our management to enable us to pay him is pouring grain into tilted-up MSC Ninety-eight per cent of output goes enough to stay in business, to keep him containers. Roger talks to pretty much for export and three trains a week leave doing what we need – growing sheep. everyone we see. Fletchers’ own rail sidings and container “Farmers are leaving sheep for the mines, yards for the port of Sydney. Roger asked When we return to his factory the for grain because it’s easier to drive an the government to build a rail line to his car park looks to be chockers but, he air-conditioned harvester than to tend plant but he was knocked back. So he observes, “I have few privileges here but sheep. We need to make it easier and financed it himself. this is one” and he drives right to it. Sure more attractive for them to grow sheep. enough the unmarked spot right beside “It’s all a big chain of making things the gate is waiting for him. “We try to become better and better at work,” Roger says. “I’ve got a lot of good what we do. We’re not perfect and never people but no shareholders, no partners.” Oh, let’s not forget that bit at the will be. It’s all small steps of continual beginning of this story, The Doctor So it’s one-man rule? – “Yes.” improvement. bit... To recognise the commercial achievements of the poor boy from Glen “Sheep numbers have dropped by half That’s a sure recipe for disaster is it Innes, Charles Sturt University in 2006 because of the drought, the wool price not? - “Well, look at all the other people bestowed an Honorary Doctorate of crash and the fact that farmers don’t in business with their MBAs and what Business on him. It’s the least we could want to do the work. They’ve found not – Elders, Patricks, Great Southern, do for him, the boy from the bush who easier ways to make a quid. We need to Timbercorp. See how they’re going and drove his way to success for himself, help farmers decide to stay with sheep compare them with me and work out his family, his army of staff and for his and to support the farmer–processor– who has the right recipe. customers all over the world. exporter chain. “Bankers know nothing of this business “There was no magic wand to it,” he says. “It’s up to producers to also have the because they have no practical experience “Just having the confidence to do it.“ of it. World economies are changing ability to sell their end product. We and the change varies from country do all our own marketing around the to country whether it’s Japan, Russia, world and rarely employ agents. In my China, the Middle East, North America experience agents like to keep their buyer or Europe. as far from their supplier as possible

8 September 2009

Maersk Line Australia Pty Ltd Level 26, 201 Elizabeth Street, Sydney Australia T +61 2 9696 9696 F +61 2 9696 9688 www.maerskline.com

CREATING OPPORTUNITIES IN GLOBAL COMMERCE Meat by ARCHIE BAYVEL The ark sails on with record prices keeping most people happy while future numbers remain uncertain as always

o far as our meat industry goes everything in the garden’s lovely Sright now. The grass is green and (mostly) plentiful and its denizens are a Noah’s Ark of beasts chewing, snuffling and grazing their way to our fortunes quite unaware of events ahead. The garden and its compromised denizens is, however, a long way from where the real action lies in the meat industry. That is in the counting houses where often uncoordinated statistics including the A$’s rise against the yen and Korea’s won are endlessly chopped and minced, and in the slaughter houses where there’s barely enough beasts to meet demand. It rests too in aloof government offices where middle-class incorruptibles primly enforce stratospheric health standards that keep our edible creatures among the world’s most desired. The entrance to all these castles of influence is a mythical portal reverently referred to as The Farm Gate. On one side of it are the meat producers, people we used to call farmers; people who in ever-increasing numbers are slamming the gate behind them and heading for more profitable careers in mines, offices, even the air-conditioned cabs of grain harvesters. Many feel the rest of the country has forgotten them and, for the purpose of this article, we too will now forget them. On the other side of that gate are people who see the high A$ as representing good news about the Oz economy and indicating improved economic sentiment. Here too are people like us to whom cows, sheep, goats et al are one thing while meat

10 September 2009 is money-stuff to slice and dice, fillet and Europe agreements our major beef customers pricing from American rivals that they were freeze, pack in boxes and tranship to nations are Asian countries ranging from Japan losing $50 a pig last year; our industry’s long- such as the US and Russia ravenous for ever- to Singapore who bought 585,577 tonnes awaited Strategic Plan 2010–2015 is still more protein or to countries simply tired of last year to June 09 and North America, unrevealed. Their challenge is exacerbated centuries of rice and chicken and able last including Canada, which bought 293,680 by a Brazilian campaign in Singapore, our year to buy 967,729 tonnes of high-energy tonnes. biggest pork customer, and the re-emergence Australian red beef (921 kj/100 grams). of Malaysia’s pork industry. Total sales for mutton and lamb were a grand Beef exports to SE Asia and China in 08–09 total of 301,829 tonnes with major markets While the porkers struggle with all these continued a strong trend over the past five being Asia, the Middle East and North problems the beef, mutton and lamb trades years, reaching a record high 28 per cent up America including Canada. continue to flourish albeit dampened by on 2007. Indonesia continued as largest buyer the global financial crisis and residual National average saleyard lamb prices are consequences of the drought. with 35 per cent of our shipments followed reported to have hit record highs in June by Taiwan (28 per cent) and the Philippines 2009 due to strong international demand and With 75 per cent of our beef and mutton (13 per cent). a A$ slightly lower than last year. going to export as does 45 per cent of our lamb, one might think these sectors haven’t After Brazil, Australia is the world’s biggest National mutton supplies declined 3 per much to complain about. But in fact they do beef exporter and were we to include live cent in June compared to last year helping have issues including: exports we’d be No. 1 in both cattle and to raise prices. The prolonged move out of sheep; although Brazil also has a live export sheep and other business due to stagnant • A squabble with AQIS over rebates trade to the Middle East and South America wool prices has exacerbated the post-drought on its charges. while Canada and the USA have vast intra- shortfall in sheep around the country. In WA • Cost threats associated with continental trades by truck and rail. intense competition between processors and addressing climate change. Talking of Brazil brings us to an anomaly live exporters plus limited supply saw June • in our beef trade last year in the shape of an mutton prices rise $13.60 on last June to The impact of grain-derived unexpected and probably not to be repeated average $54/head. ethanol fuel on grain supply and feed prices. spike in our sales to Russia due to a foot and Sheep prices are expected to remain high and mouth disease outbreak in South America. possibly become even higher over coming Perhaps the most interesting of these is But that market has come off the boil and months. If this continues it will draw more the industry’s dispute with AQIS which is Russia’s protein demand is being satisfied sheep to slaughter or to live export markets seeking full recovery of its inspection costs elsewhere this season. That probably means and the national flock will continue to from all meat processors including fish! The South America again. decline, widening the supply gap and putting biggest and most vocal protestor against 100 even more upward pressure on prices. per cent recovery is the beef industry which The Brazil hiatus crystallised to the Russians already pays 60 per cent of AQIS inspection Processors of both beef and sheep complain that they needed to buy-in protein and that costs and is refusing to cough up the extra of supply shortages linked to the drought, poultry was a far faster and cheaper protein 40 per cent which represents a $32 million high cost of feed and the A$. But hardest source than beef. From egg to two-kilo hit. Originally planned to come into effect at hit appears to be our comparatively small chicken-in-the-pot in six weeks with no need the end of July, the new measures have been pork export industry (only 39,713 tonnes for gauchos, ringers, cowboys and all these postponed and a Senate inquiry is scheduled worth $139,501,254 according to ABS romantic but costly workers! for September. figures) which may be alarmingly close to So with chicken farms springing up all over trouble. It is so short of stock that short-term While cattle and sheep are the elephants Russia, its government slashing poultry marketing is pointless because sales could not in the room, let’s not forget goat meat and import quotas to speed up the supply chain, be met. (Although that raises echoes of our boutique sectors such as kangaroo meat and and the return of its preferred and less rice industry which hasn’t grown significant even crocodile meat. expensive South American beef supply, it crops for years yet managed to prosper. See Demand from America’s hispanic population could be a while before we see big orders The great Murrumbidgee mystery, Shipping has helped to make Australia the world’s from them. Australia magazine, November 2007). largest exporter of goat meat with a total With the European market substantially Not only are our pork growers short of pigs of 20,515 tonnes to June this year (up from closed to us thanks to the EU’s Fortress but they are faced with such cut-throat 16,326 tonnes last year) and going mainly

September 2009 11 Meat

to the USA, Taiwan and Canada while tonnes of meat your ships are likely to a surprisingly few 271 tonnes go to the carry over the next few years still seems to Middle East. be something of a hit and miss operation; Kangaroo exporters have a long way to not helped by out-of-date information go before they achieve the sophisticated brochures and conflicting information marketing enjoyed by the main meats. sheets. At present they have no marketing Maybe it’s time to have a nationally co- department and no budget for one. But ordinated plain-language data book that they’re working on it and claim to have is updated monthly for use by serious exported 20,000 tonnes worth $80 million commercial people seeking real answers in the past year. to global questions. [See panel: The figures Then there’s crocodile meat! It gains a jungle.] mention in this feature more to warn the brutes that humans are fighting back and Meat trade figures are sliced and diced eating them than to recognise their place more often than a serve of polony. As a in the export industry. Apparently their result, one can find oneself in 2009 reading meat is a lot more delicious than most June 2007 stats derived from 2006 events people expect and Asian gourmets say it’s and mistaking them for currently relevant efficacious against a range of complaints facts. It’s the mincer in reverse: instead of from erectile dysfunction to cancer. being served delicately carved information Here’s what Geoff The industry is flourishing in northern one can find oneself with a plate heaped Greenwood (above), for Queensland and the Northern Territory with what meat folk call “fancy meats” albeit as a very small dot on the market. - the ghastly unsorted giblets of raw whose Hamburg-Süd One of the last things one gets to information! ships meat is the largest understand about the meat industry is how As a result, almost all works of reference commodity by value, had parlous is its forecasting. Pundits on the have been discarded apart from DAFF’s 2009 beef and cattle sectors based their to contribute: Statistics-57 Destination Report on total opinions on predictions of a much lower chilled and frozen meat exports – Fiscal “Brazil outguns us as the world’s biggest A$ of US$0.65-0.75. beef producer with current herd of 190- year-to-date to June 2009 and the personal 200 million head of beef compared to our In fact, apart from the panic months of opinions of leaders in the meat industry 28.4 million rising to about 30 million by October 08 to May this year (when many who know they are going to be quoted by 2013. economists clung to a US-like scenario name and therefore pretty-well guaranteed rather than look out their window and to get it right. “The pampas rules and reminds us that assess what was really happening here) the while Brazil is remote to us it’s a lot more dollar has never been below US$0.75 since DAFF’s report was chosen over all the top-of-mind to the rest of the western June 2006 and at time of going to press others because it was recommended by world and as a country even bigger than hovers comfortably around US$0.8593. Paul Ibbotson, of IBBCO, a successful we are. Yet we continue to remain very international meat trader whose Sydney competitive against Brazilian exporters Then there’s the weather factor. The business couldn’t work if he accepted shop- worldwide in terms of price and certainly necromancers mostly got that right and quality. predicted what they called reductions soiled info. in rainfall deficits across most of the Other experts quoted in this report include “Our beef exports last year were just under country; helped no doubt by interpretation Geoff Greenwood, managing director of a million tonnes at 954,000 tonnes, mutton techniques such as looking out the window Hamburg Süd whose ships carry their exports were 158,000 tonnes, and lamb to see if it’s raining. Just as they bathed in fair share of our export meat; Stephen exports 152,000 tonnes. that success come recent predictions of El Martyn, national processing director of the “Our markets are seeing interesting Nino visiting us again: No more rain soon! Australian Meat Industry Council; Peter changes. Last year there was an But in reality conditions on the land just Weeks, manager of market information unprecedented demand from Russia and it now are mostly fantastic – good rains, and analysis at Meat & Livestock bought between 80,000 and 90,000 tonnes. good grass, good grain that will feed stock Australia; Peter Haydon, general manager “World protein sources in order are for years to come. For most areas the marketing of Australian Pork Limited; primarily: Beef, chicken, pork, and offals. drought has broken and the national beef Dougal Gordon, executive director When these commodities become too herd is said to stand around 28 million Australian Lot Feeders Association; John expensive the market turns to beans and head, only slightly down from its peak of Kelly, CEO of the Kangaroo Industries lentils. The only constant is the amount 29 million. Association of Australia; and John of protein required and consumed in the But trying to work out just how many Dowling, of Australian Crocodile Traders. various markets around the world.

12 September 2009 “In the Australian economy we can’t even into mutton and lamb; then there’s goat, imagine the impact the GFC has had in pork, kangaroo, so-called fancy meats which other countries. There you can see it in their is hearts, livers, kidneys, tripe, and even some The numbers... faces. Every level of every organisation needs horse and camel meat. The MLA’s Statistical Review July 2007- to keep careful watch over earnings and “We buy and sell meat and poultry around June 2008 is significantly lacking stats for expenditure. There is much greater awareness the world with 60 per cent of our product 2008 but indications are that 2008 world of the need right across our industry to originating from Australia. Major importers manage costs to the nth degree. No more livestock numbers for cattle, sheep and of red meat are the USA, Japan, and Korea. armchair quarter-backs promising the world pigs are slightly over 3 billion. It’s a lot of to service a piece of marginal business. “Russia is the world’s largest importer beasts. of protein by a long way. At the end “Australia, New Zealand and South America Sheep are the No. 1 species (1.1 billion of its time as a world super-power its are all strong export countries and while in 2007), cattle next (995.8 million), then meat-growing industry had been largely container shipping worldwide is down neglected and allowed to dwindle away pigs (823.2 million). some 16-17 per cent there is a developing during its communist years. Despite the world food shortage and Australia and New With our vast land area one would expect sickle in its national emblem it was the Zealand are well placed to meet demand.” Australia to be one of the leading animal hammer of industry growth on which they growers. In fact we’re fifth in the list of focussed. Their agriculture needs substantial infrastructure investment to re-establish. animal populations with 116.3 million head while China leads with 799.5 “Russian livestock numbers are very low and million, followed by the EU with 354.8 actually decreasing and they appear unlikely million, India with 346 million, Brazil to ever be self-sufficient. with 231 million, and the US with 169.9 “Russia however has a history of idiosyncratic million. import and export protocols and often uses health objections as a polite blanket In the species breakdown India has the that disguises other dissatisfactions real most cattle (including buffalo) with 281.7 or imagined with suppliers. Currently it million head, then Brazil with 187.1 has a ban on kangaroo meat allegedly for million, China 139.4 million, the US with unacceptable bacterial levels. 96.7 million, the EU with 87.7 million, “Australia’s primary problem is getting and Australia running sixth with 28.2 access to markets. Government should million head. work on opening doors; industry will take Australia comes third in the sheep it from there. One of the worst things population ranking with 80.1 million our government has done recently was last year’s removal of veterinary attaches head. China is No. 1 with 172 million, IBBCO Trading’s Paul from Washington, Moscow, and Brussels. The the EU second with 107.1 million and excuse was that their duties could be carried India and New Zealand leading the tail- Ibbotson (above) is an out from Canberra. Strategically posted enders with 64.3 million and 40 million international meat trader. attaches can react quickly to health problems respectively. and thus our access in key markets. He’s always been in meat When it comes to ranking actual meat and spent a season as a “We need the federal government to exporters as distinct from animal maintain and add to our access to China, the numbers, No. 1 is Brazil with 2,220,000 slaughterman at Broome’s EU, and Russia. Along with New Zealand tonnes, carcass weight, of beef and we have access to more markets than any veal plus 770,000 tonnes of pork for famed but long-gone other country thanks to good work by all a total meat exportation of 2,990,000 meatworks; last year he sold governments over the years in maintaining our industry’s good name. But we can’t rest tonnes. Then the United States with a meat into 53 countries. on our laurels. 2,381,000-tonne total (687K/1694K), Canada 1,460,000 tonnes (450K/1010K), His business is a quite different concern to “Our big advantage over Brazil is that we the giant corporations that sail his goods Australia at fourth with a total of have no disease problems whereas it has the 1,420,000 tonnes (1,360,000 tonnes of around the world and even more different to lot – mad cow, foot and mouth.” sedate associations who may see themselves beef and veal/60,000 tonnes of pork), the as the true heart of the meat industry. He “China is a big prospect but is also a big EU 1,400,000 tonnes (100K/1300K), expands on Greenwood’s comments: problem to deal with because it tightly China 408,000 tonnes (78K/330K), and regulates both import and export permits Mexico 132,000 tonnes (42K/90K). “Meat ain’t just meat,” he points out. ”There’s and with the world’s largest sheep population beef and veal, similarly sheep meat is divided

September 2009 13 Meat

they want to develop their own red meat Australia are close to being the lowest industry to export level. for a century and the politics of red meat are that it’s a protein, it competes with “Its second problem is that their health pork and poultry and our competitiveness and veterinarian protocols are barely depends on cost of production and access. recognised anywhere in the world. A situation that wasn’t helped by its dried “Live exports are one of my pet hates. milk export scandal a couple of years ago. They mean we’re exporting jobs away from our processing sector. We do it without “China’s third problem is that world food truly recognising the economic benefits prices rose last year and created a small the processing companies bring to the inflation rate in China. The government’s communities where they are located. solution was to limit export permits to keep its meat within Chinese affordability. “The meat export industry is a complex intertwining of livestock producers dealing “Trade with China is all about permits and with processors, processors dealing with the balancing act of keeping themselves buyers overseas and with companies like fed. There is reported to be a fragile grey ours who then export. trade of secondary importation through Hong Kong and China’s northern ports. “Everyone we buy meat from has the It varies however according to local ability to sell direct into overseas markets. availability of other proteins and the So we need to be able to give buyers and ubiquitous health concern protocols used sellers better service. We do that by being to obstruct trade. able to match people around the world Steve Martyn (above) who have product to sell with people who “Australian meat sellers seek markets with is national director want to buy it. We survive by providing a lot of people who can afford meat and red meat at a price and quality that works processing for the who like eating it! for our customers. I’m always travelling Australian Meat Industry “Sheep and cattle livestock numbers in around the world meeting with them.” Council — the peak industry body for the The figures jungle beef, sheep and goat The following definitions are derived from Meat & Livestock Australia’s processors. He points out Statistical Review while the explanatory italics are the author’s that Australia’s health and A dressed cattle carcass, bone-in, is about 55 per cent of the live animal with boneless meat from the carcass weighing about two- hygiene status is the equal thirds of that. Translation: A live beast weighs, say, 300 kilos then its of any in the world and dressed carcass will weigh 165 kilos; if reduced instead to boneless meat underpins our ability to that will weigh only 110 kilos. extract the best possible For sheep and lambs a dressed bone-in carcass weighs about 50 per cent of the live animal and the boneless meat is about half the prices from the global weight of the bone-in carcass. marketplace. Most meat export statistics are quoted in terms of shipped weight “Food safety is taken as a given,” he says. “If you cannot deliver that you are – the actual net weight of the product when it leaves Australia discounted. Just ask our friends in North regardless of whether it’s full carcasses or parcels of boneless meat. America after BSE (mad cow disease). When export statistics are compared with production stats the “Australian pork and poultry, by shipping weight figures are converted to an estimated equivalent comparison to the beef and sheep meat carcass weight by multiplying the weight of boneless meat by 1.5 industries, have traditionally had a largely for beef or 2 for mutton and lamb and adding it to the weight of domestic focus although the pork industry has developed a stronger export culture exported bone-in meat. over the past decade. Production and domestic utilisation statistics are based on the “They have developed growing markets dressed carcass weight. in Japan and Singapore but competition in both pork and poultry from North and

14 September 2009 September 2009 15 Celebrating 20 years in Australia Meat

South America is very strong. in Queensland and there has been a slow “Fletcher International with plants at but gradual shift north from Victoria and Dubbo, in NSW, and Albany, in Western “The US, Canada and Denmark are large New South Wales over the past couple of Australia, is arguably the largest of these pork exporters of which Australia currently decades to take advantage of climate, grain, but others include: Southern Meats, imports close to 100,000 tonnes a year. labour and economies of scale. at Goulburn; Castricum Brothers, at The trade out of the US and Canada is Dandenong, Victoria; T&R Pastoral, in also a valuable trade for the shipping “About 860,000 head of cattle are South Australia; Tatiara Meat Company, companies because it provides return cargo exported live each year from Australia at Bordertown, South Australia; for their food standard containers being with about 75 per cent of them finding repositioned for Australia’s beef exports. their way to Indonesia. In the tight supply WAMMCO, in WA; and Swift Australia, market being faced by meat processors at in Victoria. “Imported pork has to be further processed present, these cattle represent the yearly here, usually for smallgoods and hams etc. “Success in serving the top end restaurant throughput of several medium-sized meat All fresh pork sold here is home-grown. and food sector in export markets lies not plants. in being a seasonal supplier but in being “The global credit crisis more than any “Twenty years ago, the lamb export trade able to deliver 12 months of the year. That other factor has impacted the global meat was only a quarter of the 150,000+ tonne can mean running at a loss during the market over the past 12 months with a export business it is today. We are still off season to keep faith with customers, fall in demand as consumer incomes have growing as a lamb exporter although our especially with lamb — something been affected and credit restraint reduced declining flock size is a real concern. Lamb producers often don’t understand.” importers’ ability to finance imports. production is falling worldwide but for the “Consumers are also moving to cheaper moment is increasing here. Peter Weeks is manager cuts and eating more at home. This “There has been a big change in world has lead to growth in the fast-food/ of market information sheep population. The US had over 50 convenience food sector where restaurant million sheep at the end of World War II and analysis at Meat and chains such as McDonald’s and Burger but has only 6 million today. Australia’s King have done well at the expense of Livestock Australia, which sheep flock peaked at over 170 million in more formal restaurants. the 1980s driven by the high price of wool provides research and “Australia’s success over the years has but today the sheep population is closer to come through being able to identify what 70 million. marketing services to the customers want and then providing it “Our lamb and mutton export trade has meat industry. to them. Our industry underestimates been driven by committed export lamb He talks of Fortress Europe where we have how entrepreneurial our export business processors with a vision for the future and a very low sheep and beef profile and says: community has been in finding and presenting high quality product for world “Britain used to be our biggest market developing new markets. markets that has lifted the reputation of until the 1950s when they joined the EU “Forty-five per cent of our beef is grown their industry. and we no longer had significant access.

Meat exports YTD June 2009: Australia’s total exports of beef, veal, All Europe, including EU and CIS When it comes to goat meat and pork, mutton, lamb, goat and pork in the past 48,973 tonnes their market shares barely justify a FY = 1,460,333 tonnes. Irrespective of table. Total goat meat sales are 20,515 Middle East type Asian countries took a whacking tonnes with North America taking 13,889 tonnes 786,417 tonnes of that, North America 12,189 tonnes of that, Asia 5057 another 362,989 tonnes, the Middle tonnes, the Middle East 271 tonnes. East 103,001 tonnes, and Europe Out of total mutton and lamb exports including the CIS 91,867 tonnes. A of 301,829 tonnes, the four outstanding Goat sales to the whole of Europe are footnote almost is the 31,789 tonnes regional buyers are: represented by a single tonne to the bought by our neighbours in the South CIS! Asia from Japan to Singapore Pacific – Papua New Guinea, New Pork’s not a whole lot better according Zealand and the Pacific Islands. 77,416 tonnes to DAFF figures with total exports of Out of total beef and veal exports of Middle East 21,307 tonnes of which 19,335 tonnes 967,729 tonnes, the four outstanding 79,110 tonnes go to Asia and 1879 tonnes go to our regional buyers are: immediate neighbours of Papua New North America, including Canada Asia from Japan to Singapore Guinea, the Pacific Islands, and New 54,433 tonnes 585,577 tonnes Zealand. Australian Pork Limited’s North America, including Canada All Europe, including EU and CIS figures disagree and quote ABS figures 293,680 tonnes 27,321 tonnes of 39,713 tonnes.

16 September 2009 Our quota for 2009 is only 7150 tonnes for these services, principally in the area “It is pointless talking to, say, Japanese of beef and 18,786 tonnes of lamb and of marketing, market access, research and retailers if we can’t supply them,” he says. mutton. integrity. “In May pig production was running at “There are anomalies in the EU quota “Our system is unique and the envy of 4.5 million for the year compared to 5.3 system and some exporting countries have the world because it is a compulsory levy million last year so we’re missing 800,000 much larger quotas than us. Argentina’s collected by the government which is head of stock. Producing pigs takes about beef quota for example is 28,000 tonnes then passed to the industry to spend on 10 months, less time than cattle but a lot and New Zealand has a huge sheep meat collective industry services. longer than poultry. quota of 227,854 tonnes. “Competitors would love to adopt our “Australian Bureau of Statistics figures “While the EU’s own meat production system but it’s difficult, as it requires provided to APL say this year’s total pork has been falling, its consumption has a high level of co-operation and trust production was 325,287 tonnes of which recovered to pre-BSE levels. They between government and industry 39, 713 tonnes went to export - 18,700 recognise the need to increase their that is not present in many of these went to Singapore, 9168 tonnes to New imports and are doing deals with, for countries. The danger is of government’s Zealand, and 1090 tonnes to Japan; all example, South American suppliers and squandering the levy before it reaches the substantially down on 2006 when exports the USA but not with us yet. industry, or dictating its use.” hit 52,000 tonnes. “One would expect to see a significant “Production will steadily increase rather opening of EU markets eventually as they A major international than explode. Credit is still not easy and need protein. It’s likely to be the next new pigs cost money; farmers are still expansion of world trade to benefit us, pork marketing initiative paying off losses from 07 and 08. particularly for sheep meat. has been delayed because “Imports are heavily driven by the “We do a lot of door-knocking of a national shortage of exchange rate, efficiencies of scale and and showing what we have to trade in the US, Canada, and Denmark export delegations. pigs caused by drought, pork is heavily subsidised and pushing “On behalf of the industry, the grain prices, and the their price down at a time when our government collects a compulsory levy on high price of the A$, farmers were losing a bucket of money every animal sold - $5 on every head of through high grain prices. It was a double cattle and a percentage of value on sheep. according to Peter whammy to our producers’ bottom line causing losses of up to $50 a pig “The Cattle Council and the Sheep Haydon, Australian Pork and forcing many farmers to leave the Council are the political bodies that Limited’s general manager industry and leaving us under-supplied represent the producers and determine today. what the farmers want to do with this marketing. levy money. MLA is the delivery agency

Innovation in marketing meat entered new reaches of the outfield when Meat and Livestock Australia launched a series of TV advertisements starring Sam Kekovich telling all Australians: “To be truly happy you just need a chop.”

September 2009 17 Meat

“Our starting position for the future is because their health and hygiene standards “The effect of grain-based biofuels such as good with the domestic market taking 90 don’t measure up. ethanol in Australia is small at present but per cent of production but half our present NSW’s recently approved mandatory 10 exports going to Singapore and New “Europe is not necessarily closed to our per cent ethanol (and proposed 5 per cent Zealand and Japan taking most of the rest. pork but the exchange rate and the cost of in Queensland) will have a large impact New Zealand buys from us because we getting product there is not helpful.” on our industry for what we believe are have a quality product and Singaporeans negligible benefits. love the taste of it. “This will have a huge impact on grain availability and therefore price in the “Chinese are about as expert as you get event of a future drought. Estimates are when it comes to pork cuisine and we that were the 2002-03 drought repeated can make what their market needs. That’s (a likely event given climate change a billion people only one flight away predictions) 22 per cent of available grain from Australia but we’re targeting the would go to ethanol production instead high-quality discerning market rather than trying to compete with USA pork’s of to feed. ALFA’s members see that as a economy-of-scale prices. crisis situation. “Ethanol mandates appears to us as “Our core target markets are Japan, South an inflexible interventionist tool that Korea and Hong Kong with China as a disconnects grain supply from demand and long-term goal but at present we simply is expected to artificially inflate the cost of don’t have enough product to supply them. feed grain. In the USA, which has 60 per cent of the world corn trade, around 33 per “Access to China is being delayed because cent of their annual corn crop now goes to China wants us to grant reciprocal rights Challenges facing our fuel and not food production. This affects to export into Australia and we’re refusing grain prices around the world. feedlot industry are “At the moment grain is the feedlot The health and potential cost blow-outs industry’s biggest cost. That and buying feeder cattle makes up 60-70 per cent of hygiene advantage from the carbon pollution feedlot running costs. The rest is made up The world meat trade is split by reduction scheme and of salaries, other ration components, plant animal diseases with some countries’ maintenance etc. meat being locked out of certain increasing grain shortages “Transport costs are comparatively markets because of mad cow disease insignificant and are much lower than and others because of foot and mouth due to mandatory increases disease. the traditional norm due to the advent in ethanol use, says Dougal of B-double trucks and road trains in Australia doesn’t have any of these so Gordon (above), executive Queensland, WA and parts of the NT. we have access to every market in the world. Nobody else apart from New director of the Australian “With about 600 properties, mostly close Zealand enjoys that access. to cattle and grain supplies in south-east Lot Feeders Association. Queensland, NSW’s northern tablelands The US and Canada have mad cow “Mitigating emissions is a big challenge,” and Riverina, the beef feedlot sector has restrictions and their beef is in turn he says, “and most of the research on the a production value of around $2.7 billion barred from Japan and Korea; Brazil’s industry’s options has not been done. Eg. and employs some 7000 people one way or foot and mouth epidemics keeps How much emissions vary with different another. its meat out of North America and breeds, frequency of cleaning pens, diet, or North Asia although foot and mouth “Our industry’s tomorrow depends on handling of compost.” does not bar its access to Europe prices. Most cattle are grain fed for 40–60 days and special beef such as wagyu cattle where the disease already exists. He says: “ALFA economic modelling are on long-feed of from 150 to 600 days indicates that a carbon price of $25 Russia has cut back all its meat to achieve marbling and special flavour. purchases because of the global per tonne under the proposed Carbon financial crisis and because of foot Pollution Reduction Scheme (assuming “Individual feedlots are sensitive to the and mouth in South America. agriculture is a covered sector), would market and conditions such as high Uruguay is a significant exporter and result in an additional cost per average grain prices and/or reduced demand (as the only South American country domestic grain-fed animal of $98.21 and is currently happening due to the global with US access because it has $136.64 per average export grain fed financial crisis) reduce the number of cattle eliminated foot and mouth disease by animal. in lots and also the time they can afford vaccination but its industry is much to spend there so there are fewer bigger smaller than that of either Australia “To put that in perspective: Feedlots heavier cattle being processed. In June we or Argentina. currently earn a maximum profit per had a total of 743,543 cattle in feedlots animal of around $30. which had capacity for 1,243,062 head.

18 September 2009 “With grain our biggest feedlot cost, diet is and meat and we predict substantial exports very much commercial in confidence sensitive within the next two or three years. data by the various lots. Dietary components “Our industry attracts criticism from the pet may include hormone growth promoters faction because we harvest an iconic wild to finish cattle’s growth but some feedlots animal. Those taking a radical position would specialise in producing HGP-free beef. The oppose guide dogs for the blind; the majority EU, for example, demands HGP-free beef but support our industry.” that is only a small market for Australia due to the current low quotas. In terms of both dollars and “Cost of feeding depends on net weight at the beginning, not weight at the end. Different tonnage its output must be feedlots have different strategies to deal with market variations. It’s a high turnover, low microscopic yet one feels it margin industry so larger feedlots in tough has to be mentioned, we refer times either reduce their numbers or fill “Production is expected to come close here to crocodile meat. completely to achieve economy of scale. to double before it will run into quota restrictions. John Dowling is the meat manager at “The feedlot industry is very corporatised with Australian Crocodile Traders, of Cairns, the largest feedlots often vertically integrated “The industry is gearing up to do more and which claims to be the world’s largest with the processing or grass-fed side of the I believe it is capable of filling some of the producer of first grade saltwater crocodile industry. JBS Swift, for example, owns several sheep gap left by the decline of the wool meat and exports carefully butchered croc feedlots throughout Australia, and in turn industry. Most meat comes from western meat to Japan, New Zealand, Bahrain, the is owned by Batista’s of Brazil, which is the Queensland and western NSW. Supply varies Maldives and a growing number of micro world’s biggest beef processor. Numerically with weather conditions and drops in drought. markets. most feedlots would be family-owned but the big ones are all corporatised and they include “Russia’s recent ban on kangaroo imports “Australia is not the only exporter of edible Nippon, of Japan; Itoham, Japan; Mitsui, means nothing because our consumers are crocodile meat,” he says. “Thailand and some Japan; Cargill, of the USA; AA Company, now educated enough to know that this is a African countries also have a thriving trade Australia’s oldest company; and Elders.” regulated industry with a trace-back system in it but Australia has the perfect clean to the point where each animal was harvested. environment for farming crocs. This is being refined to a GPS reference to the It would be fair to say that for spot where it was shot to ensure the shooter “High health and hygiene standards are most consumers kangaroo is licensed and trained in hygiene. It ensures regulated by AQIS who visit us regularly as continuity of wholesomeness. do inspectors from Fisheries and Safe Food meat doesn’t normally break departments resulting in the best quality “Most overseas marketing is done by controlled product available for export and their menu horizon. individual processing companies and a domestic use. None of the grand seigniors of the meat month ago they got an access protocol for “In Queensland it is illegal to harvest wild industry volunteer information on it but export to China. The five major exporters crocodile so each of our farm stock is tracked John Kelly, CEO of the Kangaroo Industries are Australian Meats, Macro Meats, United from hatchling to slaughter exactly like other Association, claims that most informed Game Provisions, Game Meat Processors, and food animals. It takes three years to grow a ecologists see it as the great white hope of the Game Meat Meals. crocodile for market when it is close to two meat industry. “Our association doesn’t have a marketing metres long. It is a white meat and sells from “Tim Flannery,” he says, “believes it makes department and budget for one is zero but our $12 a kilo to $26 a kilo depending on the size enormous environmental sense to derive our intent is to go to China with a single-desk of the order.” food from sources that belong here. This is united campaign and operational guidelines based on the fact that kangaroos emit no for that are being developed. methane; leave a 30 per cent smaller carbon “Shanghai and northern China have a strong footprint than cattle, their meat contains only wild food tradition that includes herbs, berries 2 per cent fat and reduces blood pressure. “We export 20,000 tonnes - 60 per cent - Nutritional aspects of crocodile compared to other meats: of our roo meat production, the vast bulk Protein (g/100g) Fat (g/100g) Energy (kj/100g) of which goes for human consumption in France, Germany, and Belgium where there is Crocodile 21.1 1.9 436 a high acceptance of game meat. Of domestic consumption half is human and half pet food. Chicken Breast 20.2 10.2 720

“Exports have been steadily rising over the Beef Sirloin 19.3 16 921 past 10–15 years and the industry itself has expanded about 8 per cent over the past 20 Lamb Legs 22.8 22 469 years. Now the only continent we don’t go to is South America.

September 2009 19 Education

E-learning best way to spread word on environment protection by Michael Julian, executive director, Marine Protection Association

he association aims to raise issues designed for all levels of primary titled Ships and the Marine Environment community awareness of school. Students can read the booklets and Ports and the Marine Environment. Australia’s marine environment online. Again, there are teacher resource When researching these topics we andT the need to protect it for future manuals to assist teachers in using the could not find any website that provides generations through various education kit. information suitable for middle year programs for schools and seafarers. students about either the shipping For seafarers, AUSMEPA, in partnership industry or port operations. The most cost-effective means of with AMSA, has produced a DVD providing education resources to the Welcome to Australia: Protecting the It is important that our kids have greater 10,000-plus schools across Australia, Marine Environment which highlights access to reliable information about the by a small AUSMEPA team of three the marine environment protection roles shipping and port industries and the people who work part-time, is by using and responsibilities of ships’ crews when roles and responsibilities these have in e-learning technology. sailing in Australia’s waters. ensuring their operations do not harm the marine environment. The government’s objective of ensuring The second edition of this DVD In the Ships and the Marine Environment each school student in Australia has which will be released shortly updates education program students will learn access to a either a laptop or personal the earlier edition with the latest about the role of shipping and the computer will assist greatly in this international conventions adopted by transportation of cargo, how ships stay marine environmental e-learning process. IMO member countries. The second edition has had three additional afloat, the journey of containers and other types of cargo including bulk Because of generous financial support languages added. It can be viewed cargoes such as grain, coal, oil, chemicals, by the shipping and port industries, the in English, Greek, Filipino, Chinese LNG and LPG. The program provides association is able to provide free marine (Mandarin), Japanese, Russian, and information on what ships must do environmental education resources for Ukrainian. to prevent pollution of the sea and air. teachers and their students, available to Simulations are used to demonstrate all schools throughout Australia. A list of Over the next few weeks 3000 copies of free surface effect and the importance of sponsors and ship members is available the DVD will be made available to SAL ballast water in ship stability. on our website. to distribute to its ship agency members who will be asked to place a copy of Students will also learn about the The educational resources consist of the DVD on all ships calling at an role of ports, the types of ships a range of comprehensive website Australian port covered by their agency. visiting Australian ports, safety education programs or units of work Copies will also be provided to all and environmental issues and the which include downloadable teacher Australian registered ships through the organisations required to operate a curriculum materials and student activity Australian Shipowners Association. The port. Ports can impact on the marine sheets. Posters and CDs for each of Apostleship of the Sea through its Stella environment so it is essential that the the units of work are also available on Maris seafarer centres will also be given community understands the precautions request. These resources are designed copies of the DVD to assist in ensuring ports take to ensure their operations do for middle year students; this covers all ships visiting an Australian port have not harm the marine environment. students from senior primary levels to a copy of the DVD. mid secondary levels. One of the key roles of ports is the interface they provide between ships AUSMEPA has recently launched Programs for schools importing or exporting cargo and a marine literacy kit on its website The two most recent school education the land transport system. As well as which consists of 18 readers or small programs available on the AUSMEPA enabling students to learn about the booklets covering a range of maritime website under the Schools menu bar are environmental impact they will also learn

20 September 2009 by Michael Julian, executive director, Marine Protection Association

that ships and ports are equally essential for the Australian economy.

Stormwater pollution The key message that students learn from this marine environment education program is that most of the pollution in the seas and oceans, up to 80 per cent, comes from land sources and not from ships, fishing vessels or recreational craft. Most of it washes into the sea through stormwater drains.

Students learn about the nature of the problem and how it starts, in particular the issues related to marine wildlife and the problems caused by entanglement, ingestion of plastic, pollution of the sea, destruction of marine habitat.

Other issues addressed include urban stormwater drains, sewage, rainwater run off from farms entering rivers and then the sea. An important aspect of learning about stormwater pollution is understanding who is responsible for letting it happen, essentially it gets down to you and I!

Students using the program learn that they can take active steps to minimise stormwater pollution both from their school and their home. They will investigate what ships do breaching MARPOL regulations. to find ways to reduce both their and their to prevent pollution. Tools are provided so community’s carbon footprint. students can design stormwater pollution communication products to present to their Effects of climate change on This education program explains the community. coral bleaching complexities and biodiversity of a coral reef, the structure of a polyp and the symbiotic The roles of federal, state and local Climate change is a concern for many relationship with algae and other species governments are explained. A full section children. In this unit of work students will of marine animals. The program goes on on the role of shipping in preventing marine discover why coral reefs are being damaged to describe the impact of climate change, pollution covers issues such as the use of by increases in sea temperatures, and how warmer sea temperatures, greenhouse gases oily water separators, discharge of bilges and this can be linked to climate change. The and the death of coral polyps. regulations about ships’ garbage and sewage, program brings together all the science ship board emergency pollution plans and and conservation issues of these current Students are next provided with ideas possible fines for ship owners and masters for environmental topics. The unit helps students and opportunities on what they can do as

September 2009 21 Education

individuals, as a family and as part of their school community to reduce use of energy.

As in all AUSMEPA education programs there is a section on what ships are able to do to minimise marine pollution and in this case reduce air pollution. A key component is explaining that shipping is one of the most energy efficient forms of transporting goods.

In the student activity section there are a number of tasks students can undertake as individuals and as part of their school community to demonstrate their commitment to reducing greenhouse gases and have an impact on the climate change debate.

Marine Pests and Threats was the first education program developed by AUSMEPA in 2002. It is in the process of revision to bring it up to date and also to use the same style of learning as the other education programs.

Students can critically examine the major threat to our marine environment which is caused by invasive marine pests (introduced to Australian waters via ships’ ballast water and hull fouling) along with threats to the marine environment from marine debris. Strategies are provided for minimising these threats and information explains what ships are doing to minimise the risk of discharging contaminated ballast water into our seas and harbours. Regular emails from the ship including AUSMEPA through its sponsorship photographs will keep students up to date program and its ship membership scheme, Also on the AUSMEPA website is a and introduce them to the members of the learning experience about what life is like which acknowledges quality shipping, brings crew. The material includes information together those in the industry that have a on board a ship at sea. AUSMEPA links about the ship’s location, weather, cargo and commitment to the protection of the marine to the UK Marine Society and Sea Cadets places visited. website which provides a unique insight environment. into contemporary life at sea and traces the There is also a section where members of the progress and on board happenings of one crew are introduced and they tell what life is For more information about AUSMEPA of BP Shipping’s newest vessels, the LNG really like at sea and what they do on a daily and to see how you can be involved, please carrier British Trader as it sails around the basis; everyone on board is encouraged to visit the website www.ausmepa.org.au or world. participate. email [email protected].

22 September 2009 The chairman of Shipping Australia, Michael Phillips said he was pleased to launch the new SAL e-learning Introduction to Shipping course at a joint E-learning function held with the New South Wales Branch of Young Shipping Australia at Parliament House, Sydney on 23 June this year. course He referred to how the course will make a major contribution in raising the profile of shipping in Australia and its flexibility in terms of when the course can be undertaken and its reach to remote areas of Australia, and in fact outside launched at Australia. He stressed it was ‘a very attractive proposition for all those with an interest in Australia’s maritime affairs’. It was anticipated that regulatory agencies, government departments, educational Parliament institutions, as well as employees of SAL members would embrace the course which is very competitively priced. Since the launch 50 applications have been House received and indications are that many more are in the pipeline. Register NOW, go to www.shippingaustralia.com.au.

Chris Theuns and Pamela Aldwell of PB Towage

Monica Cervantes of Associated Marine Insurers and Robert Dick of SAL

Kylie Frost of Maersk and Kushy Athureliya of SAL

Leanne Korte of Associated Marine Insurers, Andrew Fletcher of K Line, Darren McNamara of Hamburg Sud Australia and Jaun Xia of Associated Marine Insurers

Natalie Mulhearn and Peter Wallace of Hussein Chahine, Tasha Vidaic of Seaway Agencies Seaway Agencies with Ross McAlpine of with David Uncle of Hamburg Süd Australia Mediterranean Shipping Company Break bulk

or the first time in Australian From this wide variety of sources it became Break bulk history, the break bulk shipping apparent that the level of awareness sector has been highlighted and of this important sector of Australia’s put under the spotlight in an SAL study international trade was far below that of shipping – a releasedF in late August this year. the dry bulk, container and motor vehicle trades. Interviews were conducted with a wide variety of organisations including port As a result of this study, it is hoped to lift forgotten authorities, stevedores, terminal operators, the profile of this important sector of our shipping companies and importers. Some industry so that the identified deficiencies statistics were provided by shipping can be addressed and break bulk shipping sector of our companies and a large amount of data allowed to reach its full potential. SAL’s obtained from publications and websites. objective was to stimulate debate on The ports of Brisbane and Port Kembla how collectively we can improve the industry were the subject of special case studies. performance of this sector. More work is required to test some of the claims and particularly to undertake a more detailed assessment of its economic importance. Berthing facilities at some ports were also reported to be inadequate. Sharing berths between general cargo vessels with break bulk cargo and pure car and truck carriers and large roll-on/roll-off vessels causes serious problems for all. The answer must lie in providing separate berths for these different sectors because of their very different characteristics. Based on applying tariff charges for a port call by a typically sized general cargo ship at the ports handling the most break bulk cargoes, it was found that towage was the largest cost component; at some ports towage made up over 50 per cent of the total of the port charges incurred. Even at ports where two tug services were available, towage charges were still the highest component. This study was not able to include stevedoring charges as these were commercially confidential. However, SAL received complaints regarding high stevedoring costs. It was suggested to SAL that the high cost resulted from the land valuation imposed by the port authority on the terminal operator. In some ports, sufficient labour to work all ships alongside around the clock was not available causing further delays to the ship. The study found that in the two states where resource development in mining particularly was at its highest level – Queensland and Western Australia - some port and berth facilities appeared to be the most inadequate. The project cargoes and other cargoes vital to this development as well as infrastructure construction are essential in supporting the industries that Newcastle Stevedores commenced operationsBreak on 3rd Marchbulk 1997, and specialises in handling Bulk, Break-bulk, Project shipments as well as Containers. Newcastle Stevedores, through its extensive service provider relationships and sub-contractor management plan is equipped to provide clients with a total logistics package, and is happy to arrange the complete door to door movement of project and general freight should a client require extended services beyond the ‘traditional stevedoring realms’. Newcastle Stevedores is positioned to manage the whole transport chain responsibility, including Customs Clearances, thereby fulfilling a huge spectrum of customer needs.

Geoff Beesley, ManaGinG Director, newcastle steveDores Geoff has had over 50 years experience in the shipping and stevedoring industries, the majority of which was spent with P&O. In 1997, after parting company with P&O, he saw the opportunity to start his own stevedoring business. He has managed Container Depots, Shipping Agencies as well as all facets of the industry. His experience covers all types of cargo. Newcastle John willeBranDs, General ManaGer, illawarra steveDores John left Rotterdam in 1958 as Second Officer on the passenger vessel Willem Ruys and stayed at sea until 1973 when he joined Conaust as Supervisor, StevedoresGeneral Cargo. John spent a further four years in Europe prior to joining Geoff in 1997. In June 1998 he moved to Port Kembla to manage Illawarra repeatingStevedores. Illawarra Stevedores is a “sister” company of Newcastle Stevedores. It commenced business in June 1998 and handled its first vessel in July 1998. Primarily it handles general cargoes such as steel, timber, paper pulp and bulk cargoes. Illawarra Stevedores can assist you with your cargo transhipments, oradvert even handle them for you completely. With recent changes in Port Kembla Illawarra Stevedores is ideally placed with expert stevedores who know their job and are the best available.

25 Break bulk

make such an important contribution to kind not manufactured in Australia. Both Caterpillar won a contract with BHP economic growth. steel importers also indicated that a large Billiton to provide machines for this proportion of the steel that they import is project which will require the import of In other states where large steel imports not suitable for being carried in containers more than 500 machines with the heaviest similarly support heavy industry and due to the heavy package weights and over one weighing up to 400 tonnes, many of manufacturing and therefore employment, dimensional sizes plus the sheer volume of which will be imported as build up units. port facilities were often reported shipments. as ill-equipped to efficiently handle Similar development although not on consignments of steel, some of which are Another factor is that even if some of the same scale as Olympic Dam, will very large. the items carried on general cargo ships take place in the north-west of Australia. and discharged at Australian ports can The ports of entry for construction steel, At a time when Australia is committed be manufactured in Australia, break bulk rail lines, drilling equipment, rail wheels, to adapting to alternative sources of imports still provide benefits for consumers rail wagons etc. that will be imported power generation, the importation of as they provide competition in the market. will be Dampier and Port Hedland. Port wind generators is expected to increase One importer, for instance, advised that infrastructure at Dampier is already significantly. This equipment is highly they imported 12,000 tonnes of steel at a in need of significant upgrade. This valuable and often difficult to handle competitive price which pushed the local equipment will be carried in break bulk because of the length of some blades and steel manufacturers to come out with their form and if the port is not equipped susceptibility to damage. The availability of own competitive pricing. to efficiently handle this, it will create suitable shore-based handling equipment a significant impediment to future and skilled workers becomes essential The break bulk sector also generates development and hinder expansion of and these were reported as often in short employment for a large number of mining industries and infrastructure supply. people not only in the industry where the development in nearby Dampier and Port imported goods are used, but also at the Hedland. port, both directly and indirectly through Economic benefits the sometimes complicated handling The economic benefit to Australia was procedures. Twenty tonnes in a container considered in terms of the contribution can move with a minimum of human Conclusions These have emerged as the study made by shipping services in transporting intervention while break bulk is very progressed and it is of interest that similar those products not necessarily available labour intensive. Every piece of break bulk conclusions were made over so many in Australia, but considered important cargo is touched by stevedores while some different ports. to stimulate economic growth. Those types of project cargoes are very difficult to

products largely comprised project handle and require highly skilled workers. That the strong focus on the bulk material, machinery for mining, resource Therefore, the break bulk operation sector, container and motor vehicle development and agriculture and steel for while involving labour intensive manual sector in Australia’s maritime trade manufacturing and infrastructure projects. handling, also requires substantial skill. appears to have overshadowed awareness of the existence and Break bulk cargo is related to a wide range Infrastructure development in Australia importance of the break bulk cargo of markets, resulting in a close relationship eg. tunnel construction, rail connections, sector apart from those directly with the national economy. Steel and mining, and power station construction involved. timber products particularly have wide require overseas-supplied materials

uses ranging from household products and supplementary supplies which are That the attention given to the to defence equipment and motor vehicle mainly imported in break bulk form. The other trade sectors is reflected in manufacturing in Australia. Major steel required machinery, construction material considerable development in those importers Stemcor and CMC advise that for ports and every forklift are brought areas. However, investment in shore- every single product they import is used into Australia as break bulk cargoes. As based facilities at most ports for break in different sectors such as building, road a further example, structural steelwork, bulk cargo has fallen behind the need infrastructure upgrading, mining, road/ cranes and other equipment used in the for such infrastructure. port fencing reinforcement, kitchen tops current upgrading of the Gateway Bridge Some examples of the connection and floors. in Brisbane, was imported in general cargo between cargo carried by general ships. A relatively large number of commodities cargo ships and national development imported in break bulk form are Machinery and equipment produced have been mentioned. This is not to not manufactured in Australia. An and imported by Caterpillar is crucial put forward break bulk cargo as the importer advised that “Australian steel for supporting the mining industry and only contributor, the same can also manufacturers cannot meet the country’s development projects all around Australia. be said about other sectors. However, demands”. One carrier advised that Olympic Dam in South Australia will the unique nature of this cargo does the steel their vessels carry consists of eventually become the world’s largest provide the basis for differentiation approximately 50 per cent competitive copper and uranium mine and will result and recognition of the ports through steel and 50 per cent non-competitive in significant benefits for the Australian which these vital cargoes pass to steel, where non-competitive steel is a economy on an unprecedented scale. projects that contribute to national

26 September 2009 Break bulk

economic development as well as those separate berths for general cargo vessels information exchange, promoting commodities used for consumption. and those vessels carrying wheeled cargo collaborative problem-solving activity and and agricultural equipment. The strong connection between the type fostering co-operative action in pursuit of of break bulk cargo carried by these Establish a genuinely representative a common objective. ships, and infrastructure development of consultative mechanism for all Implementation of these recommendations Australia does not appear to have been stakeholders involved in break bulk for improvement will greatly assist break widely made. cargoes in ports where it is a significant bulk shipping in meeting their customers’ trade to improve the efficiency of In some ports the benefits that could requirements for the long-term seamless operations, eg. the use of portable be made from stronger competition in delivery of cargo. In addition, they will temporary warehouses where appropriate. stevedoring services do not appear to have encourage port authorities to upgrade

been fully assessed. Encourage increased competition in infrastructure planning and development with stevedoring/terminal management where That the level of port costs could be an the objective of removing current port user the overall benefits have been clearly impediment to the development of this dissatisfaction with port congestion, berth identified. trade. availability, inadequate labour supply, lack of Port authority charges should be kept skills and storage facilities. Because of the nature of the cargo e.g. at a reasonable level to ensure Australia heavy lifts, large awkward lifts, skilled An effective IT communications platform remains internationally competitive. labour is in short supply and not always would facilitate information exchange, available. There is also a shortage of labour Tackle the labour issues identified in the promote collaborative problem-solving in some ports. conclusions. activity and foster co-operative action. The platform could be designed to link the Berthing priorities can disadvantage break Develop valid, workable and realistic operation of port service providers as well as bulk cargo ships which emphasises the indicators of performance in ports so need for dedicated port facilities to service that a port’s performance can be ranked port users, resulting in the efficient operation this sector. against national or even international of the port as a shared responsibility. SAL’s benchmarks and results made publicly promotion of port-based data community A number of areas for improvement were available. systems is consistent with this policy identified and were recommended: objective. Development of port-based data Raise the profile of the industry. community systems to, among other Full copy of the report is available at Encourage port authorities to develop matters, provide a platform for facilitating www.shippingaustralia.com.au. Customs

An abandoned cargo story with a very nice ending

etween September and late October instructions from the “consignee” claiming port, however, the shipper had been paid 2008, a total of five 40-foot they would be collecting the bills of lading and refused to take the shipment back and containers over three bills of lading from the bank within days and would it was feared that the containers would not andB different vessels originating from India be attending the shipping line’s office only be abandoned in India but also that were discharged for delivery in Melbourne. to collect the delivery orders. This never the return freight would not be paid. These containers were declared to contain eventuated. The line decided then to look at other “lined exercise books”. The line subsequently learned that in India alternatives which included re-exporting to After the first container had not been there are export credits or awards to assist a “needy” country or donation to a charity. uplifted the named consignee, a well in fostering more export trade from India It came to our attention that Rotary known forwarder, declared the cargo as not to the world and it suspects that the award International was looking at donating theirs and effectively abandoned the first may be more than the value of the cargo school supplies to East Timor and this container. They also refused to be involved itself. fitted perfectly with our abandoned cargo. in the subsequent shipments which were In late September the member line due in Melbourne within the following involved Australian Customs who arranged By that time the container storage and the weeks. to open and inspect one of the containers. line’s equipment costs exceeded A$80,000. It was found to contain lined exercise books There were further problems contacting The storage company and port were with Spanish writing on the covers. the real consignee with phone numbers approached to consider waiving their costs being incorrect and the actual bill of lading The line shared all the information it as cargo was now going to a charity. They address referred to another company. The had gathered regarding the shipments agreed and finally in March of this year, named shipper (who is a freight forwarder with Customs and also discussed several together with Australian Customs, who in India) obtained from the real shipper options on how it could dispose of the provided invaluable assistance, the line was copies of orders for the cargo, however, cargo including re-export, destruction able to come to an agreement to donate or on-selling to another party. The line these were found to be fraudulent. During this cargo which will be re-exported to a initially considered re-export to the load this time the shipper continued to receive worthy cause for children’s education. Unfortunately during this time the line also had another similar case involving a container of puffed rice that was abandoned in Melbourne. Luckily with the experience the line had gained through the earlier abandoned containers issue the line was able to find a charity to also take this container which will be re-exported. The cost of such occurrences cannot be underestimated in terms of time, legal fees/opinions and the dwell time of the equipment involved. Obviously the situation could have been much worse if the terminal operator had not offered some lenience in the final resolution of storage costs involved. The carrier involved is looking forward to the introduction of new processes within Customs which will expedite the processing and disposal of future cases of abandoned cargoes. New guidelines for unentered and certain abandoned goods by Sue Pitman, national director cargo and trade, Australian Customs and Border Protection Service

he Australian Customs and Border the goods have been moved to a licensed destroying/disposing of the goods, subject to Protection Service have released new warehouse at the direction of Customs and Customs and Border Protection’s permission information to assist industry on the Border Protection in accordance with section and supervision; and correctT way to manage unentered and certain 72(1) Failure to Make an Entry. moving the cargo to an approved warehouse. abandoned goods. Industry operators and owners are responsible Industry operators, acting as the owner and Abandoned goods are defined as: for managing goods in their possession (even intending to enter goods for home consumption goods that are ‘found’ at Customs and where such goods are subject to Customs and or make a SAC declaration, should be aware Border Protection facilities such as wharfs Border Protection control). As the designated that duty, taxes and other charges may be and airports; ‘owner’, it allows operators to initiate action payable under the requirements of section 159 to lawfully deal with time-up and long where the goods are not required to be Value of imported goods. stay unentered goods in their possession, entered for home consumption (e.g. The new guidelines also bring to an end the in accordance with contractual terms and unaccompanied personal effects), or cannot auctioning of goods (also known as Customs conditions, and/or other relevant commercial be entered for home consumption (e.g. no and Border Protection sales) as an option for arrangements. owner is identifiable); and disposing of unentered goods or abandoned There are a number of ways an owner can goods where Customs and Border Protection goods. In certain limited circumstances only, deal with unentered goods in their possession, believes they have been abandoned by the Customs and Border Protection may assist with including: owner. the disposal of ‘certain goods’ (e.g. unclaimed making a Self Assessed Clearance (SAC) intractable waste) in the interest of public safety. This does not apply to imported goods, where: declaration of low value goods; The Instructions and Guidelines on Unentered cargo was reported and found in Customs entering the goods into a warehouse or for and Certain Abandoned Goods is available on the and Border Protection facilities, but have not home consumption; Customs and Border Protection website at www. been ‘entered for home consumption’ in the customs.gov.au. required time; or exporting the goods;

BVcV\^c\ bVg^cZg^h` IG69:GH8=6GI:G:GHI:GB>C6AH$G:;>C:GHEDGI6JI=DG>I>:H>CHJG6C8: ™ EZigdaZjbVcYYgnWja`kZii^c\heZX^Va^hih :jgdeZVcd[ÒXZ ™ Dca^cZkZii^c\^c[dgbVi^dchnhiZb AdcYdc!:c\aVcY E] ))'%,-+-&+'% ;Vm +&(-+-+*,)% ™ 9ViVWVhZd[dkZg+*!%%%kZhhZah 6jhigVaVh^Vcd[ÒXZ ™ <=IH=>E#8DB kZii^c\5g^\]ih]^e#Xdb Australian Maritime College A new realism in Maritime Simulation

Training in: Simultaion studies ECDIS, ARPA, AIS Evaluating new and expanded port designs High speed navigation Evaluating tug requirements Maritime Resource Management (MRM) Extending port operational parameters Pilotage.Competency Audits Standard operating/emergency procedures Tug Operations Incident investigation Customised courses/Professional development programs Handling of new, larger ships Human factors FPSO mooring Human system integration

For Capability Enquiries: For Booking Enquiries: Capt. Ian Rodrigues Mr. Geoff Rollins Manager–Centre for Maritime Simulations Project Administrator 36942 Email: [email protected] Email: [email protected] Phone: +61 3 6335 4797 Phone: +61 3 6335 4797 37136 m + rethink environmental print environmental rethink at

37136_amc fp shipping aust.indd 1 1/9/09 3:06:50 PM Advertorial Minister Albanese opens AMC Minister Albanese with local MP Jodie Campbell Member for Bass, at the opening ceremony with AMC Principal Malek Pourzanjani and Chairman David Sterrett. Simulator

MC’s new maritime simulation 3 x Modelling stations The tug simulator can be utilized as a facility was recently opened by stand-alone tug training facility, or used in Portable Simulator the Hon. Anthony Albanese MP, interactive simulation exercises with the full

AMinister for Infrastructure, Transport, Dynamic Positioning Simulator mission bridge simulator for tug-assisted berthing and unberthing operations. Regional Development and Local The DP simulator is the first for Australia, Government. Tugmasters can join pilots in reviewing and AMC is now providing DP Operator, and refining ship manoeuvring procedures Over 50 maritime transport industry guests Basic and Advanced, courses with in their port, evaluate feasibility of port travelled to Launceston from around the international accreditation through the expansion plans and/or entry of larger country to share in the event, and to obtain Nautical Institute (London). ships, and trial emergency scenario practices a first-hand look at the new facility. and procedures. After declaring the simulator open for business Minister Albanese took the con of the passenger ship CONSTELLATION in the full mission bridge simulator, and piloted the ship into the port of Sydney, under the watchful eye of Simulations Manager, Captain Ian Rodrigues. Overcoming a tendency to favour the left, the Minister did the job well, and certainly showed that he was familiar with Sydney Tug Simulator can interact with Bridge waterways. Simulator The 6 Ship Operation Bridges can also After meeting up with the tug escort, the operate stand-alone, interact with each Minister decided to take on a new role, and other, and/or interact with the main bridge stepped out of the main bridge simulator and ship operation bridges meaning that, in into the nearby tug bridge simulator. There total, interactive exercises with up to 8 “own he took over the tug console controls, and ships” is possible at AMC. escorted the CONSTELLATION as it Dynamic Positioning Unit approached its berth in Darling Harbour. The Centre is a key resource for AMC Minister Albanese also visited the 6 ship deck officer students and trainees. The operation bridges located upstairs, above bridge simulator in particular, is also used the full mission bridge and the tug bridge for high level training and research projects simulators. Changing roles again, he then by corporate clients, including Woodside took charge of the helm of a fishing boat Petroleum, Queensland Maritime Safety, in Sydney Harbour, and steered the vessel TasPorts, Rio Tinto, Flinders Ports, and safely around the harbour in day and night- Port of Newcastle. time conditions. The Ship Operation Bridges are The new simulator is the latest system from mainly used for training, and courses Kongsberg Maritime, which AMC believes include: ECDIS; ARPA; AIS; High offers a new realism in maritime simulation. Speed Navigation; Maritime Resource Management (MRM), and Pilotage/ Capabilities have been expanded to create Competency Audits. a world leading Centre for Maritime Simulations which comprises: Those that have used the new AMC simulator have agreed that it does indeed

Full Mission Bridge offer a new realism in maritime simulation. AMC has booked out the simulator for 6 x Ship Operation Bridges Simulating night time entrance to Port of the remainder of 2009, and is now taking Tug/Mini Bridge Newcastle bookings into 2010.

31 The economy by David de Garis, director and senior economist markets, National Australia Bank Limited

Charting a course through rocky financial waters

he past year has been a truly outlooks, “pricing in” a repeat of the Global momentous one for the global Depression of the early 1930s. This is only Tough year for trade and economy, for financial markets and in the relatively distant past. shippers the world shippers and freight forwarders. The GFC quickly led to a marked T From the trough in equity prices reached We saw the global economy fall into a downturn in the major global economies, in early March 2009, equity markets have deep recession, global trade grind to a with the major G7 economies recording since rallied. Credit spreads have eased halt and financial markets on the verge sharp contractions in economic growth somewhat, the premium cost of raising of absolute meltdown in the wake of the through the December quarter of 2008 debt and liquidity from investors has fallen Global Financial Crisis (GFC). Through and the March quarter of 2009. The 2008 and the opening months of 2009, back (though remain high) while commodity United States economy contracted by equity prices crashed as investors and prices have risen from their lows. 1.3 per cent in the December quarter analysts successively slashed forecasts for of 2008 and by a further 1.6 per cent in The recovery has followed from the growth and earnings, reacting also to a the March quarter, quarters that would extraordinary and unprecedented speed barrage of news of asset market “write- normally be seen as significant for a year as and breadth of policy actions taken by downs” and associated losses recorded by a whole let alone for just one quarter. Japan governments and central banks world- banks around the world. contracted at an even faster rate while the wide to support markets and confidence. UK economy and the Euro-zone economic From its peak late in 2007 to its low Policy interest rates were slashed and region were also contracting at a fast clip. in early March 2009, the Dow Jones governments have embarked on lifting Industrial index of major US stocks public spending and tax cuts to support The global economy seemingly imploded declined by a staggering 54 per cent; economic growth. into a deep recession. Our current indeed the trajectory of falling equity expectation is that thanks to the global prices rivalled the collapse in equity prices They were also “forced” to develop and recession that accelerated into the end of in the wake of the Wall Street share announce on the run what turned out to be 2008 and early 2009, the global economy market crash of 1929. In Australia, the an arsenal of policies to support markets, will have contracted by 1.6 per cent in ASX 200 index was similarly punished, inject more capital into the banking and 2009. With the exception of China, all of falling a large 55 per cent. In essence, financial system, offering a multitude of the world’s major economies were in free given the extreme pressure on financial guarantees for bank borrowings, deposits fall in late 2008/early 2009. markets, global trade and the global and some loans. There are signs that such economy, financial markets were “pricing policies are now beginning to bear fruit by The global recession led to a dramatic in” the worst of all economic and business stabilising markets and supporting growth. downturn in global trade, the business

Chart 1: Stock markets moving away from a repeat of the Great Depression Chart 2: From global economic contraction to recovery

usa Dow Jones Peak & trough analysis GDP: US and the Euro-zone Comparing Stock Market Crashes in 1929, 1987, 2000 and 2007-09 Quarter % change 17500 17500 1.0 1987 7 0

0 15000 15000 0.5 2

t c o

t 12500 12500 0.0 a

e 2000-01 u l t

a -0.5 n V

10000 10000 c e r w e o P

D -1.0 2007-09 o

t 7500 7500

d

e -1.5 s a

b 5000 5000 e r

1929 -2.0 x e

d 2500 2500 n I -2.5 Months before and after stock market peaks Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 0 0 06 07 08 09 -50 -40 -30 -20 -10 0 10 20 30 40 Euro Zone US [c.o.p 1 quarter] Source: NAB Global Markets Research, Reuters EcoWin Source: NAB Global Markets Research, Reuters EcoWin

32 September 2009 Charting a course through rocky financial waters The economy

lifeblood of the world shipping industry. rebuilding after the 30 August 2008 After strong growth in the global economy Australian shippers also Sichuan earthquake in south western in 2007 of 5.0 per cent, when the volume see downturn but less China that left around 4.8 million people of world trade is estimated to have risen severe homeless and caused 69,000 deaths. by 7.5 per cent, business quickly went Australian export and import goods Australian export volumes have, into reverse over the course of 2008. volumes, a key barometer for local surprisingly, mostly continued to grow Not only was this more apparent than shippers, have also been under some through the global recession. Australian in international trade. The World Bank pressure this past year or so, and not just export volumes dipped by 0.9 per cent estimated recently that annual growth because of the GFC. The largest downturn in the September quarter of 2008 and in the volume of world trade slowed to has been for importers where volumes a further 0.8 per cent in the December average year growth of 3.7 per cent for began to weaken over the course of 2008, quarter, but rebounded by 2.7 per cent in 2008. But even this slower growth masked thanks to the slowdown in the domestic the March quarter, more than making up a slump in world trade through the course economy that flowed from increasingly for those moderate shortfalls. In fact over of 2008. tight monetary policy. the year to the March quarter, Australian export volumes rose by 3.5 per cent. This We estimate that the slowdown in This was also clearly reflected in the is in stark contrast to the experience in importing that occurred through 2008 will dramatic crash in shipping freight rates Japan for example where export volumes lead to a contraction in import volumes of over the course of 2008. The Baltic Dry fell by a staggering 36.3 per cent over 8.7 per cent for calendar 2009. Consumer Freight index, for example, peaked in spending slowed as interest rates rose, the same period! Reasons cited for this the early months of 2008, but then it while business cut into discretionary resilience in Australian exports relate to collapsed through the second half of spending, also in response to the global continued shortfalls in availability of bulk 2008. Faced with the financial banking crisis that corralled and cut confidence, all commodities such as Australian resource and financial markets in meltdown important sources of import growth. This exports, some increase in farm exports phase in the wake of the collapse of downturn was also amplified somewhat after more normal seasonal conditions Lehman Brothers in September 2008, by reports of trade finance issues and and the greater economic resilience and banking-client relationships were sorely supplying issues from foreign exporters commodity demand from China, as well tested, trade finance issues came to the that were faced with large cuts in orders as its short-lived downturn. fore and business confidence collapsed. from major buyers in the US, China and International orders fell as buyers cut Europe. inventories and production; global trade Outlook brightening For Australian bulk commodity exporters, volumes were in sharp decline, shippers despite the collapse in the global somewhat were finding that freight rates were economy and falling commodity prices, Recent developments point to global also dropping like a stone. In its Global the downturn was much less severe. As banking and financial markets now Development Finance report prepared in 2008 progressed, China announced major operating at a much less dysfunctional June 2009, the World Bank has estimated measures to stimulate their economy level. Credit spreads have eased somewhat that this year, world trade volumes will which they quickly moved to implement. from exceptional levels, as has volatility, have declined by a very large 9.7 per cent. This was in part also as a response to while the multitude of stimulatory

Chart 3: Global freight rates collapse then stabilise Chart 4: Chinese domestic growth accelerating

Bulk carrier world freight index China fiscal and monetary policy boosting demand Baltic Dry index Current Prices, YoY 12000 55 11000 50 10000 45 9000 40 8000 35 t 7000 n 30 x c e r e e d 6000 n

P 25 I 5000 20 4000 15 3000 10 2000 5 1000 0 0 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 98 99 00 01 02 03 04 05 06 07 08 09 Retail Sales Fixed Assets Investment, year to date Source: NAB Global Markets Research, Reuters EcoWin Source: NAB Global Markets Research, Reuters EcoWin

34 September 2009 Safer Shipping Optimised Dredging Smarter Ports

+61 3 9412 6500 www. omc­international. com The economy

stabilising if not beginning to grow again. Chart 5: Retail trade has continued to grow With the domestic economy responding to the large measures of economic stimulus, Aust Consumer Sentiment and Retail Sales the time is approaching when the RBA 4 140 will begin to lift rates. They will inevitably Retail Sales, monthly % change begin to take back the emergency rate cuts 3 130 that took the cash rate to a multi-decade

2 120 low of 3 per cent together with multi- decade lows in residential mortgage rates.

t 1 110 n x e c e r d Signs of rising global confidence have n e I P 0 100 seen international investors renew their interest in the (relatively) high yielding -1 90 Australian dollar. In October 2008 the Consumer sentiment index -2 80 AUD/USD had its 10 most volatile days since it was floated in December 1983, -3 70 all in one month. From its low of 0.6009 Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun on 27 October 2008, the AUD/USD has 06 07 08 09 Retail Sales, m/m% [c.o.p 1 month] Westpac Consumer Sentiment Index rebounded strongly to over 0.84 by mid Source: NAB Global Markets Research, Reuters EcoWin August 2009. NAB forecasts that the AUD/USD is on track to rally further, in net terms, over the course of the next year macroeconomic policies being pursued on months. For the June quarter, retail sales to 0.90 by the end of 2010. an almost world-wide basis are beginning volumes rose a very solid 2 per cent after 1 to bear some fruit in terms of economic per cent in Q1 to be up 4.2 per cent over A more stable to growing domestic growth. As Chart 2 illustrates, even the the course of the past year. That’s around economy and some return to much less depressed US and Euro-zone economies one quarter of the economy. abnormal global financial and economic are showing signs of stabilisation through conditions should also see some return to the middle of 2009. While that revival might slow over the normality for Australian shippers over the next year as the immediate stimulus course of the next year. NAB forecasts that In our region China and the greater from the cash splashes fade, rates remain with the domestic economy recovering, Asian region are seeing increased signs of low and there is a significant element of import volumes should begin to resume economic recovery and quickly emerging government stimulus in the pipeline to growth through 2010 after what has been growth. Indeed, some now infer that the continue supporting growth. a very rocky past year or so. Chinese economy may be rebounding too quickly with concerns over the faster In addition to the forthcoming boost recent growth in bank lending, reports of from higher infrastructure spending, aged higher property prices and faster domestic pensioners received a $30/week increase growth more generally. in the pension from 1 July while there are cuts to personal income taxes announced The Chinese Government has stuck to its in the 2008 Budget, some of which took official forecast that even with the export effect from 1 July 2009. slowdown – that hit China as hard as it did other major suppliers – GDP growth will meet its forecast of 8 per cent for this Interest rates to rise and year. We agree with this outlook. currency to hold up Meanwhile, the Australian economy has There are now signs that the global weathered the GFC remarkably, at least economy is beginning to settle down so far. The economy has (so far) recorded somewhat with the global economy only one quarter of negative GDP growth of 0.6 per cent in the December quarter of 2008, nearly all made up by a 0.4 per cent rebound in the March quarter. Partial indicators on the performance of the economy through the June quarter point to the likelihood of further positive growth in the June quarter as well.

Thanks to the Federal Government “cash splashes”, low emergency levels of the RBA cash rate and a resilient labour market, consumer sentiment has rebounded and retail sales have risen strongly in recent

36 September 2009 Pac2010 Aust Shipping ad 27/5/09 4:20 PM Page 1

Economy

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PACIFIC2010 will be a comprehensive showcase of the latest developments in naval, underwater and commercial maritime technology.

PACIFIC2010 will also feature a number of timely and highly CONTACT informative industry conferences and seminars. PACIFIC2010 PACIFIC2010 will be the most comprehensive industry event of its PO Box 4095 Geelong type ever staged in the Asia Pacific region and will provide a Victoria 3220 Australia focused and informed business environment. E: [email protected] Sales Office: T: +61 (0)3 5282 0500 F: +61 (0)3 5282 4455 www.pacific2010.com.auSeptember 2009 37 Environment

Unwanted

passengers: What is biofouling? Biofouling (or fouling) is the accumulation of aquatic microorganisms, algae, plants and animals on vessel hulls marine pests and submerged surfaces. How does biofouling form on vessels? Even though the accumulation process is continuous, the terms primary, secondary and tertiary can be used to describe the ver 250 exotic marine plants Marine pest management resources levels of biofouling present on a vessel. and animals have been recently released include a marine introduced to Australian pest identification guide and national Primary biofouling begins as soon as waters by vessels since European control plans for established pests. All the surface of a vessel is submerged in O seawater with the formation of a slimy settlement. They threaten not only of these resources are available at www. native species and our unique marine marinepests.gov.au surface film consisting of bacteria and microscopic algae. ecosystems, but also the $38 billion The pest identification guide shows of economic activity earned from the identifying features of marine pests, As the vessel remains submerged in marine environment. where they might be found and how to seawater, the secondary biofouling Marine pests spread from place to distinguish them from similar native process occurs as organisms settle on place by attaching themselves onto species. If pests are sighted outside top of the primary biofouling layer. hulls or hiding in damp vessel areas. known areas they should be reported Secondary biofouling usually includes hard encrusting animals such as acorn They are not fussy, readily hitchhiking to the local marine authority. barnacles, bryozoans and serpulid worms, on any available vessel whether it is a The national control plans describe but may also include soft algal tufts and yacht, fishing vessel, commercial ship ways to minimise the impact and mobile amphipods. or petroleum vessel or rig. reduce the spread of six marine pests Tertiary biofouling generally consists of The likelihood of vessels harbouring of concern: Northern Pacific seastar, larger organisms, such as sponges, sea marine pests is highest when the vessel European green crab, Asian date squirts, mussels, oysters and seaweeds has accumulated heavy biofouling. mussel, European fan worm, Japanese seaweed and European clam. that build up on the secondary biofouling Regular and thorough maintenance to layer, and mobile animals such as crabs remove biofouling is the most effective These resources demonstrate the and seastars that can live in this growth. way to prevent marine pests from Australian Government’s commitment spreading. to protecting Australia’s marine Levels of biofouling increase the longer a environment and complement vessel or structure remains submerged in This includes regular slipping or seawater. drydocking to remove all biofouling other work being done through the and to reapply antifouling coatings. It government’s Caring for our Country Pest species are more likely to be found is also important that niche areas and initiative. on vessels that have accumulated high internal sea water systems are cleaned The Australian and state/territory levels of secondary or tertiary biofouling. regularly. governments along with marine

38 September 2009 Hydroblasting biofouling from bow thrusters on a commercial vessel in drydock. Photo supplied by Forgacs Engineering Pty Ltd.

industries, marine scientists and environmental groups are implementing the National System for the Prevention and Management of Marine Pest Incursions. This aims to prevent new pests arriving, respond when a new pest does arrive and minimise the spread and impact of already established pests. The shipping industry has worked with government to develop practical guidelines that will not only reduce the spread of marine pests but will also increase vessel performance. Some of the most important actions are as follows: Schedule regular drydocking to thoroughly clean and remove biofouling and to repair/replace the antifouling coating. PB Select an antifouling coating system for the hull that matches the vessel’s operating profile. Use antifouling coatings in painted niche areas that match the flow conditions experienced. Inspect, clean and treat internal seawater systems, cleaning strainer boxes and dosing or flushing these systems. Towage Regularly operate and monitor marine growth prevention systems to ensure effective biofouling control is maintained. For more information, refer to the National biofouling management guidelines for commercial vessels available at www.marinepests.gov.au repeat * Compiled from information provided by the Federal Department of Agriculture, Fisheries and Forestry.

September 2009 39 Piracy

Why should Australia worry about piracy? It’s too far away… or is it? by LLEW RUSSELL

s far back as May 2002, Somali region in 2008 but by May this Australian passengers have been attacked the International Maritime year there had already been around 60 by Somali pirates. There were a number Organisation’s Maritime Safety attacks and 25 successful hijackings with of Australian passengers on the Oceania ACommittee at its 75th session approved a around 300 crew being held hostage. Nautica when the cruise ship was attacked revised Notice of Guidance to shipowners, Australia is more directly involved than while on her way to Singapore and operators, ship masters and crews for one would initially think in such activities subsequently to Sydney. This incident preventing and suppressing acts of piracy that are far removed from our shores. The resulted in the Australian Government and armed robbery against ships. This was Stella Maris having loaded lead and zinc in issuing a notice advising Australian ships indeed fortunate given the subsequent Townsville for Europe in July last year and to ‘apply a robust and layered protected increase in piracy in the Gulf of Aden and whilst well off the coast of Somalia, was security regime, including exercising a off the horn of Africa by Somali pirates. attacked and hijacked by Somali pirates. high level of vigilance and extreme caution This year alone, following the monsoon It was not until late September that the and stringent access control measures, season there has been a dramatic increase vessel and crew were released after the particularly when transiting through the in piracy attacks as far away as 500 nautical payment of a US$2 million ransom. It Gulf of Aden or accessing waters off the miles from the Somali coast. International has been estimated that almost US$100 coast of Somalia and neighbouring waters’. Maritime Bureau figures show that more million was paid in ransoms in 2008. than 100 ships were attacked and 42 The attack on the Oceania Nautica was hijacked in the Gulf of Aden and in the A number of cruise vessels carrying soon followed in December last year by a

40 September 2009 reported attack on the cruise vessel MV Athena There has been successful capturing of pirates which was carrying almost 400 Australian with the French navy capturing 11 suspected tourists. It was reported that up to 29 small pirates off the coast of Kenya after they attacked boats with up to six pirates on each boat had a ship called the Safmarine Asia. One of the approached the liner but crew members had used real problems that arises is what to do with water cannon to stop the pirates from boarding the captured pirates. Regrettably there is a the ship. Similar to the Oceania Nautica, the lack of clarity regarding the legal jurisdiction Athena was able to outrun the speed boats. needed to identify and punish such criminals under due process. The world shipping industry A more recent event attracted media attention has called on governments to establish that in Australia, that being the attack in April this necessary international legal jurisdiction. The year on the cruise liner MSC Melody when six Russian President in May this year called for men in a speed boat armed with Kalashnikov an international court to be set up to try alleged assault rifles attacked the cruise ship. Security pirates. The demand came after the Russian Navy guards on the ship fired above the heads of the revealed that it had captured a pirate vessel with pirates who subsequently abandoned their efforts. 29 people onboard off the coast of Somalia, but Subsequently the vessel rendezvoused with a naval had not yet decided where to try the suspects. vessel in the Indian Ocean which escorted the vessel to Jordan. The capturing of the master of What can be done to prevent pirate attacks? the US chartered vessel Maersk Alabama earlier According to naval forces operating in the this year also attracted worldwide attention with region and insurance industry sources, levels of the master subsequently being rescued and three security awareness onboard vessels transiting of his captors shot dead by US snipers. the Gulf of Aden vary significantly despite the well published security threat posed by pirates. Australian masters of foreign flagged vessels have A number of vessels are failing to register their been attacked but capture has been avoided so far. voyage information with naval forces operating In addition, fortunately two Australian warships in the region and it is vital that this action were in the area in mid May this year and is implemented by all vessels transiting the rushed to the aid of the Dubai Princess and the area. Increasingly international shipowners are Mediterranean Shipping Company-owned MSC diverting tankers and other susceptible vessels Stella and the pirates fled when confronted by our around the Cape of Good Hope rather than use naval forces. the Suez Canal. Slower container ships with a The hijacking of the Ukrainian freighter carrying low freeboard and older vessels considered more Russian tanks and weapons fortunately also susceptible to piracy are also being diverted. It attracted a lot of media attention in 2008 and has been reported that there has been a 10-fold assisted in giving weight to international shipping increase in insurance premiums for vessels sailing representations at the UN urging a greater off the horn of Africa. There is also a need to pay military presence in the area. Another major event crew higher wages because in 2008 a number of was the hijacking of a very large crude oil carrier, leading shipowners reached agreement with the the Sirius Star with its crew in November 2008 International Transport Workers’ Federation to given that its cargo was worth around US$100 double the pay of seafarers on vessels in the Gulf. million. Following a lengthy period of detention, Dr Helen Bendall of the University of the ransom was paid by parachute onto the deck Technology, Sydney has estimated the net extra of the vessel and television cameras recorded the costs for a Very Large Crude Carrier sailing debacle that followed when some of the pirates around the Cape of Good Hope at around were drowned as they sought to return to shore. US$7.2 million and a 10,000 teu container ship at In July this year there was another attack on a approximately US$2.8 million. large crude oil tanker which fortunately managed to escape capture. The coalition naval forces have urged shipping companies to employ security guards to fight The UN International Ship and Ports Security off pirates but security experts have warned that Code which was agreed under the auspices of the non-lethal deterrents are the best option. If piracy International Maritime Organisation following boats are detected well in advance, the important the 9/11 attacks does not appear to be at all thing was to let the boats know that they have relevant or useful in the fight against this kind been detected, manoeuvre in a way that ensures of piracy in the Gulf of Aden and off the coast that it was not easy for them to board the vessel of Nigeria. Whilst the naval forces have tended and steer away from the mother ship as far as to be concentrated around the Gulf of Aden and possible so that the piracy boat is drawn further Northern Somalia, pirates using a mother ship as and further away from its comfort zone. It has a logistics base have now moved south and further also been pointed out that putting armed guards away even to the northern tip of the Seychelles. on cargo ships could be illegal in a number of

September 2009 41 Piracy

flag states. This is a matter still for owners bodies such as the Mission to Seafarers in Office of the Inspector of Transport Security to consider but the international shipping seeking to deal with this important aspect of and the Australian Federal Police to work community urges caution in deciding to put this continuing scourge. with that body in its Nairobi office in Kenya armed guards on vessels and/or to arm the The Australian Government is actively in terms of dealing with piracy in the region. crew. This would be impossible for certain responding to this threat posed to Australians vessels such as LNG or petroleum tankers Another major initiative was announced in and Australia’s international trade by piracy and arming cargo ships, in many cases, will May this year that Australia would contribute and armed robbery at sea. In February of this raise the prospect of them effectively being year, Minister Anthony Albanese asked the Defence Force resources to the anti-piracy involved in naval action given the well-armed Inspector of Transport Security Mick Palmer, efforts off the coast of Africa and Australia’s and well-resourced Somali pirates. former head of the Australian Federal Police, contribution will include tasking of a Navy Besides the increased speed and manoeuvring, to undertake a comprehensive inquiry into Anzac-class frigate and RAAF AP-3C Orion a number of vessels have taken action to maritime piracy and armed robbery at sea as patrol aircraft that are already contributing to strengthen perimeter defences with electrified it affects Australia and an interim report is counter-terrorism activities in the region. wire around the vessel and a new technique of expected in September this year. The eventual solution, as identified by many trailing nets behind and around vessels to foul Closer to Australia, the Malacca Straits has commentators, lies on land rather than sea. the propellers of the small speed boats and for many years been a focus for pirates and When one reflects on history, piracy has inflatables favoured by the pirates has been criminal activities and it is an important an innovative recommendation. Use of water passageway to China, India and is on the really never been defeated at sea but on cannon is also recommended. Nevertheless, route between Europe, the Suez Canal, land. Similarly the answer to reducing or armed helicopters or the presence of naval Persian Gulf and the busy ports of Singapore, preventing this type of piracy lies in Somalia. vessels is of great assistance and reinforces Hong Kong, Taiwan, Pusan and Tokyo. Somalia has been subject to severe violence the need for all vessels transiting this area to Indonesia, Malaysia, Singapore and Thailand since the central government dissolved in notify the naval authorities of their voyage have formed the Malacca Straits Security 1991. As a US journalist, Jeffrey Gettleman, plans. the East Africa bureau chief of the New The Maritime Security Centre Horn of Africa York Times, wrote in a feature article in the (MSCHOA) has advised ship masters to Australian Financial Review on 24 April avoid if at all possible passing no closer then this year, “Somalia is quite simply the most 600 nautical miles from the Somali coast in dangerous place in the world”. He pointed the West Indian Ocean. The IMO Maritime out that Somali society often divides and Safety Committee as well as the International subdivides when faced with internal disputes Chamber of Shipping have urged shipowners but quickly bands together when confronted to use best practice procedures to try and avoid being boarded. It is important that ship by an external enemy. The IMB in London operators register their voyage plans with has indicated there were 10 pirate attacks off MSCHOA and also report the navigational the Somali coast in 2006, which ties for the route of the ship to the United Kingdom fewest this decade. The reason was that in Maritime Trade Operations in Dubai when June 2006 Islamists had run the last warlords navigating through this area. Ship operators out of Mogadishu and besides restoring some are also requested to report any attacks or order for the first time since 1991 actually piracy activity to that organisation. A pirate artillery shell embedded in the side cracked down on piracy by using their clan of a captured vessel What is considered very important is that connections to persuade coastal towns from crew members are trained in deterrent supporting the pirates. activities and what to do in the event of being Joint Working Group to combat the issue Jeffrey Gettleman said the best suggestion boarded. and the maritime forces from those four countries co-ordinate sea patrols of the area. that he had heard was to play to Somalia’s What is often not so well understood is the Significantly there has been a major reduction strengths as a fluid, decentralised society potential effect on the seafarers themselves of in attacks in this important trade lane. Since with local mechanisms to resolve conflicts. an attempted attack or successful hijacking. 2005/06 the Australian Government has The foundation of order would be clan- There is recognition within the military that contributed $9 million of humanitarian based governments, villages, towns and it does not have the competency to deal assistance to Somalia and this assistance neighbourhoods and these fiefdoms could with seafarer hostages upon release and they has also been provided to neighbouring stick together to form district and regional have acknowledged the need for ministry countries dealing with Somali refugees. The practitioners and pastoral intervention. Minister announced this year that Australia governments. The last step would be to unite The Mission to Seafarers and other similar will provide $500,000 as well as skills and the regional governments in a loose national organisations are addressing the post-release expertise to the joint European Commission/ federation that coordinated national issues situation. None of the UN resolutions that United Nations Office of Drugs and Crime and anti-piracy efforts but which did not have directly or indirectly addressed piracy counter piracy programme to assist Kenyan sideline local leaders. make any mention of the need to care for authorities in receiving and processing the families of the hostages or of any post apprehended piracy suspects. In addition, In this suggestion may lie a long-term incident pastoral care or addressing post Australia will provide officials through the solution to our current problems of piracy off traumatic stress disorder. We commend Somalia and the Gulf of Aden.

42 September 2009

YSA Victoria

Plans to change stereotypes and promote industry

individual wants to achieve from the interaction. A YSA membership presents opportunities to connect with a growing network of young shippers enabling them to attend both social networking events and informal educational sessions. The value of a membership is strongly linked to the enthusiasm and motivation of all young professionals in the maritime industry and how much they support this positive initiative.

With over 100 attendees at the official YSA VIC launch at the Mission to Seafarers, Melbourne, on 20 March 2009, the YSA VIC membership base has continued to grow over the past four months, now reaching a total of 108 full paid memberships for the 2009-2010 period.

In addition to promoting educational and informative events for our members, we also place importance on offering social networking events every two months. Such events aim to create an enjoyable and relaxed atmosphere where people can network socially with no external ith the successful launch of between the ages of 18–35. It hopes to pressure. In late April, YSA VIC organised Young Shipping Australia break stereotypes within the industry our first social networking evening at Victoria in March, 10 young about employment choices and promote the Portland Hotel, Melbourne CBD, the maritime industry to both internal and Windividuals who make up the YSA VIC resulting in approximately 35 members committee have kept the momentum going external stakeholders as a rewarding and attending, enjoying the use of a private for the solid establishment of YSA in diverse career path for young professionals. area, a few drinks and complimentary food. Melbourne. It also aims to use joint networking This was replicated in June at the Tom The YSA VIC committee’s co- forums as a platform to close the gap Collins Bar, Melbourne CBD, promoting chairpersons, Simon Shaddick of Holman between experience levels between young complimentary food and a few social drinks Fenwick Willan and Fleur Walsh of professionals versus senior professionals resulting once again in a positive result. ANL Container Line, lead a committee in the industry. Bringing these two groups Young Shipping Australia Victoria including Andrew Fairley, APL Lines, together can bring positive exposure to the Michael Woods, ANL Container Line, industry ideally contributing to improved organised the well received Supply Daniel Daskalov, Seaway, Dee Leach, Port communication flow of issues in the Chain Seminar and Luncheon hosted of Melbourne, Jesse van de Tang, ANL industry, ideas for further training, career by the Port of Melbourne Corporation. Container Line, Lisa Jinnette, Port of networking and most importantly assisting Mr Don Forsdyke, trade facilitation Melbourne, Paul Sosic, ANL Container in the retainment of young professionals in manager presented an informative and Line, and Tom Brazel, Seaway. the maritime industry. entertaining presentation to a total of 42 members, covering topics such as supply YSA is focusing on a target audience The value of such memberships is limitless chain management and participants, the of young professionals in the industry however does depend on how much the importance of logistics flow, BAHS Study

44 September 2009 outcomes, channel deepening, and closing Rod Begley, chairman of SAL’s Fleur Walsh, Simon Shaddick, with port planning for the future. Victorian State Committee co-chair YSA Victoria co-chair YSA Victoria In August, Pacific National Rail agreed to host an educational event at their premises in the Melbourne Freight Terminal. This event offered our members an informative presentation outlining Pacific Rail responsibilities, the logistics of rail terminal and train operations and the life cycle of a shipping container moving through the rail system. The presentation included a site visit which was successfully conducted by Brian Linnell, sales manager of Pacific National Rail.

The next networking evening scheduled was hosted by Section 8, a city bar fitted out in old shipping containers which is a fitting venue for the event keeping the vibe upbeat but also related to the industry. To diversify the attendance at our networking evenings, we have also decided to invite as guests the members of FUEL, a young professional group representing the transport industry and the Institute of Shipbrokers, Young Phil Kelly, secretary of SAL’s Professionals Melbourne, bringing a different Victorian State Committee edge to the event. An event combining the three young professional groups based in Melbourne will enable further opportunities for our members to meet new people who has offered to host our next educational shipping vessel, providing informative work in other sectors of the industry and event with the aim to promote Frontline, an narrative, concluding at the Mission to consequently broaden their industry networks. educational program created by Australian Seafarers, Docklands, Melbourne. Drinks and Customs to raise awareness of the daily light food will be provided for all members, On 29 September, Young Shipping Australia tasks and issues that Customs and Border along with an overview of YSA VIC 2009 Victoria has organised a maritime law Protection services face in the maritime and a report of what’s to come in 2010. seminar, conducted and sponsored by Holman industry. This will outline how young Fenwick Willan, a maritime law company professionals working in the industry can As one of the oldest industries in the based in Melbourne CBD. HFW have agreed assist Australian Customs and Border world, it’s only expected that aged views to host the event, conduct a presentation Protection in protecting Australia’s borders and conservativeness are still highly valued. from the entry of illegal and harmful goods focusing on an overview of maritime law and Young Shipping Australia acknowledges this, and unauthorised people. discuss the legal issues facing our industry but also aims to promote our new initiative today. This event will be sponsored by HFW To complete and celebrate the calendar of to be upbeat, informative, innovative and and food and beverages and an opportunity to events for 2009, Young Shipping Australia contemporary. Young Shipping Australia network with fellow attendees will begin from Victoria will be hosting a joint Christmas Victoria’s debut in 2009 has proved to be 6pm onwards. event for both SAL and YSA members successful and we aim to build on this and To follow, on 26 October the Australian on 15 November 2009.This will include a bring our current members and new members Customs and Border Protection Service Melbourne port tour via a moving container an exciting calendar of events for 2010.

September 2009 45 Signal

a container-carrying truck surcharge for access to the Vehicle Booking System Recent policy developments during a peak period (5am to 1pm) and a lower charge for the shoulder period (1pm to 9pm). A credit will be provided and industry updates for trucks accessing the terminals over the weekend. The empty container parks are an integral SAL to participate in Sea time for AMC part of the container supply chain and development of a national students NSW Maritime has been developing a Some SAL members have been able to strategy for them to extend their opening port plan provide some sea-time for three Australian hours to assist the trucking industry and in SAL has written to both Infrastructure Maritime College (AMC) students who support of the PBLIS objectives. SAL has Australia (IA) and the National Transport have completed their AMC pre-sea deck been closely involved in the development Commission (NTC) to offer assistance in cadet training as part of the Advanced of these proposals which have been based the development of a national port plan. Diploma of Applied Science (Nautical on a study prepared by GHD Meyricks. There are many issues to be included in Science) but who do not yet have a this important debate. cadetship. Progress on proposed SAL has highlighted the need to assess Other SAL members are presently Newcastle Vessel Arrival whether our port land valuation methods examining the possibility of providing are competitive with the ports we serve some sea-time for these students and this System (VAS) overseas, are port costs in Australia is most appreciated by the AMC. A series of meetings on this subject has competitive with similar sized ports assisted in clarifying the positions of the overseas and what are the implications Port data community Newcastle Port Corporation and SAL of the sale of major ports in Queensland, regarding the proposed VAS. SAL had especially Brisbane? Would other state/ systems agreed with the objective of strengthening territory governments benefit from the Regular readers of this column will and improving the efficiency of the coal recent decision of the NSW Government be aware of the support of Shipping supply chain but was concerned that any to identify the Port of Newcastle, Port Australia for a port data community system must be practically implementable Botany and Port Kembla as State system called PortBIS which is being and not disturb the underlying contractual Significant Sites, which will provide trialled by Tradegate. A very successful arrangements that support Australia’s consistent planning, better zoning of port workshop was held on 27 July which was burgeoning thermal coal trade. land and will also protect the ports from well attended by SAL members. There was Minister Joe Tripodi had initiated a having operations and future expansion a live demonstration of a similar system stakeholder meeting in Newcastle at limited by the incompatible use of port called Destin 8 which operates in the port the end of July and this was followed up land? of Felixstow in the UK (and other similar with meetings in Sydney between the SAL has also drawn the attention of the systems in 24 other ports around the corporation and SAL. For more see our IA and the NTC to its current project world). website www.shippingaustralia.com.au. to compare Australian ship-based costs A series of workshops to discuss the in ports with the costs of regular ports benefits and potential costs of the new EC to launch programme of call overseas and we have sent them a system will be held in Brisbane, Sydney, copy of the recently completed break bulk Melbourne and Fremantle in September to boost shipping’s image shipping study which also identified a involving a much wider range of SAL has welcomed the announcement number of infrastructure shortcomings in stakeholders in the new projects. by the European Commission on 7 July that it will launch a 3 million euro (A$5.2 some Australian ports. Part of PortBIS incorporates the million) programme aimed at improving development of a new platform for public awareness of the shipping industry Dredging of channel is the consistent reporting nationally of and boosting recruitment. This joint dangerous goods manifests and electronic initiative with the shipping industry will complete messaging systems for all those involved In late August the Queen of the Netherlands get underway by the middle of 2010 and with empty container parks. left Melbourne and the Port of Melbourne will cover education, promotion of the has announced that it is in the final stages Port Botany Logistics shipping industry, ways to best address of completing the main dredging project the media and the way information about into Port Phillip Bay. Improvement Strategy shipping is collected and distributed to the The maximum allowable shipping (PBLIS) public. depth has been increased, providing an Shipping Australia continues to be closely Criminalisation and fair immediate remedy to the port’s current involved in the development of this draught constraint. Draught is now strategy by Sydney Ports Corporation treatment of seafarers 12.1 metres without tidal assistance, up and the NSW Government. Various The International Chamber of Shipping/ from 11.6 metres. Remaining works are submissions have been made and SAL International Shipping Federation scheduled for completion by 31 December. has attended all the open forums held on have issued a position paper urging For more information go to www. the proposal to charge during weekdays governments to bring all national and channelproject.com. regional/state laws which might result in

46 September 2009 ouR SPRIAfeoRITTy y!

IS Geelong introduces advanced docking technology

A new docking system at Refinery The SmartDock will improve port Pier in Geelong, Victoria will allow safety and commercial efficiency large ships to berth safely and in all weather conditions. Geelong efficiently in all weather conditions, is the first port in Victoria and the Victorian Regional Channels the second in Australia to install Authority (VRCA) said. the SmartDock system. Geelong The SmartDock system is a laser- is a major Australian port and controlled system with a 1.75-metre it is important that its facilities display board, mounted on a turntable continue to be first class. on the jetty and controlled by a central computer system. It shows speed-of-approach to the berth as well as the distance-off in metres. A green, yellow and red traffic light system helps the pilot during the docking process by flashing at pre-set distances as the vessel approached. The display board is visible from more than 200 metres.

For information Ph: (03) 5225 3500 I Level 5, 65 Brougham St, Geelong, VIC 3220March I www.regionalchannels.vic.gov.au 2009 47 Signal

criminal sanctions for seafarers into line with the agreed standards Underkeel clearance system helps Port and principles contained in international conventions. They are also considering whether to request a revision of the Hedland set ship loading record International Maritime Organisation/International Labour The Port Hedland Port Authority has approached OMC International to investigate how its proven DUKC® technology Organisation fair treatment guidelines in the event of a maritime can help the port regularly repeat its recent record of five ships accident. sailing on the one tide with a combined total cargo of 841,062 As pointed out in the paper ‘the challenges to the international tonnes. regimes as to when criminal sanctions are to be applied are Dr Terry O’Brien, OMC’s founder and executive director, said therefore of considerable concern; the world takes it for granted both parties were working together to see how the port could that the shipping industry will provide a seamless, efficient and maximise cargo throughput from Port Hedland. effective delivery of goods; across a multiplicity of countries For more information please visit and jurisdictions. Uniformity of law and regulations across the www.omc-international/media-releases. various jurisdictions is of fundamental importance to the shipping industry if it is to perform this service without disruption’. Training For more information please visit www.marisec.org/keyissues. With the introduction of the online course Introduction to Shipping, the options available to build a sound foundation about 2010 World Maritime Day theme will be shipping from SAL courses widens. There can be little doubt about the value of knowing more about the industry that you Year of the Seafarer work in. The IMO Council has agreed that the “2010: Year of the Seafarer” The e-learning method provides a unique opportunity to begin theme will be celebrated throughout the year and also at the that learning when and where you want to at your own pace. World Maritime Day parallel event in Argentina. The theme was No prior knowledge of shipping is needed and a Certificate of selected to give IMO and the international maritime community Completion is available on successful completion. The face-to-face the opportunity to pay tribute to the world’s seafarers for their course Introduction to the Maritime Industry will increase the depth unique contribution to society and in recognition of the risks of that knowledge as well as providing an environment to meet they shoulder in the execution of their duties in an often hostile people from other industry sectors and engage in discussion on environment. topics covered in the course. The theme also complements IMO’s ongoing “Go to Sea” SAL courses are scheduled for main ports and in Canberra as per the schedule below and come with a guarantee of quality and up- campaign to attract new entrants to the shipping industry. to-date relevant content. Shipping industry highlights Port Course 2009 Dates commitment to reduction of CO2 Introduction to the emissions Canberra 4/5 Nov On 23 July, in advance of the United Nations Climate Change Maritime Industry Conference in Copenhagen, December 2009, the International Introduction to the Chamber of Shipping launched a new campaign to highlight the Melbourne 23/24 Sep Maritime Industry global shipping industry’s firm commitment to reducing CO2 emissions. Introduction to the Adelaide TBA The ICS chairman, Spyros M. Polemis noted “Shipping is an Maritime Industry inherently international industry which depends on a global regulatory framework to operate efficiently. Otherwise there Introduction to the Fremantle 7/8 Oct would be chaos and serious inefficiency. Maritime Industry “The shipping industry believes that the achievement of Other courses – Reefer Cargo Handling and Introduction to meaningful reductions in CO2 emissions will be best achieved if nations agree that the development of detailed measures for Chartering - are still available subject to demand and these courses as well as Introduction to the Maritime Industry can all be presented shipping should be directed by governments at the International in-house if that is preferred. Maritime Organisation but respecting the outcomes agreed for the sector under any new UN Climate Change Convention. Details of all courses including an outline of the content can be found by following the links on the SAL website at www. “The IMO has an impressive track record of adopting standards shippingaustralia.com.au. All courses are competitively priced and for shipping that are applied equally throughout the world, include discounts for bulk purchases for the online course, and delivering maximum environmental improvement.” discounted fees for group bookings for other courses. The ICS has produced a new brochure Shipping, World Trade and Please direct any queries on training to Robert Dick –

the Reduction of CO2 Emissions which can be downloaded at www. telephone 02 9266 9916, fax 02 9268 0230 and email rdick@ marisec.org/CO2. shippingaustralia.com.au

48 September 2009 Book review by Professor EDGAR GOLD, QC

Shipping and the Environment 2nd Ed. By Colin de la Rue and Charles B. Anderson. Lloyd’s Shipping Law Library. Informa:London, 2009. Pp. cx/1247. £435. €544. US$870.

hen the first edition of this book appeared in 1998 it quickly became the leading reference text in the area as it was Wthe first comprehensive treatise that covered virtually all legal and regulatory aspects of ship operations as related to the marine environment. Furthermore, coverage not only included all international legal aspects but also the very complex regulatory system of the United States. As already indicated, the book covers many new The new edition has improved an already excellent developments in the area, including many cases that product further. Compiled by the same authors, both have affected the legal development since the first very experienced legal practitioners in London and edition was published. This includes notorious cases New York, the book not only covers an enormous such as those involving the Erika, Prestige, Hebei area in international and US marine pollution law, Spirit, New Carissa, Cosco Busan, Castor, Tasman but also brings the subject up-to-date by addressing Spirit, and MSC Napoli. Many other changes and the many changes that have occurred in the area in new developments are also fully covered. This the intervening 11 years. includes the new Bunkers, Ballast Water and Anti- Fouling Conventions, pollution from FPSOs, The book is divided into six parts covering: Liability MARPOL, SOLAS, Law of the Sea, air pollution and Compensation for Oil Pollution Damage; and carbon emissions from ships, flag and port state Compensation for Damage by Hazardous and control, measures to promote quality shipping, new Noxious Substances; Admissibility and Assessment developments in criminal liability, fair treatment of of Claims; The Law relating to Particular Parties; seafarers, oily water separators and many other areas. Limitation of Liability; and, Prevention, Reduction and Control of Marine Pollution. A number of very Despite its very hefty price tag, this book will, once helpful appendices, including information on online again, become a ‘must-have’ addition to the library sources, a comprehensive list of legislation and of anyone involved in ship operations, shipping law, cases, as well as an excellent index are also included. or the protection of the marine environment. It has A foreword is written by IMO Secretary-General been a long period between editions, but it has been Mitropoulos. worth the wait.

September 2009 49 Letters to the editor

on the Pacific The Pacific AdventurerAdventures with a hostile media Sir: I was delighted to read Dale Crisp’s excellent article Adventurer incident off the Queensland coast. The article graphically exposed not only the bias of the hostile media but also the appalling lack of knowledge of maritime matters by the journalists and media involved. Furthermore, he also provided some insight on what happens when a relatively minor maritime accident occurs during a state election campaign. The result is a media frenzy aided and abetted by irresponsible statements from politicians on both sides of the fence.

The importance of Australia’s dependence on shipping was quickly forgotten or entirely disregarded. Voices that attempted to provide a more balanced view were either not heard or not provided with the opportunity to be published. For example, I was asked to write on behalf of the Company of Master Mariners of Australia, but the article was published neither by the Brisbane nor nationalPacific pressAdventurer and instead) and online appeared in Crikey in Lloyd’s on 9 ListApril DCN 2009 on 2 April 2009 (Trial by media: The true story of the Pacific Adventurer incident). It was obvious that more knowledgeable information on the (Truth overboard in the case was neither desired nor welcome.

All of this does not bode well for what would happen if a really serious maritime accident involving extensive marine pollution occurs in Australian waters.

Yours sincerely

Professor Edgar Gold, Brisbane

Pacific Adventurer Sir: I suspect that Swire Shipping, an old established company with a reputation for looking after its employees, would have had less of an acrimonious dispute with the Queensland Government after the spill, if the authorities had spent less time attempting to demonise the shipping company and criminalise the master. For the master to face a ridiculous charge of illegally discharging oil under a law designed to prevent deliberate pollution, speaks volumes about the sheer ignorance of the authorities as to the realities of sea transport. To now, with the perfect wisdom of hindsight, attempt to criticise a master for being caught in the wrong place by a tropical revolving storm is beneath contempt. There should be navigational warnings about the administrative hazards of the Queensland coast, along with navigational risks, appended to every chart of the area.

Michael Grey [former editor Lloyds List, London]

Send letters to: The editor Shipping Australia Limited PO Box Q388 Sydney NSW 1230 We welcome letters to the editor and hope that readers will comment in the future, not only on articles in this edition or previous editions, but also topics readers would like to see covered in the future.

50 September 2009 Letters

Marine surveyors deny need to improve inspection standard

I wish to differ with a few points that are made in your article on ship inspection standards (Shipping Australia, June 2009).

The standard of hold cleanliness for grain loading in Australia is well known to all bulk vessel owners and operators, world wide. The majority of ships presenting for a grain survey in Australia are accepted at the first inspection, albeit possibly after some spot cleaning that is completed during the survey period. If a ship does fail survey, it is usually due to the small numbers in current crews and/or a short positioning voyage. Also, the cleaning of panamax class ships, in increasing use for grain, presents problems because of their size. Very few ships are engaged in a dedicated grain trade, so a variety of cargoes before a grain cargo is a seafarer’s lot.

AIMS recommends to its members that they carry out grain surveys in conjunction with AQIS inspectors whenever possible, although this is not a regulatory requirement. An AQIS inspector however, will not issue a Permit to Load until a Certificate of Fitness to Load Grain has been signed and issued by the appointed marine surveyor. For operational reasons, e.g. a grain inspection at an anchorage, the marine surveyor may inspect a ship before an AQIS inspector. In these cases AIMS recommends that a member consults with AQIS on completion of the survey.

With an FOB sales contract, the marine surveyor is appointed by the ship owner/operator’s local agent, with the approval of the shipper. With a CIF or CFR sales contract, the shipper takes control of the ship on arrival at the load port and their shipping agent appoints the marine surveyor. AIMS does not believe that there are increasing pressures on surveyors to “pass holds”. The only stakeholder who logically can be considered able to apply pressure to a surveyor is the party who appoints that surveyor. With an FOB sales contract, this is the shipowner/operator, who has an obvious interest in the ship passing survey. With a CIF or CFR sales contract however, the shipper appoints the surveyor. Logically, they want a clean ship, so any pressure would be in the opposite direction. It is difficult to see how any other stakeholder would be in a position to apply pressure to a surveyor.

AIMS does not accept that the inspection standards of its members need to be improved. It has a comprehensive, written code of practice for grain surveys, which it expects its members to follow. Grain survey “control audits” were carried out by a major exporter in 2006/2007. Audits were carried out of some AIMS’ members and resulted in prolonged discussions over the audit objectives and methods. At a joint meeting with the exporter and AQIS in June 2006, AQIS stated that in general it was happy with the level of competence shown by grain surveyors and would certainly indicate if this was not the case.

Captain Steven C. Beale

President, Australian Institute of Marine Surveyors

September 2009 51