Fremantle Ports Fremantle Ports

A ustralia Fremantle Ports AUSTRALIA Fremantle Ports Autumn 2011 Fremantle Ports

Autumn Issue Fremantle Ports Print Post Approved PP255003/07533 Approved Print Post Solving container park problems Port Kembla’s train to nowhere Behind the cameras of Border

2011 Security The rare earths crisis Profile: Gavin Smith of Royal

Special Reference issue and Caribbean Tradegate news

• Facilitating trade and business growth

Annual Report • Investing in infrastructure • Facilitating trade and business growth • Planning for future capability • Investing in infrastructure • Working with our customers • FacilitatingPlanning for trade future and capability business growth • maintaining high standards of 2010 • Working with our customers • FacilitatingInvestingenvironmental in tradeinfrastructure and and safety business management growth • maintainingFacilitating trade high standardsand business of growth • InvestingFacilitatingPlanning forin trade infrastructurefuture and capability business growth • Investingenvironmental in infrastructure and safety management • PlanningInvestingWorking forinwith infrastructurefuture our customerscapability • Planning for future capability • WorkingPlanningmaintaining1 Cliff forwith street highfuture ourFremantle standards customerscapability Western australia of 6160 • tel: +61 8 9430 3555 Fax: +61 8 9336 1391 the australian Business excellence awards • Workingenvironmentalwww.fremantleports.com.au with ourand customerssafety management and associated assessment criteria are • maintainingWorking1 Cliff with street high ourFremantle standards customers Western australia of 6160 recognised internationally as a framework • [email protected] high standards of for best management practice. environmentaltel: +61 8 9430 and 3555 safety Fax: +61 8management 9336 1391 the australian Business excellence awards • maintainingwww.fremantleports.com.au high standards of and associated assessment criteria are Special environmental and safety management recognised internationally as a framework 74066 acorndesign.com.au A ustralia [email protected] and safety management for best management practice. Reference issue 1 Cliff street Fremantle Western australia 6160 74066 acorndesign.com.au and Annual tel: +61 8 9430 3555 Fax: +61 8 9336 1391 the australian Business excellence awards www.fremantleports.com.au and associated assessment criteria are 1 Cliff street Fremantle Western australia 6160 recognised internationally as a framework [email protected] Cliff street Fremantle Western australia 6160 for best management practice. Report 2010 tel: +61 8 9430 3555 Fax: +61 8 9336 1391 the australian Business excellence awards 1 Cliff street Fremantle Western australia 6160 www.fremantleports.com.autel: +61 8 9430 3555 Fax: +61 8 9336 1391 theand associatedaustralian Businessassessment excellence criteria areawards See page ?? recognised internationally as a framework www.fremantleports.com.autel: +61 8 9430 3555 Fax: +61 8 9336 1391 theand associatedaustralian Businessassessment excellence criteria areawards 74066 acorndesign.com.au [email protected] recognisedfor best management internationally practice. as a framework www.fremantleports.com.au and associated assessment criteria are [email protected] recognisedfor best management internationally practice. as a framework [email protected] for best management practice. 74066 acorndesign.com.au

74066 acorndesign.com.au

74066 acorndesign.com.au AustrAliA’s premier port

Port of Melbourne is Australia’s premier port, handling approximately 36% of the nation’s containerised cargo as well as providing facilities for a range of Portbreakbulk of and bulk cargoes. Port of Melbourne Corporation works with supply chain melbourneparticipants to facilitate efficient cargo movement through ImetropolitanBC Melbourne, regional Victoria and beyond including Tasmania, South Australia and southern New South Wales.

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Port of Melbourne Corporation Level 4, 530 Collins Street, Melbourne Victoria Tel: 1300 857 662 Fax: +61 3 9683 1570 Email: [email protected]

Or visit our website www.portofmelbourne.com

DP World Brisbane DP World Sydney DP World Melbourne DP World Adelaide DP World Fremantle Fisherman Islands Gate B37, West Swanson Berth 6 1 Port Beach Road Port Drive 42 Friendship Road, Mackenzie Road, Coghlan Road North Fremantle Port of Brisbane Port Botany West Melbourne Outer Harbour WA 6159 QLD 4178 Australia NSW 2036 Australia VIC 3003 Australia SA Australia 5018 Australia Tel: +61 7 3895 9222 Tel: +61 2 9394 0900 Tel: +61 3 9680 0700 Tel: +61 8 8248 9325 Tel: +61 8 9430 0111 Autumn 2011

AUSTRALIAAUSTRALIA

Contents Announcements from the bridge 2 Cabotage still a concern Viewpoint 6 Empty container muddle Profile 8 Gavin Smith, of RCCL Murray Goulburn commits to 10 Melbourne Global dairy stays steady 12 AGRIBUSINESS 14 Dombarton railway 16 new life in $600m ghost train the case for it Border Security 22 Behind the scenes of TV hit Safety 24 Reliability in uranium exports Rare earths crisis 28 Special report on Australia’s role Fremantle 32 Plans for break-bulk growth Legislation 34 Convention promotes seafarer welfare Trading 38 Incoterms revised Ship Repair 42 Meeting world standards Cruising 46 Regional ports reap benefits The Scene 50 Lunch at Tattersall’s; Golf at Roseville Signal 52 Two new agent members Tradegate news 56 Important new initiatives SAL Annual report 2010 62 advertisers’ list 176 THE OFFICIAL JOURNAL OF Shipping Australia Ltd Level 6, 131 York Street, Sydney NSW 2000 PO Box Q388 Sydney NSW 1230 P: 02 9266 9911 F: 02 9268 0230 W: www.shippingaustralia.com.au

PUBLISHED FOR SHIPPING AUSTRALIA LTD BY Showcase Publications Pty Ltd C5, 99 Jones Street (Dalgety Square), Ultimo NSW 2007 PO Box 665, Broadway NSW 2007 AUSTRALIA P: 02 9211 7422 F: 02 9211 9061 1. The unfinished Dombarton W: www.showcasepublications.com.au railway bridge Editorial Executive editor: Llew Russell 2. Gavin Smith of RCCL Feature writer: Archie Bayvel 2 3. Paul Kerr of Murray Goulburn Advertising Co-ordinator 1 For advertising in the next issue contact Steve Moxey 3 4 4. Paul MacGillivary of AMSA P: 02 9211 7422 E: [email protected]

Graphic designer 5 5. Border Security TV crew Sarah Abrahams E: [email protected] Announcements from the bridge By Llew RusselL

Proposed cabotage policy still causes concern

elcome to the well as comments on the draft Marine but essentially a major concern bumper edition of Order 54 on coastal pilotage issued relates to restricting the current by the Australian Maritime Safety cabotage policy which provides our magazine as it Authority. room for foreign shipowners Wincorporates our annual carrying Australian domestic cargo Shipping Australia is strongly report which outlines incidental to Australia’s trade to also supportive of the objectives of the carry domestic trade. If there is an SAL’s activities in 2010 proposed shipping reform proposals Australian licensed vessel available and includes many of the outlined in the discussion paper three days before or three days activities of our corporate namely to: after the scheduled load date then a associate members as • ensure that Australia has a viable permit would never be issued to the well as looking forward to shipping industry, able to provide foreign flag vessel. Assuming that the potential challenges adequate coastal shipping the other taxation and productivity in 2011. services at a reasonable price for measures including the creation of customers and consumers and an international shipping register will reinvest in ships when they reach generate a more viable internationally January did not start well for us all the end of their economic lives; competitive merchant marine, then with massive flooding particularly in one would anticipate a substantial • ensure Australian shipping Queensland, Northern New South increase in vessels carrying maintains and potentially grows its Wales, Victoria and Tasmania and Australian domestic cargo. In other share of the national transport as is typical in Australia bush fires in words, is there a need to change system in order to meet the South Australia and Western Australia. the current cabotage rules if the growing transport task efficiently, The effects of the flooding will be Government has confidence that the effectively, safely with the least felt for many months if not years to other proposals will, in fact, meet the impact on the environment; come and our sympathy goes out to above objectives? all those affected particularly those • provide opportunities to increase that lost loved ones in this disaster. In addition, the Australian Government Australia’s participation in As with the bush fires in Victoria in has applied the Fair Work Act to international shipping, reflecting January 2009, members of Shipping coastal permit vessels which has the significance of shipping to our Australia have offered to help with the meant the application of minimum trade base and the linkages provision of equipment if that would wage levels from 1 July 2010 and a between strong domestic and be of assistance. new level of wages and conditions international sectors; contained in Part B of the modernised As mentioned in the Chairman’s • create employment and skill Australian Sea-Going Award which annual report, SAL prepared opportunities for Australian will apply from 1 January 2011. many submissions in 2010 and seafarers; and in the early part of 2011 there Shipping Australia has met with was an ongoing requirement for • secure the maritime skills basis Senator Evans, the current Minister submissions particularly in relation necessary to provide regulatory for Workplace Relations to argue to the discussion document on and land based maritime services their case that the regulations should revitalisation of Australian flag as well as sea based services. be amended to exclude from the shipping, a response on the draft application of the Fair Work Act In SAL’s view these are laudable report for certification of the South those vessels that are carrying objectives and it is important that Australian ports access regime, a coastal cargo incidental to Australia’s implementation of the suggested submission to the Australian Transport foreign trade. They are providing, in reform proposals contribute rather Safety Bureau on their proposed the absence of Australian licensed than inhibit the achievement of those safety investigation into Queensland vessels, a vital service in developing objectives. coastal pilotage, a submission on the coastal shipping around our coast proposed ratification by Australia of Our concerns are outlined in detail and meeting the requirements of the Maritime Labour Convention as in the Chairman’s annual report many Australian businesses and

2 Autumn 2011 AUSTRALIA Announcements from the bridge

MSC Logo variation Only to be used when extra impact is needed - Internal documents only or adverts with specific authorization

Adelaide: (08) 8341 1644 East Devonport: (03) 6427 0555 Melbourne: (08) 9336 0500 Brisbane: (07) 3909 4666 Fremantle: (08) 9336 0500 Sydney: (02) 8270 4000

Autumn 2011 3 AUSTRALIA Announcements from the bridge

companies that rely on the frequency, Whilst progress is slower than all equipment provision and rates stakeholders would have wished, provided by foreign flagged vessels. progress is now being made and it It is reiterated that this will not is anticipated in April this year that a undermine the potential viability and new Maximas IT system will increase effectiveness of Australian flagged transparency through the logistics shipping because the application of a chains as they affect empty container permit is not dependent on the level parks including provision for a kind of of freight rates charged. vehicle booking system. What is needed, in SAL’s view, is There has also been a debate about a multi-disciplined policy approach extending the working hours of a that promotes the development of number of parks and this is part of Australian flag shipping while still the overall package which requires at the same time recognising the all parties to be both cost transparent valuable contribution, that foreign and also realistic in their pricing flag ships make to filling the gaps expectations. We address these and for developing Australian coastal issues in our Viewpoint article in this shipping compared to more and edition. more cargo being consigned on road and rail with the environmental One of the fastest growing industries implications that such a development in Australia is the cruise industry and entails. Alternatively, some of the we take great pleasure in profiling domestic cargo currently carried Mr Gavin Smith, managing director around our coast could be imported of Royal Caribbean Cruise Lines in from overseas to ensure continued Australia. In the magazine section we commercial viability. also assess the potential benefits of In the spring edition last year of the developing the Maldon-Dombarton MUA’s Maritime Workers Journal, railway line and for something there was a comment that SAL was different we interview Andy Watts, producer of the Border Security asking their members to avoid the Discharging break-bulk cargo new Fair Work laws and boycott television series and he provides coastal services by withdrawing some very interesting insights into had jurisdiction to adjudicate on services. Nothing could be further this popular programme which he has container detention fees and the court from the truth as any withdrawal produced for five years. subsequently ruled that the Tribunal of services is purely a matter for Our largest container exporter is did not have jurisdiction over such individual members and there has Murray Goulburn with its main focus fees. SAL members were indeed never been and never will be any on dairy; its story is on page 10. Our discussion relating to what they industry under the spotlight for this pleased with this landmark decision. should or should not do in these edition is dairy. circumstances. There have been A meeting was held on 6 December withdrawal of services because of In the last year there was media with Captain Allan Gray; general the additional costs which could not speculation regarding whether there manager port operations and harbour be sustained but this is nothing to do should be a debate in Australia about master of Fremantle Ports regarding with any campaign or advice from nuclear energy in the future, and we the perceived lack of infrastructure SAL. The MUA suggests that SAL is look at the best practice guide for the in the inner port of Fremantle for pursuing a guest worker concept in transport of uranium oxide and the break bulk cargo. Further details are carrying the Australian domestic trade guidelines on emergency response covered in an article submitted by but forgets to mention that a viable as well as an analysis of the chemical Fremantle Ports for this edition. Australian shipping industry would and radiological safety of uranium ensure that no voyage permits were oxide in drums. I would like to take this opportunity issued in the first place. If you haven’t heard of it before we to thank all our corporate associate Over the last year a lot of work could enlighten you about rare earths members that have provided legal has gone into working with various in an article in this edition. articles for the annual report section stakeholders in Melbourne regarding of this edition as well as the many Last year the Consumer Trade and improving the efficiency and contributors from the ports industry. productivity of the empty container Tenants Tribunal ruled that China We very much appreciate input from parks and whatever emerges could Shipping Australia repay container all our members which is often so well be useful in reform of the detention costs to DB Kelly, a operations of such parks particularly furniture importer. Subsequently readily given. We also appreciate in Sydney and Fremantle where China Shipping raised the question feedback and this goes for our specific congestion problems within the Supreme Court of New readers too, so please keep the have arisen from time to time. South Wales whether that Tribunal letters flowing in.

4 Autumn 2011 AUSTRALIA Announcements from the bridge

Discharging break-bulk cargo

Autumn 2011 5 AUSTRALIA Viewpoint

We all need to get together on how to sort out the empty container muddle

mpty container park efficiency who will benefit from extended and this information comes in the is an integral part of a hours such as trucking companies. form of a vehicle booking system. seamless supply chain, yet Multiple systems have already E Ultimately the debate between inherent issues continue to detract developed such as the Tradegate who pays is between the park and from efficient operations. Long those who utilise its services. The Container Park Information System truck queues and road congestion, additional cost of longer hours has or the Maximus Container Chain particularly in Melbourne, Sydney to be through a levy as an increase initiative. and Fremantle continue to be in operating hours does not in the The effects of implementing a problems and a solution is needed short term mean an increase in system will benefit all involved. as soon as feasible. container volumes. Understandably Transport companies gain The Victorian Transport Association parks want assurances that greater visibility of park activity (VTA) has been very vocal about extended hours will be utilised. and eliminate futile trips, what they feel are the main issues MRS at Yarraville operated by unnecessary queues and improved surrounding container parks and Maersk Line and CC Container communication. Parks’ operating stand by extended operating Parks owned by MSC are currently efficiencies will increase if they hours as the only way to address trialling extended operating hours know what containers are coming or the problem. SAL supports the until 30 June. This proactive going and, more importantly, when. extension of park operating hours approach is commended by The need for a booking system was but the solution itself raises more SAL but it’s just a small step to a identified by industry stakeholders issues that need to be addressed solution because access during back in 2005 by the Victorian to make it viable. The first question the extended hours is restricted to Freight Logistics Councils’ Business always asked in business is “who containers under the jurisdiction of Activity Harmonisation Study. The pays?” and this question lingers the two lines concerned. Containers suggested solution was to introduce unanswered. for all others will continue to pick an IT interface that could provide up and drop off during the original SAL conducted a survey of its operating hours unless specific visibility of available stock to members to determine whether they arrangements are made between transport companies, exporters and would agree to a six-month trial the parks and shipping lines at an relevant parties. period for extended park trading agreed cost. The Maximus system is expected hours in Melbourne. The survey to be operational as of next month revealed that the majority view is Lines are already paying an and promises to streamline flow that the empty parks, in a number infrastructure levy imposed by parks and virtually eliminate costly delays of cases, are not being realistic in Melbourne, Sydney and Brisbane. arising from the parks’ inability regarding the levies that would There is no guarantee that extended to deliver within current hours of be required to open for extended hours alone will fix the problems operation. Booking systems have hours. The problem is that there has and to truly address them we need already proved their worth within been a lack of transparency in how to identify their root cause. The the maritime industry and lessons the additional costs are calculated real issue is that container park learnt in Melbourne will be valuable and what potential revenue would operators currently suffer due to the in improving efficiencies in Sydney arise from the extended levy. The lack of information received, and and Brisbane. most viable solution is to have a the flow-on effect is what the VTA transparent cost structure with costs has focussed on. Parks simply need The only thing left to do is to divided between shipping lines, the more information on when trucks will agree on a cost model and to empty park contractors and those pick up or drop off empty containers implement it.

6 Autumn 2011 AUSTRALIA Viewpoint

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Autumn 2011 7 AUSTRALIA Profile GAVIN SMITH, managing director RCCL Australia

A very private man whose company’s the hero in The Nation of Why Not? By ARCHIE BAYVEL

avin Smith wasn’t me giving back to the industry that has “So I went to Jetset which was then mentored me.” preparing itself for sale to Qantas and exactly born at sea I became its chief marketing officer for Royal Caribbean International’s but he was, he says, 18 months; after the sale to Qantas I publicity refers to the company and G became Jetset’s general manager. always going to work in its associated lines as the Nation of shipping. Why Not? And supports that theme “I learnt many things there about what with vivid images reminiscent of Far retailers seek from a product provider. “My dad was a chief engineer,” he Faraway, Camelot, Brigadoon and all It gave me a deeper understanding says, “and Mum was a seagoing the other destinations of our dreams. of retail including how to motivate franchisees. I enjoyed it and the hairdresser so I grew up at Bondi in This year, the company’s 40th career opportunity to remain with a family that was very interested in anniversary, it also celebrates its Qantas.” shipping and my career. Because highest sales growth and the arrival my parents were used to life at sea in Sydney of three of its cruise ships: But in fact Gavin was approached and its strong work ethic I had a Radiancy of the Seas, Rhapsody of by Royal Caribbean with a new offer fairly regimented upbringing: Sydney The Seas, and Celebrity Century. which – not without some criticism for High, take up lawn bowls at 20, play not staying with Qantas - he accepted. breakaway for Easts, UTS, a degree in But we’re running ahead of ourselves. Gavin Smith was back in cruising, marketing. Gavin takes us back to his early days back in Australia where Anne Sherry at P&O: “Then P&O where 22 years later I had moved into his old job and ended up as managing director of “P&O was where I leant my trade,” P&O Cruises in 2007. he says. “David Dingle (who is now chairman of Carnival in the UK) “Today at Royal Caribbean I have a was the managing director and my very private approach to my role and mentor. P&O was very kind to me I don’t run a personality cult nor do and every time I felt like leaving a I participate in our publicity. It’s our new opportunity cropped up to keep company that’s our hero. me interested and by the early 90s I “I want everyone on my staff to want to was looking after the company’s UK come to work every day. It’s important business here so David offered me a to me that this is a happy place job in London. to be. We are a holiday company “It was a good time to move because and a travel company as well as Australian was entering the recession a shipping company and we have we had to have, the UK was beginning obligations to keep everyone happy to emerge as a serious overseas while never getting too far away from cruise operator, plus construction of the centuries-old business of being a the Oriana became a significant part shipowner. of my work during my three years in “That’s why we are members of SAL Britain. because we are all comrades in shipping rather than being in bulk, “Back in Australia I really enjoyed containers, or cruising. Cruising has running an old-established company long been a member of the tourism like P&O where so many intellects had industry but is still an emerging gone into making it what it is today. member of the Australian shipping But along came the tragic death of industry. Mrs Brimble, with repercussions that impacted the entire cruise industry “I recently became chairman of and resulted in many changes. I was the International Cruise Council of one of them and in 2007 it was time Australia and that is the beginning of for me to move on.

8 Autumn 2011 AUSTRALIA Profile

was now running Carnival Australia, is getting over the emotional instinct of cruising was growing at a galloping having to work in Sydney Harbour. pace, talk was of MSC entering the “Many ports around the world have local market. Things were jumping! already bitten the bullet and moved “The two years I’ve been back have their cruise industry out of town. In been a rich cultural experience,” the USA for example very few cruise Gavin says. “Royal Caribbean lines now turn around in Manhattan sources its cruise passengers from and Miami, our own HQ, has moved all over the world and consolidates its cruise ships 30 miles out of town to what they desire into a single Fort Lauderdale’s Port Everglades. brand. We’re a global brand and “In Sydney our choice is a new cruise I’m enjoying the nuances involved terminal at Port Botany’s T3 and in applying that to our local market. we’re getting some traction for that

from government and it’s an on-going “Working remotely with a distant dialogue. We’ve looked at floating corporate head office means anchorages and there is no problem in managing the independence of the getting them in Sydney but they raise organisation you’re responsible for problems with fuelling, baggage and while still maintaining the company’s stores delivery. global guidelines. “Over the next 5-10 years we’ll be “Australia is still something of a frontier out of Sydney Harbour. While Garden experience yet we must stay true to Island is a warm favourite I don’t see the brand while on our learning curve. it as a solution because it’s going to And we need to do that without the take too long to negotiate with the backing of a critical mass like Europe RAN. On balance I think we have more and the USA. chance of getting Botany Bay. “There is great UK interest in what “Our proposal is for ships that call we’re doing here with a huge visitation here only once a year to get priority rate and a strong culture. It’s the spark to use Sydney Harbour because within the company and it doesn’t it’s Australia’s iconic gateway, the an impediment and we’re probably matter where in the world you work, reason why liners call here. But for only three years from that because in that spark is there. It cultivates the Australians on round-trip cruises addition to Royal Caribbean’s plans for entrepreneurial spirit and if you have Sydney is not the focus of their the future MSC is talking about basing a viable idea Royal Caribbean will holiday; it is just the launching pad ships here, and Carnival will have embrace it, no matter what your role. towards their real destination. So we’d a new ship soon. So whatever the In Australia you’re never far from your look after them at Botany Bay while process may be, we need to devise a global role. our visitors from overseas get to see solution soon. “We’re a commercial office in Australia Sydney. “Sydney’s problems are mirrored at so our office premises can afford to “A port brings new economic Brisbane and both cities need low- be modest. All ship services such throughput to a neighbourhood and cost solutions rather than a waterside as marine, technical, and hotel are that can help pay for additional Taj Mahal. based in Miami. That leaves me to wharfage. The port of Miami, for focus on the company’s commercial example, is very big but most of “Governments in the USA and in undertakings in Australia and New its cruise industry has had to move Europe will do almost anything to Zealand. north to Port Lauderdale plus all the attract the cruise industry while “I’m interested in the cruise industry services needed to handle an average Australia hasn’t yet recognised the true turnaround of five or six ships a day becoming more collaborative with benefits. International opinion is that with 10 at weekends; a total close working in Australia is difficult and that governments because cruising here to 2000 turnarounds a year. Miami people here still dispute that the need is growing up quickly and challenges could never have expanded enough for new berthing is already a hot topic. governments to satisfy its needs. Ships to handle that and the new port has are getting bigger with the two biggest “The fact is that the cruise companies brought new life to its surrounding – our Alliance and Oasis - each having are now planning their 2013 arrivals area. capacities of 6000+ passengers. So and shortage of existing waterfront cruise ships need bigger berths, more “Circular Quay and Pyrmont can’t space is not just an Australian fuel, more water, more provisions. support the number of cruise ships problem; it’s worldwide.” wanting to turn around in Sydney and “The industry’s dilemma is that it’s At 44, Gavin Smith has already had jumping up and down and whacking demanding the federal and state an action-filled career into which he governments over the head is not governments upgrade infrastructure has managed to include a Swiss wife, going to solve that problem. while not being able to do that Jackie, and two pre-teen kids. ourselves. We need to take a broader “We need to understand that this But it could be that he ain’t seen view to find solutions and part of that growth can be a show-stopper or nuthin’ yet.

Autumn 2011 9 AUSTRALIA Exporters

Murray Goulburn commits to Port of Melbourne and drive for higher returns

By paul kerr, chief operating officer of Murray Goulburn Cooperative

urray Goulburn exported more Effective management of shipping costs warehousing shows that suitable than 25,000 TEUs from the Port is also a focus of the co-operative and alternatives are not available. of Melbourne in FY 10 making we have a range of partners who support M Our investment in storage and distribution the farmer-owned co-operative one of the our shipping operations and assist us in Laverton and the Melbourne Port port’s largest export users. in remaining competitive in terms of our precinct is based around shipping pricing to foreign ports. It is critical that Over the past 10 years it has focused out of Melbourne. Any relocation of port and shipping costs are managed supply chain investment based on export shipping operations to Geelong carefully in commercial and policy terms exporting through the Port of Melbourne. or Hastings would mean additional if Australian exporters are to remain This includes multi-million dollar operating costs, mainly through increased viable. investments in the 130,000-tonne road transport. We also work closely with the dairy capacity Laverton integrated logistics We pride ourselves on having good industry and AQIS to minimise the cost centre and two other storage facilities relationships with state and federal of export documentation management within the port which have a further governments and we aim to provide them and maximise the number of on-time 68,000-tonne capacity. with the facts about policy impacts on deliveries to foreign ports. The world dairy market is still one of the exporters. We have put forward our views most distorted in regards to tariffs, lack of MG believes that the primary policy on the recent freight infrastructure charge market access and subsidies but despite position of governments should be proposal from the Port of Melbourne and this MG, backed by its 2695 farmer- to maintain or improve the cost- also the issue of cabotage. competitiveness of exporters contributing shareholders, has built a successful The future of the Australian dairy industry to the economic prosperity and export business. is at a crossroads. Demand for dairy sustainability of the Victorian and Export revenue In FY 10 was $1.16 billion products worldwide is very strong and Australian economies. to markets including Asia, the Middle the outlook is for that to continue but East, the European Union and North We have invested to maximise the markets and currency have been volatile. efficiency of the supply chain and any America. Major products sold are milk In terms of the farm sector the drought loss or disruption of storage capacity at powders, cheeses, butter, UHT milk and is now over but national milk supply has our port-based facilities would see MG other specialty ingredients. Domestic fallen by about 20 per cent since 2001 incur additional costs and ongoing loss of sales including our flagship Devondale and farm debt levels have increased efficiency. brand took total company revenues to significantly in that time. At MG we aim $2.24 billion with more than 2200 people We want to maintain access to port- to provide our farmers with higher returns employed. precinct facilities and believe that key in the future and hope that weather In the late 1990s we committed to a export-based assets such as these conditions can underpin a recovery in centralised logistics plan. We used should not be disrupted as part of farm profitability and Australian milk to load containers at our regional expansion plans. A scan of available supply. processing sites but this limited our load capacity. Now all product apart from cheese is transported to Melbourne on pallets in B-doubles and this has dramatically improved our road transport efficiency. Containers are packed in Melbourne at our Port or Laverton sites which operate around the clock most days. This allows trucks entering our storage sites to do so outside main peak hours. MG also operates a processing site in Tasmania and this product is transported across Bass Straight by Toll to be distributed domestically and internationally via the co-operative’s Melbourne facilities. We maximise export movements via the port storage facilities because we have such efficient access to Swanston Dock from our Coode Road location which is only a few hundred metres from the entrance to the dock. Devondale products on their way to market

10 Autumn 2011 AUSTRALIA SYDNEY PORTSExporters total container trade 2000/01 to GROWING AND 2009/10 (teUs)

1,927,507 WORKING TOGETHER 1,778,3701,784,017 1,445,3181,620,114 1,376,239 1,270,153 1,009,2961,161,316 990,485 2009/10 2007/08 2008/09 2006/07 2005/06 2004/05 2003/04 2002/03 2001/02 2000/01

Sydney’S portS facilitate over $50 billion of trade each year, with an annual contribution to the new South waleS economy in exceSS of $2.5 billion.

To meet the future demands of Sydney Ports continues to outperform international trade, Sydney Ports is other major Australian container ports with increasing capacity at Port Botany with the container trade increasing 8% in 2009/10. construction of a third container terminal. The $1 billion Port Botany Expansion is For the latest trade information and due to be operational in 2012, providing port developments please visit more options for importers and exporters. www.sydneyports.com.au

www.sydneyports.com.au Autumn 2011 11 AUSTRALIA Dairy

Global dairy market stays steady amid domestic challenges By JOANNE BILLS, Dairy Australia

he outlook for the global dairy production expansion, although market is positive, however international market prices are firming, Tclimate continues to present driven by steady global demand and challenges for farmers in a number of limited supplies. Australia’s dairying regions. The impact of Cyclone Yasi in far north Queensland Buyers appear more accepting of and the floods in Queensland, northern a supply constrained dairy market, NSW and northern Victoria have however prices are approaching buyer been severe for those farmers and resistance levels. “We’ve also seen an manufacturers directly affected, but improvement in market dynamics with the overall impact on milk production the Global Dairy Trade moving from remains unclear. At this stage, Dairy monthly to fortnightly.” Australia has revised its 2010/11 milk Competing vegetable fat and protein production forecast to between 9.0 and prices have increased rapidly in 9.1 billion litres, slightly down from 9.1 response to global demand outstripping to 9.2 billion litres. supply and this has offset some of the powder exports to China remain the major driver of current global market While international commodity prices substitution risk arising from stronger strength. The US Dairy Authority have consolidated since September, dairy commodity prices. anticipates China’s demand for milk current operating conditions were A weak US dollar has seen most powder will continue at current levels making it difficult to give a national currencies appreciate against it, overview of the Australian dairy for the foreseeable future, thereby making internationally traded dairy underpinning import demand. industry. commodities more affordable for On the one hand seasonal conditions importers, while a strong Australian Domestic production in China is for most producers in south-eastern dollar reduces returns to local exporters struggling to keep pace with demand Australia remain highly favourable. with dairy commodities generally growth but rapidly rising food In contrast, the flooding and heavy traded in US dollars. In contrast, the commodity prices will limit further rain has affected the quality of hay Euro has weakened against the US increases. and silage and it also means large dollar, making European exports more “While it would be expected that areas of pasture will need to be re- competitive. However, most Australian demand growth in China and other established. And in Westerrn Australia product has been committed for the developing economies will eventually farmers are dealing with severe drought February to June period. be slowed by higher retail food prices, conditions and the collapse of a local Demand for dairy continues to rise in evidence of this is yet to materialise. manufacturer. China with whole milk powder imports Reduced local milk production in Prices and availability of cows and surpassing expectations during Japan, Korea, Pakistan and Russia has replacement heifers are also limiting 2010, up 68 per cent on 2009. Milk further increased demand for imported dairy products in those countries. Dairy Australia’s Situation and Outlook Update shows Russian import demand increased substantially in 2010, as a result of reduced domestic production and strong consumption. Trade data to October 2010 indicate a 50 per cent increase in dairy import volumes compared to the same period in 2009. Cheese exports to Russia, (Russia’s largest dairy import) also increased 5 per cent in 2010 to around 250,000 tonnes. Increased Russian demand is coming at a time when the EU (Russia’s primary butter supplier) is also short

12 Autumn 2011 AUSTRALIA Dairy

of butter. The Russian government is settings, combined with signals from Australian dollar have consolidated the attempting to slow imports in order to major manufacturers, suggests the farmgate price outlook for the current support local producers, with potential 2010/11 price to southern producers season. consequences for 2011 trade. could average between $5.30 and But at least two further step-up $5.50 per kg MS – slightly higher than In Europe and the US, stockpiles payments will be required to reach the the September 2010 Update. are low and the supply response to upper end of the range. improved farmgate signals has been More recently, rising commodity prices * Joanne Bills is Dairy Australia’s slower than expected. Markets are and a relatively stable - albeit strong - manager strategy and knowledge. expected to remain steady as the northern hemisphere production season builds momentum. Opportunistic exporters from India and parts of South America could re-emerge in response to higher dairy The ABC of Dairy Australia commodity prices. However this may be curtailed by government policy Dairy Australia is the Australian dairy also attracts funding from other dairy changes restricting exports in order to industry’s national service body, and agricultural bodies such as the contain domestic food prices. responsible for Research, Development Geoffrey Gardiner Foundation and the and Extension and industry services. state Departments of Primary Industries Closer to home, drought has affected key New Zealand dairy regions, The organisation’s aim is to build to support new and ongoing R&D. reducing production growth from earlier a sustainable and internationally Farmers receive a benefit of $3 for expectations of up to 8 per cent to competitive industry, providing solutions each $1 invested by Dairy Australia on around 3 per cent. to help farmers adapt to an ever- their behalf. changing operating environment. Production conditions heading into Most of the Levy, about 48 per cent, is spring in both Australia and New Dairy Australia acts as the collective invested in improving farm productivity, investment arm of the dairy industry, Zealand, as well as US export while the remaining is equally invested investing in essential research, availability, will be critical to the in maintaining and developing markets development, extension and industry international pricing outlook for the services individual farmers and and products and promoting and latter part of 2011. dairy companies could not efficiently protecting the benefits of Australian Australian live dairy cattle exports undertake themselves. dairy. reached 75,000 in the 12 months to Work in industry services helps provide A sustainable dairy industry needs December 2010, a 28 per cent increase access to markets through negotiating growing markets for its products. Dairy on the previous year. Most of the cattle trade agreements and tariff regimes, Australia helps improve farm returns went to China, with about 53,000 technological and product innovation, (70 per cent) ending up in that country and develop high value markets for and agreed industry standards for safe, Australian exporters by delivering a while other major destinations were high quality nutritional products using range of international trade policy and Russia (9000), Indonesia (4000) and responsible production processes. the Middle East (4000). market development programs. Dairy Australia develops and drives Competition for export and replacement industry services and innovation for the Because the Australian dairy industry heifers has increased with limited ultimate benefit of the Dairy Services sells almost half of its production availability and improved milk Levy payers through collaboration and overseas, the farmgate price for milk production conditions in some regions. investment across the dairy supply in many regions is closely aligned to chain, from farm through manufacturing Pricing signals to farmers have export sales, which ultimately reflects to domestic and export markets. remained steady. Step-up payments international market developments. to southern producers have been On the whole, Dairy Australia works Dairy Australia helps Australian cautious, as expected, given with various industry bodies and exporters to identify, develop and uncertainty in currency and market organisations, universities, federal and maintain access opportunities in key conditions and strong opening prices. state governments (such as Department of Agriculture, Forestry and Fisheries), overseas markets, to maximise potential Dairy Australia modelling of current dairy companies, manufacturers and returns to farmers. The organisation exchange rate and commodity price other research and development also provides technical support for corporations to carry out its Research, industry and government in policy Development and Extension work. negotiations which aim to expand and improve our access to key markets. The Levy paid by farmers is based on milk production. The Levy amounts to Programs are also delivered to develop approximately $28 million a year. The an active preference for Australian Australian Government supports the dairy products, reinforcing the country’s dairy industry by providing matching position as a safe, friendly, trustworthy payments for eligible research and and reliable supplier of high value, development (R&D) activities. Matching quality dairy products. payments represent about $19 million a year invested into qualifying R&D For more information visit for the dairy industry. Dairy Australia www.dairyaustralia.com.au Milk trucks being loaded

Autumn 2011 13 AUSTRALIA Agribusiness

Farmers expect to ramp up capital spend this year

By MICHAEL CREED, NAB agribusiness economist

espite post farm gate However, these confidence indices farm gate) sector recorded sharp agribusiness conditions are mainly in positive territory (with falls in both profitability and trading Dweakening in December to the exception of sugar) and are conditions, while employment was fall into negative territory for the first generally well above their historical neutral. time in a year, respondents to a averages. Over the medium term, Looking to the March quarter, National Australia Bank agribusiness the recent rainfall bodes well for survey respondents remain fairly survey expect to ramp up capital expectations, particularly given that pessimistic on balance, with 23 per expenditure over the next year. much of eastern Australia is coming out of drought. cent of survey respondents expecting Forty per cent of respondents expect poor to very poor conditions in the For instance, water storage levels in to increase capital expenditure, coming quarter, compared to 19 per the Murray‐Darling Basin stood at just reflecting expectations of increased cent expecting good to very good 28 per cent in December 2009, while water allocations and subsoil conditions. December 2010 levels were at 80 per moisture boosting agricultural output. cent. This does appear to feed into In contrast, survey respondents Driving the December 2010 result expectations surrounding production remain highly optimistic over the next were falls in trading conditions over the next year and outweigh any 12 months, reflecting the expected and profitability, while employment further strength in the exchange rate. impacts of the recent rainfall on remained neutral. Underlying the next season’s production as well decline in business conditions were Confidence in wool at record as strength in prices and demand the rising AUD through the quarter, levels for agricultural commodities. In as well as weak consumer demand, Confidence in most agricultural the non‐farm economy, business which were cited as key constraints commodities declined over the conditions eased further in the to both profitability and trading quarter, with cotton pulling back in December quarter with falls in conditions. Agribusiness confidence response to excess rainfall during trading conditions, employment and also fell during the quarter, with the the quarter. Similarly, confidence profitability. likely cause being the excess rainfall in livestock products fell back a making harvest conditions difficult for little in the quarter. Nonetheless, all Employment growth stalls for the winter crop. confidence indicators by commodity second consecutive quarter remain in positive territory and are Despite high expectations, Expectations for coming year high by historical standards. employment growth in the December remain strong One notable exception was quarter was neutral, following the NAB’s December quarter survey agribusiness confidence in wool, same result recorded in September. which continued its upward trend and highlights the divergence between This largely reflects the impact of is now at its highest level on record. near and medium term expectations. excess rainfall through much of the This result was hardly surprising, This is largely a reflection of two harvest window, with expectations of given the strength in wool prices over factors. bumper crops in some areas going the past few months, the extremely unfulfilled. Firstly the AUD appreciated fairly tight supply situation, insatiable sharply in the December quarter, Chinese consumer demand and Nonetheless, employment levels which seemed to exceed survey recent return of Italian buyers to the in the sector do remain fairly high, respondents’ expectations of where market. Reflecting this, the Eastern especially when compared to levels the exchange rate was expected to Market Indicator recently pushed seen during the drought. ABS Labour fall. Secondly, we did see excess past 1200c/kg in mid‐January. Force data indicates that employment rainfall during the harvest window Coming in well below expectations in the sector (agriculture, forestry and which saw confidence in crops fall from the September quarter, business fishing) is sitting at around levels last back from their record highs. conditions in the agribusiness (post seen eight years ago. Looking at the

14 Autumn 2011 AUSTRALIA Agribusiness

next three months, however, survey compares to their September Declining cost pressures boost respondents expect employment to quarter expectations of 89.6 USD. sales margins decline on balance. Given these expectations, survey Post farm gate agribusiness sales respondents expected trading Capacity utilisation in the post farm margins were up in the December conditions to remain in negative gate agribusiness sector in the quarter, for the first time since June December quarter was relatively territory in the March 2011 quarter. 2005. Driving the result was a large unchanged from September, Tracking expectations, stocks picked increase in prices (up 0.14 points), increasing just 0.1 percentage up during the December quarter as combined with even larger declines point to 79.4 per cent. Constraining the harvest of the winter crop got in input costs and labour costs (down output in the sector were weak 0.37points) while purchase costs demand factors, with 56 per cent of underway, although stocks came in (down 0.22 points) fell significantly. respondents citing sales and orders slightly lower than expected. This Looking at the March quarter, survey as a constraint to ouput. is likely to have reflected a weaker crop than previously anticipated with respondents expect sales margins Additionally, availability of suitable to deteriorate, as final product prices much grain being downgraded to labour continues to pose a problem fall and purchase costs ramp up. feed with significant volumes being on the supply side for 45 per cent This is expected to be partially offset stored on farm. Looking to March of survey respondents. This is up by a fall in labour costs. significantly from the September quarter, survey respondents expect a quarter result, where 33 per cent significant winding down of stocks. Respondents’ outlook for the 12 months ahead remains very strong, cited it as a constraint. In contrast to expectations of a albeit weaker than last quarter. In the sharp rise, agribusiness forward December quarter, 40 per cent of Trading conditions and orders were down in the December respondents expected an increase expectations fall on high AUD quarter, with the index falling back in overall business conditions, 47 Trading conditions fell for a second into negative territory. This appears per cent expect an increase in consecutive quarter in December, consistent with the broader economy, profitablility while 56 per cent expect with respondents citing a high where weaker consumer demand has an increase in output. AUD as the main cause. Over the led to a fall in forward orders across quarter, the AUD had firmed and the total business sector. Employment expectations, on the pushed passed its highest level other hand, have weakened with since being floated in 1983. This Looking ahead, survey respondents 21 per cent expecting to reduce has led to an increase in exchange expect forward orders in March to their number of employees. The rate expectations in the agribusiness remain neutral, with 34 per cent NAB survey shows this compares sector, with survey respondents of respondents expecting forward to just 16 per cent of respondents expecting the AUD to trade at orders to remain unchanged from expecting to increase the size of their 96.1 USD in 12 months time. This December levels. workforce.

See the NAB’s Quarterly Agribusiness Survey and other reports - www.nab.com.au/agrireports.

Autumn 2011 15 AUSTRALIA Dombarton railway

An Odd Couple build up a $600 million head of steam on a train that never was

By ARCHIE BAYVEL

t’s a railway that never was and Building was stopped by the Greiner South Wales’ growth, the dramatic about an odd couple of blokes government a few years and many growth of Port Kembla’s port AND Iwho would like to change that at millions of dollars after and in 1988 the increasing traffic congestion a cost to the taxpayer of, depending its first few kilometers of rail were of all roads and rail between the on whom you believe, anything ripped up. Legend is – and there’s a massive Port Botany, 100 kilometres north, and the Wollongong – Port from $150 million to $600 million lot of legend around this ghost train Kembla urban complex. and a profit to the same taxpayers, – that it cost more to terminate the depending on whom you believe, various construction contracts than Which brings us to the Odd Couple of zilch (government estimate) and to have completed line been. … Messrs Michael Cronin and John money back in two years and profits MacRea, a couple of old codgers increasing indefinitely (the Odd So there is no Maldon-Dombarton who have devoted a significant part Couple). railway. of their recent lives - Cronin is 70, MacRea 74 - to get work started But there are astonishing The railway in question is a phantom again on the Maldon-Dumbarton track planned by NSW’s Wran monuments to it in the form of line. government in the early 1980s to cuttings, part-dug tunnels and the To listen to them the $3 million take a 35-kilometre short cut down mighty approach spans of a large is just money down the drain; as the Illawarra escarpment from bridge to cross the Nepean River. indeed it probably is when one They tower almost 100 metres high, Maldon, a god-forsaken hamlet considers that at $300 an hour (and taller even than the historic Roman on the great southern Sydney to how many of us earn that?) it would Melbourne line, to Dombarton ruins in the north African desert. represent 10,000 hours to list what which is a nondescript settlement Amid the rolling farmlands around has to be done and add up its cost. conveniently close to the rapidly Wilton they stand out, as one local No need to re-work the benefits emerging wharves of Port Kembla. put it, like dog’s balls. A multi- ‘cos they are already in the public million-dollar dog, never mind the Such a shortcut makes sense. It domain. extras! would reduce the freight time from the coal, timber, and grain-rich The spans on both sides of the upper Illawarra to Port Kembla from river lead nowhere and come from 24 hours to only four hours. And it nowhere but they’ve been the would save almost as much time in focus of many attempts, promises delivering the cars, containers and even, to revitalise the project and general cargo which are pouring complete the railway. The business out of the once sleepy and now case is that the 2006 Parliamentary booming Port Kembla to their market Inquiry recommended that the line in Sydney and beyond. be resurrected; The federal and Commercial support for its state governments remain to be completion comes from at least 50 convinced; Infrastructure Australia professional and business bodies also needs to be convinced. including SAL, Port Kembla, and a As a result, Anthony Albanese’s host of others Department of Infrastructure and The only trouble is that the railway Transport is in the midst of a $3 doesn’t exist and until now all million study to help decide whether governments have been extremely the project is now economically leery of giving it their support. viable in the light of southern New Michael Cronin and John MacRea

16 Autumn 2011 AUSTRALIA Dombarton railway

Cronin puts their views remember) alive, in the news, and The $300 million gap in a nutshell when almost constantly on the NSW Government’s hammer. he says: Our original point was with the In conversation their arguments are NSW Government, illustrated by terrifying inaccuracies. eg: especially the Minister for Transport! His • Port Kembla’s thousands of imported cars are trucked to department should have Sydney and stored on the Glebe looked at it and said: island site from which they were ’Hey, Boss, this is a no- expelled four years ago. [Fact: brainer – we must do This happened for a few weeks a feasibility study and, only when the Port Kembla car imports were first settling in.] prove the point and get on with it.’ But they/he • The planned billion-dollar developments of Port Botany did not do that.” and Port Kembla cannot take It’s clear as day to the Odd Couple place unless the ghost train and that the job must be completed its rail are built [Fact: They are ASAP and it must be done by the already under construction]. NSW Government and not farmed • Newcastle’s coal terminals are out in any public:private partnership clogged to capacity and its (as has been proposed) that will coal could be sent to Port see the “private” snitch all the profit Kembla if only that railway were while the “public” foots the bill. built. [Fact: Newcastle’s terminal Get the ghost train running and Port operators have the capacity to Botany’s already choking rail and double throughput of what is road system will be freed-up from already the world’s biggest coal the growing avalanche of imports port.] and exports generated at Port • The railway is already almost Kembla. Such is the Odd Couple’s complete and needs only a Expedition to Nowhere … eloquence that one wonders what bridge and rails for its trains to luck their railway would have in run. [Fact: It needs several Visiting the Bridge to Nowhere begins at Wilton curing cancer, the clap, and the bridges, a tunnel, rails and some airfield, an area infested by men in jump suits and an old woman in parachute harness who king’s bad leg. hundreds of millions of dollars to has just jumped or is about to. Her face is blank, Unfortunately, like many well complete. It has no trains.] eyes staring, wizened body tightly bound in intentioned enthusiasts, their One could go on with such criticism the paraphernalia of her folly. The sky is full of eloquence and energy sometimes and end up dismissing them as parachutes battling down against the thermals of leads them astray and their seeming just an odd couple … Like Dame a 40-degree country day. The track gate is locked lack of gravitas, indeed their Edna and Madge where one makes so Mike Cronin does a neat vault over it, MacRea holds the barbed-wire fence apart and steps vigorous irreverence can reduce the outrageous statements and the other persuasiveness of their advocacy. through. I follow accompanied by a ripping sound by remaining silent endorses them. and the appearance of a metre of fine wool thread It can also play havoc with their But that would be a great shame from mid- weave of my trousers and something credibility; the epistemology of many because as well as spearheading warm trickling down my left calf and into my of their claims is woeful and after the Build The Railway lobby they loafers which turn out not the best footwear in one has been spooked a few times are also the authors of a surprisingly the circs. Onwards, onwards, ever onwards. And by glaring and often basic errors, persuasive and mostly reasoned then we come to them: Monoliths of the bush, the huge pillars supporting the bridge’s approach to their ghost train runs slower and submission supporting the railway. It’s a submission whose opinions the River Nepean. “It’s the Bargo River,” Macrae slower. are now enthusiastically supported announces. We marvel and head back, back, Over the years there would hardly by a groundswell of industrial and ever backwards; MacRea limping just a little due, have been a newspaper, or news business opinion. It’s most recent he says, to “lifts” in his boots. Then that fence. program that wouldn’t have featured iteration is addressed to Anthony MacRea ducks through; Cronin does his nifty little vault and I try that too. Something goes wrong the Cronin MacRea Railroadmen Albanese, as Federal Minister of and one leg and one arm end up on one side of with their song and dance act. Infrastructure and Transport, dated the gate, the other leg and arm on the other side. Almost single-handedly they 15 December 2010, titled Maldon to I fall on my back to the dust on the wrong side of have kept the Maldon-Dombarton Dombarton Rail link Feasibility and the gate. The Odd Couple watch without, just this Railway (which doesn’t exist, signed by both Cronin and MacRea once in our morning together, saying a word.

Autumn 2011 17 AUSTRALIA Dombarton railway

and you can read extracts from their Trained as a motor mechanic and argument on Pages 17 and 18. fitter he went into business for himself buying and selling horses which he So how could a couple of such old subsequently trains for their owners. blethers have such well-thought He is divorced with one child, a and well-presented arguments at daughter who shares his interest in their core? Partly it’s because in horses. When I take the Odd Couple conversation they tend to get carried for lunch at the Wilton café both away and talk too enthusiastically to accept only a bottle of soft drink stay reliably on song; writing it down each; while I negotiate a meat pie for seems to have crystalised their entire myself it is the affable MacRea with case for going ahead with what has whom the prettiest woman in the shop until now been only a ghost railway. engages in cheerful conversation. But mostly it is because behind Just what the outcome of all this will the Odd Couple façade stand two be is still anyone’s guess but mine intelligent and public spirited men. would be that trains will run on the Mike Cronin is a retired quantity Maldon-Dombarton line and that for surveyor whose career included the sake of traffic circulation in the consulting work on the Sydney Opera Sydney-Wollongong basin that they House and the coal industry. Father run sooner than later. of five children he says he’s always been too busy to consider much else Meanwhile the vast pillars of its outside his family. He describes the bridge to and from nowhere stand pair of them as: “Just two blokes on the savannah either with their who don’t like people telling us lies.” usefulness still ahead of them or MacRea, by far the more flamboyant as monuments to an odd couple of It’s only a and loquacious of the two, says it all gallant old men. We should get their when he says: “I have experience, names on plaques before the pillars knowledge and speak to people.” do an Ozymandias and fall down. matter of time, says Figliomeni

Dom Figliomeni, CEO of Port Kembla Port Corporation, says he is a strong advocate of completing the Maldon-Dombarton railway provided a supporting business case provides economic justification for it. “It’s not a matter of ‘if’ but of ‘when’”, he says. “It’s a timing issue that could integrate with our Outer Harbor development. I also support the argument that the line would seriously reduce freight time coming from Newcastle and from coal mines in the Hunter Valley and the Western Coalfields. For freight ex- Port Kembla it would provide good connections to distribution centres at Minto, Enfield, Moorebank and Eastern Creek.” The Maldon and Dombarton area

18 Autumn 2011 AUSTRALIA Dombarton railway

The Cronin: MacRea submission in response to the Department of Infrastructure invitation to persons interested in the future of the Maldon- to-Dombarton rail link is a substantial and critical document. It reads in part:

If a toll is put on the rail link (as trains travelling at 100km/hr and crossings and also traverses the we accept will be reasonable maintenance of the network. escarpment with the same, or to recoup the costs) the profits worse, slippage problems as the The effect of such delays to will be enormous but not only from Illawarra line. exports/imports can be seen in coal. There will be many more the number of ships anchored Tahmoor mine was recently trains carrying grain, cars and motor off Pt Kembla. barred from sending its coal vehicles, containers and general down this line (18-hour turn cargo than there will be of coal, (b) The has major Illawarra line around per train) and must now specially when the current bubble of age problems and also send it via Sydney (24-hour turn demand for minerals deflates. settlement occurs on much of around per train). The mine the track down the escarpment “Any contract for the completion of operators have assessed turn to Wollongong. The track is so the rail link should be structured such around time on the rail link will at risk of slippage that a that the contractor is paid by the be about four hours. owner, being the government, and permanent speed restriction of future operation and maintenance is 40km/hr is imposed on freight (f) Demurrage fees, payable by the vested in the relevant operator of the trains (lowered to 10km/hr under NSW Government to the rail government’s rail tracks. Funding light rain conditions) and, on a freight operators are some is a separate and straightforward regular basis, during/after $5000 per 15 minutes issue. The government can issue heavy rain periods, traffic is ($480,0000 per day) for 10-year bonds and the toll per tonne prevented altogether. Under unscheduled delays to each and set at a level which ensures that the those circumstances, freight every freight train so delayed. construction cost is recovered in that stops and passengers are The annual demurrage fees bussed. would go a long way to pay the period while providing a reasonable relatively small cost of return to the investors. (c) The , 70m Stanwell Park viaduct completing the Rail link. We high and of brick construction, The government will be swamped by believe very few members of is in its last stages of decay. It superannuation funds seeking such the public and probably few now has a concrete slab in lieu a guaranteed and nation- building politicians would be aware of investment. of ballast under the rails to this cost to the State’s taxpayers. spread the load over the The following are some of the columns. The columns have had 16. Currently, road transport is not deficiencies in the current rail network tie-bolts passed through the favorable for Port Kembla or the which make the need for the Rail link bricks at the arched tops to residents of the Illawarra Region. to be completed more compelling: minimise cracking and failure. A There are only five roads up (a) Currently all rail freight to/from Pt recent addition has been the escarpment of which only Kembla from/to the north, west concrete buttressing between one is suitable for heavy trucks, and south has to travel through the columns to further delay total namely, Mt Ousely. collapse. People who know the Sydney, via the Tempe Triangle, (a) The Mt Ousely road has a line refuse to travel on it. to access the Illawarra line. A dangerously steep gradient with curfew is imposed on freight on (d) The Moss Vale line is reportedly significant gear and speed limits all lines used by Sydney an alternative southerly route for on heavy vehicles and a very commuters for four hours, access to/from Pt Kembla to high police presence. At the top morning and evening, Monday to the Main South Line at Moss of Mt Ousely, traffic may go: Friday, that is 30 per cent of the Vale, which provides access * north on Princes Highway/F6 time in each day! back north to Liverpool/Sydney Freeway to Sydney Outside those hours, freight or south to Melbourne. This line travels at the slow rate of is single track, with 3 short * north on Princes Highway and 40km/hr, in between passenger passing loops, traverses many Heathcote road to western farms with at least 37 level Sydney

Autumn 2011 19 AUSTRALIA Dombarton railway

* north-west on Appin road and years and was given an extra the benefits and use it to its full Campbelltown to western stimulus by the closure of potential. In the nation-building Sydney, or west on Picton Sydney Harbour to cargo style of our forefathers, we must road to the F5 Freeway and shipping in 2007. The cargo make provision within this facility beyond. throughput of the port increased for the use by passengers. as follows: All these roads are a mixture of near-saturation level or just dangerous. The Picton and Heathcote roads are Total Coal 22.1mt 8.3mt constantly in the media as a Year 2003/04 throughput component result of road deaths. Mt Ousely is closed on a regular basis as the result of Total 31 mt Coal 13.7mt accidents and truck Year 2009/10 breakdowns. throughput (up 40%) component (up 65%)

(b) The Princes Highway/F6 is notorious for its high volume of Port Kembla is developing plans The only reason for excluding traffic, multiple village centres for another major expansion, with passengers is because and the two bridge crossings land reclamation of a 42ha site in Government has a preference for over the Georges River, which the Outer Harbour, for a bulk a PPP process and it expects prevent the use of alternative cargo berth and a container knows that the developing routes in the event of the closure berth, with work starting in first consortium will not want to have of that road. quarter of 2011. In addition, the passengers - because they have (c) At the Picton road/F5 Freeway operators of the coal terminal are feelings and vote. is a tangle of four slip considering plans for expansion junction 19. In our campaign with the NSW roads on and off the freeway of that facility. Government, commenced 5 years and four stop signs. (b) Port Botany has out-grown its ago, we did not need to do (d) Intermodal depots are previously ideal location. The estimates of cost for completion proliferating along the F5 only rail access is a single line of the Rail link. Estimates were Freeway/M7 Motorway, and even spur with a 5km speed limit and it already available from 2 expert at Moss Vale. The rail link will be even has 3 level crossings on it! sources. The (then) State Rail an ideal mass transit conduit The whole surrounding road Authority had made a preliminary provided that both ends are system is a suburban nightmare. estimate for the cost to complete designed for rapid loading and Waiting trucks have to park in the the Rail link in the amount of unloading. roads or cruise until they can $140m to $152m but noted that gain access to the port. The only the “final” cost could be in the (e) The usage of B-Doubles has “relief” is the M5 Motorway, with order of $215m to $227m. become the norm for heavy its long unventilated tunnel, which Dr Philip Laird, of Wollongong freight but freight companies the trucks fill with life threatening University, had estimated that want even greater efficiencies. fumes. During peak hour, the M5

completion of the Rail link would cost The B-Triple, after much has the slowest travel times of all in the order of $100m to $150m, in developmental work, has been of Sydney’s “main” roads. approved for use on public early 2006. roads in Victoria. Botany Bay has an existing B-Triples Both of these estimates included will be the truck of choice for shallow draft for shipping but this

electrification of the rail link. Based freight to and from Port Kembla has been further compromised by on these estimates, one could safely if the rail link is not completed. the pipeline from the new say that the estimated cost for desalination plant. 18. The port system in NSW is also completion could have been in the far from perfect, with only Pt (c) Mega-ships are changing the order of $200m at that time. That Kembla and Pt Botany being face of shipping. Effectively, this cost estimate would have increased “ relevant to the “feasibility” of the will double the number of trucks through inflation over the intervening Rail link. Also having an having to visit Port Kembla for 4½ years, plus additional costs of influence, is the continuing each such ship, which will require more recent/stringent environmental development of shipping more transport and dockside and other factors and legislation. technology and the mega storage space. One might surmise at a current cost ship concept. to completion of some $300 million. (e) Passenger services must be (a) Pt Kembla is the only deepwater included on the rail link. When We call upon all Australians to apply port in NSW. It has been a Government builds a freeway, pressure on the Federal Government through a series of major to ease traffic congestion, what to have a high priority applied to expansion programmes for many happens? Commuters recognise the completion of the rail link.

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Australia New Zealand Papua New Guinea Inchcape Shipping Services Pty Limited, ISS-McKay Ltd Inchcape Shipping Services Level 10, 54 Miller Street, The Shipping Exchange, Level 5, Mogoru Moto Building North Sydney, NSW 2060, Australia 2 Akaroa Street, Parnell, Auckland 1052 Champion Parade, Port Moresby Tel: +61 2 9410 8888 Tel: +64 9 3094266 Tel: +675 321 2599 Fax: +61 2 9954 0288 Fax: +64 9 3092930 Fax: +675 321 2295 E-mail: [email protected] Email: [email protected] Email: [email protected] Autumn 2011 21 AUSTRALIA Border Security

Behind the scenes of TV’s winning Border Security show ...

By a special reporter

y the time you read this, Border there are no stars to pay, with Sydney Security, the Seven network’s Airport as its main location hence no Baward-winning TV show, will be costly sets, and with peoples’ greed several weeks into its latest series and and foolishness the single never- its ninth year on air. ending theme there are no script writers wracking their costly brains for Despite a basically adversarial theme new shock and horror every week. of law-and-order v. The People it’s the show everyone seems to love The basic quid pro quo is that with around 1.5 million viewers every Customs and Quarantine get a lot week and no apparent shortage of of their messages out right across advertisers’ support. Australia and in return the network The Customs department loves it, gets a show. So it’s all pro for not too while keeping a wary eye on content; many quids. advertisers love it, and most of all the Andrew Watts, the show’s series A camera-and-sound crew record a Customs Seven network loves it. It’d be mad producer, describes it as unique, officer testing for suspected narcotics. not to because with the travelling different from all other TV shows public and Customs staff as its cast because viewers are actually in on visitors being harassed nor of Aussie the crime as it is being committed or yobbos trying to smuggle contraband. attempted whereas other crime shows Nor do we want to get the show on are just follow-ups after the deed is the side of the rogues nor for that already done. matter unduly biased to intrusive law “Watching our show is like looking and order. We need a balance and so at a car accident,” he says. “There’s far have achieved that very well. nothing else like it and although we “Sydney Airport is our bread and are always looking for a different style butter location with Customs on one we always comes back to the Border side and the passengers on the other formula. “ and there’s always the tension of While the formula appears simple whether they’re on to something or the when you put it like that the details of passenger’s protests are genuine. it need constant monitoring. Terrorism, for example, would seem an obvious “We used to go out to Customs at area of interest and a mine of good Port Botany and wait around for stories but in fact terror is something stories to happen but now Customs the production team avoid because of alerts us when it has a suspect the intelligence opportunities it might container and we send a team out. offer by revealing secret security We haven’t had a container story for procedures. a while now. We do a lot of educating “Basically we have three kinds of Customs people in our needs and one stories,” Andrew says, “and they’re of them is more container stories. We based on Customs, Immigration, want to be there when a container is and Quarantine with the Mail Centre first opened rather than arriving after providing a few more. the event. “We always try to take a middle-of- “Smuggling isn’t always about drugs. the-road approach and not be on the Tobacco is a big thing with container Customs’ side all the time. We don’t stories because duty evasion comes Actor Grant Bowler, the face behind the voice. want to fill the show with incidents of under Customs all the way and does

22 Autumn 2011 AUSTRALIA Border Security

not get handed on to the police. We had a big counterfeit clothing story recently.” Production teams operate in threes – a cameraman, a sound recordist and a producer plus a Customs staffer to look after them on site. DVDs of all completed shows are sent to Canberra for checking as part of the programme’s content control to ensure that they don’t contain errors of fact or reveal secrets of the smuggler-busting trade. “We need to be careful about divulging private information,” Andrew says, “and there are a few operating techniques and questions that Customs don’t like us filming because they could educate smugglers. But in some ways we’ve already done our job too well and the public is now well aware of the legal twists and turns that can be used to an accused person’s advantage. The winning team (from left) of Lyndal Marks (executive producer), Andrew Watts (series producer) and Amy O’Connor (researcher). Their show won the 2010 platinum award for “Some Customs officers don’t want the most outstanding factual series at the 43rd WorldFest Awards in Houston, Texas. to be recognisable on air and run the risk of being identified later by In the early days of the show present the story introductions but he smugglers’ families.” episodes were run as soon as there left Australia to work in Hollywood and was a court verdict and while the was never replaced. “His voice had Unlike news broadcasts that are hot people involved were still awaiting such a good conversational style that and go straight to air, there’s always sentencing but that was scrapped we didn’t want to lose him, however,” a substantial delay between the because of fears that episodes Andy says, “so now we send him a photography and a Border Protection could be seen as influencing judges. DVD of the action and he records the episode going to air because of a Nowadays the programme rarely even voice-over.“ legal need to wait until everyone mentions sentences to avoid viewer involved has been convicted or The actual programme runs for 22 controversy over whether or not they exonerated by the courts. minutes with major items ranging from were too severe. six-seven minutes interspersed with It takes anything from six weeks “It’s a two-way trade between us short items to give viewers variety and to four years from a story being and the Customs Department,” Andy help hold their attention. recorded to getting it to air. One story says. “We get to make an interesting involving chrystal meth smuggling On the wall behind Andrew’s desk programme and it gets to showcase has been on hold for four years while are progress charts of all the itself to the public, people considering some 20 people involved go through shows in the pipeline and list all the Customs as a career, and to its the courts. component segments and their stage own huge staff around the country. of production; on the wall facing are It gives them a lot of pride in their all the past shows. Working titles organisation.” include: Bali buffoon, Diamond dealer, In contrast to the army of Customs Legless Latvian, Boris the Bear, Llama people, the whole Border Protection alarmer, Loaded, Bribe me crazy, and team consists of only three producers, one from a coming show this April a researcher, two editors and called Smoke in the Water. an assistant. Camera and sound And the most interesting story Andrew crews are hired as freelances as can recall? – “We had one passenger required from all around the country whom the sniffer dog was specially and recruiting them is quite a task interested in. Customs searched him because all need to be security- from top to bottom but couldn’t find cleared. That takes about four months any drugs. Then the dog handler and needs to be renewed every two discovered that the man was a dog years. handler himself and his clothing was A Seven team film a boat suspected of The programme doesn’t even have a carrying traces of the substance they illegal fishing star. The actor Grant Bowler used to use to train sniffer dogs.”

Autumn 2011 23 AUSTRALIA Safety

Reliable shipping essential to our uranium exports By Tammy de Wright, senior policy officer, Uranium Industry and Nuclear Section, Department of Resources Energy and Tourism

Australia is the world’s third largest than 500 parts per million of uranium was established by the Australian producer of uranium, on average and thorium combined) require export Government in 2007 to develop producing just under 10,000 tonnes permissions, which are issued by the a sustainable Australian uranium of uranium (U3O8) a year. All of Minister for Resources and Energy. mining sector in line with world’s Australia’s uranium is exported for best practice in environmental and Transport of nuclear materials, of which processing prior to use in civilian safety standards. The Council’s UOC is one of the least radioactive, vision is “to contribute to national nuclear power in the US, the European has been carried out safely and wellbeing through the progressive Union, China, Japan, South Korea routinely at ports throughout the world and sustainable development of the and Taiwan. These countries for over 45 years according to the Australian uranium exploration, mining, meet Australian safeguards policy World Nuclear Transport Institute. milling and exporting industry in line requirements by being a member of During this period there has never with world’s best practice standards.” the Nuclear Non-Proliferation Treaty been a transport incident involving The Secretariat for the Council is (NPT), having an Additional Protocol nuclear materials or UOC that has provided by the Australian Government in force with the International Atomic caused significant radiological damage Department of Resources, Energy and Energy Agency (IAEA) and having to people or to the environment. concluded a bilateral safeguards Tourism. Australian uranium producers are agreement with Australia. The With representatives from industry, dependent on access to reliable majority of Australia’s uranium is government agencies from state commercial shipping routes in order to currently exported out of Adelaide for and Commonwealth jurisdictions, the ensure the delivery of their product to processing by converters in the US, work of the Council encompasses their customers world wide. Access Canada and France. four broad strategy themes, that to commercial shipping routes for the are focused on progressing the Uranium is a naturally occurring, transport of Class 7 goods (including recommendations of the 2008 Review weakly radioactive element which is UOC) has traditionally been a of Regulatory Efficiency in Uranium widely distributed through the earth’s challenge. Mining (Regulation Review) and the crust, in rocks, soils, rivers and oceans. Despite the strong safety record of remaining priorities from the initial Uranium is exported in the form of uranium and other class 7 shipments Uranium Industry Framework Steering uranium oxide concentrate (UOC) many shipping companies and Group Report. The themes are: which is both chemically and physically ports choose not to engage in the competitiveness, which includes stable. UOC is weakly radioactive and transportation of UOC. Factors which regulation and transport issues; is classified as a Class 7 Dangerous may contribute to this include: relatively stewardship; Indigenous engagement; Good. All shipments are undertaken low volumes of trade; difficulties with and, sustainability, including health, in accordance with codes adopting port access, both for transit and safety and environment, the International Atomic Energy trans-shipment of uranium, leading to Agency (IAEA) Regulations for Safe increased logistical issues; scheduling Transport Working Group Transport of Radioactive Materials. difficulties, The lengthy delivery lead The IAEA Regulations are based on times from Australia to overseas The Council’s Transport Working the fundamental principle that whilst discharge ports result in significantly Group, currently chaired by Uranium being transported radioactive material higher operating costs for Australian Logistics Manager at BHP Billiton, should be packaged adequately to producers than those of their overseas Mr Frank Boulton, is actively working provide protection against the hazards competitors. Access to competitive towards addressing the transportation of the material under both normal and and safe international commercial challenges facing uranium exporters accident conditions. The regulations shipping routes therefore remains an at both the national and international outline the performance standards for ongoing challenge. level. The Working Group developed packaging and ensure that radioactive a Transport Mapping Model and an materials have strong containment Information Sheet for the Safe and Uranium Council whilst being transported. All shipments Effective Transport of Uranium. The of UOC from Australia (and other The Uranium Council, formerly the Transport Mapping model is a short materials such as zircon, tantalum and Uranium Industry Framework (UIF), DVD identifying the routes available monazite containing more is an industry led forum which for uranium transport within Australia

24 Autumn 2011 AUSTRALIA Safety

The need to address impediments to the transport of uranium, both nationally and internationally continues. The Transport Working Group is in the process of developing and progressing a strategy to clarify and identify the current restrictions on uranium transport and reduce the burden faced by both existing and future uranium exporters. Goals of the strategy include: • Increasing the availability of shipping transport routes; • Continuing efforts to open new ports to transit and trans-shipping UOC; • Exploring options for intercoastal shipping routes; • Examining options to increase the efficiency of UOC transport; • Continuing efforts to encourage carriers to accept uranium/Class 7; and, • Developing recommendations for Government consideration. In developing the strategy members of the Working Group and the Secretariat are planning to engage with representatives from a wide range of industries involved in the shipment of uranium, including producers, shippers, regulators, port authorities, and local and state governments. In conjunction members of the Working Group have been active in the past year in developing a suite of guidance documents on shipping and transport of uranium including: • Best practice guide on the transport of uranium; • Analysis of the Chemical and Radiological Safety of drummed UOC – development of safety data sheet to global harmonised standards;

-- and internationally for exports basic radiation protection, first aid • Guideline on emergency response; and, from Australia -- as of 2008, when it and safety measures. The leaflet was completed. It has been widely informs stakeholders of the steps • Guidance on creation of circulated both domestically and taken to safely transport uranium and incident response action plans internationally. the intrinsic safety of the product if for the transportation of Uranium Ore Concentrates. The Information sheet for the Safe and handled appropriately. The leaflet Effective Transport of Uranium is a has been distributed domestically and When finalised, these documents will leaflet which gives a short description internationally to government, industry, be publicly available. The Working of uranium, its uses, transportation shipping and port organisations. The Group is also planning to develop a and packaging requirements. It also World Nuclear Transport Institute has template for developing transport plans outlines the safeguards and permit recently created a similarly focused and shipping documentation including requirements and explains the risks, brochure. requests for shipment approvals.

Autumn 2011 25 AUSTRALIA Safety

to act as a point of conduct for all IAEA matters related to denials and delays of shipment of radioactive material in their country. The National Focal Point for Australia is located in the Department of Resources, Energy and Tourism. The Committee is also in the process of developing a communication strategy designed to highlight the importance of class 7 goods in medical, research and electricity generation. In addition the IAEA has just commenced a new project focused on improving transport safety and the application of transport safety standards alongside measures to mitigate or resolve denial of shipment. Recognising increasing numbers of states are now dealing with transporting nuclear material the project is designed to address gaps in regulatory regimes that may not have previously had to deal with the International Steering considerable work in order to be transport of radioactive materials in Committee on Denial of achieved. The Australian Government the past. This project will include the Shipment has been working internationally development of guidance material, through the International Steering The challenges faced by Australian collection and analysis of information, Committee on Denial of Shipment uranium producers in getting their interactions with other bodies involved and in other multilateral and bilateral product to market are not unique. in the transport safety regime, and the settings to increase the variety of Internationally the shipment of class organization of a major international commercial shipping routes available conference. 7 goods from uranium through to for the transport of uranium to market. radiopharmaceuticals continues to For further information on the Uranium encounter difficulties even when Regional Coordinators and National Council please see www.ret.gov.au/uc transported using good transportation Focal Points have been appointed in practices and in accordance with numerous countries to act as points For further information on the delay national and international regulations of contact in cases of difficulties, and denial of shipping of radioactive based on the IAEA Regulations. delays and denials with shipments of materials see http://www-ns.iaea.org/ The Australian Radiation Protection all radioactive materials. The National tech-areas/radiation-safety/denial-of- and Nuclear Safety Agency Code Focal Point in each country is intended shipment.asp?s=3&l=23. of Practice for the Safe Transport of Radioactive Material (2008 edition), which is in turn adopted by Commonwealth, State and Territory Governments, incorporates the IAEA Regulations for the Safe Transport of Radioactive Materials. One of the important mechanisms being used to address and reduce incidents of delay and denial internationally is the IAEA’s International Steering Committee on Denial of Shipment. The Committee was established in 2007 to overcome international problems with denials and delays in shipments of radioactive materials internationally. In February 2010 the IAEA announced a target of reducing the delay and denial of shipment of radioactive materials to ‘an insignificant level’ by 2013, a goal which still requires The Ranger uranium mine at Jabiru in the Northern Territory

26 Autumn 2011 AUSTRALIA Newcastle Stevedores specialises in Break bulk, Project cargo and containers in the port of Newcastle and works at developing client relationships ensuringSafety a high quality of stevedoring services. Our ability to give assurances is supported by highly trained human resources backed up by an experienced Management and operational team who excel in ships planning and ship management who are backed up with specialist stevedoring equipment and machinery

Geoff Beesley – Managing Director Geoff has almost 50 years experience in the shipping industry, 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 and Consolidation depots, shipping agencies as well as stevedoring interests.

James Griffiths – General Manager James Griffiths started with NS in 1998, as a Casual Waterside Worker. He has been fortunate enough to experience a wide exposure to the industry during the last 7 years, including roles within Shipping Agencies, Cargo Consolidation Facilities and here at NS.

Philip Watt – Operations Manager Philip Watt has over 15 years experience managing all operational facets of container and multipurpose port operations. He has hands on operational experience across a broad range of port environments. Prior to joining NS in August 2010 he worked with AECOM, Swire Shipping and Port of Wellington. In his time at Swire Shipping he was fortunate enough to spend 2 years in PNG managing the port operations for the region.

Darrel Madden - Wharf Superintendent Darrel Madden has over 20 years experience as a waterside worker, He worked for Patrick and Strang Stevedores prior to commencing with NS in 2001. Darrel spent time working as a Grade 5 and 6 foreman prior to moving to his Superintendent role

Jeff Harvey - Wharf Superintendent Jeff Harvey was one of the Newcastle Stevedores original employees. Prior to Stevedoring Jeff had a very mechanical background. Now with over 14 years working as a Grade 5 and 6 foreman he has moved in to the role of Wharf Superintendent.

Brian O’Dowd – Logistics / IT Brian first began in shipping in 1986 as an agent. He worked for a number of different Agencies before becoming manager of Barwil in 1999. After leaving shipping in 2000 he reappeared with Newcastle Stevedores in 2002.

Newcastle Stevedores Unit 14, 56 Industrial Drive, MAYFIELD NSW 2304 l PO Box 525, MAYFIELD NSW 2304 Ph Main: +61 2 40147100 l Fax: +61 2 49688711 l Mobile: 0412 680 001 l Email: [email protected] Autumn 2011 27 AUSTRALIA The rare earths crisis

We may never have heard of them and they’re not even rare, yet we need lots of them

By ARCHIE BAYVEL

ever heard of rare earths production takes around 10 years and and speculators out there urging before? Don’t worry, by the billions of dollars. their readers – for anything from Ntime you’ve read this story $99 to $999 a time – to subscribe But an Australia white knight has of intrigue, folly, greed and genius and thereby learn the names, stock you’ll know more about these 17 galloped on to the scene in the form exchange codes and other vital info elements than most people and you’ll of one Nicholas Curtis and his Lynas about companies whose shares will do be astonished how often you’ll notice company. Tucked under his arm he in a trice what has taken people like Lynas’ installation of rotary kilns at the LAMP, Malaysia them in the media now. has a fully fledged environmentally Curtis a lifetime of diligence, insight, immaculate rare earth mine that will On the international manufacturing and good management to achieve. scene rare earths make almost daily go a long way to making up the news because almost all high-tech Chinese shortfall. It is due to go into One tipster promises the possibility commodities which define our present production at Mt Weld, near Laverton, of a 9000 per cent increase in their way of life need a trace of one or other about 300km north of Kalgoorlie, any investment if they buy into a sure-fire rare earth to make it work. All small- day now and his refining plant in rare earth prospect in Kyrgyzstan. tech devices such as cell phones and Malaysia – to where his ore will be The venture involves reactivating a laptops, the electric car revolution, mothballed Soviet nuclear plant and wind-powered turbines, TV screens, shipped for refining – is scheduled for re-running its slag heaps in search radar, the space industry, defence. start-up early next year. The list goes on. of any erbium and thulium or even Lynas Corporation Limited looks lutetium. And these vital rare earths with like making millions for him and his unpronounceable names – try yttrium shareholders. You may get some Where is that again? Best directions or cerium in conversation – are idea of how much by the fact that are to say that it is a former Soviet suddenly becoming very very rare Curtis sold 7 million of his shares republic not far from Kazakhstan, with China, which produces 97 per a few weeks ago for $13.5 million, made famous by Borat Sagdiyev. cent of the world supply, slashing its exports just as world demand for them presumably to fund one of his many Yet another hot tip concerns rare is doubling. Cuts announced so far are other projects or to simply pay a few of earth deposits in Greenland. Projected 35 per cent for the first half of the year the kind of bills that even people living profits here are based on an estimated with more to come. in a world of billions need to settle to $273 billion deposit of rare earths keep the lights and phones on. His Not that the world uses very much promethium and samarium or remaining interests in the company are europium and gadolinium. Total reported at 14.93 million shares and consumption of all 17 rare earths 31 million employee options. Rare last year would just about fill a single So lanthanum and praseodymium and cape-size ore ship. Scattered among all the nations that make consumer their rare earth ilk seem to offer big earths good, engineering and electronic opportunities to anyone who has them. parts it’s just a handful of terbium Oddly enough you find them all over yttrium lanthanum and dysprosium or holmium here and the place but finding a deposit big to cerium praseodymium there. But they are critical handfuls. mine is a different story and refining promethium erbium According to the U.S. Geological rare earths takes 10 days’ processing samarium thulium Survey global demand will exceed from the time you get a chunk of the 200,000 tons a year by 2014. There europium stuff on your shovel to having a few lutetium are sufficient global reserves for many gadolinium pure grains in your test tube. years but the challenge is to find and terbium neodymium develop them quickly enough. If you hadn’t heard of rare earths until dysprosium scandium To find a new rare earth deposit and now you’re also probably unaware of holmium ytterbium get it into environmentally acceptable the raft of newsletters, emails,

28 Autumn 2011 AUSTRALIA The rare earths crisis

time last year when China announced its need to clean up the environmental aspects of its industry. When it announced 35 per cent cuts in its export quotas in December the rare earths really hit the fan! Sensationalists quickly suggested it was a Chinese plot to move its manufacturers up the supply chain by forcing rival manufacturers to move to where the rare earths are. But the fact is that many people did have advance warning and plenty of it. The US Government for one had Cindy Hurst’s paper in 2009 and would probably have known the gist of its content a year earlier. Long before that our little Aussie digger, Nicholas Curtis, would have known heaps about the looming Lynas’ installation of rotary kilns at the LAMP, Malaysia shortage of rare earths and the pending China rationing of them. As which lie under several metres of ice Big issues hanging over far back as the 1990s he was already and snow for most of the year. Their the world rare earths an expert on China’s mineral potential. promoter describes the drought of crisis include: In 2000 he founded and became rare earths as more dangerous that chairman of Sino Mining International Al Qaeda, drug trafficking, or cyber 1. How China came to which later renamed as Sino Gold terrorism – combined!! monopolise world and sold in 2009 to Eldorado Gold Yet another rare earths urger supplies of not for A$2.15 billion. One doesn’t build reports “Panic at the Pentagon” in a $2.15 billion company with Sino in uncommon minerals its name unless you know a bit about one paragraph while assuring his China. readers that he can turn their “$7000 2. Why China suddenly into nearly $150,000” by revealing turned off its exports 1. China’s road to shocking (and profitable) rare earth monopolising the world secrets the US Government doesn’t 3. How Australia rare earth market began want them to know. suddenly leaped on in the late 1950s when to centre stage. Other promoters write of a nuclear it started to recover rare submarine penetrating a polar icecap Until the 1950s the world’s to enable a brave officer to leap earth elements during the comparatively modest demand for rare process of producing iron ashore and plant his national flag on a earths was met by mines in Brazil, land rich in rare earths. South Africa, India, Malaysia, and by and steel. But back in real life the true facts are Mountain Pass, in California. Then By 1989 its production was increasing industry suddenly discovered that a that apart from our Mt Weld there is by about 40 per cent a year and magnet with a dash of neodymium only one other mine producing rare through the 1990s exports grew so in it was dozens of times stronger earths at industrial level. Owned by much that the world price plunged and smaller than one without it, that Molycorp of the US, it is at Mountain forcing other producers, including surfaces polished with lanthanum were Pass, in California. Like Mt Weld, it Molycorp, the biggest US producer, brighter and more scratch-proof, and out of the market. Demand for different is predicted to produce some 22,000 other discoveries were going on and rare earths also varied from use in tonnes of ore in the coming year. on and on. coloring glass to magnetic technology We’re indebted for much of what That was when China realised it had which is their most important use today. you are about to read to MS Cindy easily-mined rare earths coming out Hurst, an analyst for the US Army’s of its ears at Bayan Obo, in Inner In 1986 General Motors formed a Foreign Military Studies Office, at Fort Mongolia, and at other smaller sites special magnets division called Leavenworth, in Kansas. She wrote all around the country. It set out to Magnaquench. Nine years later two the bible on the world’s rare earth dominate the market with prices a Chinese companies joined forces situation and her lengthy 2009 briefing fraction of what anyone else was with a US investment firm and tried paper is meticulously annotated charging. Eventually all the other to acquire it. But the US Government and its epistemology appears to be miners and refiners shut up shop and intervened and the Chinese had to immaculate. Any conclusions drawn left the market to China. Everyone agree to keep Magnequench in the US from it are my responsibility alone. lived happy ever after until about this for at least five years. The day after

Autumn 2011 29 AUSTRALIA The rare earths crisis

that agreement expired in 2002 the housekeeping on industrial health and the shutdown would far outweigh the entire operation and all its equipment, safety issues. short-term western concerns. disappeared. All employees were laid He summarised the world rare earth off and the company moved to China. At its main rare earth source in situation as: Not long after that China came within the Baotou area, 5387 residents are reported as suffering from a whisker of purchasing Molycorp • There are about 200 exploration pneumoconiosis (Black Lung disease). itself. At the time, it seemed nobody and development projects of It used to be the miners’ terror all really cared. But within five years which only seven are currently able over Europe and America and is still world leadership of the permanent to produce 10,000 tonnes pa of magnet market, including military a death sentence on its sufferers. rare earths. and aerospace uses, had shifted to Now eliminated in western mines, China from the USA. Today Molycorp’s it’s still the end of a road for these • From now until 2015 China’s export Mountain Pass is the only operating 5387 Chinese. Who knows how many quota should be 32,000 to 35,000 remaining rare earths plant in the USA thousands more walking dead there tonnes. today. are at other rare earth installations. No • This would leave a demand figures are available but the Chinese Then in February 2009 focus balance of from 18,000 to 50,000 government is determined to bring it tons which he described as a great suddenly switched to Australia and a under control. comparatively unknown outfit – Lynas opportunity for new producers. Corporation - which, because of Even more terrifying is the fact that • China was already the world’s funding problems, had suspended tailings are leaking into the Yellow biggest consumer of rare earth construction of a big rare earths mine River which snakes another 2000 elements. in WA. Within 12 weeks China Non- kilometres through China to the sea. Ferrous Metal Mining was poised to A hundred and fifty million people • With demand within China for rare invest $252 million in return for a 51.6 depend on the river for their water earth concentrates growing percent stake in Lynas. which is so poisoned around the beyond its production capacity, mines that all fish have died. the country was moving from the Before the deal could be finalised, the sell side of the market to the buy Australian Foreign Investment Review So with demand for its products side thus offering new Board stepped in and China backed expected to double in the next five opportunities to outside producers. out of the deal after the FIRB insisted it years then double again there seems reduce its stake to below 50 per cent. no time like now to come to grips with Dr Zhanheng said China’s new the environmental issues and if that export restrictions were part of a Australia had saved the world! Or the quantity control programme to reduce rare earths part of it anyway. China means cutting off production then so be it. environmental damage from its mine has, however, managed to invest in sites, and to curb gougers and rare another Australian rare earth developer Addressing the Critical Metals earth smugglers. His concerns are - Arafura Resources Ltd. East China Investment Summit in Vancouver a few supported by Cindy Hurst’s report that Exploration, a division of Jiangsu weeks ago, Professor Chen Zhanheng, at the rate China was mining, its main Eastern China Non-Ferrous Metals a world authority on China’s rare earth ore bodies would be exhausted within Investment Holding Co, is reported as industry, claimed advantages from 35 years. having a stake of 17.51 per cent in Arafura. 2. China’s decision to reduce its rare earth export quota by 35 per cent has been seen as a first step to blackmailing western and Japanese industry. Speculation has run riot that this is but a foretaste of things to come. But it seems there are much more rational reasons for the cuts. According to Cindy Hurst, China’s rare earth industry is so plagued with disorderly development and poor management practices that the government fears that if they continue, China will become a rare-earth poor country or even a country without any rare earth elements. So at least one serious reason for the cuts is to enable Rare earths filter press and thickener area at the concentration China to do some much-needed plant in Western Australia

30 Autumn 2011 AUSTRALIA The rare earths crisis

3. That brings us to how low profile. Unlike other billionaire A presentation paper prepared by Australia has suddenly families the Curtis clan rarely appears the company predicts the growth come on to centre stage in the news and he refused to be of hybrid electric cars as likely to interviewed for this story. So modest is demand up to 23,400 tons pa of rare rare earth. their profile that a first glance at Who’s earth products by 2020 while lighting It largely focuses on 53-year-old Who in Business reveals only that demands (4981 tons in 2008) are likely Nick Curtis who first surfaced in the father Nick is prominent in good works to grow by about 12 per cent pa and finance world in 1982 at Macquarie as chairman of St Vincent’s Private LCD (729 tons) and plasma (227 tons) Bank where he stayed for 12 years, Hospital and suchlike. A second look technologies’ consumption will each ending up as head of commodities. finds a different entry that reveals his grow by 22 per cent pa. From there he founded Asia Resource business interests, that he was born Capital, a joint venture with Macquarie at Le Havre, in France, that his mother Among all the rare earth dabblers in advising governments on non-ferrous had the rather delightful maiden name Australia, and there is a surprising metals. In 1995 he became CEO of of Chantal Courant and that Nicholas number, Arafura Resources Limited, Sino Mining before founding Sino went to school at Riverview. a WA company, seems most likely Gold in 2000 and, five years later, to become an active producer with selling it to Eldorado for $2.15 billion. The family hero is, of course, the Mt claims to have superior ore finds to Mt At the same time he had got Lynas Weld mine with a projected 2011 Weld, Mountain Pass, and even China. Corporation off the ground in 2001 production of 22,000 tonnes of rare It has, however, a long way to go with and slowly developed to its present earth elements expected to double its drilling programme alone expected position as one of only two rare earth by 2013. Mt Weld already has a lot to go into 2013. miners of note outside China. He of product sold or spoken for. One also founded in 2009 the corporate 10-year contract is worth upwards of Conspiracy theorists are now asking advisory firm of Sino Resources US$200 million; another is a five-year what would happen were China to Capital – of which his son Oliver is contract for US$200m; a third is for reverse its export cuts and flood the also a founding director - to advise US$20 million over an unspecified market with low cost product again? on Chinese investment in resource period; a fourth’s details are as yet In the light of all we now know about industries. unspecified while heart-warmers five rare earths and China’s environmental Despite all that activity Nick Curtis and six are letters of intent worth a plans does anyone really think that’s and his family have kept a remarkably total of US$160 million. likely?

Rare earths filter press and thickener area at the concentration plant in Western Australia

Autumn 2011 31 AUSTRALIA Fremantle

Fremantle plans for break-bulk growth

By a special reporter

he ramp-up of major resource- Steel imports through Fremantle’s handled through the port, Chris based infrastructure projects Inner Harbour to the end of Leatt-Hayter said. Tin Western Australia and the December 2010 were up by 14 “Our break-bulk trades contribute recovery in global steel production per cent compared with the same significantly to the economic are being factored into Fremantle period the previous year. performance of this port, particularly Ports’ planning for break- bulk when that contribution is measured Overseas demand for scrap metal trades. in terms of dollar value per square destined for the blast furnaces of Fremantle’s common-user berths metre of wharf space occupied. southern and south-east Asia has handle new motor vehicle imports, seen this export trade also grow “We recognise the importance, machinery, mining equipment, steel therefore, of giving due attention strongly at Fremantle, with an products and scrap metal, tallow, to the break-bulk components increase of about 26 per cent year bitumen, livestock and some other of our trade as part of our port load on/load off and ro-ro cargoes. to date. development and strategic planning. “The growth in the resource sector There has been significant growth, “To this end, we undertook a has resulted in general cargo too, over the past six months in common-user berth operations growth beyond our previous livestock exports, another important review in 2008 to identify limitations predictions in some trades, says trade for Fremantle. and possible efficiencies. The aim has been to ensure our facilities Fremantle Ports Chief Executive Break bulk trades are a very for break-bulk can meet customer Officer, Chris Leatt-Hayter. important part of the mix of trades needs both now and in the future,” he said. “In recent years, upgrading of some of the common-user berths has increased their flexibility to handle different types of shipping and cargoes and this will continue to be important in planning future works.” he said. “This helps with scheduling and avoids delays when we have two ships both requiring the same type of berth.” Facilities at the eastern end of Victoria Quay are used for handling most of Fremantle’s new motor vehicle imports. This trade is another strong performer for Fremantle, with a post GFC increase of 26 per cent last year and significant growth occurring again this year. In 2008, a heavy-duty reinforced concrete pad was constructed at H Berth on Victoria Quay. This Wallenius Wilhelmsen’s Tirranna, in Fremantle was designed to enable the direct

32 Autumn 2011 AUSTRALIA Fremantle

“Decisions on how the land will be used will be based on the extent to which proposed uses are compatible with and contribute to the efficiency and success of existing port operations,” Chris Leatt-Hayter said. “Fremantle is Western Australia’s principal general cargo port handling some $25 billion in trade annually. Facilitating trade is Fremantle Ports’ role under legislation and we continue to work closely with our customers to identify trends, needs and solutions. “Workshops involving break-bulk customers have contributed to mutual understanding of issues as well as helping to identify improvement opportunities. Improved security in common Unloading steel at the common user berth user areas has been one of the outcomes of these discussions, as unloading of heavy duty equipment under-used and maintenance- has improved stacking area layout (up to 120 tonnes in weight) from hungry building will also improve a ro-ro via the vessel’s steel ramp. the configuration of stacking areas. “In addressing current and This new facility supplements the predicted growth in a number of existing ro-ro facility at Berths 11/12 Existing undercover storage further our common-user trades, Fremantle and provides additional berthing back on Berth 12 will be retained Ports’ aim is to maximise berth flexibility in the port for these and options for the provision of availability, reduce congestion vessels. additional under cover storage and any potential for delays and areas are also being considered to promote efficient receival and The introduction of the heavy duty make sure that user needs are met. delivery of cargo, Chris Leatt-Hayter pad on H berth enabled the industry said. to supplement vehicle imports The program of planned upgrading with coastal ro-ro cargoes such of common-user berths in the “As well as meeting current and as caravans and second hand Inner Harbour also includes new medium term needs, we are looking machinery when the vehicle trade fendering for North Quay Berths well ahead to the time that the Inner was impacted by the worldwide 1 and 2 which are used for Harbour reaches capacity and our economic downturn. livestock exports, steel imports and planning encompasses the needs of “To cater for continuing growth other cargoes. Fremantle Ports the very important break-bulk trade and the future need to be able to continues to review engineering sector.” accommodate up to 6000 vehicles options at these berths to ensure in a single shipment, consideration the sustainability of general cargo is being given to increasing operations and flexibility of berth capacity for motor vehicle imports,” choice. Chris Leatt-Hayter said. “One option we are looking at is the The area behind Berths 1 and 2 construction of tiered decking on is included in current planning to Victoria Quay to expand short-term ensure that land at North Quay is car storage capacity.” used in a way that contributes to At common-user Berth 12 on North port efficiency. Following a call Quay, the proposed demolition of for expressions of interest for use a large shed will increase stacking of land at North Quay and Rous area. The shed was built in 1969 Head, including 27 hectares of land when the berth was developed newly reclaimed through dredging, for container shipping. Fremantle Fremantle Ports is progressing its Car carrier Trans Leader at Ports’ plan to remove this oversized, development planning for the area. H berth Victoria Quay

Autumn 2011 33 AUSTRALIA Legislation

Maritime Labour Convention promotes seafarer welfare

By Paul MacGillivary, principal officer, Seafarer and Ship Paul MacGillivary at the IMO Safety Management, AMSA

The Australian Government is one that will work within the well- the basic obligations of member expected to introduce legislation into established international system of States that ratify the MLC. The Federal Parliament in 2011 to allow enforcing standards for ship safety, Code contains the details for the it to ratify the International Labour environmental protection and security implementation of the Regulations, Organisation’s (ILO) Maritime Labour embraced by the IMO. comprised of Part A (mandatory Convention (MLC). Amendments Standards) and Part B (non- The MLC is seen by the ILO as to the Navigation Act 1912 and mandatory Guidelines). the vital, new tool to create a level Marine Orders will be precursors to playing field for best practice ship The Regulations and the Code are the formal ratification process. An owners so they do not face unfair organised into general areas under exposure draft of a Bill amending competition from ships providing five titles: the Navigation Act is now being substandard conditions. Aiming circulated to ship owner and seafarer Title 1: Minimum requirements for to achieve this through the equal representatives for comment and seafarers to work on a ship; treatment of ships set out in Article discussion. V of the MLC, it requires ratifying Title 2: Conditions of employment; The MLC is the most complex and member States to implement their lengthy ILO convention in history. responsibilities under the Convention Title 3: Accommodation, recreational Designed to reflect the demands so ships flying the flag of non- facilities, food and catering; on shipping in an increasingly ratifying countries do not receive Title 4: Health protection, medical globalised world, it promotes decent more favourable treatment than care, welfare and social security working conditions for all seafarers those of ratifying States. Essentially, protection; and by setting minimum requirements this means ratifying members will on a wide range of matters, among apply the MLC standards to all Title 5: Compliance and enforcement. them: employment conditions, foreign vessels arriving in their The MLC will come into force as accommodation, health protection ports – if necessary, detaining and/ international law 12 months after and social security. or inspecting them – regardless of the date on which there have been whether or not the ship is flagged in a It is intended to be the “fourth pillar” registered ratifications by at least 30 country that has ratified the MLC. of international shipping regulation, ILO member States with a total share complementing the SOLAS, MARPOL The Convention is written to be in the world gross tonnage of ships and STCW Conventions of the consistent with existing mechanisms of 33 per cent. To date, the MLC International Maritime Organisation in the maritime sector for ship has been ratified by eleven member (IMO), and crucially also establishes inspections (by flag and port States) States representing approximately 50 mechanisms to ensure ratifying in connection with an earlier maritime per cent of the world fleet by gross members comply with and effectively labour Convention – the Merchant tonnage. This means that the tonnage implement the MLC. Shipping (Minimum Standards) requirement for entry into force has Convention, 1976 (No. 147) – and already been achieved and it is likely It has been described as a seafarers the major ship safety and pollution that the quota of member States will “bill of rights.” prevention Conventions developed be met in 2011. The MLC consolidates and by the IMO. It also seeks to take modernises 37 existing maritime ILO into account agreements currently The MLC and the social Conventions, many of which have in place under the various regional welfare of seafarers proven difficult for governments to Memoranda of Understanding (MOU) One of the catalysts for the ratify and enforce. on port State control. development of the MLC was There has been a growing Three different but related parts Australia’s “Ships of Shame” report, recognition of the need to develop make up the MLC: the Articles, the and subsequent shipping inquiries a more effective enforcement and Regulations and the Code. The throughout the 1990s, which raised compliance system that would help Articles and Regulations set out awareness of the unacceptable to eliminate substandard ships, the core rights and principles and impacts of substandard shipping. The

34 Autumn 2011 AUSTRALIA Legislation

evidence from these inquiries also • Lack of access to welfare and depression amongst seafarers identified seafarer welfare issues, services due to more stringent are on the increase. specifically: port security restrictions; The most dangerous risk to the • The failure of flag States to • Reduction in crew sizes and seafarer is not from ship and job- adequately implement IMO and increased use of multi-national related accidents, but rather from ILO standards exposes crews, resulting in reduced social conditions on board, both at seafarers to exploitation and onboard social interaction; sea and in port. Fatalities with social causes are the largest group—and abuse; • Recruitment of poorly trained the most ignored. • The mistreatment of crews and unqualified crews, placing Improving social conditions on affects the safe operation of more work load on competent crew; board can surely lead to better ships and endangers all who work performance and enhanced have contact with those ships; • Additional onboard procedural safety of ship, crew, cargo and the duties, such as maintaining • The abuse and neglect of environment. For this reason, the shipboard security; seafarers constitute both a largest potential for crew safety violation of human rights and a • Increasingly longer tours of is through improvements in social serious risk factor for ship and duty, away from home and conditions for every seafarer through port safety and those working in, family, leading to a sense of a variety of ways, such as: more on, or around such ships; isolation and depression. careful selection in recruitment along with increased job security; • A poor quality ship poses a In terms of safety at sea, ship progressive working environment safety threat to human lives, its accidents, such as collisions, fires and living arrangements; upgrades cargo and the marine and groundings, do not represent the to education and training; along with environment; most significant cause of fatalities more leisure time enriched by better amongst seafarers. In the mid-‘90s, accessibility of communication with • Ship safety problems, along with Det Norske Veritas completed a friends and family. crew fatigue, impacts port safety research project identifying less than and efficiency; 25 percent of shipboard fatalities There is a close correlation between were attributable to ship accidents. social, safety, working and living • The human factors of shipping And while job-related accidents conditions on board ship and accidents and pollution incidents account for another 25 percent, improvements in these conditions are take on a greater significance if suicide, drug overdose and homicide explicitly identified in the MLC. crews are fatigued, account for more than 50 percent of malnourished and/or under all deaths at sea. Lead up to Australia’s personal or social pressures. imminent ratification These conclusions are supported The realities of modern shipping by more recent studies as well. In a Ratification of the MLC by Australia in the post “9-11”, “Erika/Prestige” joint Monash University/University of will represent a strong demonstration era make the last two points New South Wales paper delivered of its support for the ILO’s highly significant. Recent fatigue to the Seafarers Welfare Forum fundamental goal to promote “decent studies conducted by the Seafarers (2000), British coronial data revealed and productive work, in conditions International Research Centre (SIRC), the major cause of traumatic death of freedom, equity, security and International Transport Workers’ for seafarers is suicide. From SIRC human dignity.” The MLC is designed Federation (ITF), US Coast Guard, findings, the paper also cited the specifically for the world’s 1.2 million AMSA and others, have revealed the rate of suicides amongst seafarers seafarers, and takes account of the levels of stress from industry-specific is three times that of the general evolving realities and needs of an social factors contribute to both acute population. A paper delivered by industry that handles 90 per cent of and chronic fatigue. Social factors Robert Iversen, head of the Mental international trade. The relevance of include: Health of Seafarers Project for the the Convention for Australia is clearly Rotary Club of Melbourne South, evident from the fact that its reliance • Changes in ship technology and to the Seafarers Welfare Forum in on shipping by sea of 99% of all shorter turn-around times in port September 2010, quoted research imports and exports represents nearly meaning reduced shore leave; that indicates mental health problems 10 per cent of world trade by mass

Autumn 2011 35 AUSTRALIA Legislation

a system of certification, avoiding will also be changes required to or reducing the likelihood of lengthy subordinate legislation, ie. Marine delays related to inspections for Orders, made under the Navigation compliance with the Convention in Act. foreign ports. Supporting the Bill, an MLC The regulatory impact on Australia National Interest Analysis (NIA) and is expected to be minimal. The Regulation Impact Statement (RIS) Convention will cover a very small proportion of the total number of have been tabled in both houses of ships registered here (approximately Parliament with the text of the MLC. 100 vessels) and law and practice in These documents are subject to all jurisdictions already demonstrates consideration by the Joint Standing substantial compliance with its Committee on Treaties. requirements. In view of the current level of compliance, industry Asia Pacific regional dialogue – stakeholders will be required to make May 2011 only small changes to their current practices. The responsibility of In order to facilitate greater implementing the Convention will be understanding of the MLC in shared between the Commonwealth, the region, AMSA will host an state and territory governments international conference of Asia- through a range of legislation in Pacific nations to strengthen maritime safety, occupational health and safety and workplace relations. regional technical cooperation on the ratification, implementation and To ensure full compliance, minor consistent enforcement of the MLC amendments may be required to the in Cairns from 4-6 May. Australia’s relevant legislation of the states and Minister for Infrastructure and the Northern Territory as it applies Transport, the Hon Anthony Albanese to ships within their jurisdiction that will fall within the scope of the MLC. MP will address the conference, All jurisdictions have been working as will the Director of the ILO Seafarers at work. to progress necessary amendments International Labour Standards throughout 2010 and will provide Department, Dr. Cleopatra Doumbia- – the fifth largest shipping task in the reports of their compliance in early Henry. world. 2011. The MLC provides a new opportunity Ratification will enhance safeguards to strengthen the viability of The Navigation Act, 1912 is the to seafarers on Australian ships and international shipping by enhancing only Commonwealth legislation that on foreign-flagged ships entering its capacity to deliver quality, safe requires amendment to give effect to our ports. Australian-flagged ships the MLC. The required changes to and environmentally sustainable will consequently be protected from the Act have been incorporated into shipping services and providing fair unfair competition from foreign ships the draft Navigation Act Amendments and decent employment opportunities on which crews have substandard Bill in order for the ratification process for seafarers that Australia and other conditions. They will also benefit from to commence in early 2011. There member States can be proud of.

Unit 57, Level 34, AMP Centre, 50 Bridge St, Sydney, NSW 2000 Australia 24hr emergency response line: +61 (0) 403 226 449 COOGANS & CO Ph: +61 (0) 2 9252 4776 legal and consultancy services Web: www.coogansandco.com.au

Coogans & Co specializes in providing advice in relation to maritime law, transport and international trade. The following represent a non-exhaustive list of areas where Coogans & Co can offer its assistance: Charterparty issues including hire, freight and demurrage due under the various forms of charterparties. Cargo recovery and defence claims including the application of the Hague, amended Hague and Hamburg rules. Collision, salvage, ship fires, stranding and groundings. Passenger and cruise ships issues. Monetary security for claims including arrest and release of assets from arrest. Marine insurance, general and particular average, total and constructive total losses. Commodity quantity and quality issues and disputes. Advice on CIF, FOB and letter of credit issues and disputes. General debt recovery including the collection of container demurrage.

36 Autumn 2011 AUSTRALIA Newcastle Port Corporation Legislation Delivering Opportunity

The Port of Newcastle is one of Australia’s most diverse regional Newcastle Port Corporation ports and one of the world’s largest coal export ports. With over owns and manages over 610 1,700 ship visits a year, the port provides major economic benefi t hectares of port land within to the city, the region and the State of NSW. fi ve defi ned precincts – Carrington, Mayfi eld, Walsh Point, Kooragang The export of coal is the ports’ core trade however over 40 Coal and Kooragang Future Development. different commodities are handled through the port including Much of this land is allocated to current or future alumina, aluminium, cement, fertiliser products, forestry products, trade but a range of development opportunities still exist grain, mineral concentrates, petroleum products and steel. for port related industry. Infrastructure within the port can handle all types of cargo The former BHP Steelworks site located within the Mayfi eld including dry bulk, bulk liquids, break bulk, project, passenger Precinct has 90 hectares of river front land and can support and containers. The Port of Newcastle is a critical supply chain a diverse range of infrastructure, including bulk and general interface for the movement of cargo and includes 18 operational cargo, bulk liquid and container terminals. Newcastle Port berths, 11 of which are allocated to handling a range of cargoes Corporation envisages development on this site will focus on and 7 dedicated to the handling of coal. the growing maritime trade and offer regional and statewide Newcastle Port Corporation is a state owned corporation. commercial rewards. The Mayfi eld site is close to the Newcastle Its role is to provide safe, effective and sustainable CBD and perfectly positioned within the Port of Newcastle port operations and deliver effi cient port development accessible by effective road, rail and sea links. that enhances the economic growth of the Hunter In support of this unique development opportunity, Newcastle Region and New South Wales. By working with Port Corporation invested $25 million to provide new berth its stakeholders the Corporation aims to deliver infrastructure at the site. Mayfi eld No.4 Berth was offi cially opportunity that is mutually benefi cial. opened in March 2010 and consists of a 265 metre long wharf Whilst coal continues to be the port’s major area and 10,000m2 adjoining hardstand for port-related uses export, expertise in handling other project such as cargo handling, storage and assembly area. Brisbane cargo, dry bulk and bulk liquid products has enabled strong growth in these A recently completed refurbishment project saw the re-commissioning of the Channel Berth for tie up purposes and as a dedicated facility Newcastle commodities. Total trade through the port in 2009–10 was valued at $13.05 billion, for P&O Cruises’ Pacifi c Sun and visiting international cruise ships. Sydney with coal trade valued at almost $10 billion. The Port of Newcastle is a thriving commercial port recognised In 2009–10 the total tonnage handled through as a major strategic asset for the New South Wales economy and Melbourne the port increased by 7.5% to reach over a generator of employment for thousands of people both directly 103 million tonnes. and indirectly.

Opportunity and diversity

The Port of Newcastle is one of Australia’s leading bulk ports. Handling a diverse trade base of over 40 different commodities, the port has the services and facilities to meet your needs. The port offers: diverse facilities suitable for a range of cargo types including dry bulk, bulk liquids, break bulk, project cargo, general cargo and containers. 11 berths allocated to general cargo. the only berth-face rail line on Australia’s east coast. excellent back-up storage options. close to Sydney with excellent road and rail connections to other parts of NSW and Australia.

As one of the most diverse regional ports, the Port of Newcastle has the expertise to manage all types of cargo. Contact our Trade & Port Development Team for more information on your cargo solution.

Newcastle Port Corporation (02) 4985 8222 [email protected] www.newportcorp.com.au Autumn 2011 37 AUSTRALIA NPC0204 Trading

Apportioning of risk and cost at the core of Incoterms

IMAGE TO COME By Roberto Bergami, senior lecturer, School of Economics and Finance, Victoria University

ncoterms, an acronym between sellers and buyers on each of the subsidiary contracts for International a mutually exclusive basis. This is an independent contract in its Commercial Terms, is important because, as a result own right. Whilst the contract of I of choosing a particular Incoterm sale binds sellers and buyers, the were first issued in 1936 2010 the obligations of the seller contract of carriage will only bind by the International or buyer vary accordingly, as the carrier and either the seller Chamber of Commerce invariably subsidiary contracts or the buyer, depending on who (ICC). Incoterms have are necessary to complete the is responsible for entering into a been regularly updated transaction, as shown in Figure contract of carriage as per the with revisions issued in 1. For example, in using Carriage chosen Incoterms 2010. 1953, 1967, 1976, 1980, Paid To (CPT) the seller has to As Incoterms 2010 are only a 1990, 2000 and 2010, the enter into a contract of carriage, but part of the overall contract, their not insurance. As such, it will be current edition, that application is limited. Incoterms the buyer’s responsibility to insure became effective on 2010 do not deal with 1 January 2011. for consequential losses arising through such things as damage to • Property (title) in the goods and Although Incoterms 2010 may apply or loss of the goods in transit, from breach of contract. These to domestic transactions, this article the time the goods commence their matters should be dealt with in limits the discussion to international journey, but not to contract for the specific clauses in the contract; transactions and maritime container carriage itself. traffic issues. • The price and the method of It is important to note that whilst payment for the goods. These Incoterms 2010 are a voluntary the subsidiary contracts may are commercial matters for set of rules and must be explicitly be executed in order to fulfil the negotiation between the seller incorporated into a contract for underlying contractual obligations, and the buyer, although the these to apply. Doing so is relatively simple, as all that needs to appear Figure 1: Subsidiary contracts arising from the sales contract in the contract is the chosen term (from a selection of 11) and a Exporter Importer reference to Incoterms, followed by Contract of Sale their revision year, that is, Incoterms 2010.

Incoterms are delivery terms Possible subsidiary contracts required under contract performance and, consequently, they are • Contract for local carriage (e.g.from export works to point of export) concerned with the movement of cargo from origin to destination, • Export customs clearance and related documentation and the associated processes • Contract of international carriage necessary for such movements. Incoterms, therefore, spell out • Contract of international cargo insurance the rights, duties, obligations and • Import clearance (payment of duties/taxes) responsibilities of sellers and buyers against the specified term chosen • Contract for domestic delivery in country of import for the contract. Depending on the term chosen, the seller, or buyer, will be responsible One of the core features for all, or only some, of the above of Incoterms 2010 is the (From: Bergami, R. International trade: a practical introduction, 2009, 3rd ed., apportionment of risk and cost Eruditions Publishing, Melbourne, Australia, at p. 244.)

38 Autumn 2011 AUSTRALIA Trading

contract must clearly stipulate 2010, p. 37). In practice, this The Incoterms 2010 define the price and currency and the means that buyers and sellers terminal to include “any place, method of payment for the need to communicate exactly what whether covered or not, such as contract goods; and charges are included in a contact a quay, warehouse, container of carriage. This issue affects yard or road, rail, or air cargo • Stowage of packaged goods Incoterms 2010 CPT, CIP, CFR, CIF, terminal” (International Chamber of within a container or other DAP and DDP. These terms require Commerce, Incoterms 2010, p. 53). means of transport. Incoterms the seller to contract for carriage, 2010 limit their application to DAP requires the seller to deliver but not be responsible for charges packaging in relation to the goods, not unloaded from the related to the unloading the goods compliance with the arriving vehicle and not cleared for from the arriving vehicle at the requirements of the contract of import, at an agreed place. The delivery point, unless this is part of sale and fitness for place may be an inland location the contract of carriage. transportation of the goods in in the foreign country requiring question. The Incoterms 2010 have been the seller to arrange for transport divided into two categories as beyond the customs entry point, Incoterms 2010 require the shown in Table 1. although, as stated before, customs delivery point to be specific, to avoid ambiguity and unwelcomed surprises for sellers and buyers. Table 1: Incoterms 2010 by category This applies to both costs and Terms Category risks. It is always best to specify full postal delivery addresses as the point of delivery details. Ex Works (EXW) Free Carrier (FCA) In recognition of global security Carriage Paid To (CPT) initiatives for the international Carriage and Insurance Paid to Any mode or modes of transport movement of goods, the Incoterms (CIP) 2010 require the seller and the Delivered At Terminal (DAT) buyer to co-operate with each other Delivered At Place (DAP) in the provision of documentation Delivered Duty Paid (DDP) and information to comply with security clearance and other formalities, with the costs of doing so being apportioned to the seller Free Alongside Ship (FAS) or the buyer, depending on the Free On Board (FOB) term chosen and the type of Cost and Freight (CFR) Sea and inland waterway transport documentation and information Cost Insurance and Freight (CIF) requested. The ICC has also attempted to address the issue of double clearance is the responsibility of the The Incoterms 2000 feature four charging by shipping lines, buyer. stevedores and other service categories, assigned according providers, by clarifying the to their cost and risk structure, Delivered terms are high risk for the apportionment of costs for matters whereas the Incoterms 2010 are seller, as contracts incorporating relating to loading and unloading categorised in accordance with these terms usually have a of goods from the means of their mode of transport. Some specific performance clause that conveyance (referred to as the of the previous Incoterms have is the delivery date. The seller is “arriving vehicle” in Incoterms been replaced by two new terms, holding itself responsible for on 2010). For example, in Carriage shown in bold in Table 1. DAT time delivery, yet the seller does Paid To (CPT) the seller is replaces the former DEQ (Delivered not control the performance of responsible to contract of carriage Ex Quay), and DAP replaces third parties, such as carriers, and pay for the goods to be the former Delivered At Frontier nor border control and permit transported to the agreed place. (DAF); Delivered Ex Ship (DES); issuing authorities. It is highly Loading costs are, therefore, the and Delivered Duty Unpaid (DDU) recommended that a suitable Force responsibility of the seller. The terms. Majeure clause be used to deal with such issues in the contact of sale. buyer is responsible for “unloading DAT requires the seller to deliver costs unless such costs were for the goods unloaded from the One of the most significant changes the seller’s account under the arriving vehicle at the agreed introduced by the Incoterms 2010 is contract of carriage” (International terminal, not cleared for import. the demise of the ship’s rail as the Chamber of Commerce, Incoterms

Autumn 2011 39 AUSTRALIA Trading

risk transfer point in FOB, CFR and the departure wharf. The ICC maritime container revolution that CIF terms. No longer will traders recommends that the terms FCA, began during the 1960s. Yet, these be exposed to the curious notion CPT and CPI be used instead. As days, for a significant number of of “liabilities shifting uneasily as the Table 1 shows, FOB,CFR and CIF traders, especially in Asia, the term cargo sways at the end of a derrick are meant to be used for sea and FOB and containers are an almost across a notional perpendicular inland waterways transport, and inseparable union. Modern maritime projecting from the ship’s rail.” not maritime container traffic that container practices and multimodal (Devlin J in Pyrene Co Ltd v. typically form a part of a multimodal transport modes, however, do not Scindia Navigation Co Ltd [1954] transport movement. sit well with FOB Incoterms 2010. 2QB402 at 419). If we consider the flow of a There a number of challenging The Incoterms 2010 now require the consignment from the seller’s seller to deliver the goods on board warehouse to the wharf, there issues that the new Incoterms 2010 the nominated vessel. This is a new may be more than 10 lift-on and introduce. The most significant of requirement and, to date, untested. lift-offs before the container is these challenges hinges around the In the absence of a clear definition actually loaded on board. The notion of maritime containers, and of loaded on board, it is currently goods may be collected loose to the need for traders to embrace the understood that this means that be packed at a stuffing warehouse reality of modern day practices. the total consignment has to be then transferred to a forwarder, for The market place is in a transition successfully loaded on board the eventual delivery to the departure vessel, but not necessarily stowed wharf. The more remote from the period at present, as the old or lashed. The new requirement will wharf the origin of the consignment, Incoterms 2000 are being phased probably require a decision from such as rural or remote location, the out and the new Incoterms 2010 a court case for a more thorough higher the movements of the goods are being incorporated into new definition. en route to the departing vessel. contracts. It is highly recommended Even when the consignment has that traders and their service The issue of container traffic reached the wharf it will be shifted providers become familiar with continues to create problems. within the wharf apron a number of the new Incoterms 2010, from Since the Incoterms 1990, the ICC times before the goods are actually has recommended that the terms both a cost and risk management loaded on board the vessel. FOB, CFR and CIF not be used for perspective. This means that sellers Hopefully the reader can see that maritime container traffic. This is and buyers may need to educate the term FOB is not appropriate. because with maritime containers each other about the new Incoterms the handing over of the goods The irony of FOB in maritime 2010, in order to choose the most from the seller to third party often container traffic is that the term FOB appropriate term for the transaction occurs at a location remote from was coined a long time before the at hand.

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40 Autumn 2011 AUSTRALIA Trading

Autumn 2011 41 AUSTRALIA Ship repair

Repair group enables us to compete with best in world By a special reporter

he Australian Ship Repairers companies that are dedicated to the • hydraulic and pneumatic systems Group (ASRG) was formed in ship repair industry. Whether it be and hardware. T1971 to represent and promote for an unscheduled or emergency the interests of the ship repair dry-docking or a scheduled survey • maintenance, servicing and industry in Australia. The ASRG or refit the experience and capability testing of ships’ lifting gear and member companies are strategically of the ASRG Members will deliver a equipment. located in Australia’s major ports service on time and meet the most • servicing of diesel engine turbo and represent the best in ship repair stringent of requirements of the Ship chargers and governors. services that Australia can provide. Owner. The ASRG provides an efficient Some of the services provided by In this extremely competitive and reliable, round the clock ship the member companies of the ASRG industry, having a highly mobile, repair and maintenance service on include; skilled and productive work ships and their equipment for the • damage repairs and structural force with the support of modern naval and merchant marine sectors. renewals. workshops and facilities provides The ASRG membership includes an opportunity for Australian ship • pipework (ferrous and non companies which are recognized repairers to challenge and compete ferrous) as leaders in the supply chain with the best in delivering to the for the nation’s Defence sector. • repairs and replacement. ship owner a quality service, on time The Group has the capability of • electrical and electronic every time. All work is carried out to handling most types and sizes component testing and servicing the requirement and specification of vessels for dry-docking and of Ship Owners, their Classification repair. The services provided by • corrosion protection (dry and wet the Group to the shipping industry blasting) and paint coating Society Surveyors and to best include dry-dockings, refits, application. industry practice. conversions, hull and machinery • cargo holds and tank cleaning The ASRG together with the repairs, mechanical and electrical and coating. efforts of its individual members repairs and maintenance, ferry and actively promote the expansion passenger ship refurbishments, • repair–maintenance-overhaul riding crews, voyage repairs, etc. machining of ships’ machinery and development of technology The Group provides engineering and equipment. and skills in its industry through the application of good work practices, solutions, technical support and • interior refurbishment for cruise servicing capability for leading ships, ferries and superyachts. reinvestment and training. The ASRG marine equipment and engine is recognized by the Australian manufacturers. • engineering solutions and trouble Government, State Government shooting. The current membership of the departments, regulatory bodies and ASRG comprises of 77 companies • survey, inspection, repair, marine authorities as the recognized which collectively offer a wide range servicing and testing of life boats ship repair industry body in Australia. of services to the shipping industry, and davits. For further information on the including dry-docking capability for • servicing of power and propulsion services and capabilities of the vessels up to 345m long x 45m wide. equipment. There are dry-docks, synchrolifts, ASRG and its Members contact Liz • sheet metal, insulation and vent slipways and workshops strategically Hay at tel: +61 7 5597 3550, e-mail: trunking repairs and renewals. located in the major ports and [email protected] or visit our web maritime centres around Australia • marine diesel engine servicing site at which are operated by and parts supply. www.asrg.asn.au

42 Autumn 2011 AUSTRALIA Ship repair

The 266 metre long, 77,500 GT Bermuda registered cruise ship Dawn Princess in Forgacs’ Caincross drydock, Brisbane.

The Dawn Princess’ propellers and rudders

Autumn 2011 43 AUSTRALIA Advertorial

Floods, Criminals and Competition

From the BRISBANE MARINE PILOTS he Port of Brisbane is largely back The peaks of the flood arrived it could be accessed by shore side in business after the devastating throughout Wednesday and Thursday machinery and disposed of. Where this Tfloods that have affected most with the focus on rescue, protection was not possible, the ports work boats of the State and much of the country. of infrastructure and recovery of large were used. We Queenslanders have watched with debris. We all cheered when we During Saturday surveys and the sadness as the events unfolded and witnessed the ‘Little Tug That Could’, clean-up continued in the priority the mighty ‘Mavis’ and crew guiding the with pride as communities pull together area and planning began to bring in remnants of the River Walk safely under to get things cleaned up and returned, the first large ship, a 250m long 42m the Gateway Bridge. as far as possible, to some sense of beam crude oil tanker. This ship was normality. Each day key port stakeholders met successfully berthed on the Sunday, Likewise the port community has rallied to plan the recovery phase, while still ensuring the refineries could continue together to get things moving again. continuing to manage the ongoing their production and supply of fuels The overall operational responsibility events. One boat owner requested so vital for the recovery of the entire for Brisbane’s waterways lies with the authorities be on the lookout for his boat State. The Fisherman Island container Harbour Master. I can say from personal which was last seen floating down river terminals reopened Monday with some observation that he and his team at still sitting safely atop its pontoon. It was restrictions. Survey vessels continually rechecked areas as debris that could Maritime Safety Queensland have, later found still attached to the pontoon potentially endanger shipping continued even before the flood waters arrived, but upside down. Strong moorings! He to come down the river. been working tirelessly to ensure the was by no means alone. protection of port users, infrastructure Friday was the beginning of the All and in the Port was closed to major and to ensure that the Port reopened as Port recovery operation with the shipping for just 4 days with a careful soon as possible. They of course were commencement of hydrographic progressive reopening after that time. not alone, supported in a large part surveys and checks on port On a side note it was great to see the by the Port of Brisbane survey teams infrastructure, such as wharves, compassion, tenacity and kindness and dredging fleet, boat crews, tug beacons, buoys and leading lights. displayed by so many under such crews, Royal Australian Navy, Police This was carefully planned to target awful circumstances. It was particularly and Rescue groups and the team at the areas required for the priority amazing to see the good humour Brisbane Marine Pilots and many others. shipping. Hydrographic surveys using retained by people who had lost so Unlike some affected areas, in Brisbane state of the art multi beam equipment much. we were fortunate enough to have some covered over 1000 hectares of the port warning of the imminent flood. Pilots and waters and channels in just a few days. In November 2010 the International other port services such as tugs and This revealed 62 objects of significant Maritime Pilots Association’s (IMPA) line launches were already dealing with concern including sunken vessels, biennial conference was held in large amounts of debris and exceptional numerous large trees, gas cylinders and Brisbane. It was attended by hundreds currents (up to seven knots) in the pontoons, each posing a potential threat of delegates from around the world, river due to extended rain periods and to shipping. Objects were identified including many leading lights from releases from Wivenhoe Dam. The day and prioritised for removal. Surveys the practical, political and academic before the predicted flood peaks BMP also revealed a layer of silt had been spheres of pilotage. The discussions representatives met with the Harbour deposited across the seabed in the port and presentations covered many issues Master to discuss the developing area significantly reducing navigable that affect the global profession of situation and the decision was made depths by the best part of a metre in the Marine Pilotage, among these two in to close the port and commence main port area. It is estimated that there particular were of great importance, the the removal of large commercial is more than 1,000,000 m3 of dredging issues of criminalisation of seafarers and to be undertaken to return the port back shipping from the Port. Conditions in competition in pilotage. to its pre flood condition. The Navy was the Port were rapidly deteriorating. also pitching in with a significant fleet During the conference many tragic The unprecedented conditions had of survey vessels and mine hunters cases were presented from around the increased the risks involved in the checking the more open bay areas and world where a pilotage incident has handling of large ships in the confined the river reaches up to the Moggill Ferry. lead to marine pilots losing not just areas of the Port. Late on Tuesday night there livelihood but also their liberty. the last of the ships were safely removed Floating debris was as far as possible Several mariners languish in prisons to the anchorage. corralled to designated areas where around the world as a result of cases

44 Autumn 2011 AUSTRALIA Advertorial

which, if determined under maritime services, only to revert to a sole provider their interests become more closely legislation, would have provided them model. It will come as no surprise aligned with the commercial interests with a degree of understanding and that the conference totally rejected the of stakeholders to the detriment of the immunity. This is no longer the case concept of competition in the delivery wider community. as more and more often mariners of pilotage, seeing it as an unsafe and are prosecuted under none maritime In ruling on an arrangement for the legislation or in civil courts where there untenable model. provision of pilotage services in is little consideration or understanding Brisbane by Brisbane Marine Pilots on Some commentators believe that the of the circumstances of the maritime behalf of Maritime Safety Queensland, safety claim is used merely as a shield world. This approach is often taken the ACCC acknowledged that benefits to protect the “interest” of Pilots. So in response to the need for “heads to and efficiencies are derived from having roll” and results in the targeting and does the “safety” argument protect the a sole provider of pilotage services in victimisation of individuals without fully interests of marine pilots? You bet it a port. The ACCC also recognised the accounting for the complexities of the does and long may that continue, given right of authorities to acquire marine maritime environment. The danger is that this interest is aligned with the interests pilotage services from a single supplier. rather than reaching a full understanding of so many others, whether it is the of the factors leading to an incident an Brisbane Marine Pilots have been delicate environment of marine parks investigation ceases once a scapegoat proud to supply pilotage in the Port of like Moreton Bay or the infrastructure of is identified and brought to “justice”. Brisbane for over 21 years. As the port our ports and the vessels that carry our The conference also heard many returns to normal following the floods, commerce. The regulation of compulsory examples where competition in we continue to work closely with MSQ, pilotage recognises that pilots act on pilotage has led to a reduction in the new port owners, shippers and other safety outcomes and failure to deliver behalf of, and have obligations to, the port providers to deliver an efficient and economic benefits. Some jurisdictions community. When pilotage providers are safe pilotage service for the Queensland have dabbled with competing pilotage forced to compete for business community.

Autumn 2011 45 AUSTRALIA Cruising

Regional ports prosper from round Australia cruises By helen hutcheon, Australasian correspondent for Seatrade Cruise Review and Seaside Insider

t a Department of Industry, manager of enforcement operations in February last year, there is an Tourism and Resources for the ACBPS, told delegates at increasing number of ships here for Aforum on the development of Cruise Down Under 2010 in Brisbane extended programmes. Australia’s cruise shipping industry last August that work on the manual in Sydney in October 2004, Greg was under way. Redman says it is Royal Caribbean is positioning an Coopman, who was with Barwil at the a ‘one-stop shop’ covering customs, unprecedented three ships in Sydney. time, spoke about the lack of uniform immigration and quarantine regulations Rhapsody of the Seas will operate a customs and quarantine procedures that will be a welcome tool given the fifth consecutive season, arriving on and called for a ‘clear, precise industry’s phenomenal growth. October 27 and departing April 13, operating manual’ covering all ports 2012. She will be joined by Radiance Sydney Ports Corporation reports for ship agents and operators. of the Seas which arrives October that more than 300,000 cruise ship 15 and departs April 5. And Royal Now, nearly six-and-a-half years later, passengers will arrive during the Caribbean’s Celebrity Cruises is Coopman, who is the cruise co- current 2010/11 wave season which returning to Australia after operating ordinator for Wilhelmsen Ships Service, ends next month – the equivalent of two seasons with Celebrity Mercury will have his wish come true. 721 Boeing 747s in a typical three- (2007/08) and Celebrity Millennium class configuration – injecting an As this issue went to press, the launch (2008/09). estimated $190 million into the NSW of an Australian Government Cruise economy alone. Celebrity Century heads for Sydney on Ship Manual was imminent. It has an 18-night voyage from Honolulu on been coordinated by the Australian The 2011/12 wave season that November 11 and makes the return Customs and Border Protection commences in Sydney in October will journey to Honolulu from Sydney on Service and will be available on be even bigger. As well as visiting an Australian government- hosted international passenger ships on March 6. website. world cruises, including the maiden Holland America Line’s voyage of Costa Cruises’ 92,600gt Andrew Redman, acting national 1,432-passenger Volendam will Costa Deliziosa which entered service make the company’s seventh annual extended programme when she arrives in Sydney on October 4. She will be joined by her sister ship, Zaandam, which arrives on November 25. Oceania Cruises’ Regatta commences a trans-Tasman season in Auckland on February 5, 2012 which ends in Bay of Islands on April 13 when she departs for Tahiti. Classic International Cruises will return for its eighth successive season in Fremantle from December 18 until April 14. It will be operated by the 600-passenger Athena which replaced Funchal for the 2008/09 annual Australian programme. It includes five cruises to and from Adelaide and the company’s first round trip from Adelaide to Sydney. The 16,200gt Athena is making maiden calls at Darwin, Broome and Celebrity Century heads for Sydney on an 18-night voyage. Geraldton.

46 Autumn 2011 AUSTRALIA Cruising

One of the most memorable round- Australia voyages will be made by Queen Mary 2 from Sydney on February 14, 2012. The historic 22-night cruise, that will make calls at Brisbane, the Whitsundays, Cairns, Darwin, Bali, Fremantle, Adelaide and Melbourne, will be a first for Cunard which was founded in 1840. The trans-Atlantic ocean liner, which was named by Queen Elizabeth II in 2004 after the first RMS Queen Mary, is tipped to generate at least $10 million for the Australian economy when she circumnavigates the Continent. It will be the longest period the Cunard flagship has been based in any country, outside her northern hemisphere home ports of Southampton and New York. When bookings opened last Silver Shadow July for this much-anticipated ‘royal circumnavigation,’ 450 staterooms P&O Cruises Australia has four ships Melbourne, Hobart, Dunedin, were taken up in the first 15 minutes. since Pacific Pearl joined its fleet Christchurch and Wellington. in December and Princess Cruises, Carnival Australia senior vice A highlight of Celebrity Century’s president, Jenny Lourey, said the which has two resident ships, will inaugural season will be a 36-night company had been ‘overwhelmed’ bring Diamond Princess back to circumnavigation of Australia with by the response. She said almost Sydney on December 16 for a Down a pair of sailings that may be taken 75 per cent of the passengers who Under programme that runs until together or separately - an 18-night booked have never cruised before February 4. Sea Princess will also be cruise from Auckland on January and that around 40 per cent are aged based in Sydney from October 17 until 30, 2012 to Fremantle that features between 40 and 60. ‘There may still April 15. an overnight in Sydney and takes be some element of uncertainty in the in Melbourne, Adelaide, Albany and Importantly, many ships are visiting economy,’ Lourey said at the time, ‘but Bunbury and an 18-night cruise from regional ports on circumnavigations of it seems consumers are very bullish Fremantle on February 17 to Sydney Australia. when it comes to cruising.’ that goes via Geraldton, Broome, On January 19 this year Silversea’s Darwin, Cairns and Brisbane. 382-passenger Silver Shadow set sail from Sydney on the company’s first 30-day round-Australia cruise. The all-inclusive 28,258gt luxury liner called at Brisbane, the Whitsundays, Willis Island, Port Douglas, Cooktown, Darwin, Broome, Exmouth, Fremantle, Albany, Port Lincoln, Adelaide, Geelong, Melbourne and Hobart. On September 7 and again on March 16 next year Dawn Princess will make round Australia voyages from Sydney calling at Brisbane, the Whitsundays, Port Douglas, Darwin, Fremantle, Bunbury, Albany, Adelaide, Melbourne, Burnie and Hobart. Radiance of the Seas will make a 34-night round-Australia and New Zealand voyage from Sydney on October 15 and again next February 19. Her ports are Brisbane, the Whitsundays, Port Douglas, Darwin, Broome, Bali, Geraldton, Fremantle, Albany, Esperance, Adelaide, Radiance of the Seas

Autumn 2011 47 AUSTRALIA Advertorial

Tasports’ customers the heart of decisions

asports is committed to improving managed by the northern ports: Bell an efficient management system to its ports to maximise opportunities Bay Port, Port of Devonport and Port of prioritise projects and have a robust Tfor customers and support value- Burnie. forward-planning schedule to save on adding business development and supply operating costs. chain efficiencies. Burnie has sufficient capacity to cope with forecast growth in commodity Protecting people, assets and the After 12-months at the helm of the segments and the focus is on improving environment Tasmanian Ports Authority, Chief the efficiency of port and rail-road At Tasports we strive to achieve a zero Executive Paul Weedon, has steered the interchange for container and bulk balance when it comes to risk to our business towards a customer oriented commodities. strategy promoting port development people, customers, assets and the aligned to customer needs. Our Burnie Plan centres on: environment. “It was critical for Tasports to recognise · Expansion plans in response to Tasports Safety Management System has the value in working with its market customer demand and stakeholder been externally certified and recognises segments to understand infrastructure consultation; and our continued improvement of safety requirements for the short, medium and systems, working towards a zero-harm · A reconfiguration of the port-rail target. long term to ensure our port planning was interface to provide more efficient taking an approach consistent with our service delivery of freight consistent Our new target comes on the back of a customers’ future directions,” he said. with other transit points in Tasmania remarkable reduction rate over the past “A good example of this was recognising for consistency and compatibility. five years in LTIFR and MTIR. our Cruise and Antarctic customers Devonport, while just an hour east Since 2006 Tasports has achieved and stakeholders’ vision for Hobart as a of Burnie handles 24% of the State’s an 86% reduction in Lost Time Injury primary destination for cruise vessels and total freight including cement, fuel frequency rate, and our Medical Referral home to southern polar research. and containers, and is home to major Injury rate has decreased by 50%. “We identified that our infrastructure passenger ferry – Spirit of Tasmania. Highlights would need to be developed to attract In the past year at Devonport Tasports and sustain this particular market · Winner of the WorkCover Safety Best has: segment and earmarked one of our Injury Management and Return to primary wharf sheds to be developed · Upgraded infrastructure to support Work System Award. as a dedicated facility for cruise and wharf based operations to benefit · Introduction of a Ports Procedures Antarctic customers. customers; Manual to provide information on “We have embraced a strong ethos of · Upgraded the TT-Line upper-deck port operating parameters applicable stakeholder and customer engagement loading ramp to handle increased to all vessels calling at Tasmania’s to drive results, and as we emerge from highway truck loads; and ports, details of marine emergency the global financial crisis we begin to see response processes, appropriate the benefits of our strategy with forward · Conducted dredging of berths and communications advice, required cruise bookings already up by 20% for channeling silt levels to support the standard of navigation aids and details the coming cruise season. ongoing ability to meet water depths of available port facilities. required for current vessels’ berthing. “It’s this style of business development · Winner of the Australian Port or we’re embedding across our ports and In Bell Bay Port Tasports’ operations Terminal of the Year Award at the Tasmania’s tradelink to the world processes.” centre around lift on- lift off containers Annual Lloyd’s List DCN Australian and cargo, with a long term emphasis Shipping and Transport Awards. Customers inform port on supporting short-sea container Operating over 11 ports in Tasmania, we are committed to our customers, development opportunities movement. · Continued above line operating profit and superior service delivery. Paramount is the safety of our employees and in difficult economic conditions Tasports is responsible for 11 ports Long-term infrastructure planning our customers. across Tasmania including the Bass Strait · Total freight volumes managed of 13.4 islands and has four primary ports which Tasports has developed a 10-Year million tonnes Our vision is focused on the development of Tasmania’s ports as global trade form critical transport links with almost all Infrastructure Plan informed by a highly With a number of port enhancement links for the benefit of Tasmania’s economy and community. We believe in import and export freight moved by sea. comprehensive asset review and investing in our infrastructure for the growth of Tasports and Tasmania. condition report. projects coming out of the design phase With Hobart celebrated as Tasmania’s and redevelopment opportunities ready to home to Cruise and Antarctic it means With an extensive asset portfolio across commence, Tasports is preparing for the www.tasports.com.au 1300 366 742 TPOR4480rj core shipping business is primarily its ports Tasports is focused on achieving real work to begin.

48 Autumn 2011 AUSTRALIA Tasmania’sTasmania’s tradelinktradelink to to the the world world

OperatingOperating overover 11 11 ports ports in in Tasmania, Tasmania, we we are are committed committed to to our our customers, customers, andand superiorsuperior service service delivery. delivery. Paramount Paramount is is the the safety safety of of our our employees employees and and ourour customers.customers. OurOur visionvision isis focused focused on on the the development development of of Tasmania’s Tasmania’s ports ports as as global global trade trade linkslinks forfor thethe benefit benefit ofof Tasmania’sTasmania’s economyeconomy and and community. community. WeWe believe believe in in investinginvesting inin our our infrastructure infrastructure for for the the growth growth of of Tasports Tasports and and Tasmania. Tasmania. www.tasports.com.au 1300 366 742

www.tasports.com.au 1300 366 742 TPOR4480rj TPOR4480rj The Scene NSW State committee christmas luncheon

The annual Christmas luncheon generously sponsored by Sydney Ports Corporation was held at the historic Tattersall’s Club in Sydney with around 300 guests in attendance, who enjoyed a fun day meeting industry colleagues and their guests in an informal atmosphere. Each attendee was presented with a gift by DP World. Patrick Stevedores and Feliba also sponsored lucky door prizes. The Guest of Honour was the Hon Michael Gallacher, Member of the Legislative Council, Leader of the Opposition in the Legislative Council, Shadow Minister for Police and Shadow Minister for the Hunter. Philip Lin, managing director, Macquarie Telecom sponsored the entertainment, with Graeme Bowman giving a hoax address which held the Evergreen Shipping Agency audience spell bound with a speech purportedly relevant to the current issues facing the industry.

Frank Fu, managing director and Greg Von Litzheim, deputy general manager of COSCO

Graham Nisbet and Alan Rousselot of Macquarie Telecom; Peter Creeden, chairman, NSW State committee

Grant Gilfillan, chief executive officer; Hellena Kenya and Lachlan Benson, executive general manager of David Martin; Bill Rizzi, NSW manager; Andrew Karas of Sydney Ports Corporation Mediterranean Shipping Company

Michael Gallacher, Shadow Minister for Police, Kurt Gallacher and Suzanne Fosbery, John MacGowan, policy advisors to the Shadow Minister Jason Webb, Mark Swavley, Jim Alvey Ben Hanley of DP World The Scene SAL’s ninth annual Sydney golf day

Winner of SAL’s annual golf day this year was the immaculately turned-out team from Wilhelmsen Ships Service with an ambrose net score of 49 points. Hamburg Sud’s Geoff Greenwood led his team to second place The winning team with a score of 49 with Nigel Raiss of sponsor Macquarie Telecom: (51 points) and Alan Bradley’s Svitzer team John Clawley, Michael Buchanan, Jason Hawkins, and Stephen Hooper – came third (51.6 points). We’d like to thank our all of Wilhelmsen Ships Service. main sponsor, Macquarie Telecom, and all our other sponsors for a very successful and enjoyable day at Roseville Golf Club, in Sydney: Mediterranean Shipping Company, Patrick Stevedores, Sydney Ports Corporation, Newcastle Port Corporation, ANL Container Line, Wilhelmsen Ships Hamish Mackay, of Tim Service, Svitzer Green RE, lucky doorprize Australia, PB Towage winner – a TaylorMade and lawyers Holman hybrid donated by Runners up in the comp with 51 for the day: John Cirjak and Zeljeko Blazic of Vanguard, Fenwick & Willan. Hamburg Sud. Simon Gardiner and Geoff Greenwood of Hamburg Sud. Graham Nisbet and Alan Rousselot of Macquarie Telecom; Peter Creeden, chairman, NSW State committee

David Martin; Bill Rizzi, NSW manager; Andrew Karas of Mediterranean Shipping Company Stephen Thompson, Robert Springall, Gavin Valley, all of Holman Fenwick Willan; and David Sobel, Tom Charter, of Asia World; Roland Briene, Damen; Ken Fitzpatrick, Asia World; of Hapag Lloyd Pim Schurman, Damen.

Llew Russell and Kushy Athureliya, of Shipping Nick Robertson, Caesar Sanchez, Kuehne Nagel, Phillip Holmes – all of K Line; Jason Webb, Mark Swavley, Jim Alvey Ben Hanley of DP World Australia, and Steve Moxey, of Showcase Publications. Fiona Doncouski, Helman; Steve Mushet, K Line. Signal

Two shipping agents become SAL’s newest members

At the beginning of February we The study will be undertaken by the project approval includes by 2012 new extended our welcome to our newest Victorian Department of Transport in cruise ship terminal buildings at White full members, Quay Shipping Australia close consultation with stakeholders. Bay wharf number 5 for up to 170 Pty Ltd who are agents for Sinotrans It will commence in March, 2011 ships per year, temporary berthing of Container Line and Pacific Forum Line. and is expected to be completed by a second cruise vessel at wharf 4 and The other new member is Ship Agency December this year. In SAL’s view the demolishing an old industrial storage Services Pty Ltd. future of the break bulk trade presently shed, no longer in use. handled at Webb Dock should also be included in the study. SAL chairman re-appointed 500 seafarers held hostage by pirates The Board of Directors of Shipping New passenger terminal for As at the end of last year, 500 Australia Ltd was pleased that Michael Sydney Phillips was able to accept the seafarers, of many different invitation to be re-appointed chairman The NSW Government announced nationalities, were being held hostage for a further twelve months. on 4 February that planning approval by Somali pirates. Not a fitting end to had been given to the construction of the IMO Year of the Seafarer. For his part, Michael said it is not only a new $57 million cruise passenger As the round table of international a team effort on the part of the Board terminal at White Bay but there are shipping associations and the but through the active participation strict conditions to protect community International Transport Federation has of so many individual members that amenity and provide public access to pointed out: “In fear of their safety enabled SAL to advance the interests areas of the White Bay precinct. The of the industry as a whole. For more information read SAL’s press release at www.shippingaustralia.com.au.

Study into moving Melbourne car trade to Geelong On 3 February, Dr Denis Napthine announced a feasibility study into moving the car trade from Webb Dock to Geelong. A range of issues will be considered including: • Economic benefits to the greater Geelong region • Technical feasibility of the proposal • Port infrastructure/capital requirements and costings • Land transport options and implications • Financing options and responsibilities • Competition and regulatory issues • Import/export supply chain and related industry impacts • Boarder port policy and strategic implications Cars being discharged from an NYK car carrier

52 Autumn 2011 AUSTRALIA Signal

and even their lives, and deprived Control to assist at the peak of the extraordinary high costs involved in of contact with their families, these floods. The crew of PB maintaining any semblance of reliable seafarers have also suffered the Murrumbidgee retrieved the Pelican sailing schedules. trauma of having their ships attacked Banks buoy which had come adrift It was hoped by all those affected with automatic weapons, prior to being at around 18:00 hours on Tuesday, that within the first quarter of this year, kidnapped for ransom. Many have 11 January. The same tug assisted DP World’s reliability and productivity been held captive for several months, the tug, Mavis to control and would return to the point of removing often in the most appalling conditions, secure the breakaway section of the necessity for a surcharge. by armed criminals who can be violent the Brisbane Riverwalk in the and unpredictable”. lower reaches around 05:30 hours on Thursday, 13 January. Autostrad terminal world first The organisations believed it was vital that the international community • The highlight of Svitzer’s assistance The Patrick Autostrad terminal at focuses on the plight of these seafarers provided during the flood period Fisherman Islands has become the held in Somalia. SAL fully supports this was the use of a tug and its first container terminal in the world approach and takes every opportunity water cannon to guide a leaking to operate its night shifts in relative it can to publicise the plight of these LPG tank downstream and safely darkness. Lighting control software, hostages. out into Moreton Bay. The tank was which was developed locally by the one of the large types that provide stevedore’s engineering department, motor vehicle gas at service enables terminal operators to Appointment of CEO, Port stations, which had come adrift individually control each light within the Brisbane Pty Ltd from further upstream. At MSQ’s facility. The chairman and managing director request, Svitzer was tasked to Q Port Holdings jointly announced on escort the tank down the river Release of the Maldon- 17 January, this year that Russell Smith below the Gateway bridge, as it Dombarton feasibility issues has been appointed chief executive continued to leak gas, and to paper officer of the Port of Brisbane Pty Ltd prevent it from impacting any of the and Q Port Holdings. Russell was ports wharves and vital This paper was released late last most recently chief operating officer infrastructure – including the oil year and submissions were sought (transport) of Prime Infrastructure and terminals and the oil pipe to by 17 December. The $3 million he has had extensive port engineering, Luggage Point. With the risk of Commonwealth Government funded development and leadership ire and explosion being too great to feasibility study is scheduled to be experience both in Australia and secure a line to the tank, the tug completed mid 2011. internationally. He will commence as crew showed fantastic initiative CEO on 3 May, 2011. in using the tugs water cannon CILTA hosts international to maintain the tanks position in conference the middle of the river as it moved Industry assists in downstream. The water cannon The Chartered Institute of Logistics and reconstruction of flooded areas also provided excellent insurance Transport Australia has won the right Members of SAL have offered to assist against possible explosion as the to host the 2011 meeting of the world where they can in the much needed tank passed Fisherman Islands and leaders of the Chartered Institute. The reconstruction of the heavily flooded Luggage Point. convention will commence in Sydney in areas, particularly in Queensland, the first week of May 2011. Northern New South Wales and Victoria Serious congestion at DP World, One of the highlights of the five day that occurred last January. They have Port Botany terminal convention that runs from 1-5 May offered to provide containers to be 2011 is the one-day international Whilst the Patrick terminal at Port used as temporary storage. In addition, conference on 4 May, 2011. Senior Botany experienced congestion in the the ability of members, using single national and international T&L leaders first half of 2010 in the second half voyage permits to carry domestic have already agreed to speak. For unfortunately the ball was passed to cargo to not only to capital city ports further information please contact Hal DP World. Whilst it was expected that but also to ports such as Townsville Morris, the CEO of CILTA on 0419 374 the problems would be resolved by should be acknowledged. This should 134. be a note of caution for the Federal end August, 2010, this proved not Government in its proposed restriction to be the case. For the first half of of the granting of permits for foreign November, the situation deteriorated Maersk Australia/Inchcape win flag vessels being able to carry coastal with the introduction of a new IT AQIS 2010 national biosecurity award cargo when there is no Australian system in the peak season without any parallel running or prior testing in a licensed vessel to do so. The award was presented to the ‘live’ environment. Master of the Tatiana Schulte, Jurevic Our towage members were particularly SAL members indicated that if matters Tadeus, Sam Nabhan from Inchcape, active in supporting the recovery did not improve, as a last resort, a and Andrew Cumming and Glen effort, especially in Brisbane. Just two congestion surcharge may have to be Haines from Maersk Line by Senator examples were: introduced. By mid December some Joe Ludwig, the Minister of Agriculture, • PB Towage’s larger tugs members advised that a surcharge Fisheries and Forestry in a ceremony responded to two emergency call would be introduced from mid at Parliament House on 22 November, outs under the direction of Harbour January, 2011 to recover part of the 2010.

Autumn 2011 53 AUSTRALIA Signal

Lifetime recognition award for its relevance and continues to be the Successful course were held in Hart Krtschil starting point for those who are new to Brisbane 2/3 March. the industry. At the same event, as the national Remaining scheduled dates for the first half of 2011 are: biosecurity award was presented. Hart As new staff complete the Introduction Krtschil received the Department’s to Shipping eLearning online course or Sydney 14/15 April lifetime recognition award from the those who are ready to take the next Melbourne 19/20 April Minister for Agriculture, Fisheries and step in developing their understanding Adelaide 10/11 May Forestry in Canberra. In our view, of the shipping industry , SAL offers Fremantle 1/2 June this was a richly deserved award a two day face to face course; and Hart receives our wholehearted Introduction to the Maritime Industry. Pricing remains $650 for SAL members congratulations. SAL has always and $750 for non-members. This course is presented on behalf of appreciated all the assistance and SAL by Robert Dick whose extensive Outside of the scheduled dates, in advice Hart has so readily given on all house courses can be arranged for experience within the industry is a biosecurity matters. groups of 8 or more. valuable asset as a trainer and can be fully utilised by course participants. For those unable to attend, you will be Thomas Miller wins corporate interested to know SAL has submitted social responsibility award Subjects covered in the course are: an application to the Tradegate Cargo Automation Development Fund The principal of our corporate • International trade to develop the Introduction to the associate member, Thomas Miller • Seaborne trade and shipping Maritime Industry course into an online package. Enhancements to the course (Australia), was presented with this • International maritime logistics will see those who cannot get two award in early December in London, days away from their jobs to attend by the editor of the publication • Port management, cargo handling in person and the ability to study at Insurance Day. and port development their own pace yet still benefit from the years of experience and information Thomas Miller won the award for • Structure of the maritime industry in that has gone into developing this its decision to celebrate its 125th Australia course in an online format as an alternative to the face to face delivery. anniversary by becoming the lead • The regulatory regime sponsor of the Chauncy Maples Malawi For more details on training Trust; which is renovating the 19th • Agency operations please contact Paul Alexander, century ship Chauncy Maples as a • Cargo in a chartered ship palexander@shippingaustralia. clinic to provide essential medical com.au or by phone on • Liner cargo shipment 02 9266 9916. services to the lakeside people in Malawi. Thomas Miller has already succeeded in raising more than half of the £2 million sum it set as its target. 42nd FONASBA

New maritime academy for ANNUAL CONFERENCE Sydney Detailed planning is well underway (Australia), LBH Australia, Newcastle There is a plan to establish a new for SAL to host the forty-second Stevedores, Middletons Lawyers, maritime academy in Sydney in annual conference of the Federation Thomas Miller (Australia) and the July, 2011. Education and training of National Associations of Ship Australian Maritime Safety Authority. Brokers and Agents (FONASBA) in courses will cover commercial Sponsors – Svitzer Towage (Australia) Sydney, 10-14 October this year. maritime operations, maritime tourism, and the Australian Maritime College. maritime search and rescue and youth Over 100 delegates from 43 countries are expected to attend development. For more information, this international event, being held in visit the website at www.coastguard. Australia for the first time. edu.au. We are most grateful for the following sponsors so far: Training Introduction to the Prime sponsors - Sydney Ports Maritime Industry Corporation and the Australian 2011 is shaping up to be a productive Quarantine Inspection Service. year for SAL’s training program. The Major sponsors - Hetherington Introduction to Shipping eLearning Kingsbury and McArthurs, Inchcape Shipping Services, Asiaworld course continues to be available and Shipping, Gulf Agency Company has been recently updated to maintain

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Autumn 2011 55 AUSTRALIA NEWS

NEWS

Important new initiatives and projects completed

By PETER BLANCHARD, chief executive officer

2010 was another busy year industry and Shipping Australia as and Fremantle – are all accepting for Tradegate as it completed a well as empty container parks and electronic dangerous goods number of outstanding activities transport organisations. manifests from Tradegate on behalf at the same time commencing a Another new initiative was the of Tradegate’s customers. number of new initiatives. design of a national electronic Tradegate was also involved Following a strategic review by dangerous goods reporting system. in myriad discussions between the Board, Tradegate embarked This system was designed in container parks and shipping response to the needs of the liner on an exciting new initiative lines about improved information shipping industry and its need to – the development of a pilot exchange and greater visibility as respond to multiple requirements demonstration project of a port a means of avoiding unnecessary community system, called PortBIS. from each of the port authorities. congestion, futile truck trips and Following a series of public The implementation of this delays. presentations in each of the major national system has highlighted container ports in September and the parochial manner in which Sadly, despite both shipping October 2009, PortBIS was placed dangerous goods reporting is companies and container parks into production in March 2010. implemented among the States’ agreeing to implement a common different port authorities. Most industry agreed electronic At year’s end there were 14 concerning is that a dangerous standard, the industry has chosen shipping lines involved in PortBIS goods manifest approved in to “do its own thing” and implement as well as 63 empty container one State could be rejected proprietary electronic messages. parks and transport hubs providing in another State. It is aligning information. In addition PortBIS these types of inconsistencies All this does is increase the cost to received vessel arrival and that will reduce transaction costs service providers and customers. departure information for the ports and improve productivity so that Tradegate Membership increased of Sydney, Brisbane and Adelaide. Australia can retain its international by over 50 per cent to 368 competitiveness. As part of this development companies. During the year Tradegate enhanced its The four major container ports – Tradegate increased its customer relationships with the shipping Brisbane, Sydney, Melbourne base by over 100 customers.

56 Autumn 2011 AUSTRALIA NEWS

Major Metropolitan freight flows consistently argued, information can be the co-ordinating agent that allows individual enterprises to make better informed commercial decisions. In this manner it is competition and the market that establishes outcomes, rather than a government agency or monopoly stepping in to tell business how to operate. A number of these issues have been identified in the recently released National Ports Strategy. Of particular note is the Strategy’s reference to the need to further investigate the use of information technology by the ports sector including the implementation of port community systems. Tradegate supports such initiatives and is prepared to work with all interested parties to achieve improved information, and hence cost outcomes for the international trade and transport industry. The National Ports Strategy identified the improvement of landside efficiency, reliability, security and safety of container ports as a specific priority. The Strategy identified the need for action to be taken to implement Source Oct 2007 - (Source: BAHS Stage Four Report, p 28) some oversight of co-ordination within the ports industry. The Strategy did not specify how this CADF Continues to fund Tradegate Development Fund was to occur or who should be the Industry Projects The Trustees approved additional co-ordinator. CADF Pty Ltd, a 50:50 joint venture funding for the GST study and This action item is implicitly between Tradegate Australia campaign to clarify GST treatment identified in another report Limited and Australian Chamber of services to non-residents released during 2010, namely the of Commerce and Industry Ltd, following GST Ruling 2005/06. The Victorian Department of Transport’s approved additional projects TDF approved an application by Discussion Paper on Shaping that met the Funding Deed Shipping Australia for the electronic Melbourne’s Freight Future (“Freight requirements. These approvals dangerous goods reporting system. Futures”). included funds for the development Freight Futures identifies three of an online import procedures Future Crystal Ball Gazing – intermodal hubs or freight precincts course for the Australian Information and Supply Chain in the west, north and south east of Institute of Export, and Phase II Co-ordination Melbourne. These hubs will feed of the Australian Federation of freight into the port environs by Throughout 2010 Tradegate raised International Forwarders” (AFIF) either road or rail depending upon a number of issues that directly Freight forwarding Degree Course. the technology to be deployed. impact the productivity and During the year, the Customs competitiveness of the international Interestingly, it may be necessary Brokers and Forwarders Council trade and transport sectors. for efficiency purposes for the of Australia’s (CBFCA) Diploma of stevedore to be given the authority International Freight Forwarding Key to Tradegate members is to “pull” containers from these commenced to deliver two the exchange and availability of freight centres or hubs to fit with introductory units. information. As Tradegate has the operational requirements of the

Autumn 2011 57 AUSTRALIA NEWS

The real question for the industry is when will government implement some of these recommendations? What is the delay? Why haven’t these reforms been implemented? What role in the delay has industry played? Is there market failure that is preventing industry from undertaking reforms? Perhaps our industry does not want reform and more competition. The BAHS Report identified a number of key issues that neither industry nor government has seen fit to address. These issues include: • Lack of a broad understanding across the supply chain by industry participants; • Shipping lines have a critical role to play in establishing improved supply chain performance but many are perceived to be internally focused;

Tradegate’s helpdesk • Supply chain visibility, transparency of information and container terminal. In this manner National Transport Commission, the adoption of common the stevedore would be taking on COAG and the Henry Tax Review standards were highlighted as some of the role of a supply chain have all identified user pays road being a fundamental component co-ordinator. charges as a more appropriate to delivering efficiency gains by industry; and Further, it also may be necessary to means of taxation. limit direct to terminal deliveries to • Much of the bottlenecks that all but particular classes of cargo ‘Reportitis’ – An Australian exist in the landside logistics e.g. dangerous goods, and ensure disease task impact on and occur that all other cargo is delivered to between businesses that have a It is now almost 25 years since the the terminals via the freight hubs. direct operational relationship This would result in a situation not report on Shore-Based Shipping but no commercial relationship or responsibility. dissimilar to the retail supply chain Costs was released and the Inter- where most goods are delivered to State Commission reported on the BAHS, like IPART and Warehouse a distribution centre and the store Australian Waterfront. to Wharf identified clear market pulls the stock from the distribution Over those 25 years there have failure but the response of centre. been a myriad of reports released government and industry to that market failure has been less than on various aspects of the industry This may well have a fundamental impressive. change to the manner in which including former Minister Peter Australia’s containerised freight Morris’ Warehouse to Wharf Port Botany’s users are about sector operates. released in 1992, the Victorian to taste the fruits of government intervention when industry vacates Changes such as these will need Freight and Logistics Council’s Business Activity Harmonisation the field due to lack of leadership. to be considered in light of the It is to be hoped that the fruit is Study (BAHS) Report (2005) and projected increasing volumes, sweet rather than sour. limited space, limited infrastructure, the IPART (NSW) report on the Port and road congestion that are Botany Landside Interface (2008). Perhaps the National Port Strategy’s confronting the sea freight industry. call for a supply chain co-ordinator All of these reports identify the is the only way to move forward to Already, there are plans on the need for changes to the land ensure the importers and exporters drawing board to implement a truck side interface as indeed does the receive internationally competitive access fee in Melbourne and the National Ports Strategy. services.

58 Autumn 2011 AUSTRALIA Pac2012 Shipping Australia YB 24/2/11 4:00 PM Page 1

NEWS

INTERNATIONAL MARITIME EXPOSITION SYDNEY CONVENTION AND EXHIBITION CENTRE 31 JANUARY - 3 FEBRUARY 2012

PACIFIC MEANS BUSINESS

THE COMMERCIAL MARITIME AND NAVAL DEFENCE SHOWCASE FOR THE ASIA PACIFIC PACIFIC2012 International Maritime and Naval Exposition will be a unique marketing, promotional and networking forum. PACIFIC2012 will be a comprehensive showcase of the latest developments in naval, underwater and commercial maritime technology. PACIFIC2012 will also feature a number of timely and highly informative industry conferences and seminars. PACIFIC2012 will be the most comprehensive industry event of its type ever staged in the Asia Pacific region and will provide a focused and informed business environment. www.pacific2012.com.au AUSTRALIAN SALES TEAM Bob Wouda T: +61 (0) 3 5282 0538 M: +61 (0) 418 143 290 E: [email protected] Penny Haines T: +61 (0) 3 5282 0535 M: +61 (0) 407 824 400 E: [email protected] Nandini Rego T: +61 (0) 3 5282 0519 M: +61 (0) 417 011 982 E: [email protected] MARITIME AUSTRALIA LIMITED PO Box 4095, Geelong VIC 3220, Australia T: +61 (0)3 5282 0500 E: [email protected] Autumn 2011 59 AUSTRALIA Welcome to Treasury Wine Estates Greg Phillips National Account Manager Managed as four regional businesses in Australia and New Zealand, The Americas, Europe, Middle East & Africa and Asia, Treasury Wine Estates is a unique international premium wine business with a leading Phone: international portfolio of new world wines. 13 23 37 From the establishment of Australia’s Penfolds in the mid 1840s to the 1876 founding of Beringer Vineyards, a winemaking legacy has been created. The Treasury Wine Estates portfolio includes iconic brands such as Email: Beringer, Chateau St. Jean, Lindemans, Wolf Blass, Penfolds, Rosemount, Wynns Coonawarrra Estate, Stags’ [email protected] Leap Winery, Matua Valley, Etude, Castello di Gabbiano, Australia’s Seppelt, Coldstream Hills, and Devil’s Lair. With over 12,000 hectares of vineyards, sales totalling over 35 million cases of wine annually, and revenues of over AU$2 billion Treasury Wine Estates employs over 4,000 winemakers, viticulturists, sales, distribution and support staff across 12 countries.

Part of Foster’s Group Limited Welcome to Treasury Wine Estates Greg Phillips National Account Manager Managed as four regional businesses in Australia and New Zealand, The Americas, Europe, Middle East & Africa and Asia, Treasury Wine Estates is a unique international premium wine business with a leading Phone: international portfolio of new world wines. 13 23 37 From the establishment of Australia’s Penfolds in the mid 1840s to the 1876 founding of Beringer Vineyards, a winemaking legacy has been created. The Treasury Wine Estates portfolio includes iconic brands such as Email: Beringer, Chateau St. Jean, Lindemans, Wolf Blass, Penfolds, Rosemount, Wynns Coonawarrra Estate, Stags’ [email protected] Leap Winery, Matua Valley, Etude, Castello di Gabbiano, Australia’s Seppelt, Coldstream Hills, and Devil’s Lair. With over 12,000 hectares of vineyards, sales totalling over 35 million cases of wine annually, and revenues of over AU$2 billion Treasury Wine Estates employs over 4,000 winemakers, viticulturists, sales, distribution and support staff across 12 countries.

Part of Foster’s Group Limited AUSTRALIA Limited

Minister’s Introduction 64 SAL MEMBERS - 2010 92 Reforms address all aspects of shipping industry SAL ORGANISATION 93 Chairman’s Report 66 BORDER AGENCIES Rebuilding flood damages ports must be a priority Australian Customs and Border Protection 94 Effective border controls and trade facilitation CEO’S Report 72 Australian Transport Safety Bureau 98 Greater conformity is needed at local and international levels Prevention rather than blame Australia Quarantine Inspection Service 102 STATE COMMITTEE REPORTS Bugs to ballast water New South Wales 76 Office of Transport Security 106 Queensland 79 Government and industry working together South Australia 82 Australian Hydrographic Service 108 Victoria 84 Supporting safe navigation and enabling maritime trade

Western Australia 87 PORTS Ports Australia - Port efficiency and growth 112 INTERNATIONAL LINER SERVICES 88 Albany - Whose port is it anyway? 114 Board of directors 90 Brisbane - New management and upgraded 116 port facilities POLICY COUNCIL MEMBERS 91 Darwin - Investing in the future 120 Annual Report for 2010 AUSTRALIA Limited

Flinders - Forward thinking 122 Important changes to accounting standards 152 Fremantle - Strategies will maximise capacity 126 maritime law Melbourne - Ports to benefit from a national strategy 128 Two topical issues that concern the salvaged industry... 154 Newcastle - National importance underlined by 132 new research study The unpaid seller’s right of stoppage in transitu 156 North Queensland - Record figures acheived despite 134 Application of Australian employment law to permit ships 158 global crisis The effect of COGSA on foreign law and jurisdiction 160 Port Kembla - Busiest year on record 136 clauses and enforcement in Australia Sydney - It’s a century of infastructure improvements 138 After the floods - Potential legal implications 162 Townsville - More than $230m in capital works in 142 the pipeline yOUNG sHIPPING Australia Victoria - The momentum grows through industry events 164 Environment New South Wales - A year full of success 165 Awareness and protection are core objectives 144 education and training Towage Workforce Advisory Group 168 Svitzer set to take operations to yet another level 146 Seafarer skills shortage 170 INTERNATIONAL DEVELOPMENTS Looking forward to FONASBA annual meeting 150 NAVIGATION in Sydney Are static UKC rules coming to an end? 172 Minister’s introduction By Anthony albanese

Reforms address all aspects of shipping industry

n November last year ports, the bluewater and offshore now there’s been no guiding the Prime Minister, sectors, regulators, unions and strategy, no national co-ordinating Julia Gillard, announced training providers. The Groups program to help them run more Ithat 2011 will be a year met for the first time on 8 February efficiently. and the way the discussions were of delivery and decision Historically, the federal government conducted demonstrated a positive has played almost no role in the for the Government. and constructive manner by industry jurisdiction of ports or management This is certainly true in and unions on how the reforms of the land around them. This has the case of my portfolio should operate. of Infrastructure and been left to state, territory and Transport and in The Government’s reforms address local governments. The federal all aspects of the shipping industry; government’s role has been mostly particular the maritime taxation, regulations and workplace confined to defence, quarantine and industry. arrangements. border security. Without reforming our shipping Over time, this has led to layers of The key maritime productivity sector, we risk becoming nothing red tape and regulatory overlap. reforms to be delivered in 2011 more than the customers of others. It has also meant haphazard include the shipping reforms that I Australia must become an active management of the land around announced during the last election, player in the enormous international our ports that is so vital if we are to the National Ports Strategy that shipping industry. Other developed expand transport corridors to meet the Prime Minister released on 7 countries have embarked on growing demand. January 2011 and the draft National extensive and successful programs The Government’s National Ports Freight Network Strategy that I to rebuild their shipping industries. Strategy lies at the core of the released on 22 February 2011. They have all recognised that a Gillard government’s productivity These three reforms ensure that the healthy, competitive shipping sector reform agenda. It is a blueprint Gillard Government is providing, brings great economic, security and for the future that will address the for the first time, a comprehensive environmental benefits. bottlenecks that for too long have multi-faceted plan for Australia’s Those benefits are something hampered competition and growth. shipping and landside and portside that Australia should seek, and It will ensure our ports are served infrastructure planning. clearly we have a long way to go. by world-class infrastructure with The shipping reforms are being However, the Gillard government is the flexibility to respond to growth. progressed with positive action. facing this challenge head-on. Through this national process, On 1 December 2010 I released Reforms to Australian shipping, states will be asked to provide a Discussion Paper that proposed when added to improvements from buffer plans to preserve the all- important reforms and invited our national ports strategy, will important freight corridors to the submissions to be provided by the stop the sinking of the Australian ports. These will be backed by end of January 2011. shipping industry. They will create broader regional plans to ensure, In January I also established three a platform for rejuvenation with for instance, that housing proposals industry reference groups to consult enormous potential for new jobs, are considered in the context of not and provide advice to me on the opportunities and productivity that inhibiting future transport corridors. will benefit the whole of this island taxation, regulatory and workforce There will be a national data nation. elements of the reforms. Members collection system, the first in our of those groups represent the Given the economic importance of history. Better data will mean more breadth of the maritime industry; our ports, it is surprising that until efficient and co-ordinated

64 Autumn 2011 AUSTRALIA management of our growing trade growth and plan where we want to In the past, overall government task. There will be an onus on be in 2030 and beyond. policy on freight has been segmented by mode and ports to participate in performance As part of the Gillard Government’s reviews, so their systems and jurisdiction. Road, rail, aviation and productivity agenda, Infrastructure shipping were handled in separate efficiency can be effectively Australia was tasked with the and often non-communicating compared and measured. There development of a national freight sections of government. The Gillard will be moves towards nationally network strategy. I have released Government is committed to putting consistent environmental this discussion paper to generate to an end this disjointed and assessment process and continuing debate and input into the framing of inefficient approach to Australia’s regulatory reform. the final strategy. freight network. Our national ports strategy is not a The draft national freight strategy 2011 is the year for decision and federal takeover. It is not a one- discussion paper needs to be delivery. I look forward to working size-fits-all approach. And it will not discussed and responded to in with the maritime industry to achieve conjunction with the National Ports create new bureaucratic hurdles for these significant productivity Strategy. reforms. the commercial sector. This historic approach to ports is part of the Gillard government’s plan to stop the segmentation of our nation’s transport system. For too long freight infrastructure planning has been conducted in isolation and with differing approaches in each state. This lack of co-ordination – by mode and by jurisdiction - is neither sensible nor efficient. Australia’s prosperity depends on our capacity to support productivity through reliable, responsive, world- class infrastructure. It’s a strategy that will help our ports keep pace with economic growth. And it’s tied in to Australia’s largest ever nation- Towage is a People Business Good people, Good Tugs building program. If infrastructure is the skeleton around which the economic body is constructed, then freight is the lifeblood. The two are inextricably linked, and mutually dependent. Without infrastructure, freight cannot move and drive the economy. Without freight to drive the economy, businesses and communities do not grow. Australia needs a tightly defined national freight network encompassing the road networks, the rail networks, the ports and the airports. We need to get the best out of our existing infrastructure, integrate the freight modes with land use planning, determine the capacity for

Autumn 2011 65 AUSTRALIA Chairman’s report By MICHAEL PHILLIPS

Rebuilding flood damaged ports must be a priority

All the effort last year put into the SAL will continue to contribute and grown from 43 to 45 and we welcomed development of a national ports assist where we can to try and avoid to the team Thompson Clark Shipping, strategy bore fruit early this year with the continuation of congestion in our Australian Shipping Consultants, Colin the release of the strategy by the Prime major ports which we have witnessed Biggers & Paisley, Hutchison Ports Minister on 7 January. In our view, in Sydney and in a number of bulk Australia and CLSA Australia Pty Ltd. this was pivotal in focussing attention ports in 2010. Rebuilding our port Access Records Management, Blake on the need for better infrastructure infrastructure after the devastating Dawson and Australian Ship Suppliers planning and the more productive floods in Queensland and in other did not renew their corporate associate use of existing infrastructure in our States must be a priority. membership. major trading ports. Shortly after I There were very pleasing signs was elected chairman of SAL in 2005, towards the end of 2010 that some A year of submissions I flagged the need for governments of the policy issues that have been to take a leading role in freight There were growing signs of union pursued by SAL for a number of years infrastructure development and it is militancy including the Maritime Union were showing signs of being resolved. indeed pleasing to see governments of Australia and this continued into the finally acting on that recommendation. In particular, the electronic customs early part of this year, especially in the clearance for vessels just prior to general stevedoring sector. Having By recommending high productivity departure is an issue that is now firmly been in the industry for many years corridors be set aside to cater for the on the agenda as well as the possibility and personally involved in such issues expansion of trade through our ports, of non-quarantine officers, authorised in the past, I very much hope we are better coordination of port planning by AQIS, for example marine not witnessing a return to those days in the States and Territories and surveyors, undertaking grain vessel with the significant economic impact restrictions on property development inspections at anchor rather than AQIS arising from such disruptions. in and around our ports to protect inspections at the berth subject to a transport access; the document can 2010 was certainly the year of regulatory regime and an appropriate be considered inspirational rather than submissions. SAL made a submission indemnification arrangement. In aspirational although a lot of work is to the Victorian Government on its addition, we commend the Australian required to achieve implementation of discussion paper about shaping Maritime Safety Authority for its these recommendations. Melbourne’s freight future which willingness to supply us with financial particularly focused on a metropolitan There were also recommendations data regarding the extra costs being freight terminal network. SAL believes relating to the streamlined raised by an increase in AMSA levies that intermodal terminals are another environmental approval processes, to fund the additional clean-up costs important link in the supply chains the development of better and more arising from the oil spill by the Pacific easing the potential for congestion in timely data on the landside efficiency Adventurer off the Queensland coast in Sydney, Melbourne and Fremantle, of ports, the use of international March 2009. at least in the short to medium term. performance indicators, and the In my report last year, I noted that Essentially Brisbane is reasonably establishment of a small independent SAL’s full membership stood at 39 full self-contained on Fisherman Islands industry panel to assist Infrastructure members with 43 corporate associate but as trade grows through Adelaide, Australia and the National Transport members. As at the end of 2010, we the demand for intermodal terminals Commission oversee implementation had 37 members with the withdrawal of will likely emerge in that capital city of the strategy. A review within three its Australian services by one member as well. In our view, it is important years was recommended. The strategy and Carnival Australia also did not that these facilities be seen as inland will be complemented by the current renew its membership. We continue to ports with customs and quarantine development of a national freight encourage other members to join but clearance being available at these network strategy. our membership still covers around 80 intermodal terminals and stevedores The interest of the Council Of per cent of Australia’s container and controlling the movement of cargo to Australian Governments in this process car trade and over 50 per cent of our and from such facilities to ensure that and infrastructure generally is what break bulk and bulk trade. Importantly they seamlessly merge in with the makes this initiative so important and Royal Caribbean Cruise Lines remains operational practices of the stevedores provides a clear delineation from a member. I am also pleased to report and that they retain liability for the previous attempts at reform. that our corporate membership has movement of the cargo to and from the

66 Autumn 2011 AUSTRALIA inland ports. The issue of ownership of these facilities and access are matters that will continue to be developed and SAL is also concerned to ensure that we can make such facilities commercially viable for both importers and exporters. SAL has also made a number of submissions to the Victorian Government regarding the creation of sufficient container terminal capacity to handle anticipated future demand as well as handling the expected increase in throughput of motor vehicles. SAL has urged the Victorian Government The Macarthur Intermodal Shipping Terminal to develop Webb Dock East as a new the year we carried out an international infrastructure charge was introduced in container terminal for a third stevedore port cost comparison exercise using Melbourne. bearing in mind that by early 2013 an average sized container vessel Hutchison Port Holdings will be firmly currently calling Australia and using an There have been a number of established in Brisbane and Sydney. average exchange of containers, which stakeholder meetings in Melbourne SAL also recommends that the existing showed that Melbourne sat almost in regarding improving the performance motor vehicle stevedoring lease at the middle of the table in terms of the of empty container parks and SAL Webb Dock East be transferred to cost of a ship call with 12 ports being members are doing their best to Webb Dock West. We continue to urge cheaper than Melbourne out of a total improve the efficiency of the parks the Victorian Government to provide of the 22 ports surveyed. Details of although all stakeholders will be for a third stevedore in Melbourne that exercise can be found on the required to contribute in that respect given that not only are there national Shipping Australia website at www. if it is to be efficient and productive. stevedoring contracts but also the shippingaustralia.com.au. One of the important issues is an IT ability of the contracted stevedore to system that will provide the required handle ships that fall out of berthing During the year the Victorian Transport transparency of operations to allow windows at previous ports; thus Association was critical of SAL’s trucking companies and the empty enabling them to get back on schedule approach to another important link in container parks as well as shipping if at all possible prior to departure from the container supply chain; namely companies to better plan their demand Australia. empty container parks. Earlier in the for services at the parks and the year an infrastructure charge was SAL’s overall objective is to improve Maximus Container chain initiative levied by the empty container parks the efficiency, reliability and should fulfil that role in April this in Brisbane, Sydney and Fremantle. productivity of stevedoring operations year. SAL members are supportive of As expected, this was undertaken in Australia. SAL members remain increased operating hours for parks without any consultation with SAL very concerned regarding the regular assuming that negotiations between and subsequently SAL was unable cost increases that are occurring in the parks, their contractors and the to ascertain the breakdown of cost many Australian ports and the lack of shipping lines can arrive at mutually increases which gave rise to these infrastructure in a number of our break acceptable costs to achieve that infrastructure charges. However, SAL bulk ports and the need for improved has made representations on the result, otherwise similar volumes of productivity particularly in some rapid increase in land rental values cargoes are passing through the container ports and especially at the at Fisherman Islands and is aware of empty park at much higher costs. DP World terminal in Sydney. During the high rent costs in Sydney. A lower At the time of the preparation of this report these discussions were ongoing but it appeared that some empty container parks in Melbourne were not being realistic in their cost increase demands. In SAL’s view, a vehicle booking system is essential; one that could be more flexible and efficient than that which currently operates at the container terminals at the port. The cost of this system should be met by the trucking companies; thereby achieving a financial contribution by all stakeholders. SAL remains committed to the development of this strategy which, if successful, will also most likely assist in the development of an improvement in efficiency of empty Trucks need a vehicle booking system at empty container parks parks in both Sydney and Fremantle.

Autumn 2011 67 AUSTRALIA Chairman’s report

Proposed development of an Australian merchant marine/ coastal shipping policy During the federal election campaign last year, the then Minister for Infrastructure, Transport, Regional Development and Local Government released a statement on a future Labor Government’s proposals regarding development of an Australian merchant marine including the establishment of a tonnage tax, removing discriminatory tax treatment for international Australian seafarers which currently exists, creation of an international shipping register and proposals for increased productivity. SAL supported the direction of these Government proposing new coastal shipping policy proposals but issued a note of caution whether the implementation would paper by the deadline of end January existing arrangements given the other result in the provision of internationally this year. We reinforced our support proposals will be levelling the playing competitive shipping services and for the direction these proposals were field as far as international competition long term viability. SAL is concerned taking on the basis they would lead to is concerned. In other words, a viable that there was not a higher level of a viable and internationally competitive internationally competitive Australian consultation with the industry with the revitalised Australian merchant marine. shipping industry would fit neatly into development of these proposals but In particular SAL supported the the existing coastal trade policy without were hopeful of being more involved Australian Government’s objectives for the need for further restrictions. in the industry consultation on the shipping including ensuring Australia detailed implementation as the matter has a viable shipping industry, able Other SAL comments related to the was progressed. to provide adequate coastal shipping proposal for an international shipping services at a reasonable price for register and the need for the Australian On 1 December last year the Minister customers and consumers and which policy to be developed as close as for Infrastructure and Transport reinvests in its ships when they reach possible to internationally accepted released a discussion paper outlining the end of their economic lives. maritime conventions and practice. a number of proposals designed However, SAL expressed reservations to restore the viability and reverse In terms of coastal shipping policy regarding the proposal for a new the decline of Australian’s domestic generally SAL has remained concerned category of temporary licence which shipping industry by: about the costs of the application of could be up to two years for access by the Australian Fair Work Act to permit a. Modernising the domestic foreign flag vessels to the Australian vessels carrying domestic Australian regulatory arrangements applicable coastal trade on the basis that it cargo incidental to the carriage of to coastal shipping; supports the long term interests of Australia’s international trade. Late a competitive Australian shipping b. Introducing new tax arrangements last year SAL met with Senator Evans, industry including explicit consideration to attract greater investment and the Minister for Workplace Relations of the employment of Australian place the industry on a sustainable and continues to urge the Government seafarers and numbers of vessels in footing comparable with its to exempt such vessels from the the Australian trading fleet and taking international competitors; application of the Act given that many into account the proposed operations ship operators and ship charterers c. Establish an Australian national of both the individual ship and the have no connection whatsoever with shipping register to facilitate applicant’s broader fleet. In addition, the payment of seafarers wages. A Australian participation in this was seen as a transitional measure ridiculous situation would be seeking a international shipping during the first three years after the permit for one container, for example, implementation of the package to d. Make changes to income tax when a ship was carrying 3,000 effect a smooth phase in of the new arrangements for Australian containers of overseas trade. The arrangements. resident international seafarers to additional costs are substantial and remove the disincentive for Furthermore a single voyage permit have the potential to see the cargo companies employing Australians could be limited to circumstances of driven onto road or rail and/or the and an urgent or emergency nature where cargo imported from overseas. The there is a broad, national or community CEO in his report explains in more e. Work with industry, unions and interest. Given that permits are only detail the ongoing problems with education providers to improve issued where there is no licensed the application of the Fair Work Act maritime skills development and Australian ship to take the domestic to such vessels. He also refers to training. cargo three days before or three days what I believe were misleading and Shipping Australia made a detailed after the scheduled load date, SAL mischievous comments in the spring submission regarding the discussion does not see the need to change edition of the MUA’s Maritime Workers

68 Autumn 2011 AUSTRALIA Journal last year regarding SAL’s in the future and the rapidly aging plan for the Association based on a position on the Federal Government’s profile of those in the industry. In detailed SWOT analysis and discussing proposals on the rejuvenation of the past, a number of SAL members possible ways and means of increasing the Australian merchant marine and have provided berths to students productivity and efficiency. Australia’s coastal shipping policy. from the Australian Maritime College As a result there has been clarification undergoing sea training courses to of the role and functions of the Board, give them more sea time and all those Year of the Seafarer/Maritime more streamlined policy co-ordination, students have subsequently been training agreement on certain measures to awarded cadetships. In addition, reduce operating costs as well as a In the spring 2010 edition of Shipping SAL continues to work with the pilots new focus on attracting additional Australia magazine, I commented on and other stakeholders in terms of members. It is felt that particularly in how difficult life can be for international creating alternative pathways for the the bulk and break bulk area there is seafarers and how they can be appointment of pilots and hopefully scope for SAL to provide services to forgotten even though they are such other areas of the maritime industry will a wider range of shipping companies an important link in our international benefit from the implementation of the and agents in Australia. Furthermore, supply chains. 2010 was the UN’s current proposals. we are willing to encourage members International Maritime Organisation’s The SAL e-learning introduction to who have an interest in the maritime international year of the seafarer and the maritime industry course has industry to join SAL as an individual Government proposing new coastal shipping policy that initiative was strongly supported gone very well since its inception as long as they are not part of a by SAL. The CEO of SAL is a director and consideration is being given to corporation or have an ABN. I envisage of the Australian Mariners Welfare the creation of a much more detailed a very bright future for SAL as it goes Society and continues to support e-learning course to allow students from strength to strength. their work and the work of the various to go on to study the subject in more Missions to Seafarers around Australia. detail. Essentially this later course The Australian Maritime Safety International organisations will be very similar to that which is Authority organised a seafarers welfare provided in the current two day face to SAL remains actively involved with the forum in Melbourne late last year that face course. activities of the Federation of National brought together specialists to talk Associations of Ship Brokers and about the problems faced by seafarers Agents (FONASBA). The CEO attended that make their jobs difficult and Future of SAL the annual meeting of the various sometimes dangerous. It was pointed In 2010 the SAL Board of directors committees and council that was held out that recent research studying the along with the CEO have been giving in Varna in Bulgaria in October last health and wellbeing of seafarers and detailed consideration to a five-year year. SAL has been selected to host the causes of their deaths at sea show that their mental health in many cases was not very good. Robert Iverson, manager of the Mental Health of Seafarers Project, Rotary Club of Melbourne South, presented a paper at that forum to discuss this problem in detail and he referred to the booklets which have been produced to assist shipping masters in recognising the problems and providing a resource for assistance when they call in Australia. The booklets are produced in various languages in a joint project by the Melbourne Port Welfare Association, Beyond Blue: the National Depression Initiative, the Rotary Club of Melbourne South, Stella Maris Seafarer Centre and the Mission to Seafarers Victoria. Members of SAL have offered to distribute the brochures to masters of vessels calling at the wide range of ports we have in Australia. Shipping Australia remains concerned regarding the provision of future services by adequately trained seafarers for the many landside jobs that are required in Australia and has joined with other stakeholders in seeking to remedy that situation given the forecast shortage of seafarers Delegates at the FONASBA annual meeting which was held in Bulgaria, October 2010

Autumn 2011 69 AUSTRALIA Chairman’s report

the meeting in Sydney over the period container steering groups as well as Shipping Australia magazines have 10 to 14 October, 2011. Detailed the e-commerce steering group. The greatly assisted SAL in terms of not plans are being implemented for a border agencies and port services only raising our profile generally but very memorable event as far as the steering group continues to address a also getting the major policy issues expected 110 delegates from over 40 wide number of issues that have direct that impact the maritime industry in countries who are expected to attend impact on all aspects of the maritime Australia out there for public scrutiny this important event. industry in Australia. and consideration. Whilst distribution Official Australian Electronic Charts - Shipping Australia is an associate is about 4,500, it is understood that In addition, I am pleased that Shipping member of the International Chamber it is read by around 10,000 people the future of charting. Australia is a member of many outside of Shipping and we have continued to with hundreds of copies being sent organisations such as the Customs and liaise closely with that organisation and overseas. I would particularly like to Border Protection National Consultative are also a member of the Australian thank the PR steering group for all their Committee, the AMSA Advisory branch of the International Chamber work in producing this magazine. National Standards for Commercial Vessels (NSCV), introduced in October of Commerce. We have continued to Committee, the high level Maritime liaise closely with the World Shipping Security Strategic Committee, the In terms of state secretaries I 2009, includes requirements for carriage of official Australian electronic (ENC or Council. SAL is a member of the Industry Security Consultative Forum, would also like to acknowledge the Australian branches of the International the Tradegate Board, the Australian contribution of our South Australian RNC) or paper charts. The Australian Hydrographic Service, part of the Royal Institute of Logistics and Transport Mariners Welfare Society, the AMSA state secretary, Doug Bourne-Jones, and the International Cargo Handling Bulk Committee, the AQIS Industry who has been the secretary since SAL Australian Navy, is the only producer of official ENCs, RNCs and paper charts Coordination Association. Cargo Consultative Committee as well was formed in July 2001 and our best covering Australian waters. When used in either a compliant ECDIS or compliant I would particularly like to thank as the Industry Working Group on wishes go with him in his retirement the sponsors so far namely Sydney Quarantine and the National Introduced after over 60 years of continuous ECS, these ENCs and RNCs allow vessels to meet NSCV regulations. Ports Corporation, Australian Marine Pests Coordination Group. service in the maritime industry. Quarantine and Inspection Service, That list is one of examples rather than Over this year I have had the strong Hetherington Kingsbury/McArthurs, being an exhaustive one. Inchcape Shipping Services, Gulf support of my fellow directors on the Australian ENCs are available through the IC-ENC and PRIMAR global Shipping Agency, LBH, Newcastle I would particularly like to thank all the Board of SAL and I wish to thank them Stevedores, Australian Maritime Safety chairmen of our steering groups and for their contribution and assistance. distribution networks and an update service is included in the purchase price. For Authority, Australian Maritime College, State committees in 2010: I would particularly like to thank Jan Middletons, Thomas Miller Asiaworld Schot, managing director of CMA CGM more information see the IC-ENC website (www.ic-enc.org) and PRIMAR website Shipping and SVITZER. Queensland State Committee, Australia, who has resigned from the Sharon Ralph (APL) (www.primar.org) or contact the AHS directly at [email protected]. There are many issues impacting on Board to take up a post in the Middle ship brokers and shipping agents of NSW State Committee, East and he is being replaced on the direct relevance to SAL. We continue Peter Creeden (Hamburg Sud) Board by his successor Simon Aynsley. to promote the FONASBA quality Soren Houman, managing director of Australian RNCs (known as ‘Seafarer RNCs’) are available through the AHS assurance scheme for shipping Victoria State Committee, Maersk Australia resigned during the agents and we have also participated Rod Begley (APL) year to return to Copenhagen and we Distribution network. For more information see the Distribution Network section in a number of surveys which are South Australia State Committee, welcomed Soren’s replacement, Nicolaj conducted to assist members to learn of the AHS website (www.hydro.gov.au). Alan Brundish (COSCO) Noes, to the Board in the middle of from each other. September. I also wish to express Western Australia State Committee, my appreciation to Soren for his help Other issues Graeme Wilson (Indian Ocean and assistance over the years on the Shipping Agencies) Shipping Australia has generally Board. accepted the objectives of the Port Border and Port Services Steering In my report last year I mentioned Botany Logistics Improvement Strategy Group, that I hope that in reviewing 2010 it but is concerned how the significant Frank Needs (ANL) would be financially successful as a costs of the new proposals will be result of the resurgence of demand recovered. There is further mention of Container Technical Steering Group, in all shipping sectors. Whilst there this important strategy in the report of Peter Creeden the New South Wales State committee. has definitely been a resurgence in Technical Steering Group, I would like to express my sincere demand, the continued oversupply of appreciation for all the work that our Ross McAlpine (MSC) shipping tonnage has clearly impacted on a number of sectors, in particular member lines put into the various state Human Resources Steering Group, the bulk shipping sector. One can committees in each mainland state and Eddy DeClercq (OOCL) I commend the reports of those state only hope that in 2011 we will see committee for your attention. E-Commerce Steering Group, a continuation of the trend towards Nathan Wicks (NYK) In addition, there are many issues recovery from the disastrous results for the shipping industry in 2009. The which I have not commented on here Maritime Legal Steering Group, effects of the natural disasters we that have been the subject of detailed Ken Fitzpatrick (Asiaworld Shipping) consideration within those state witnessed at the beginning of this committees and our maritime legal PR Steering Group, year will certainly put a brake on that steering group. Technical and Ross McAlpine recovery. the national charting authority 70 Autumn 2011 AUSTRALIA trusted since 1920. www.hydro.gov.au Official Australian Electronic Charts - the future of charting.

National Standards for Commercial Vessels (NSCV), introduced in October 2009, includes requirements for carriage of official Australian electronic (ENC or RNC) or paper charts. The Australian Hydrographic Service, part of the Royal Australian Navy, is the only producer of official ENCs, RNCs and paper charts covering Australian waters. When used in either a compliant ECDIS or compliant ECS, these ENCs and RNCs allow vessels to meet NSCV regulations.

Australian ENCs are available through the IC-ENC and PRIMAR global distribution networks and an update service is included in the purchase price. For more information see the IC-ENC website (www.ic-enc.org) and PRIMAR website (www.primar.org) or contact the AHS directly at [email protected].

Australian RNCs (known as ‘Seafarer RNCs’) are available through the AHS Distribution network. For more information see the Distribution Network section of the AHS website (www.hydro.gov.au).

the national charting authority Autumn 2011 71 trusted since 1920. www.hydro.gov.auAUSTRALIA CEO’s report By Llew RusselL

Greater conformity is needed at local and international levels

AL prepared many The Chairman in his annual report, ABB Limited and the application for submissions in mentioned the submissions we authorisation lodged by DP World 2010 in addition prepared and sent to the Victorian Australia and Patrick Stevedores Government in shaping Melbourne’s Operations Pty Ltd in Fremantle. Sto engaging with freight future and to the Port of We provided comments on the stakeholders, government Melbourne regarding the additional proposed South Australian ports agencies and departments container capacity required to access regime and we also meet future demand as well as the on a whole range of prepared a submission on the discussion paper on Webb Dock policy issues affecting Navigation Act rewrite discussion West and automotive development the maritime industry in paper, the inquiry into biosecurity to also cater for future demand. and quarantine arrangements by the Australia. If 2010 was In addition, besides ongoing Senate Standing Committee on Rural the year of submission engagement regarding the national Affairs and Transport and provided hopefully then 2011 will ports development strategy we our comments on the proposed made a submission on the initial be the year of action. Victorian freight infrastructure discussion paper regarding the Certainly the start of charge that was intended to apply national freight network plan 2011 with the disastrous to the trucking industry. As far as prepared by Infrastructure Australia. Melbourne is concerned we also floods in many States in We made a number of submissions made a submission on the proposed particular in Queensland to the government regarding the new towage legislation which would and Victoria and Cyclone application of the Fair Work Act to see a considerable enhancement the carriage of coastal cargo under Yasi in Queensland of the power of tugs in the Port of permit, we responded to the draft has raised many Melbourne as well as a submission application for authorisation from the additional challenges on the proposed privatisation of ACCC by the Brisbane Marine Pilots the Port of Brisbane Corporation. In to those we faced in as well as the proposed merger addition we made a submission to terms of infrastructure between Grain Corp Limited and development in this country. The effects of those floods will be felt for a long time to come.

Our other hope for 2011 is that we will see legislative and policy reform that will result in much greater conformity with international conventions and policies then hitherto as well as a greater level of national uniformity in Australia between the States and Territories. Such an approach will also assist in reducing the impact of the regulatory burden on the industry and reduce the level of inconsistencies that currently apply in terms of implementation of legislation and regulations between ports and between the States and Territories. Swanson Dock at night, photo supplied by Port of Melbourne Corporation

72 Autumn 2011 AUSTRALIA the ACCC on the AAT tariff review pointed to the hardship for Australian international trade being defined as: and we also made a submission shippers of coastal cargo who would a. Vessels regularly engaged in to the Grain Ministerial Task Force not have access to the frequency international trade and which on a number of issues including of sailings required or access to regularly move into and out of the possibility of inspection of grain containers that they require to Australia’s jurisdiction; ships at anchor rather than at the service their needs. berth. b. Vessels that carry less than the Subsequently, the Government introduced regulations which made majority of their capacity of Application of the Fair Work Act it clear that the Act would apply Australian domestic trade per to permit ships to licensed ships in the Exclusive annum (ie. the majority of their Economic Zone or the waters above capacity is used for international In November 2009 SAL gave the continental shelf of Australia, trade); evidence to a full bench of the and would apply to a permit issued then Australian Arbitration and c. Vessels whose carriage of after 1 January, 2010 if a continuing Conciliation Commission regarding Australia’s domestic trade is voyage permit had been issued in regulations issued in the middle of incidental to the main purpose the previous 15 month before the that year by the then Minister for being an international voyage current permit was issued or if two Workplace Relations, Julia Gillard and there is no disconnect or more single voyage permits had extending the application of the from the international voyage been issued in the period 12 months Fair Work Act to ships which have to do so; and before the current permit was issued. been granted a permit under the d. Vessels that do not trade Navigation Act 1912 to be allowed The Commission subsequently regularly between Australian to carry domestic cargo under decided that the modernised ports in the one round voyage certain circumstances. The Minister Australian Sea Going Award would within the Australian EEZ. subsequently requested that the not initially apply to permit ships Commission give consideration but they set out their ideas on It was pointed out that all the above whether it is appropriate to establish the appropriate wage rates and criteria needed to be fulfilled to modernised award provisions for conditions that should apply to meet the exemption. SAL met with employers of cruise and permit permit ships covered by the Act from the Minister on 20 September last ships and employees relating to 1 January, 2011 under Part B of that year and remains hopeful that the accrued entitlements and associated award. Following up representations Australian Government will accede to arrangements. Considering the made by SAL in 2009 to Minister this request on the basis of ensuring matter, the Commission was Gillard, SAL wrote to Simon Crean that Australian businesses do not requested to have regard to the when he was the Minister and suffer economic hardship given, in needs of those employers and subsequently to Senator Evans who SAL’s view, the unfair application of employees who may be in Australia was appointed after the federal the Fair Work Act to permit ships as for relatively short periods and who election. In those representations described above. are regularly moving in and out of SAL set out the extent of the the Australian jurisdiction. additional costs that would arise from Overweight containers the application of the Fair Work Act We argued strongly before the which initially involved the payment In July last year we became Commission that the modernised of minimum Australian wages from aware that the Road and Traffic Australian Sea Going Award 1 July 2010 as there was no award Authority in New South Wales should not apply to permit ships coverage and Part B of the award had been discussing the building that are carrying cargo under will apply from 1 January, 2011 of weighbridges in the container permit incidental to the carriage which was approximately another 25 terminals at Port Botany for the of Australia’s foreign trade. We per cent increase in costs. SAL did previous 12 months. Following explained that if there is an quite a bit of cost modelling which meetings at the office of the Minister Australian licensed ship available showed the extensive impact of the for Roads as well as the New three days before or three days after application of the award on foreign South Wales Minister for Ports and the scheduled loading date of the flagged ships and even pointed to Waterways, there was a meeting domestic cargo, then a permit would the fact that the Government would of all stakeholders chaired by the not be issued in the first place. The be paying a much higher level of Sydney Ports Corporation to work out additional cost of carrying coastal freight equalisation for Tasmania on how best to achieve the objectives cargo in smaller amounts would the basis of the application of this of the chain of responsibility make it prohibitive if Australian Act. SAL urged the Government legislation while still facilitating award conditions applied to foreign to clarify the previous regulation to international trade. The Roads and seafarers. For example, the Act ensure that the following vessels Traffic Authority were particularly would apply if only one container of would be excluded from the focused on axle weights for inward domestic cargo was lifted compared operation of the Fair Work Act containers by road but SAL pointed to say up to 3,000 containers for given that they are carrying coastal out that export containers are also foreign cargo on the vessel. We also cargo under permit incidental to often overweight or at least have

Autumn 2011 73 AUSTRALIA CEO’s report

of the Nationally Introduced Marine Pests Coordination Group with Commonwealth/State and Territory stakeholders representatives meeting without industry representation. SAL has concerns with these arrangements and will be discussing these with the Department.. The development of legislation to implement the recommendations of the Beale inquiry is certainly a major exercise and has not been proceeding as expeditiously as industry would have hoped. There will be ongoing consultations with the Department in relation to that legislation which will also incorporate the national ballast water strategy misdeclared weights which can ATO. Subsequently SAL has joined and ratification of the ballast water cause problems right throughout the other stakeholders such as the Convention when it comes into force. supply chain. Customs Brokers and Forwarders We continue to foster stronger Council of Australia and the As at the end of last year, relationships with the Australian Australian Federation of International discussions were ongoing regarding Quarantine and Inspection Service. Forwarders with a submission to both how a better risk based approach There was on-going debate the ATO and Treasury to remove the could achieve benefits for all throughout the year regarding the existing and unfortunate degree of stakeholders without necessarily administrative guidelines that should uncertainty where GST may need to building a lot of static weighbridges be applied under certain terms of the apply to the AQIS Industry Cargo in the container terminals in Port sale agreement or terms of trade and Consultative Committee and the level Botany. A request was made to the not applied in other circumstances. of transparency that should apply to RTA to extend the time for which It is hoped that this matter can be the costs recovered from industry in the improvement notices would clarified in the near future. the import seaports programmes. It take effect to allow a more practical is hoped that these issues can be solution to be developed. resolved expeditiously in the first Border agencies/Environment quarter of 2011. Application of GST to land As mentioned in the Chairman’s SAL welcomed the establishment of based charges in ports report, the new electronic payment the Maritime National Co-ordination of AMSA levies now appears to be On 1 July, 2010 the Government Centre beginning from July last proceeding satisfactorily and we are changed the law relating to the year in the AQIS Adelaide regional receiving updates on the amount of application of GST for certain office. Pre-arrival activities to be co- money being collected to pay the charges arising under a single ordinated were phased in for various extra three cents per Gross Tonne contract involving an overseas as part of the clean-up cost for the ports up to 6 September. The pre- movement as well as a land based Pacific Adventureroil spill incident in arrival activities included: movement in Australia. Door-to-door March 2009. It is anticipated that it shipments, for example, under one • processing Quarantine Pre-Arrival could take up to five years to repay overseas contract were to be exempt Reports (QPAR), eQPARs and the total amount but hopefully it will from the application of GST and the Pratique Documentary be recovered in a shorter period. position of overseas entities was Clearances (PDC) SAL is monitoring this matter closely. clarified and the Australian Taxation • issuing Approval to Berth (ATB) Office issued a factsheet regarding There have been a number of or Certificate of Pratique these new rules on the charging developments this year with of forwarder cargo under their biosecurity and a number of SAL’s • verifying Ballast Water contracts from overseas to places member vessels have been part Management Summary (AQIS of consignment in Australia being of a trial regarding the filling out Form 26) GST free. However, the application of a form that will facilitate the risk • seeking advice/assistance in the of certain charges by shipping lines assessment of bio-hull fouling on a management of identified on land based port charges where vessel and this will be the subject biosecurity risks prior to arrival ie. freight was paid in Australia had not of further discussions with the death and/or illness been adequately addressed and Department of Agriculture, Fisheries this has been the subject of ongoing and Forestry. New arrangements • initial point on contact for discussions between SAL and the have been agreed for deliberations pre-arrival activities.

74 Autumn 2011 AUSTRALIA Once a vessel has arrived at the first Australian Transport Safety Authority (ie. at the anchorage) there are still port call in Australia, shipping agents noted that officer fatigue could have a large number of vessels drifting continue to liaise with the local AQIS been an issue in that grounding. We off the coast of Australia and Seaport officer on matters relating recommended that the Government even Papua New Guinea waiting to vessel movements, inspection consider extending the current Great to be called forward to enter the of the vessel, crew signing off Barrier Reef vessel tracking system anchorage area. Some fine tuning of etc. For more information contact South to incorporate this area and the arrangements is required and the [email protected]. this was subsequently progressed congregation of drifting vessels in It is hoped that there will be an through the International Maritime close proximity to regularly used sea increase this year in the number Organisation. lanes is of concern. of vessels quarantine cleared on During the year consultations where the basis of documents alone Other issues also held with the Department of being more risk assessed but Shipping Australia has had very still maintaining a high level of Employment Workplace Relations good relationships over the past year quarantine standards. It was also regarding Australia’s ratification of with Tradegate Australia Ltd. We pleasing that there was no fee the Maritime Labour Convention have worked successfully together increase as far as the Seaports and this level of consultation was on many issues of mutual interest. I programme was concerned. very much appreciated by SAL. The look forward to ongoing participation objectives of the MLC are strongly SAL continues to appreciate the this year. supported by SAL who believes high level of co-operation normally I am also pleased with the way Australia should ratify it on the received from the Australian Customs that Young Shipping Australia has basis that a number of major open and Border Protection Service. A developed both in New South Wales registries have signed and ratified number of customs issues are raised and Victoria and am hopeful that the the Convention and as long as it has in the annual reports but in addition, we liaised with Customs regarding concept can be developed in other broad international acceptance, then the new requirement for outgoing States if there is the demand. My Australia should be a party to it. view is there is a bright future for passenger cards to be completed by I also wish to thank the SAL Board passengers embarking on a vessel the development of Young Shipping Australia and they have successfully of Directors and particularly the SAL with round ship cruise status. We are Chairman for all their support and also monitoring the current Customs avoided it simply becoming a networking exercise but have assistance throughout 2010. I am analysis of underbond movements. confident that the five year forward We continue to encourage as much sought to develop the education business plan which has been national consistency as possible and knowledge of the employees agreed by the Board will provide in the implementation of customs involved. very exciting opportunities for the regulations and policies. The new vessel arrival system was growth of SAL and it will increase our In terms of maritime security, we introduced in Newcastle during the strength and effectiveness. are aware that many Maritime Crew year and it has been the subject Visas will expire in the early part of of on-going discussion with the We could not exist without the strong this year and SAL members have shipping lines especially in Japan. support of all our members including been advised to ensure that all Whilst it has reduced the number our corporate associate members foreign flagged vessels and crew of vessels awaiting off Newcastle and for that I am very grateful. coming to Australia are aware of this requirement to have such a visa prior to entry. We continue to work closely with the Office of Transport Security on passenger screening and security and in particular security for mass gatherings and the other security issues relating to the renewal of the Maritime Security Identification Card and other issues which are being raised in the various security fora. SAL continues to work well with the Australian Maritime Safety Authority on a whole range of issues and the high level of consultation is appreciated. The Shen Neng I grounded on 3 April last year 60 nautical miles North of the entrance to the port of Gladstone and the Shen Neng I

Autumn 2011 75 AUSTRALIA State committee reports

New South Wales

By Kushy Athureliya, State secretary

n looking back over the events of Sydney There is concern that the administrative 2010, the NSW State members can burden resulting from the reporting Ifeel satisfied with the joint efforts requirements of the new mandatory Port Botany expansion of the Committee. The Committee arrangements will result in additional has continued its liaison with all Port Botany T3 container terminal costs to the stevedores, which no doubt ultimately would be passed on to organisations connected to the expansion project is progressing on the consumer. industry. The co-operation of the schedule the site should be handed Port Corporations in NSW is much over to the new Terminal operator by SAL supports a practical and sensible appreciated and the Committee the middle of 2011. The construction approach of implementation of these continues to build on the good activity associated with the terminal new regulations by stages and relationship with them reclamation works continues, with the holding of a trial (commencing the installation of cope beam and February 2011) before actual penalties Bill Rizzi, NSW State Manager, installation of fenders and the building are enforced. Mediterranean Shipping Company of a new terminal access bridge well (Aust) Pty Ltd was elected to the under way. Cruise shipping position of Chairman of the NSW A meeting of the State Committee was State Committee for 2011/12 at the The Passenger Cruise Terminal held in the Sydney Ports Operations Steering Committee, which was tasked last meeting of 2010. Peter Creeden, Centre in July after which a site tour with investigating and recommending Regional Logistics Manager, Hamburg was arranged by the SPC for members not only a preferred location for a Sud, who stepped down from the to view the new development. Another replacement passenger terminal west role of Chairman has been appointed visit is planned for early 2011. of the Harbour Bridge, but investigating Vice Chairman. The Committee was grateful to both Peter Creeden and Ross McAlpine (Vice Chairman) for Port Botany Landside leadership of the State Committee over Improvement Strategy (PBLIS) the previous two years. The State Government having initially tried to negotiate voluntary Peter Creeden represented SAL in arrangements with the stevedores has a number of Committees in NSW, released regulations and mandatory looking after member’s interests. standards in support of the Port Botany Ross McAlpine, the Vice Chairman Landside Logistics Strategy, as a last represents the Committee on the resort. Freight and Logistics Council of NSW. Andrew Karas represents Shipping Australia has been a strong the Committee on the Sydney Ports supporter of the objectives of the Cargo Facilitation Committee. The strategy to improve productivity and Port coordinator in Newcastle was efficiency. SAL had raised concerns Ian Dwyer, from Inchcape Shipping regarding the appropriateness of the Services. Brad Ross from Inchcape $10 increase on wharfage rates for all Shipping Services stepped down full import and export containers (not as the Port Kembla Coordinator in transhipment or coastal) to cover the February and Fiero Mammone, Port cost of the scheme. Manager, Gulf Agency Company SAL was concerned that devoting (Australia) Pty Ltd, took over this resources to handling road and position. The Committee is extremely rail, receival and deliveries, within grateful to them for the time and effort stevedoring terminals may detract from in attending to industry matters on the efficient handling of vessels at the behalf of members. terminal. Linesmen at work in Port Botany

76 Autumn 2011 AUSTRALIA options for a further passenger terminal east of the bridge. A new cruise terminal is to be constructed at White Bay as the replacement terminal for # 8 Darling Harbour. SAL is represented on the Steering Committee. Over 150 cruise ship visits are scheduled to call in Sydney in the 2010/11 Sydney cruise season, a 26% increase on 2009/2010, with passenger numbers expected to be over 300,000 injecting an estimated $190 million into the NSW economy.

Intermodal terminals The NSW Government has confirmed that community and stakeholder consultation will commence shortly for a proposed $490 million intermodal terminal at Moorebank. The site for Ship working at Port Kembla the terminal is essentially two blocks of land, one owned by the School of The Sydney Pilot Service was per container from $15 was a bid to Military Engineering and the other by absorbed under SPC in July 2010. improve efficiency at its terminal. Stockland. Llew Russell, CEO of SAL resigned In December the New South Wales from the Board of SPS. Two new pilot Members were pleased with the Government regulated rail servicing cutters are under construction. $70 million in funding allocated by prices at the port and rejected Patrick’s the Commonwealth Government to decision to increase its rail window undertake planning for the site in the Tugs and line boats fees at Port Botany by 67%. 2010-11 budget. SVITZER Australia has announced There has been considerable that it will divest non-core operational New ports Minister services such as lines and mooring opposition to the project from local In September 2010, Eric Roozendaal, operations in Port Jackson and Port residents, but SAL is of the view that NSW Treasurer and Minister for State Botany and some other locations in this is a nationally significant project and Regional Development replaced Australia, with a view to intensifying its which requires urgent development. Paul McLeay as Minister for Ports focus on towage operations. and Waterways and Minister for Empty container parks PB Towage has issued a new tariff the Illawarra. SAL met with the new for towage, which shows an average Minister soon after his appointment to Some empty depots have extended increase across the three ports, being brief him on shipping industry issues. their opening hours to assist, but held below 5%, which they inform utilisation of these hours has been is less than the increase in their Terminal productivity rather poor and depots are considering crew cost. PB Towage rates are fully reviewing their opening hours. inclusive of bunker costs and no fuel The productivity at both terminals was affected during the year. Whilst one Some empty depots introduced an surcharge applies. terminal managed to regain normal “Infrastructure Levy” applicable to productivity levels towards the end inbound containers to their container Patrick rail services to Port of the year the other was plagued parks located on Port Corporation Botany by problems associated with the controlled land as result of increasing Patrick Port Logistics ceased operating introduction of a new IT operating rental rates over the past 5 years. rail services to/from Port Botany system.SPC has developed an action Some depots outside these areas also from June 30 2010, stating that a plan which is designed to get the followed suit. contributing factor to their decision key stakeholders and industry bodies has been a requirement to invest in together with the aim of improving Pilotage the Camellia rail terminal to continue overall quay side performance in operations. Sydney. SAL will be involved in trying Minimum harbour pilotage fees for to make this action plan work. Sydney Ports were increased by 23% Patrick had reviewed its rail operations from April 1. All other components of at Port Botany and had developed Weigh bridging of containers the pilotage fee, including harbour rules for charging in an effort to removal and anchorage, will rise by a improve the efficiency of terminal RTA NSW is seeking to have all import total of 7.5% over three years and fees operations and to encourage the containers leaving the container are also subject to annual changes in efficient use of rail windows. Patrick terminals by road to be weigh- the consumer price index. claimed that its price increase to $25 bridged within the terminal. This

Autumn 2011 77 AUSTRALIA State committee reports

is enforced by legally enforceable terminal complex with an annual on the major roads in the area and improvement notices under the chain capacity of 1 million containers a year provide alternative infrastructure to of responsibility legislation. and a hardstand for cargo, storage cater for the anticipated increase in and assembly, in Mayfield at the former NSW trade. SAL had been concerned at the BHP Steelworks. potential for serious disruption to During the latter part of the year terminal operations and a substantial Newcastle had recorded a 7.5% vessels had been encountering delays increase in costs. increase in trade to 103m tonnes for in Port Kembla, following a shortage of the 2009/2010 financial year. pilots. It is important that the remedial measures being proposed are Port Kembla Port Corporation (PKPC) commensurate with the level of risk Port Kembla had made an application to Fair Work involved. Australia for an order to prevent the Port Kembla Port Corporation had Port Kembla pilots from increasing tug SAL is promoting the idea for all reviewed their Port Pricing and requirements for cape size vessels export containers showing the weight increased charges by 5% other than and limiting pilotage movements in a of the container, being provided with for vessels using the Bluescope and shift. Following an order by Fair Work a certificate by the exporter or the coal terminals, due to a loss of revenue Australia Port Kembla pilots were packer. because of an arrangement that was prevented from taking industrial action entered into in 1990, thereby losing The International Chamber of Shipping in this regard and pilot availability about $ 30 million in earnings usually and the World Shipping Council reverted to normal levels. generated by coal exports. has urged the IMO to establish an international legal requirement for all SAL had appreciated the predicament Freight and Logistics Council of loaded containers be weighed at the faced by PKPC in trying to maintain its NSW INC. (FALCONSW) marine port facility before they are revenue levels, but had to cope with stowed aboard a vessel for export as the lack of income and had suggested The NSW Government decided part of the SOLAS convention. If this the port to look at recovering this that FALCONSW would no longer legislation materialises, the requirement income from the coal industry perhaps receive financial support from the by the NSW RTA to have ‘import’ by introducing an ‘infrastructure levy’ NSW Government and decided to containers weighed will be superfluous on transport. Unfortunately, the Minister establish a new freight and logistics had approved the revised pricing advisory body called the NSW Freight schedule for the port, without change. Advisory Council. Its main task is Newcastle to fast-track a freight plan for the Port Kembla had recorded a 17.7% The Newcastle Port Corporation State amid concerns that NSW had increase in trade to 31.4m tonnes for which had been investigating various fallen behind southern rival Victoria, the 2009/2010 financial year. options to reduce the queue and the which has already released its number of vessels at anchor off the Port Kembla Port Corporation (PKPC) strategy. Ross McAlpine was the SAL Port of Newcastle has established a has prepared an Environmental representative on FALCONSW, which “Vessel Arrival System”, which was Assessment (EA) and is seeking was subsequently wound up. fully implemented on 1 January 2011. approval for the development of Members of SAL had many concerns the Outer Harbour, which entails Other issues with this system, which has now been reclamation of approximately 42 This year’s Parliamentary luncheons accepted by many vessel operators, hectares of land and the construction were hosted by Paul McLeay, Minister with vessels no longer anchoring but of 7 new berths to attract new trades for Ports and Waterways and Minister drifting well off-shore between 11 NM and increase the volume of existing for the Illawarra and Andrew Stoner, and 50 NM from the coast. cargoes. Reclamation of stage 1A is MLA, Leader of the Nationals, Shadow expected to commence by first quarter The Department of Planning has Minister for Roads & Ports and 2011 and completed by 2012/2013 released details of Newcastle Port Shadow Minister for State & Regional subject to approval being obtained Corporation’s plan for a new container Development. without delay. Stage 1 involves construction of a multi-purpose berth Shipping Australia joined the Australian and the majority of dredging and Hydrographic Service to celebrate reclamation works. “World Hydrography Day” and held its biennial “Port Kembla Luncheon” in University of Wollongong’s SMART Wollongong. The Guest of Honour and Infrastructure facility is to look at how Speaker was Paul McLeay. the region’s rail network can be used more effectively. Port Kembla Port These luncheons hosted by the Corporation and SMART will work with shipping industry have proved to be the CSIRO to model the rail network most successful. supplying the port with bulk products such as steel, grain and coal. Congratulations are in order to Peter Creeden, Chairman of the Committee SAL had made a submission in 2010 who was appointed as supporting the development of the Managing Director - Finance & Maldon to Dombarton rail line, which Operations, Hamburg Süd Australia The Basin at the Port of Newcastle will no doubt reduce road congestion Pty. Ltd on 01 January 2011.

78 Autumn 2011 AUSTRALIA Queensland

By Bill Guest, State secretary

he position of Chairperson of the Randall Coates (Australian Customs & buoyancy due mainly to a significant lift SAL Queensland State Committee Border Protection Service) elaborated in motor vehicle imports and favorable Tfor 2010 and 2011 remains with on the Frontline program and the climatic conditions which assisted Sharon Ralph (APL Lines) and the importance of industry feedback to agricultural exports. Over budget coal secretariat is most appreciative of the curb illegal product shipments. exports also helped. continued input and support. Sharon is also chair of the Steering Committee Capt. Steve Pelecanos (Brisbane Without doubt however the event of which comprises Mark Austin (Mitsui Marine Pilots) on the establishment most significance resulted from the OSK), David Hislop (Hetherington of Star Pilots for the provision of decision of the Queensland State Kingsbury), Steve Pelecanos (Brisbane secretarial services covering pilotage Government in mid 2009 to reduce Marine Pilots), Matt Hollamby (Patrick arrangements within the Torres Strait debt by selling a number of State Terminals), Peter Keyte (Port of and Great Barrier Reef. owned businesses. The Port of Brisbane was high on the list and Brisbane) and Bill Guest as Secretary. (DP World) provided Mark Hulme following strict competitive bidding and Unfortunately the valuable services of details of DPW plans for the sales processes the final settlement Russell Stuart were lost when he left expansion of their Brisbane terminal was made on 30 November 2010. Inchcape Shipping Services in the and improvements in operational latter part of the year and we welcome performance. The new owner (actually 99 year John Widdis (MISC) to that position on lessee) is Q Port Holdings (QPH) (Svitzer Australasia) the Steering Committee. Bruce Victor which comprises equal shareholders presented an overview of the Svitzer Global Infrastructure Partners, Industry It is also pleasing to advise that international tug service coverage plus Funds Management and Queensland on completion of Sharon’s tenure prospects for the sale of their lines Investment Corporation. Within QPH late in 2011; David Hislop (HKSA) boats business in Brisbane. will take over as chairman of both a minority share was acquired by the Queensland State and Steering Rowena Routh (Port of Brisbane Tawreed Investments Ltd, a wholly Committees for a two year period. Pty Ltd) updated members on the owned subsidiary of the Abu Dhabi development of the vessel tracker Investment Authority. Six bi-monthly meetings were held in system which, in conjunction with The new board will be chaired by 2010 and once again SAL was grateful Maritime Safety Queensland (MSQ) Jeremy Maycock with Alistair Baillie to the Port of Brisbane Pty Ltd (PBPL) QShips, is to be used as a valuable as interim managing director. A recent for the provision of most venues and real time ships management tool. supporting services. Presentations appointment was Russell Smith who made included: The input to these meetings by regular will take up the CEO position in May senior invitees from the border and 2011. Full details are included on the regulatory agencies adds further value. website www.portbris.com.au. It is pleasing that working relations with While acknowledging the port government instrumentalities remains management expertise within QPH positive and productive. there is no doubt that different structural and reporting arrangements Overview will be applied. SAL will assist with any changes and looks forward 2010 saw some claw back in container to maintaining the levels of mutual volumes through Brisbane following cooperation that have existed with port the devastating impact of the global management over many years. financial crisis in 2009. It will be many years however before that sector of the There is no doubt that the port is the industry will financially recover and the engine room of the local shipping consequential effects of cost cutting community. Effective communication and service rationalisation have already and cooperation between port been felt by many container operators. management and agents/service On a more positive note, cargo flows providers translates to industry Sharon Ralph through Brisbane showed some efficiency. In that respect SAL

Autumn 2011 79 AUSTRALIA State committee reports

members owe a debt of gratitude to Queensland ports pilotage support to their pilots as justification the outgoing CEO Jeff Coleman for for continuing the status quo. Despite – While Queensland port ‘making it all happen’! Brisbane the stated objectives of STAR that pilotage rates expired in June 2009, they had no ambitions beyond the The port will continue to power on with MSQ advised that an 18 per cent secretarial role. SAL was concerned considerable infrastructure expense increase would apply from 1January that any viable proposal would require committed to expand the capacities 2010. This was further delayed, the full support of the existing service for future cargo throughput. Berth in consideration of the post GFC providers. 11 will be handed to Hutchison Port impact, with staged rate increases STAR Pilots have now progressed Holdings in 2012 and berth 12 in set from 1 April 2010 and then again from 1 October 2010. Prior where further development is reliant 2014. Part of the port sale price ($200 to implementation, SAL strenuously upon the Federal Government (and million) commits the new owners to an objected at the quantum of the AMSA) creating the necessary upgrade of the port motorway. increase (10%) applicable from each structure to allow the company to date. Meetings with MSQ produced operate. Queensland Shipping no satisfactory outcome other than The SAL objective is to achieve a for the Minister to advise that ‘Agents Information and Planning safe and reliable service through the may apply to the regional harbour System (QShips) GBR/Torres Strait at least cost and we master for consideration of a pilotage remain in dialogue with all parties to QShips, the web based ship movement as a non-standard pilotage’. that end. management system, became Substantial savings were touted with mandatory in late 2009 after a close to 17 per cent of movements number of years under development. falling into the non-standard category. Brisbane port incidents SAL acknowledges the ongoing Regrettably that percentage was During 2010 the control of a fire within commitment of MSQ to further refine reduced significantly following an the engine room of the Maersk Duffield the processes to ensure that the analysis by MSQ of a number of confirmed the capabilities of personnel maximum capability of the system is non-standard moves where the risk/ and emergency response procedures. achieved. The input of the QShips User safety elements were stated to justify Equally so when the MSC Basil Group has enhanced that objective. the application of full pilotage rates! grounded off Moreton Island following a steering gear failure. The vessel The data base of QShips has more Further erosion took place when it was refloated on the high tide and recently facilitated the progress of the transpired that in the absence of a proceeded under its own power. Port of Brisbane Pty Ltd Vessel Tracker clear definition of a ‘non-standard system which is being developed in movement’ no discounted rates could be applied for auditing and regulatory conjunction with MSQ as a real time Brisbane port security reasons. adjunct to QShips for decision making The upgrading and increase in CCTV (ship scheduling etc) purposes. MSQ acknowledged the frustrations links throughout 2010 concluded with felt by SAL and it was agreed that SAL PBPL coverage extending from the Refinements to QShips have been would have input into the next pilotage Caloundra boarding ground (across made as the result of user feedback fee model being developed by MSQ. the Fairway entrance) virtually along with the following still on the to do list: the route into Fisherman Islands. A 1. The elimination of the Arrival Star Pilots camera at Tangalooma and others on Departure Report which is the new Fisherman Islands port office Early in the year this organisation was submitted by agents who duplicate building provides extended coverage. created out of the concerns of pilots the same information within QShips. transiting the Great Barrier Reef and 2010 saw some tightening in the processes for issuing Maritime Security 2. The introduction of electronic Torres Strait. The primary catalyst was Identification Cards (MSIC). From invoicing. Invoices from MSQ the requirement for each pilot to carry December they would be issued for (pilotage and conservancy dues) personal accident liability exposure at substantial cost as well as unease over either a two or four year period with are posted to agents for each ship background checks to be made every in/out movement and there safety and fatigue management issues during the transit period. two years. Costs would thus increase are obvious time and economic as would the number of conditions advantages by moving to an email At the request of coastal pilots, (criminal convictions) which will prevent process. It is understood however Brisbane Marine Pilots in support an applicant from acquiring an MSIC. that an easy fix is not the case. helped them set up STAR (Sea Torres OTS Inspectors and other statutory The Queensland Government uses and Reef) to act in a secretarial role for bodies (Customs, Police etc) have a SAP system which is being used government and industry consultation. been given the authority to issue to amalgamate the Department of STAR would also train and supply pilots for the present service providers infringement notices to those in Transport with that of Main Roads waterside or landside restricted zones and changes to the SAP module and manage liability exposure under a broader umbrella. who are not displaying an MSIC. There would be needed to achieve the is to be greater focus by the OTS on invoicing objective. SAL is satisfied It is understandable that the two port wide risk assessments and how that it will ultimately happen but major service providers in particular each port uses these assessments accepts that priorities presently are objected to the intrusion of STAR to develop security plans. Greater exist elsewhere. and have quoted safety records and scrutiny will also occur on the

80 Autumn 2011 AUSTRALIA background checking process for held and the outcomes are now being which maximise networking within the foreign crew visas. examined for national application. The shipping and transport industry. In agency has been actively persuading April the SAL golf day was held at the Landside Logistics Forum agents to become more involved in Pacific Gold Club in Carindale and 120 attended. In October the annual Frontline initiatives. Much emphasis Initiated and chaired by the PBPL, it SAL shipping industry ball took place includes industry stakeholders with had been legitimately placed on at Moda Events Portside Hamilton with the overall objective of improving uncovering illegal imports but exposing 270 enjoying a great night. This ball efficiencies within the port environs. It illegal exports is becoming an raised $5,000 for the Volunteer Marine is active on many fronts as exampled important part of the program. Rescue Association at Victoria Point by: to urgently replace outdated computer equipment and other essentials. a. Updating and republishing A Guide Australian Quarantine & for Maximising Efficiencies in the Inspection Service Some years ago the Brisbane Port Sea Freight Container Supply Chain Users Group was established to foster SAL acknowledges the advances networking particularly among the b. Responding to industry needs by made to risk assess operational younger and newer members of the building a fully automated programs to gain efficiencies with industry. More recently as the group weighbridge at the Fisherman both procedures and resources. met harder times, several events had Islands Brisbane Multimodal to be cancelled for lack of attendance. Terminal. This weighbridge should Trials were run in Brisbane during The decision has now been taken to be in operation by late the year to facilitate the speedier flow resuscitate this group in 2011 but as February 2011. of containers potentially exposed to Young Shipping Australia. Giant African Snail contamination. c. Trailing a Port Container Vehicle. With the cooperation of stevedores, (A super B double with attached Queensland Government issues trailer to give a 6 TEU combination) inspection processes were refined and within the port precinct. Better electronic clearances trialed to create The SAL Steering Committee utilisation of trucks with advantages a less manually intensive process for and secretariat work closely with to both the environment and lifting ‘holds’ on suspect containers. government instrumentalities and road congestion are expected Successful results have been achieved especially MSQ. With the retirement of John Watkinson from the position when permission (Department of and further trials in Melbourne will Transport and Main Roads) is given of General Manager MSQ we hopefully result in a national procedure to extend beyond the port. congratulate Patrick Quirk on taking being established. that position. d. Developing an empty container park information system in From July 2010, the Seaports Program From a broader perspective the April conjunction with Tradegate commenced consolidating all pre- grounding of the Shen Neng 1 on the Australia. This remains a work arrival activities for international vessels GBR Douglas Shoal justifies inclusion. in progress off the back of trials in into the Maritime National Coordination MSQ led a multi-agency response Melbourne. Centre (MNCC) situated in the AQIS to this incident where lessons learnt following the Pacific Adventurer oil Adelaide regional office. This has e. Ensuring industry awareness spill proved beneficial. With damage created one point of contact for all with Chain of Responsibility issues to both the main engine and rudder, especially relating to overweight pre-arrival information and enabled some fuel oil was offloaded and the containers. the introduction of the electronic Shen Neng 1 refloated and towed to an Quarantine Pre-Arrival Report for all anchorage off Harvey Bay. A quantity Queensland Transport & ports. Agents response was positive. of the coal cargo was then discharged Logistics Council to lighters and the vessel moved off Gladstone for the ocean tow to China. Training The objectives of the council, Despite some damage to the coral to promote the efficiency and In 2010 no courses were held in reef, little environmental harm resulted development of the transport and Brisbane. It should be recorded as only a minimum spillage (approx logistics industry in Queensland, are 3-4 tonnes) occurred. A great example however that the SAL introduced well aligned with those of SAL. We of the coordination between the many eLearning modules were accessed remain in contact and offer assistance response organisations involved where with the preparation of the Queensland by many members. It is pleasing that the incident review has provided integrated freight strategy which nears prospects for new staff employment recommendations which will further completion. improved in the latter part of 2010 and benefit the handling or avoiding of any there are positive expectations for face future calamities. Australian Customs and Border to face training in 2011. As a positive by-product, SAL is Protection Service pleased that at its recommendation, It is pleasing to record the appreciation Events MSQ vessel traffic management of the agency for Brisbane agents operations will be extended South input which advanced the electronic With so many corporate events (from 1 July 2011) to provide greater clearance process. A number of cancelled, SAL places even greater coverage for vessels transiting the meetings with local stakeholders were importance on holding functions GBR Torres areas.

Autumn 2011 81 AUSTRALIA State committee reports

South Australia

By Doug Bourne-Jones, State secretary

There are ten commercial ports in with Australian Customs and Border Issues still to be resolved during South Australia: Protection Service, Australian Maritime 2011 Safety Authority, Australian Quarantine Flinders Ports Limited (FPSA) owns Plough to Port was placed on the SAFC inspection Service, SA Department for and operates the following ports under website for comment. Unfortunately, Transport, Energy and Infrastructure lease agreement with the Government due to circumstances beyond anyone’s of South Australia: Port of Adelaide (1), and Flinders Ports SA (FPSA). control, the committee of volunteers Thevenard (2), Port Lincoln (3), Port Members serve on the SA Freight has been delayed in reviewing the Pirie (7), Wallaroo (8), Klein Point (10) Council (SAFC), executive committee responses and updating the document. and Port Giles (11). (chair), four management teams and The industry will be advised when the review is completed and if another Remaining ports: the Container Terminal Monitoring Panel. forum will be held. Ardrossan (9) is owned and operated by Viterra Ltd, www.viterra.com.au and State committee meetings continue to AQIS [email protected] and for wharf be held at Flinders Ports SA. We are Issues identified have been: operations email wharfservices@viterra. grateful to FPSA for not only hosting • Ensure SAL at both Federal and com. Whyalla (5) and Port Bonython these meetings, and that they will State level is included in all future (6) are owned by the South Australian continue in 2011, but also for their notices, correspondence, etc. Government and are operated under continued support and co-operation. separate indentures, with some In addition, FPSA convene agents • Problems supplying hold inspectors management of shipping into and out meetings. Minutes from these meetings and terminal labour, when there are of the ports being the responsibility of are distributed to all SAL members. several vessels at different ports. the State Government (and managed under contract by FPSA). Whyalla (5) is operated and managed by OneSteel Manufacturing Pty Ltd (www.onesteel. com/onesteel_whyalla). Port Bonython (6) is operated by Santos on behalf of the Coopers Basin Joint Venture Partners (www.santos.com). Port Stanvac (12) mothballed and unlikely to re-open.

South Australia State Steering Committee effective 1 January 2011 Mr A Brundish, Five Star Shipping & Agency Co (COSCO) (chair) together with Messrs P Bates, Mitsui OSK Lines (Australia); G Burk , Inchcape Shipping Services; L Feltrin, Inchcape Shipping Services; I Henderson, 1. Port Adelaide Hamburg Sud Australia; P Paparella, 2. Thevenard Asiaworld Shipping Services and G 3. Port Lincoln Rose, McArthur Shipping/Hetherington Kingsbury Shipping. D Bourne-Jones 4. Sheep Hill (Proposed) retired from SAL on 31 December 2010 5. Whyalla and the position of State secretary 6. Port Bonython was abolished. Currently there are 7. Port Pirie seventeen owner or liner agents and 8. Wallaroo nine bulk/tramp ship agents (including 9. Ardrossan Viterra Ltd) in Adelaide. 10. Klein Point The South Australia State steering 11. Port Giles committee continues to meet on both 12. Port Stanvac a regular and when required basis, to promote a close working relationship

82 Autumn 2011 AUSTRALIA State Steering Committee to the industry. Finally he paid tribute to his wife Maureen, as he would have been unable to achieve anything without her assistance and support.

Port infrastructure Port security (all ports) - There have been no major incidents during the year. FPSA will be installing a new key system at their South Australian ports over the next 3-4 months. The first MSIC’s issued are due to expire in May 2011. New cards can be ordered as a four year or a two year card. FPSA standard terms and conditions for the use of berths were implemented on 1 August 2010.

Outer Harbor (Adelaide) Berths 1-4 Seated from left, Doug Bourne-Jones (State secretary now retired), Alan Brundish (chairman), Lu Feltrin This whole area, including passenger (past chairman). Standing from left, Geoff Rose, Paul Bates, Paul Paparella and James Fisher terminal (berth no. 2) has now been upgraded to cater for handling cars, • Inspection of grain vessels, Australian State secretary distributed a Ro/Ro operations and cruise ships. including clearance at anchor. document, Shipping in South Australia The cruise season commenced in covering port operations, towage and • Ensure accounts for services September. It is anticipated there will pilotage. The document was prepared rendered are prepared and be a total of thirteen Adelaide calls. as a quick reference for those in the forwarded to vessel operators shipping industry and as a teaching Berths 6-7 (DPW container terminal) etc, within an acceptable aid for new entrants to the shipping Major repairs to terminal tarmac and commercial timeframe. industry. upgrades to truck lanes for improved SA Department of Environment and driver safety were completed. Annual functions Natural Resources However, tarmac repairs are ongoing Our annual golf and dinner day was with major works planned for late South Australia’s Marine Park held on Thursday 14 October 2010 at January. Some additional container Management Plans as provided to SAL stacking space has been provided by in a letter from Greg Leaman dated 22 the Riverside Golf Club (RGC). Once again, a great success, thanks in the Flinders Ports to accommodate the December 2010. We were surprised new IMX containerised iron ore exports that only now are we being directly main to our regular supporters and five new sponsors. with the balance due late January/ consulted. Furthermore, we are also early February. The crane rate (fourth concerned that the paper was released On 2 December the State committee quarter of 2010) was 27.48 mph in late December 2010 with comments held a farewell luncheon for Doug (previous quarter, 27.56 mph). closing by 28 January 2011. This Bourne-Jones (DJB) which was held at matter has now been addressed and the RGC. During the luncheon, Greg Berth 8 (Viterra Grain Terminal) SAL has been invited to a briefing on 2 Burk, introduced Vincent Tremaine who Both the SA State chair and secretary February. An extension for comments outlined DBJ’s career and SA Transport attended the official opening by to mid February has been granted. Minister P Conlan who acknowledged premier M Rann on 21 January 2010. DBJ’s contribution to this industry over Despite some early teething problems, Viterra have advised that the berth is Year under review many years. Llew Russell also took the now fully operational. There is currently opportunity to thank Ms Virginia Lynch a vacant area behind berth 8 which is Container Terminal Monitoring Panel for her help and assistance, noting currently on hold. 1. Port Adelaide Messrs I Henderson and K Fox are the that she had retired from Customs on 2. Thevenard SAL representatives on this committee. 30 November 2010. He then outlined Inner Harbour (Adelaide) 3. Port Lincoln As minutes of meetings are not for DBJ’s career which is summarised in Osborne Techport Australia, (Defence circulation, the SAL representatives the summer edition of SAL’s magazine. 4. Sheep Hill (Proposed) SA owned) has been completed to on this committee provide a general He also presented him with a gift 5. Whyalla construct the Australian Air Warfare update for members as and when and a crystal plaque and Customs Destroyer. The facility was officially 6. Port Bonython required. A log of any occurrence presented DBJ with a wooden plaque. opened by Premier M Rann on Monday 7. Port Pirie which, in members’ opinion, had some In response DBJ thanked the guest 15 February 2010. On 28 April, Svitzer 8. Wallaroo detrimental effect on the handling of speakers for their kind words and gifts Australia Pty Ltd became the first 9. Ardrossan their vessels/equipment, has been and went on to say he would rather commercial company to use the ship 10. Klein Point introduced. not have resigned as he had have hoist, when their tug Tingari was lifted. always enjoyed all aspects of his work 11. Port Giles Training 12. Port Stanvac and the time spent with everyone in Upgrade continues with painting No SAL courses were held in South the industry. Therefore, from 1 January of shed 19. The new BHP Billiton Australia during 2010. In March, South 2011, he volunteered his assistance 10,000m2 shed at berth 29, and new

Autumn 2011 83 AUSTRALIA State committee reports

roads within the vicinity are still on barges and a floating ship-loader. DP World Adelaide is the first target to be operational early in 2011. Australian terminal to have successfully Port Bonython (6), the Spencer Gulf There are also plans to install a rail achieved Occupational Health siding. Livestock shipments continue to Port Link Consortium continues to and Safety Management System be carried out at this berth. develop and operate the Port Bonython Accreditation. The new ZPMC crane bulk commodities export facility. This was delivered in April and positioned Regional ports proposal would be to either modify between cranes 2 and 4. Crane 3 is Port Lincoln (3), whilst approval has the existing wharf, or build a separate currently being dismantled. There were been given for Centrex Metals to ship wharf to convey ore to the ships. orders for four straddles, two reach iron ore out of the main jetty and to stackers, two empty container handlers construct their own belt on the jetty, it Port Pirie (7), lead cleaning facilities and three Rotainers for handling ore. appears that the project might not now are being installed for all personnel proceed. working on the lead berth. Western New IMX containerised iron ore export Plains and FPSA have signed an business commenced in October with At Sheep Hill (4), Centrex Metals full boxes being railed into the terminal agreement to ship ore through the port. proposal to invest money in an iron-ore from the Cairn Hill mine site. Currently processing plant and to construct a General items there is only one rotating spreader. The deep water port 20km north of Tumby Rotainer is hooked up to crane 4. It Bay on the Eyre Peninsular has now All lines are now using electronic rotates 360 degrees (15 seconds to won major development status from import delivery orders. The new complete a rotation) depositing State Government. automatic gate system for truck the ore into the hold. The first ore Whyalla (5), Project Magnet continues processing was completed on 31 vessel Genco Leader arrived on using two 10,000t self-discharging December 2010. 9 December.

Victoria

By Phil Kelly, State secretary

Office bearers elected vice chairman, taking effect Meetings on 1 January 2011. In accepting At its meeting on 15 December The Victorian State Committee this role, Rod Begley expressed the 2010, the Victorian State Committee comprises the senior officers in Victoria hope that effort will be made to find unanimously elected Peter Bartlett of all member lines, agencies and (Asiaworld Shipping Services) as its a replacement, explaining that the by invitation, corporate associate chairman for 2011. unexpected resignation by another members. The committee meets at two member at the eleventh hour had led to month intervals. Rodney Begley (APL Lines), chairman his agreement to volunteer his services of the State Committee throughout in support of the incoming chairman on The Victorian Steering Committee 2009 and 2010, was unanimously the understanding that it is a temporary comprises seven members with measure. The opportunity is taken to expertise in a broad range of shipping- place on record members’ gratitude for related arenas. It meets on the alternate months and is the source of Rodney’s display of dedication. SAL representation on a number of The newly-elected chairman paid State Government departmental sub- tribute to the enormous contribution committees and working groups. which Rod Begley had made throughout the past two years, SAL Victorian membership of itemising the challenges facing ‘outside’ industry and port- shipping and port-related industry related groups during and after the global downturn. As chairman, he had displayed Victorian Freight and Logistics outstanding leadership for which the Council (VFLC) Victorian State Committee is greatly The Council is funded by both State Peter Bartlett the new chairman indebted. and Commonwealth Governments,

84 Autumn 2011 AUSTRALIA is chaired by a senior industry figure and maintains an independent secretariat. At the invitation of the Victorian Government, David Munro (ANL Container Line) has been a VFLC member since its formation in 2005. There are two other committees established under the aegis of VFLC in which SAL Victoria is involved: Infrastructure Working Group (IWG) Formerly known as the Channel Deepening Working Group and most effective in that role, IWG’s charter was broadened in 2008 to ascertain and report on the condition and adequacy of road and rail infrastructure both in metropolitan and regional Victoria. Peter Bartlett (Asiaworld) has represented SAL since 2009. A briefing on the forthcoming grain Photo supplied by the Port of Melbourne Corporation harvest was held in October from which short term actions were agreed intermodal efficiency across Victoria’s that Port Phillip Bay is in an eminently for implementation. This was of course freight and logistics system. Tony healthy ecological state and sea life is in anticipation of a record harvest Keunen (MOL) and Phillip Edgley (Five prolific. Star) jointly represent SAL. which unfortunately did not eventuate. According to a recent report by Notwithstanding, the investigation was Our congratulations go to Dr Hermione Stephen Bradford, deep-draft ships worthy in that its findings will be a Parsons, a member of VFLC and which could not have negotiated the guide to deficiencies which are likely Associate Professor and Deputy Heads prior to deepening have entered to be confronted in the future. Amongst Director, Institute for Logistics & Supply the port of Melbourne on an average several other studies involving the Chain Management, following her of one every second day in the past preparation of submissions during appointment as Chairperson of FIEG. twelve months, thus vindicating the 2010 were: decision to dredge Melbourne’s Amongst the many issues discussed • Infrastructure upgrade preliminary approaches. Tony Keunen (MOL) has and reported upon were: business cases. served on this committee since its • MARP final report inception. • Managed motorways (the terminology now used to represent • Freight Infrastructure Charge (FIC), Whole of Port Health, Safety & freeways subject to electronic or noting there may be funding pro Environment Committee ICT devices to control the flow from lems for infrastructure requirements This group is hosted by PoMC and feeder roads). if the FIC is not introduced by the comprises a wide range of business incoming Government. • PoMC container capacity and and support services within the port of Automotive Terminal Market • Food Quality container shortage. Melbourne. Most of its delegates have Soundings. a connection with either OH&S or the • The formation of the Victorian environment. Mike Dawkins (Hamburg • Response to DoT Green Paper Container Park Association. “Shaping Melbourne’s Freight Sud) represents SAL. • PoMC Origin/Destination Study, Futures. Customs Logistics Chain whilst completed, is awaiting Consultative Committee • Submission to the National Port Ministerial release. Strategy. The Victorian regional office of the Channel Deepening Community • High Productivity Vehicle trials in Australian Customs Service established Liaison Group the ‘Green Triangle’ situated in the this committee in order to harness the Western District hinterland and Upon completion of the Channel goodwill and expertise of all industry- future requirements of the port of Deepening Project and in accord with related organisations which have some Portland its undertaking, PoMC took the initiative reliance on Customs procedures. in which any possible unforeseen Expert in this and in many other fields, Freight Intermodal Efficiency Group side-effects of deepening would remain Meredith Adams (MOL) and Mark (FIEG) under close scrutiny and established Molloy (Five Star) jointly represent SAL. The prime objective of this Group is this group. To date, none of the Port of Melbourne Corporation to generate ‘whole of chain’ input and catastrophic effects predicted over collaboration between industry and the past four years by the opponents SAL acknowledges with pleasure the government to identify and recommend have emerged. Indeed the antithesis, excellent rapport which exists between practical operational improvements to as scientific monitoring has indicated SAL and the corporation and its

Autumn 2011 85 AUSTRALIA State committee reports

planning, provide visibility and vastly improve throughput and truck turn- around. At the close of 2010, it was anticipated that eight ECPs will be equipped and conversant with the Containerchain/ Maximas software by the end of February 2011, thus becoming operational shortly thereafter

Department of Transport (Dot) At the invitation of the Department, SAL responded to a discussion paper titled Shaping Melbourne’s Freight Future in which comment was sought on a proposal for an Intermodal solution to service Melbourne’s growing containerised freight task. The proposal involves the Phil Kelly with Minister for Ports, The Hon Denis Napthine and Rodney Begley establishment of a Metropolitan regular attendance at State Committee A market sounding paper was released Freight Terminal Network and whilst supportive of the general meetings as an Associate member, by PoMC in July, inviting comment thrust, SAL has made a number of ensures frank discussion on a wide on an option for a third container suggestions which it considers are range of topics which have a bearing Terminal at Webb Dock.SAL is deserving of thorough evaluation. on all aspects of ship visitation and strongly in favour of re-development SAL looks forward to a resumption any areas which have the potential to of a container Terminal at Webb Dock and has responded to this effect. The of discussions in 2011, bearing in impair the flow of cargo through the mind that the recent trend suggests port. opportunity was taken to emphasise the opportunity this would afford that predictions on burgeoning trade In the matter of tariff, PoMC’s policy towards the entry of a third Terminal are most likely to become a reality. in which there is consultation during operator and the competitive edge it This will place a heavy burden in budget preparation, provides an would undoubtedly bring to costs. terms of space at existing container opportunity to draw attention to any terminals and the metropolitan road With the advent of a new State existing anomalies or economic and rail infrastructure. SAL supports Government, there is much interest in principle, the establishment of constraints which might justify further in this topic and effort is being made metropolitan freight terminal hubs. consideration. to meet and convey SAL views to the For much of 2010, the Victorian State PoMC issued a pricing policy Minister for Ports. Committee has been involved in statement in May 2010, setting out Throughout 2010, SAL and discussion with governmental agencies procedures for ensuing years in which representative members have engaged and latterly with DoT on a proposal to it will communicate to the users of port with empty container parks, VTA, apply a Freight Infrastructure Charge services, the intention for any price CBFCA and PoMC in a joint effort to (FIC) to most containers entering or increases and take into consideration resolve the many issues which led to departing East and West Swanson the views of users. heavy congestion early in the year. Dock by road. The few exceptions to PoMC agreed to convene and chair It was heartening to note from data this are containers to rail and those in the meetings and two working groups the transhipment category. SAL and released recently by PoMC that were formed: volumes of cargo transiting the port of its members have registered deep concern that empty containers will Melbourne in the final Quarter of 2010 The Information, Visibility & Exchange attract the FIC despite their non- indicate a steady improvement. Working Group’s role was to look at available information technology with a earning capacity and essentially, are Total trade (measured in revenue view to understanding platforms which part of a ship’s equipment. tonnes) for the December quarter of could enable greater container visibility Whilst the dimension of the FIC in across the supply chain, 2010/11 was 5.5% above that recorded monetry terms has not yet been for the same period in 2009/10. Total The Park Operations Group’s role announced, the then Minister for Roads imports and exports increased by 3.1% was to work through and resolve and Ports indicated that the FIC was and 8.7% respectively. operational issues at ECPs to improve expected to generate $1 billion over Total container throughput (full + operations across the industry. 10 years and would be regarded as empty) for the quarter was 632,000 a contribution towards Victoria’s $38 The two working groups were billion Transport Plan. TEU, up 7.6% on the same period last subsequently merged and year, with total imports and exports Containerchain/Maximas were Following the change in State for the quarter up 5.0% and 10.3% appointed by almost every ECP to Government, SAL is seeking discussion respectively. This equated to an overall introduce an electronic system which with the new Minister with a view to increase of almost 45,000 TEU. it is hoped, will facilitate operational reiterating SAL members’ disquiet.

86 Autumn 2011 AUSTRALIA Young Shipping Australia SAL functions and absorbing overviews on future (Victoria) directional policy. Two highly successful and well- The Victorian State Committee warmly attended luncheons were held in the The final meeting/luncheon was held congratulates the Victorian chapter Jim Stynes room at the Melbourne in December in line with a 20 year of Young Shipping Australia for its Cricket Ground during 2010.The tradition, at the Railway Club Hotel in innovative program of activity and respective Guest Speakers were the Port Melbourne. the enthusiasm of its committee and members shown since inception Minister for Ports and Transport and The annual SAL Shipping Industry two years ago. They have provided the then Shadow Minister for Ports, Golf Day was held in March in idyllic an update on their activities in this Regional Cities and Racing, both of surroundings at the Waterford Valley magazine. whom presented interesting Golf course.

Western Australia

By GRAEME WILSON, State chairman

he Port of Fremantle continues considerable berth work took place impediment to the efficient flow of to see increased volumes of which required multi level co-ordination cargo. Several strategies are being Tcontainerised cargo, break bulk to ensure vessels and cargo moved considered both on a local level and a cargo, motor vehicles and bulk cargo. with out delay. SAL continues to be national one. With the revitalised and vibrant mining involved in the discussion process with sector providing a strong financial industry and the port to have open input to the economy it is expected the dialogue to ensure all concerns are West Australian Port Operations trade volumes will continue to improve considered. Task Force & The Freight and over the coming years. Logistics Council of WA The resulting increase will see Port of Fremantle - container Members of the state working group considerable pressure on infrastructure transport congestion continue to be actively involved and and resources. Shipping Australia In conjunction with the West Australian participate in all aspects of the WA has been proactive along with other Port Operations Task Force, the Port Operations Task Force and Freight industry participants to engage transport industry and the overall and Logistics Council of WA. The Government in the debate to ensure logistic community, SAL is closely major issues before the Council are : the future movement of cargo is involved in implementing strategies not impeded by a lack of suitable to overcome transport congestion at • The East Kimberley Freight and infrastructure. terminals, empty container depots and Logistics Study; further in the logistics chain. The continued growth in the state of • Fremantle Port truck productivity; West Australia is providing government The initiatives are inter related with • Grain logistics and the forthcoming with many challenges to ensure many other factors within the transport adequate infrastructure is available chain that cannot be solved in ACCC hearing; through out the state to cover the isolation. However, we will continue to • Federal shipping policy; increased cargo volumes expected. contribute to ensure the logistics chain Commonwealth funding for freight With the mining industry increasing out does improve and does become more councils; and put and the number of new projects cost effective for all concerned. on the horizon, increasing import and • The national transport reform Considerable progress was made export volumes will apply considerable during 2010 by implementing positive agenda. pressure to regional ports and the strategies that will in time provide already congested infrastructure. • The dredging guidelines from the benefits to industry. It still requires the Environmental Protection Authority; community and the shipping industry at Fremantle Ports – Inner Harbour large to implement changes that may • The issue of port governance as it deepening impact on how business is performed. impacts on access The deepening of the Inner Harbour Issues relating to container terminals • The Council position on heavy proceeded throughout 2010 with remain a major concern as does vehicle pricing options co-operation from all sectors of the congestion at container parks where industry. In addition to the deepening severe congestion is becoming an • The regional freight strategy

Autumn 2011 87 AUSTRALIA International liner services

Gold Star Line www.gslltd.com.hk Agreements registered Hamburg Sud (HSDG) www.hamburgsud.com. under Part X of the Trade Hyundai Merchant Marine www.hmm21.com Practices Act, 1974 (Cth) Kawasaki Kisen Kaisha (“K” Line) www.kline.com.au Maersk Line www.maerskline.com MSC Mediterranean Shipping Australia/North & East Asia Trade Facilitation Agreement Company S.A www.msc.com.au Australia/South East Asia Trade Facilitation Group Mitsui O.S.K Lines (MOL) www.molpower.com Australia/Fiji Discussion Agreement Nippon Yusen Kaisha (NYK) www2.nykline.com Australia & New Zealand – United States Orient Overseas Container Discussion Agreement Line (OOCL) www.oocl.com Contact Details Service details The range of ports covered by members South and East coast services is as follows: Andrew Chittenden Load ports General manager, Melbourne, Sydney and Brisbane (Note: Adelaide and liner services Tasmanian ports are served via Melbourne) Telephone: 02 9266 9908, Discharge ports [email protected] • China – Shekou, Chiwan, Xiamen, Yantian, Qingdao, Shanghai, Ningbo and Nansha • Hong Kong • Taiwan – Kaohsiung Kevin Swaine • Japan – Yokohama, Osaka, Nagoya Trade Policy Advisor • South Korea – Busan Telephone: 02 9266 9924 Other ports are served by transshipment [email protected] Additionally, various TFA members provide exporters a wide choice of weekly sailings from Fremantle to ports across the North and East Asia region via Singapore Australia / South East Asia Trade Australia/North and East Asia Trade Facilitation Group (TFG) Facilitation Agreement (TFA) The primary objective of the TFG, which was registered in The TFA, which was registered in May 1998 under Part X 1997 under Part X of the Trade Practices Act, is to promote of the Trade Practices Act, aims to promote efficient and efficient and economic shipping service from Australia to economic shipping service from Australia to North and East South East Asia. The TFG is an association of 10 member Asia. The TFA is an association of 12 member lines offering lines offering Australian exporters varied shipping services Australian exporters a variety of services from both the East from both the East and West Coasts of Australia to points in Singapore, Malaysia, Indonesia, Thailand, Vietnam, and West coasts of Australia Cambodia and Brunei. The scope of operation has recently been extended to include South Asian and Gulf region Between the twelve member lines of the TFA, six weekly destinations: Myanmar, Bangladesh, Pakistan, Sri Lanka, services are deployed from South and East coast of UAE and Saudi Arabia. Australia comprising 35 vessels that provide 312 voyages annually with fast transit times and the most comprehensive Member lines port coverage in North and East Asia. Please visit member lines website for detailed service Member lines information. Enquires concerning specific service details should be ANL Singapore Pte Ltd www.anl.com.au directed to individual member’s websites. APL Lines (Australia) www.apl.com

ANL Singapore Pte Ltd www.anl.com.au Kawasaki Kisen Kaisha, Ltd www.kline.com.au Maersk Line www.maerskline.com China Shipping Container Line www.cnshipping.com.au MISC Berhad www.miscaust.com.au COSCO Container Line www.cosco.com.au Mitsui O.S.K Lines Ltd www.molpower.com

88 Autumn 2011 AUSTRALIA Nippon Yusen Kabushiki Kaisha www2.nyk.com.au Australia & New Zealand - United Orient Overseas Container Line Ltd www.oocl.com States Discussion Agreement Pacific International Lines www.pilship.com (ANZUSDA) RCL Feeder Private Ltd www.rclgroup.com ANZUSDA is an association of ocean carriers registered under part X of the Competition and Consumer Act 2010 Service details and also with the US Federal Maritime Commission. The Ports serviced by TFG member lines carriers provide liner shipping services from Australia and New Zealand to the USA. The main objective of the Load ports agreement is to promote adequate, economical and efficient Sydney, Melbourne, Adelaide, Bell Bay, Brisbane and direct services from Australia and New Zealand to a range of ports on the West and East coasts of the USA, and to Fremantle other points and ports via transshipment. Discharge ports Member lines Singapore, Port Kelang, Tanjung Pelepas, and Jakarta. Hamburg Süd www.hamburgsud.com Other ports in South East Asia, South Asia, The Gulf and Hapag Lloyd AG www.hapag-lloyd.com Red Sea are served by transshipment. Maersk Line www.maerskline.com Australia / Fiji Discussion Agreement ANL www.anl.com.au - AFDA CMA CGM S.A. www.cma-cgm.com The AFDA is an association of ocean carriers, whose Service details - West Coast USA agreement was registered in 2000 under Part X of the Australian Trade Practices Act, providing liner services The member lines operate a vessel sharing agreement from Australia to Fiji. Member lines offer two comprehensive utilizing 11 vessels running between Australia, New Zealand, services to shippers utilizing six vessels from Melbourne, and West Coast. 78 sailings per year are provided(52 Brisbane and Sydney, Australia to Suva and Lautoka. weekly and 26 fortnightly) with a comprehensive port range and optimum transit times. The service is divided into two port rotation strings: Pacific North West,and Pacific South The main objective of the agreement is to provide adequate, West. economical and efficient services from Australian East Coast ports to Fiji. Load ports Member lines Sydney, Melbourne, Adelaide , Auckland and Tauranga. Note: Fremantle and Tasmania are served via Melbourne. Enquiries concerning specific service details should be Brisbane is served via Sydney or Tauranga/Auckland directed to individual members’ websites. Discharge ports Hamburg Süd www.hamburgsud.com Seattle, Long Beach, Oakland, and Honolulu. Neptune Pacific Agency Australia Pty Ltd www.neptunepacific.com Service details - East Coast USA Pacific Forum Line (NZ ) Ltd www.pflnz.co.nz The member lines provide a total of 78 sailings per year on their various services to the US East Coast . Hamburg Süd Swire Shipping www.swireshipping.com and Maersk Line operate a vessel sharing arrangement utilizing 10 vessels on a weekly service. Hapag Lloyd has a slot charter arrangement with Maersk Line. ANL and CMA CGM separately deploy six vessels to provide a fortnightly service.

Load ports Sydney, Melbourne, Adelaide, Timaru, Port Chalmers, Napier, Auckland and Tauranga Note: Fremantle and Tasmania are served via Melbourne, and some lines service Brisbane via Sydney or Tauranga Auckland. Wellington is serviced via Napier and Nelson via Auckland.

Discharge ports Savannah and Philadelphia and other ECNA/Gulf ports via transshipment at hub port en route. The importance of the Australian frozen and chilled meat trade with the USA is reflected in the large reefer container carrying capacity of all vessels employed in these East Coast and West Coast trades.

Autumn 2011 89 AUSTRALIA Board of Directors for 2010

Chairman

Michael Phillips

Managing director of Hetherington Kingsbury Shipping Agency

Directors

From the left back row Front row from left Geoff Greenwood Simon Aynsley Managing director marketing Managing director of CMA CGM & and sales of Hamburg Sud ANL Australia Pty Ltd Agencies Australia Pty Ltd Michael Phillips Kevin Clarke Managing director of Hetherington Managing director of Mediterranean Kingsbury Shipping Agency Shipping Company (Aust) Pty Limited Eddy DeClercq Ken Fitzpatrick Managing director of OOCL Managing director of Asiaworld (Australia) Pty Ltd Shipping Services Pty Ltd Nicolaj Noes Absent: Royce Brain Senior vice-president Australia/Asia Managing director of Maersk of Inchcape Shipping Services Australia Pty Ltd

90 Autumn 2011 AUSTRALIA Policy Council Members for 2010

Members Front row (from left) Ross McAlpine Australia Pty Ltd Agencies Geoff Greenwood Mediterranean Shipping Company (Aust) Brook Paviour Managing director marketing and sales of Pty Limited Director of NYK Line (Australia) Pty Limited Hamburg Sud Australia Pty Ltd Melissa Poon Greg Von Litzheim Llew Russell AM Managing director of MISC Agencies Deputy general manager of Five Star Chief executive officer of Shipping Australia (Australia) Pty Ltd Shipping & Agency Co Pty Ltd Limited Kushy Athureliya Bill Rizzi Michael Phillips General manager technical services of State manager NSW of Mediterranean Managing director of Hetherington Shipping Australia Limited Shipping Company (Aust) Pty Limited Kingsbury Shipping Agency Gary Beadle John Clawley Eddy DeClercq General manager commercial of ANL General manager finance of Wilhelmsen Managing director of OOCL (Australia) Pty Container Line Pty Limited Ships Service Ltd Nai Kong Yip Alan Miles Ken Fitzpatrick Managing director of RCL (Australia) Pty Managing director of K Line Australia Pty Managing director of Asiaworld Shipping Ltd Ltd Services Pty Ltd Denis Speyer Paul Alexander Regional operations manager of The China Policy Advisor of Shipping Australia Limited Navigation Company Pte. Ltd (Australian Second row John Bradley branch) Tony Cousins Managing director of Hapag-Lloyd Managing director of PB Towage (Australia) (Australia) Pty Ltd Back row Pty Ltd Phil Coolican Simon Aynsley Ted Muttiah Managing director of Gulf Agency Managing director of APL Lines (Australia) Managing director of CMA CGM & ANL Company (Australia) Pty Ltd Absent

Phillip Abraham Darren Dumbleton Murray Read Australian general manager of Inchcape Managing director of Quay Shipping Chief operating officer of Evergreen Shipping Agency (Australia) Pty Ltd Shipping Services Australia Pty Ltd Mike Slee Mark Austin Kirsty Ellison Vice president of Wallenius Wilhelmsen Director of Mitsui OSK Lines (Aust) Pty Ltd Manager of Ship Agency Services Pty Ltd Logistics Royce Brain Steffen Faurby Gavin Smith Senior vice president Australia/Asia of Managing director of Svitzer Australasia Pty Managing director of Royal Caribbean Cruises Australia Inchcape Shipping Services Limited Ulrich Stelling Wendy Cheah Michael Horsburgh Managing director of Austral Asia Pte Ltd Managing director of APL Lines (Australia) General manager of Pacific Asia Express Johnny Tam Pty Ltd Peter Creeden Managing director of LBH Australia Pty Ltd Regional logistics manager of Hamburg Frank Needs Peter Wallace Sud Australia Pty Ltd ANL Container Line Pty Limited Director of Seaway Agencies Pty Ltd

Autumn 2011 91 AUSTRALIA SAL Members

SAL members for 2010

ANL Container Line Pty Limited Seaway Agencies Pty Ltd Flinders Ports South Australia

APL Lines (Australia) Svitzer Australasia Pty Limited Fremantle Ports

Asiaworld Shipping Services Pty Ltd The China Navigation Company Pte. GHD Meyrick Ltd. (Australian Branch) Austral Asia Line Pte Ltd Holman Fenwick Willan HFW Wallenius Wilhelmsen Logistics CMA CGM & ANL Australia Hutchison Ports Australia Pty Ltd Agencies Wilhelmsen Ships Service HWL Ebsworth Evergreen Shipping Agency Contribution members (Australia) Pty Ltd Macpherson + Kelley Lawyers China Shipping Container Liner Co. Ltd Five Star Shipping & Agency Macquarie Telecom Co Pty Ltd Hanjin Shipping Middletons Lawyers Goodman Fielder Limited Hyundai Merchant Marine Newcastle Port Corporation Gulf Agency Company (Australia) Pty Neptune Shipping Line Pty Ltd Ltd Newcastle Stevedores Pty Ltd Pacific Forum Line (NZ) Ltd Hamburg Sud Australia Pty Ltd Norton White Lawyers & Notaries Corporate associate Hapag-Lloyd (Australia) Pty Ltd members NSW Maritime

Hetherington Kingsbury Access Records Management OMC International Pty Ltd Shipping Agency AGS World Transport Patrick Inchcape Shipping Services Associated Marine Insurers Peter McQueen Pty Limited Indian Ocean Shipping Agencies Agents Pty Ltd POAGS Pty Ltd K Line Australia Pty Ltd Australian Amalgamated Terminals (AAT) Port Kembla Gateway Pty Ltd LBH Australia Pty Ltd Australian Maritime College Port Kembla Port Corporation Maersk Australia Pty Ltd Australian Ship Suppliers McArthur Shipping & Agency Co Pty Port of Brisbane Pty Ltd Association Inc (ASSA) Ltd Port of Melbourne Corporation Australian Shipping Consultants Pty Ltd Mediterranean Shipping Co (Aust) Pty Port Phillip Sea Pilots Pty Ltd Limited Brisbane Marine Pilots Pty Ltd Queensland Rail (QR Rail) MISC Agencies (Australia) Pty Ltd Chalmers Industries Pty Ltd Sea Transport Solutions Mitsui OSK Lines (Aust) Pty Ltd CLSA Australia Services Pty Ltd Sydney Ports Corporation NYK Line (Australia) Pty Ltd Colin Biggers & Paisley

OOCL (Australia) Pty Ltd Coogans & Co Thomas Miller (Australasia) Pty Ltd

Pacific Asia Express Pty Ltd (PAE) Darwin Port Corporation Torres Industries Pty Ltd

PB Towage (Australia) Pty Ltd DP World Tradegate Australia

RCL (Australia) Pty Ltd Feliba Pty Ltd Visy Logistics

Royal Caribbean Cruises Australia Field & Associates Pty Ltd Viterra

92 Autumn 2011 AUSTRALIA SAL Organisations

Steering State Staff Groups Committees

Front row (from left) Border and Port Services NSW State committee Steering Group • Clare Haskew, clerical assistant • Secretary: Kushy Athureliya • Chairman: Frank Needs • Chairman: Peter Creeden • Llew Russell, chief executive officer Container Technical Steering Group Queensland State committee • Deborah King, communications • Chairman: Peter Creeden • Secretary: Bill Guest events coordinator E-Commerce Steering Group • Chairman: Sharon Ralph Backrow (from left) • Chairman: Nathan Wicks South Australia State committee • Kevin Swaine, trade policy advisor Human Resources Steering Group • Secretary: Doug Bourne-Jones • Kushy Athureliya, general manager • Chairman: Eddy DeClercq • Chairman: Alan Brundish technical services Maritime Legal Steering Group Victoria State committee • Bryan Sharkey, company secretary • Chairman: Ken Fitzpatrick • Secretary: Phil Kelly financial controller Public Relations Steering Group • Chairman: Rodney Begley • Andrew Chittenden, general • Chairman: Ross McAlpine Western Australia State `manager, liner services Technical Steering Group committee

• Paul Alexander, policy advisor • Chairman: Ross McAlpine • Secretary/chairman: Graeme Wilson

Autumn 2011 93 AUSTRALIA Border agencies Australian Customs and Border Protection

“Customs in the 21st Century: Effective border controls and trade facilitation”

By MICHAEL CARMODY, chief executive officer

n the early years of federation, procedures in the 21st century, Australia’s customs functions entered force in 2006. It promotes Ifocussed largely on the collection of trade facilitation and effective controls revenue. Entering the second decade through provisions that detail the of the 21st century, the mission of application of simple yet efficient the Australian Customs and Border procedures. Key governing principles Protection Service has become much of the revised Kyoto Convention broader, to encompass: include: The protection of the • transparency and predictability of safety, security and Customs actions; commercial interests • standardization and simplification of of Australians through the goods declaration and border protection designed supporting documents; to support legitimate • simplified procedures for authorised trade and travel and persons; ensure collection of border revenue and trade • maximum use of information technology; statistics. • minimum necessary Customs Challenges now facing Customs and controls to ensure compliance with Border Protection and Australian regulations; traders are varied, and include an increasingly globalised economy; • use of risk management and audit to implement these guiding principles heightened security risks; resource based controls; for Customs in the 21st Century. constraints, and the need to exploit and – where employed by criminals – • coordinated interventions with other In 2011 Customs and Border Protection counter, ever more complex, powerful border agencies; and is continuing a program of work that aligns with the key themes identified and pervasive technologies. At the • partnership with the trade. same time, Customs and Border within the guiding principles, including Protection recognises the reasonable The WCO – of which Australia is an business needs of legitimate traders active and influential member - has Professional Service Culture – and the economic benefits that identified 10 building blocks as means Measuring Performance improvements in trade facilitation bring to the Australian economy It is said: ‘To reform, first measure.’ via increased competitiveness and One of the things a professional expanded trade and investment. service culture demands is How then to balance effective border transparency of self-performance. control with efficient trade facilitation? At the APEC Customs Business Modern customs methods must Dialogue in 2007, Customs and Border support both objectives. Protection undertook to measure its trade facilitation performance by Australia is a party to the International undertaking a Time Release Study Convention on the Simplification and (TRS). Harmonization of Customs Procedures (the Kyoto Convention). The Kyoto TRS is one of the WCO’s key tools Convention, which was revised in 1999 for trade facilitation. It is a method for and adopted by the World Customs measuring the average time from the Organization (WCO) as the blueprint arrival of goods at a port until their for modern and efficient customs Source: World Customs Organisation release by the customs and other

94 Autumn 2011 AUSTRALIA Only 7% of cargo was impeded by the border agencies while a further 8% was not fully reported or declared, meaning that a required document – import declarations in the main, bills of lading to a lesser extent – had not yet been submitted to Customs and Border Protection (see Graph 1). A clearer view of trade facilitation performance by the border agencies has also allowed sharper focus on other inputs to the efficiency of trade such as transport infrastructure and business-to-business communications. The timeline shown at Graph 2 shows for Trans-Tasman trade that while clearance is occurring on average just prior to arrival, average dwell time at the cargo terminal is around 3 days. This indicates that the reasons for Graph 1: Comparative results from Australian TRS delaying removal and delivery lie with shore-side commercial clearance, border agencies which recognises that (legislation, systems and collection, transport and receiving industry assesses the performance processes) serve to facilitate trade arrangements rather than with border of customs by how long it takes to – along with some that don’t; clearance. release cargo. • factors that drive the timing of The studies have identified Since its first TRS for 2007, Australia business actions; and, opportunities where improved has conducted annual studies based clearance performance may be on a snapshot of release times for • visibility of the interdependencies achieved. Two areas are: increasing all cargo arriving in the last week of between these factors. the proportion of cargo that is fully September each year. Results for reported and declared to customs by In 2009 some 60% of cargo was the 2010 study are currently being business before its arrival, and refining released by Australian border agencies compiled with publication due by mid- border intervention processes to more and consequently free to leave the year. sharply target activities. customs controlled area by the time In 2010, Australian Customs and it was physically available (that is Overall, the TRS outcomes show Border Protection Service and New discharged or if LCL, unpacked). that early reporting supports early Zealand Customs conducted a joint clearance, by enabling border TRS covering Trans-Tasman trade, A further 26% of cargo was effectively agencies to complete risk assessment which measured performance for unimpeded but simply waiting for before the cargo has arrived. In return, imports and exports processes. The revenue and charges to be paid (the early clearance provides traders with reports of the studies completed by timing of which is at the discretion of predictability and time to pre-arrange Australia are published on Customs the importer or their service provider). collection and inland transport. Earlier and Border Protection’s web-site at: www.customs.gov.au The driving objective for TRS is to measure and monitor clearance performance with a view to identifying opportunities for further streamlining. TRS results and follow-up analysis have helped identify opportunities by providing more complete views of the operating environment. These include: • how the different parties – customs, other government agencies and business – impact clearance times; • the extent to which the border agencies impede the movement of cargo; • identification of which elements of the customs environment Graph 2: Trans-Tasman Clearance Times

Autumn 2011 95 AUSTRALIA Border agencies

identification of high risk cargo means Recently feedback has been sought emerging strategic issues in the that legitimate trade is unimpeded. from industry on what additional international trading environment. aspects of the clearance process or The Trans-Tasman TRS with New other trade-lanes may merit closer Chaired by the Chief Executive Officer Zealand also helped highlight an investigation and performance of Customs and Border Protection, opportunity to improve the performance measurement. I welcome your membership includes: of smaller traders. Smaller operators suggestions, which can be • Shipping Australia Limited represent a significant proportion of forwarded to our TRS Team at: • the stevedoring industry Trans-Tasman traders, tend to report [email protected] later and pay revenue and charges • Customs Brokers and Forwarders later than average. The result is later Customs-trade partnerships Council of Australia Inc. clearance for small trader cargo. The primary forum for the discussion of • Australian Chamber of Commerce customs issues relevant to those in the Other improvement opportunities lie and Industry trading community is the Customs and in data harmonization – particularly Border Protection National Consultative • Law Council of Australia on key identifiers for traders and Committee (CBPNCC). Formed in • Institute of Chartered Accountants shipments – and in regulatory 1991, the Committee is a forum where alignment, such as payment Customs and Border Protection and • Australian Federation of arrangements. industry members can jointly consider International Forwarders Ltd

Photo supplied by the Australian Customs and Border Protection Service

96 Autumn 2011 AUSTRALIA • Board of Airline representatives of Australia • Conference of Asia-Pacific Express carriers • Australia Post • Australian Quarantine Inspection Service Over the remainder of 2011, Customs and Border Protection engage with CBPNCC members to explore a range of opportunities for more effective controls and enhanced trade facilitation. One key area of work will relate to a continuing focus here and internationally to further strengthen global supply chain security. In particular, work will continue on: • receiving information about cargo and conveyances earlier; • preventing trade in illicit drug and explosive precursors; and • reviewing and harmonising international supply chain security standards through participation in multilateral bodies such as the Photo supplied by the Australian Customs and Border Protection Service World Customs Organization (WCO) and ICAO. issues and opportunities with an initial The work outlined that Customs We believe effective international focus on: and Border Protection is currently cooperation is necessary to achieve undertaking is important if we are to • Underbond Movements – to global supply chain security and, meet the challenges and to maximise develop options relating to the whilst it is appropriate for international the opportunities that are arising from movement of unclear cargo with bodies such as the WCO to take a the future environment. A critical lead role, industry also has a critical a view to addressing facilitation ingredient for the successful pursuit part to play. requirements and vulnerabilities; of all these initiatives is effective As part of this work, we will take a • Intermodals – to develop options engagement between Customs and further look at the impact of Authorised for intermodal solutions that Border Protection and industry. This Economic Operator (AEO) programs maximise the proportion of cargo is vital if we are to deliver mutually adopted by other economies on available for intermodal movement beneficial improvements to the border Australian traders and whether the while maintaining border clearance process. case for an Australian AEO program management outcomes; has changed. This will involve Consolidating capabilities to reduce a survey of industry views and • Reporting arrangements – to duplication of effort between perspectives. determine if there are alternative Government agencies and industry is reporting requirements that would an important facet as trade volumes Coordinated border satisfy both border management rise and the need to deploy resources management and industry objectives; on an enhanced risk basis increases.

Through CBPNCC we have also begun • Business systems – to identify Working together, and monitoring to review the role of core elements future systems improvement our progress through initiatives such of the end-to-end Cargo Control and opportunities that will deliver as the TRS and Cargo Control and Clearance process and consider improved facilitation outcomes; whether changes would be required to Clearance Process Review will ensure address emerging industry business • Integrated Border Management that we can both provide effective models and vulnerabilities at the – To identify opportunities to better outcomes for clients of the shipping border. A CBPNCC Working group streamline and coordinate industry and the community both today has been established to consider regulatory activities at the border. and into the future.

Autumn 2011 97 AUSTRALIA Border agencies Australian Transport Safety Bureau

Prevention rather than blame is bureau’s role By Martin Dolan, chief commissioner and CEO

he 7 February 2009 grounding Safety Bureau (ATSB), advising the When it comes to marine accidents, of products tanker Atlantic Blue agency of safety accidents and the ATSB’s marine investigation section Tin the Torres Strait has raised incidents across the marine, aviation undertakes at least ten investigations serious issues about the safety and rail transport sectors. These a year. Transport safety investigations of coastal pilotage operations in notifications are made by a variety of almost always focus on a single accident, breaking it down and gaining Queensland. Serious enough for the people classified as a ‘responsible Australian Transport Safety Bureau an understanding of exactly what went person’ under the Transport Safety to conduct its first ever marine safety wrong, the contributing factors and Investigation Act 2003 (TSI Act) – issue investigation. ascertaining how to prevent such an pilots, ship masters, ship agents, port accident from reoccurring. The Australian Transport authorities and traffic centres. In the Periodically, however, the ATSB will Safety Bureau is Australia’s case of marine notifications, these identify a broader safety issue – a usually come through the Rescue national transport safety problem that pervades an entire Coordination Centre – Australia (RCC). investigator. Entirely regulatory regime, industry sector, separate from transport Ships’ masters, managers, shipping safety system, class of equipment agents, and company representatives safety regulators and or vessels, or procedural or training all alert the RCC of safety problems. service providers, the ATSB structure. This identification might come out of research, monitoring and In 2009–2010, more than 15,000 investigates accidents and analysis of occurrence data, or a series people notified the ATSB of incidents for the purpose of of incidents. In those circumstances, preventing similar events occurrences. The ATSB is not the ATSB may initiate a Safety Issue resourced to investigate every safety in the future, rather than Investigation. occurrence. It has to be strategic, looking to assign blame or investigating events that are likely to The ATSB has conducted several Safety Issue Investigations, but only for apportion liability. yield the most useful safety messages aviation-related issues. In December – those which will have the greatest Every year, thousands of phone calls, 2010, however, the ATSB commenced faxes and emails stream into the impact, and help prevent future its very first Marine Safety Issue offices of the Australian Transport accidents. Investigation: a systemic examination of Queensland’s coastal pilotage operations. This investigation was born out of the 7 February 2009 grounding of the products tanker Atlantic Blue. A coastal pilot boarded the Atlantic Blue for its intended eastbound transit of the Torres Strait. While the pilot was on board, the ship accidentally grounded on a sandy shoal. Bound for Townsville, the ship was nearly fully laden with a cargo of unleaded petrol. Fortunately, during the grounding the hull remained intact and there was no pollution. The ATSB investigation found that Atlantic Blue’s bridge team had not effectively monitored the ship’s progress in the shipping route. In particular, there was no allowance for The Doric Chariot grounded at Piper Reef, North Queensland the prevailing strong wind and tidal

98 Autumn 2011 AUSTRALIA “We needed to verify the exact nature of the issues raised by pilots that led to AMSA’s serious concerns,” says Chaudhri. “We had to do something and with purpose – we could not wait for near-misses to become serious incidents or accidents.” As a result, the ATSB sought the confidential information from AMSA under Section 32 of the TSI Act. “Section 32,” explains John Taylor, Principal Lawyer for the ATSB, “requires a person either to attend an interview and answer questions, or to produce ‘specified evidential material.’ The evidential material could include photographs, logs, procedures, statements obtained from crew, or operational documentation. Essentially Section of navigational chart Aus 700 showing Atlantic Blue’s track it is anything that is potentially relevant to the investigation. But, and this is stream, resulting in the ship deviating had resulted in any injuries or pollution, extremely important, action under from its planned track. Adjustments to but such incidents can have severe Section 32 protects the information, and the people providing it.” the course were inadequate and could consequences in the very sensitive not prevent it grounding off Kirkcaldie Great Barrier Reef environment. “That,” Information acquired under Section Reef. continues Chaudhri, “combined with 32 is restricted under the TSI Act, and Several safety outcomes came AMSA’s concerns, and the issues can only be disclosed in particular and out of the investigation, including identified in previous investigations, quite limited circumstances. It helps actions by the ship’s managers, Fleet indicated that there was the need for to assure the free flow of information Management (of Hong Kong), AMSA (Queensland coastal pilotage) to be that is so vital for transport safety. and a review of shallow water areas by investigated.” Ensuring the confidentiality of reports the Great Barrier Reef and Torres Strait is crucial to ATSB investigations. It is Vessel Traffic Service. But more information was needed. not a function of the ATSB to assign AMSA advised the ATSB that a review of the coastal pilotage marine orders was being finalised. Changes would include an upgrade of the system to check and audit how pilots conduct pilotages, and an enhancement of pilot training and licence renewal requirements for trainee pilot licenses. Significantly though, AMSA advised that it had concerns that there might be systemic issues that could impact upon the safe operation of coastal pilots and the ability to develop fully a ‘safety culture.’ AMSA’s concerns were based on confidential reports by pilots, raising issues about safety and certain aspects of pilotage operations. AMSA’s response suggested to the ATSB that there were systemic issues that warranted further investigation. “This was the third grounding in the last 10 years in the Great Barrier Reef,” notes Vik Chaudhri, the Senior Transport Safety Investigator who is heading the Issue Investigation. The other two groundings had been the general cargo ship New Reach in 1999, and the bulk carrier Doric Chariot Photograph taken from starboard bridgewing of Doric Chariot with in 2002. Like Atlantic Blue, neither one Piper Reef light beacon in the distance

Autumn 2011 99 AUSTRALIA Border agencies

blame liability. In fact, under the TSI and Brisbane. They are licensed by and AMSA and then collating the Act, ATSB reports cannot be used to AMSA but they are not Government information gathered, and analysing establish liability at all. All the ATSB employees. Instead, they operate the data. Trends or critical issues will is interested in is improving transport mostly as individual contractors. be identified. If necessary, the ATSB safety, identifying problems so that “After reviewing the AMSA-provided will issue an appropriate warning or they do not happen again. And people material and initiating the safety issue alert. These can take the form of Safety are much more likely to tell you the investigation,” says Chaudhri, “the first Recommendations or Safety Advisory truth if they won’t get in trouble for thing we did was to contact all the Notices. doing so. coastal pilots to let them know that What safety outcomes the Coastal AMSA provided ATSB with the we would be approaching them for Pilotage investigation yields is yet to be confidential reports from coastal pilots information. This was soon followed seen, but it certainly has the potential with safety concerns. The reports by a survey, with about 90 questions, to influence important changes. indicated that significant safety issues based on areas of concerns in the could exist in coastal pilotage. These pilots’ confidential reports.” The “This isn’t just our first ever Marine covered a broad range of factors, survey was done under Section 32 of Issue Investigation,” notes Mike including fatigue issues, near-misses, the TSI Act to ensure the information Squires, Manager of Marine Safety collisions, groundings, passage provided was restricted and could not Investigations for the ATSB. “It’s also planning and pilotage procedures. be disclosed. This was done mainly to the biggest marine investigation that offer the pilots complete confidentiality In January 2011, there were 82 we’ve ever started, not so much in the to address their concerns for their licensed Queensland coastal pilots. scale but in terms of potential effects future employment. The ATSB also Coastal pilots are ex-Master Mariners, or outcomes.” invited 30 key stakeholders and and most of them have significant interested parties (including pilot- Does the ATSB anticipate more issues seagoing experience. Many of them providing companies, Shipping investigations coming from the Marine had significant experience of transiting Australia, Ports Australia, Australian Investigation Branch? the Great Barrier Reef on ships before Shipowners Association, Australasian they became pilots. In recent years, Marine Pilots Institute and various “Our perspective,” says Squires, “is because of the dwindling Australian other organisations) to submit their that this is a valuable tool that can be merchant ship fleet, many pilots have initial views on coastal pilotage safety used by the ATSB to review safety been recruited from overseas. Australia issues. “All 82 pilots responded,” notes systems in a proactive way, rather than is also seeing new entrants from the Chaudhri. “From the industry, we got a the occurrences, which are attended Australian navy, rather than merchant fair amount of constructive feedback.” after the event. Do we want to do more seamen. Pilots usually live in coastal investigations like this? Queensland cities or towns, with From here, the ATSB will be meeting the majority spread between Cairns with key stakeholders, some pilots “Absolutely.”

Photograph courtesy of Marcelo Vieira

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Autumn 2011 101 Boosted Productivity For Bulk Discharge :: E. [email protected] :: P. +64 AUSTRALIA7 575 5079 Border agencies Australian Quarantine and Inspection Service

Bugs to ballast water: Biosecurity and the shipping industry

he Australian Quarantine and board, animals, high risk cargo, • avoid adding attachments to Inspection Service (AQIS) is ballast water and waste. the email. moving to a more risk-based T The MNCC operates 7 days a approach to biosecurity. We value week from 6.30am to 6.30pm More about managing the the important relationship with the in every time zone in Australia. marine biosecurity risk from shipping industry and look forward When in Australian waters you can biofouling to developing even stronger links contact MNCC on telephone (08) in the coming months. The Australian Government has 8201 6185. On-call arrangements been looking at ways to manage The following information is a are in place outside core hours. the biosecurity risk posed by sample of some of the changes Vessels still in New Zealand waters marine pest species arriving in happening to target biosecurity need to contact shipping agents Australia attached to vessels as concerns and improve the way we directly. biofouling. interact with the shipping industry. An electronic version of the We look forward to your feedback Some of these species have Quarantine Pre-Arrival Report to ensure we get the balance right the potential to establish viable (eQPAR) was introduced when the between biosecurity and trade. populations and become invasive MNCC commenced in July 2010. It pests outside of their native can be found on the AQIS website: ranges. This can have catastrophic Pre-arrival: the Maritime www.daff.gov.au/aqis. ecological, economic, human National Coordination Centre health and social consequences. and electronic Quarantine Use of eQPAR has been better For example, in the United States Pre-Arrival Report than anticipated, reflecting the extensive collaboration between the associated damages and The Maritime National Coordination AQIS and Shipping Australia costs of controlling marine invasive Centre (MNCC) opened in Limited members on development species amount to an estimated Adelaide in July 2010. It is of the form and the MNCC to US$14.2 billioni annually. responsible for handling all ensure beneficial outcomes for The movement of vessels has been pre-arrival activities for vessels everyone. shown to pose the biggest risk for greater than 25 metres arriving into marine species to be transported Australia. The MNCC is achieving Tips for submitting the eQPAR to around the world. a nationally consistent approach avoid delays in the way AQIS processes All vessels entering Australian When submitting the eQPAR it is documentation and has greatly waters, regardless of their size essential that: improved the level of service or frequency of visits, pose a provided to industry. The MNCC is • you use the most recent version biosecurity risk to Australia’s a one-stop-shop for all pre-arrival of the form to ensure that marine environment. To mitigate documentation and a direct point agents details are entered this risk, the Australian Government of contact for all shipping agents correctly is proposing to introduce new for activities prior to a vessel’s measures requiring that vessels • pilot boarding details are arrival. are free of a suite of pest species entered if not going to anchor before entering Australia. The The MNCC handles over 1300 • use only the port name not the requirements will apply equally first port vessel visits a month and country when entering High to all vessel types arriving in coordinates responses to risks Risk Cargo Australian waters, regardless of such as insects (for example, vessel size or origin. Asian Gypsy Moth and Burnt Pine • use the ‘Submit by email’ Longicorn), death and illness on button; and In developing the requirements,

102 Autumn 2011 AUSTRALIA the Australian Government and certification of BWMS may has been working closely with differ between ships. the shipping and offshore AQIS is currently seeking petroleum industries. The applications from vessels with government will continue a BWMS to trial prior to the to consult with industry to Convention taking effect. AQIS ensure that implementation will consider applications to arrangements are both practical use an IMO Type approved from an industry perspective BWMS on a case by case and effective in minimising basis. That is, only BWMS that the biosecurity risk posed by have received Type-approval biofouling. in accordance with the Biofouling and the IMO’s BWM Convention and International Maritime supporting Guidelines 8 and 9. Organization Until this convention comes into During 2007, the International effect, vessels are still required Maritime Organization’s (IMO) to manage their ballast water Marine Environment Protection via existing methods (e.g. deep Committee (MEPC) recognised ocean exchange) until the that biofouling was a significant approval to use a BWMS has international issue. Through been issued. the IMO, Australia and other Ship agents and operators are countries are working to requested to notify AQIS of develop international measures Most_Unwanted_BurntPine_PRINTREADY.indd 1 8/11/2010 2:08:48 PM biofouling management guidelines, any arriving vessels fitted with to minimise the transfer of invasive a marine pest identification guide a BWMS which could satisfy the aquatic species through biofouling. and the marine pest website: www. Australian BWM Requirements. The One measure is the development marinepests.gov.au. The biofouling following should be provided to of voluntary guidelines for the guidelines and the identification AQIS: management of biofouling called guide are available for free • vessel details (name, IMO, call Guidelines for the control and download from the marine pest sign, vessel type) management of ships’ biofouling website. to minimize the transfer of invasive • details of the BWMS (name, aquatic species. On-board Ballast Water make, approving administration) Implementation of these guidelines Management Systems – • planned arrival (port, date and by the IMO will help promote an verification trial time) internationally consistent approach AQIS is the lead agency in • discharge intentions (full ballast to biofouling management by the regulation of internationally capacity and forecast Member States, leading to an sourced ballast water. discharge volume) awareness of the risks associated with biofouling, improved vessel The International Maritime • copy of Type Approval maintenance practices and Organization’s (IMO) International Certificate and Ballast Water an increased interest in the Convention for the Control Certificate development of technologies and Management of Ships’ • ballast pump capacity (rated, if associated with the management Ballast Water and Sediments available) of biofouling. (BWM Convention) stipulates a gradual introduction of Ballast • further voyage intentions (for National biofouling management Water Management Systems example, Victorian arrival, tools (BWMS) as the recognised and departing Australia). In recent years Australia, through approved method of ballast water This information should be the National System for the management with the phase out of provided as soon as available, but Prevention and Management current deep ocean exchange. no less than 96 to 12 hours prior to of Marine Pest Incursions, has arrival to allow AQIS to prepare to developed a number of tools AQIS is aware that ships are assess the status of the BWMS. to assist in the management of installing BWMS to meet Australia’s biofouling and marine pests. ballast water management Should a BWMS meet AQIS’s These include a series of national requirements. As the Convention verification requirements the vessel is not yet in force, documentation

Autumn 2011 103 AUSTRALIA Border agencies

will be provided with an approval beetle and AQIS is working hard to the entry of BPL, one of the world’s to use the system on future visits to prevent it from establishing here. most destructive timber pests, into Australia. If this pest establishes a viable the country. population in Australia it could The Maersk chartered vessel threaten our softwood forests and AQIS developing offshore Tatiana Schulte was heading for construction industries. petroleum industry guidance Australia from New Zealand when The AQIS Seaports Program is BPL (Arhopalus ferus) grows to the captain and crew discovered working with offshore petroleum between 12-30mm in length, is an infestation of unfamiliar black production and exploration service reddish brown to black in colour beetles. The captain reported the providers to develop guidance for and has antennae approximately detection immediately to AQIS, Australia’s offshore oil and gas half as long as its body. This pest and the beetles were confirmed industry. has a typical flight season between as BPL. Maersk and Inchcape November and March and seeks returned the vessel to Auckland for The guidance information will shelter in dark secluded areas in the pests to be removed. provide details about quarantine or on imported cargo and vessels. requirements relating to the Adults are active from dusk to What you can do arrival of construction vessels, dawn, are attracted to light and barges, mobile offshore drilling shelter in crevices during daylight. BPL could enter Australia on units (MODU) and production During the season Australian and cargo or vessels carrying timber, paper and machinery, so everyone facilities (including floating New Zealand biosecurity officers involved in the shipping industry production, storage and off-take are extra vigilant in combating plays a key role in keeping (FPSO) facilities) in Australian incursions. waters. The guidance will also Australia free of this pest. Award from Minister Ludwig include information for operators Australia applies strict quarantine of currently producing offshore The Minister for Agriculture, legislation with harsh penalties resource installations, off-take Fisheries and Forestry, Senator for vessels that fail to comply. tankers, Australian supply vessels Joe Ludwig, presented the 2010 Before arrival, the master of the and helicopters. Australian National Biosecurity vessel must complete a Quarantine Award to Maersk Australia and Pre-Arrival Report which includes Changes ahead Inchcape Shipping in recognition reporting on the presence of The offshore petroleum sector is of their swift action in preventing insects, including BPL. very different from traditional areas of vessel quarantine management and AQIS recognises that this area poses new challenges. The Seaports Program is in the process of developing new methods of Insect activity and infestations quarantine management specific to this unique environment. These should be reported immediately to measures will be consistent with our risk-based intervention AQIS by calling approach and are part of a broader program within AQIS to examine quarantine management for major resources sector projects and engagement with industry. For further information on vessel 1800 803 006 quarantine requirements visit the AQIS Seaports Program website: www.daff.gov.au/shipping. Visit www.marinepests.gov.au Current pest alert Burnt Pine Longicorn – an to find out how to report new unwanted hitchhiker marine pests in your area Australia is currently free from the Burnt Pine Longicorn (BPL)

104 Autumn 2011 AUSTRALIA Autumn 2011 105 AUSTRALIA

Most_Unwanted_BurntPine_PRINTREADY.indd 1 8/11/2010 2:08:48 PM Border agencies Office of Transport Security

2010 saw the Australian Government and industry working together to continue to strengthen Australia’s risk-based approach to preventative maritime transport and offshore facility security – an effort that will continue into 2011.

By paul retter AM, executive director

s a nation we have been of the ways in which the Office In early 2010, the Minister for fortunate that there has not of Transport Security (OTS) has Infrastructure and Transport, Abeen a serious maritime worked with industry, within the Hon Anthony Albanese MP, security incident in recent memory. government and internationally announced a number of We can be justly proud of the over the past year to safeguard enhancements to the MSIC initiatives that we have put in against terrorism and other scheme relating to background place to establish a world-class unlawful interference with maritime checking of applicants – security regime. But we must transport and offshore facilities. these came into effect on not be tempted to think that work 1 December 2010. The amendments provide for a more to improve our maritime security Developments within thorough background check of is complete, nor that Australia’s Australia shipping industry, ports and MSIC applicants. At the beginning of 2010, OTS offshore facilities will remain off the The OTS is continuing to work maritime security inspectors radar for terrorists or other criminal closely with industry to implement around the country focused their interests. these changes, and established attention on security measures an MSIC Working Group to seek These groups have a associated with passenger demonstrated ability to exploit specific feedback from industry vessels visiting Australia during and ensure that industry is vulnerabilities in transport security the cruise season. In addition kept informed. The feedback regimes in order to conduct to the general screening and we have received so far has attacks that can cause mass clearing of passengers, cargo and been invaluable in initiating and casualties, economic damage, baggage, there was an increased implementing these changes. symbolic media imagery and emphasis on ensuring the integrity Following the examination anxiety in the community. of waterside security zones around of security arrangements for Over the past year the global high risk vessels, including cruise passenger ships earlier in the liners and chemical, oil and gas maritime industry has seen an year, the Maritime Transport and tankers. attack on a Japanese oil tanker in Offshore Facilities Security Act the Persian Gulf, an attack on an Inspections were also conducted 2003 and the Aviation Transport offshore oil facility off the coast at a number of security regulated Security Act 2004 were amended of Nigeria, and continued piracy ports following the conclusion of in July with a range of measures to incidents and hijacking in the the cruise season in most states enhance passenger ship security. Gulf of Aden and off the Somali in March 2010. The inspections Other amendments allowed Coast. The Royal Australian helped evaluate the effectiveness the appointment of Security Navy continues to conduct of access control procedures Assessment Inspectors and counter-piracy operations in the into security zones. In particular, improved coordination between Middle East as part of combined compliance with Maritime security authorities in times of maritime force operations, and Security Identification Card crisis. early this year HMAS Melbourne (MSIC) requirements was closely Coordination channels within successfully disrupted a pirate assessed and a regular inspection government were tested in the attack on the MV CPO China. program was implemented for latter half of the year when around With this in mind, I would like to inter-state passenger/vehicle ferry 50 OTS staff joined thousands of provide a snapshot of just some operators. other Commonwealth, State,

106 Autumn 2011 AUSTRALIA Territory and Australian Defence resilience of the Australian oil and Closer to home, the Australian Force officers in the multi gas industry by sharing security Government is working closely jurisdictional counter terrorism information and insights. Members with the Indonesian Government exercise MERCURY 2010. This participated in a discussion on a range of transport security exercise was designed to test exercise facilitated by the Deputy activities to assist in the our national response to multiple National Security Advisor, and the international fight against terrorism. concurrent terrorist attacks against Secretariat developed a strategic critical infrastructure, community directions paper on oil and gas In December, the Minister met facilities and transport across security. Membership continues with the Indonesian Directorate the nation, including the Port of to grow and the next meeting is General of Sea Transportation to Geelong. scheduled for the second quarter talk about our shared relationship of 2011. on maritime security and to thank Developments in offshore oil the Indonesian Government for its and gas International developments efforts on the Indonesia-Australia Maritime Security project. Recent incidents such as the The security of international Montara offshore oil platform fire shipping is critical to the social This project, funded by AusAID, and oil spill in the Timor Gap in and economic prosperity of our has enabled us to provide port 2009, the grounding of the Sheng region. security training to a number of Neng 1 on the Great Barrier Reef The United Nations’ International Indonesian port officials, working in April 2010, and the ongoing Maritime Organization (IMO) plays closely with them to implement environmental consequences a pivotal role in setting globally maritime security auditing and of the oil spill in the Gulf of consistent security standards, whole-of-port security planning Mexico, clearly demonstrate the most notably the International principles. importance of effective security Ship and Port Facility Security arrangements for Australian Code. Australia continues to play Finally, in 2010 we opened new offshore oil and gas facilities. a leading role in the IMO Maritime offices in Australian embassies It has been five years since the Safety Committee, particularly on in Abu Dhabi and Bangkok OTS first security regulated the maritime security issues. to complement our existing offshore oil and gas industry. So representation in Bali, Jakarta, Australia’s commitment to safety it is not surprising that a large Manila, Port Moresby and and security at sea was further number of five-year offshore Washington. Our overseas reinforced with the appointment security plans expired, and we representation is critical in building on 17 November 2010 of the processed a large number of Australian High Commissioner lasting and effective relationships regulatory approvals for new to the United Kingdom, with foreign governments, plans. HE John Dauth LVO, as our first and plays an important role in On 1 July 2010, the OTS released Permanent Representative to the supporting ongoing capacity the Offshore Oil & Gas Security IMO. building. But it is in a crisis that Risk Context Statement. The the real benefits are demonstrated. In this role, Mr Dauth will build Statement provides the oil and on current strategic relationships gas industry, and other relevant with other member states in What does 2011 hold? bodies, with an overview of the relation to important maritime current security environment Good basic protective measures issues, participate in negotiations in the context of transnational coupled with an effective maritime on matters before the IMO, and terrorism. The Statement identifies security culture are the keys provide a full time presence vulnerabilities that could be to future success. We have a in London. He will also lead exploited in a terrorist attack on world-class security regime but Australia’s re-election campaign to offshore oil and gas infrastructure we need to remain vigilant to new the IMO’s 40 member Governing and provides advice to industry Council, the vote for which will and emerging threats. The threat on preventive security to mitigate be held in November 2011. In to Australia’s maritime sector has threats. addition, Mr Anthony Hogan has not diminished and our future The Oil and Gas Security Forum been appointed as Australia’s challenges are uncertain. I look met twice in 2010 providing further Alternate Permanent IMO forward to continuing to work opportunities for government and representative based at the High together with industry to meet industry to improve the Commission in London. these challenges.

Autumn 2011 107 AUSTRALIA Border agencies Australian Hydrographic Service

Supporting safe navigation, enabling maritime trade – Australian Hydrographic Service update By Hydrographer of Australia Commodore Rod Nairn, Royal Australian Navy

The shipping industry will benefit limits, with at least 30% of most New and improved Australian from new and improved national voyages conducted through coastal, Hydrographic Services for the charting services from the Navy’s reef strewn or shallow waters and mariner Australian Hydrographic Service frequently all three. Given the relative 1. Electronic Navigational Charts (AHS) in 2011. time ships spend negotiating those now available Australia’s international seaborne coastal trade routes, this is where Since January 2011, the mariner trade is now worth in excess of the greatest risk to Australia’s can access Electronic Navigational $275 Bn annually. This represents international supply lines lies. Charts, or ENCs, for all Australian around 70% by value of Australia’s Today the AHS produces and and PNG ports and major trade total trade. It is carried by over updates a folio of around 450 routes – about 800 ENCs in total. 3700 ships making 10 000 voyages. charts covering from the Equator This major project was completed on It’s the AHS that provides both the time and budget by the AHS at the ‘roads’ and the ‘roadmaps’, to help to Antarctica. It remains our core end of 2010. ensure those ships arrive at those business. We also produce a range gateways safely. of publications for mariners, all Australian ENCs are distributed focussed on safe and legal use of internationally through the Although we focus strongly on our waterways. International Centre for ENCs* and ports, we can’t lose sight of the are available through their global fact that 99% of a typical two week 2011 gets underway with some network of value-added resellers. voyage from Australia to China new and improved services for the The AHS also provides a limited or Japan occurs outside any port mariner. direct ENC distribution service for Ports, Pilots and Government agencies. For further information, contact hydro.licensing@defence. gov.au or phone (02) 4223 6500. The International Maritime Organisation (IMO) has mandated the phased adoption of ENCs and Electronic Chart Display and Information Systems, starting from 2012. The IMO has determined that the use of the smart data in these charts, in combination with real-time positioning and computer based navigation systems, will lead to at least a 30% reduction in groundings world-wide. Our own study of 25 years worth of Australian grounding investigations has more than confirmed this view. A great example is the case of the Shen Neng 1, which grounded on the Great Barrier Reef in April 2010. The ship had just departed Gladstone for China, and was four Survey vessel, HMAS Leeuwin hours into its two week passage.

108 Autumn 2011 AUSTRALIA on the paper charts. There were no mechanical problems. Based on the Australian Transport Safety Bureau’s interim report, it is clear that the accident was caused by fatigue, leading to inattention. The supposed “short-cut” reported in the media actually took them along the shipping route, not away from it. The problem wasn’t the short-cut; it was that they didn’t know when they reached the end of it. However, if they’d been using ENCs alarms would have sounded, and it is highly Cartographer James Ghislain likely that the ship would not have 3. Full Compatibility between grounded. Charts and GPS Firstly, they would not have sailed A few years ago the AHS recognised off the northern edge of the southern that use of GPS was increasing paper chart, which they did at just dramatically and for the mariner, the wrong moment, because ENCs the incompatibility between GPS join together seamlessly. Secondly, positions and positions on the they would have been able to see charts (because of differences in their current position, not just in datums) was an increasing source of relation to their planned track, but frustration and risk. more importantly, in relation to the submerged reefs around them. In response to this, the AHS has undertaken a significant datum Finally, even if they weren’t watching conversion program in its chart the display, two other functions could modernisation program. This is now have saved them. in its final stages with the last charts These are “anti-grounding” (a look- to be complete by mid 2011. After ahead function) and “safety depth” that, all charts will be on the WGS (based on their own ship’s draft). In 84 horizontal datum, fully compatible combination, these would have given with GPS. them a typical 15 minutes or more 4. Improved Notices to Mariners warning, even if they had no planned service track in the system at all. In a typical year, the AHS publishes Fortunately, such accidents should around 1300 marine safety updates now largely be preventable, with or Notices to Mariners, all of which ENCs now covering all major have to be applied to master files Australian shipping routes. Further, for the affected paper and electronic we have progressed ENC coverage charts. in parallel with the biggest chart modernisation program ever Unfortunately for mariners, they have undertaken. also had to be applied to the charts already in use – the ones at sea. But 2. Fathoms to Metric Chart there is help ahead. Modernisation Program For those mariners using ENCs, The chart modernisation program a streamlined update service is has included recompiling all fathoms available. And, in response to user charts to metric as well as shifting demand, since January 2011 the all charts onto WGS84.** Of the The ship was within the Designated AHS has expanded this service to approximately 450 charts produced Shipping Area. For all but the include Temporary and Preliminary by the AHS 96% are completed, with last twenty minutes it was closely Notices to Mariners within the ENC full conversion to be completed this following the recognised shipping update files. So now, updating year. route. The ship was using modern ENCs is now as simple as loading paper charts and was equipped It is going to make charts even the latest file. This is a far cry from with GPS. Navigation was done by easier to follow when all the charted applying 1300 updates, by hand, to periodically plotting GPS positions depths are in the same units. their existing paper charts.

Autumn 2011 109 AUSTRALIA Border agencies Australian Hydrographic Service

5. Web services Since 2009, our safety updates have been available as a web based service and can be accessed free of charge at www.hydro.gov.au. Having Notices to Mariners on the website has halved lead times and improved the currency of information. It has also greatly enhanced their uptake. There are now four times as many downloads as were previously distributed using any or all of three different methods. In 2010, we further expanded electronic services. Since late 2010, ports, pilots and Government users have been able to to Mariners updates over time, all A series of recent coastal surveys directly download ENC updates from needing application by either the done by Navy’s hydrographic ships the new www.hydro.gov.au website. chart agent or mariner upon receipt. will again directly benefit maritime trade. In mid 2011, we plan to expand our From late 2010 the AHS shifted to direct ENC distribution service to in-house printing of our charts, with Previous surveys have included all mariners. This will be especially orders from individual agents and Hydrographers Passage and the beneficial to interstate and smaller customers printed on demand using more recent LADS Passage, both commercial vessels and will up to date print files. within the Great Barrier Reef. complement existing international arrangements. Chart Agents have already noticed a The latest are a series of very high vast reduction in the need to correct accuracy surveys in Torres Strait. 6. New Print On Demand service for charts before sale, while mariners These are to support the under keel Nautical Charts should notice improved consistency clearance management system that The AHS has made a fundamental in chart quality as we shift from will be operational from early next shift in the way paper charts are three or four printing sources to one year. This will considerably improve printed. centralised and quality controlled safety while maximising the draft of service. ships using Prince of Wales Channel. Previously, the AHS had to rely on a panel of commercial printers. With The key benefits to the user are To conclude, the Australian that it will save them a considerable lead times of six weeks, it was quite Hydrographic Service continues amount of time, and ensures that possible for a new chart to be out to work hard to improve the they receive the most up-to-date of date even before stock became hydrographic services supporting products available. There is no available. safe navigation and maritime trade. longer a five or six week delay while Perhaps the biggest change for The requirement to print in bulk also charts are printed, so new charts are mariners is the IMO’s phased meant that shelf stocks accrued available sooner and there are no introduction of compulsory carriage more and more outstanding Notices longer large volumes of charts sitting of Electronic Chart Display and on shelves getting out-of-date even Information Systems (ECDIS) from before they are distributed. 2012. The AHS has provided the Finalists in Lloyds List DCN ENCs but the shipping industry Australian Shipping & Maritime needs to commit to bridge team Industry Awards training to ensure that the potential benefit of ECDIS translates into In November last year, the AHS was safer navigation and more efficient nominated for the Maritime Services operations. Award for its new Print On Demand service, recognising exceptional *The International Centre for ENCs is an association of national hydrographic achievement or contribution to any organisations working together to harmonise service sector of the Australian the production and distribution of high quality maritime industry. official electronic charts. **World Geodetic System 1984 (dating from 7. High accuracy surveys in Torres 1984). The World Geodetic System is a Strait – supporting under keel standard for use in cartography, geodesy, and clearance management navigation.

110 Autumn 2011 AUSTRALIA Smartship Australia is a centre of excellence in advanced human factors based maritime training, and supported by full mission high fidelity simulation.

Smartship Australia is a purpose-built, modern facility providing ample space to house five simulators, training rooms, debriefing rooms and passive recreation for centre users. Facilities include: • clients lounge and dining rooms • wifi for visitors • fully equipped training rooms with facilities to playback all simulator scenarios • showers and change rooms.

The five simulators comprise of: • primary full mission bridge (FMB) simulator of 16m diameter with 240° field of view (FOV) from the wheelhouse centre in addition to 210° FOV from connected bridge wings • secondary FMB simulator of 12m diameter with 240° FOV and rear monitors for astern view • tug simulator with 360° FOV and with the ability to simulate all tug prolusion systems including rotor configuration • two part task (120° FOV) simulators for general training.

All simulators can be operated independently or integrated in any arrangement depending on training needs.

Courses being offered will include: • Advanced Marine Pilot Training • Advanced Bridge Resouce Management • Basic and Advanced Shiphandling for Pilots • Competency Audit

Smartship Australia is located close to all Brisbane airport terminals and to the expanding Airport Village which consists of many retail outlets, including DFO shopping, Novotel Hotel, supermarkets and several restaurants.

Smartship Australia will be opening in April 2011.

Phone: +61 7 3358 9300 Email: [email protected] Website: www.smartshipaustralia.com.au

Autumn 2011 111 AUSTRALIA Ports

Port efficiency and growth – Australian governments should seize opportunity to embrace national ports strategy

By David Anderson, CEO, Ports Australia

meeting of COAG on sustainable, or will not be delivered at a through industry driven productivity competitive international price. measures, and securing transparency 13 February 2011 and accountability on the part of those brought Australia’s The COAG outcome was ominously responsible for delivering. qualified in that it “endorsed the need for AFirst Ministers together to a national ports strategy” but fell short For our organisation this has essentially address an agenda that of signing off on the strategy itself. In amounted to articulating what have been included consideration addition it assigned the strategy to the our strategic policy goals, particularly of the National Ports “relevant Ministerial Council to complete as they relate to the three key areas of an implementation plan for a final ports access, regulation and planning, and Strategy (NPS). strategy by August 2011 for out-of- to take them forward under one single session endorsement by COAG”. initiative. We have not viewed the This was preceded by the release of the strategy as a centrally planned blueprint, strategy by the Prime Minister in January This immediately suggests that there but more as a practical set of nationally 2011 following an intense period of are challenges ahead in preserving the based measures that can be agreed development and consultation on the part integrity and essence of the National jointly by governments and industry to of lead agencies, Infrastructure Australia Ports Strategy. We trust that the address the critical need to facilitate port and the National Transport Commission. committees supporting the Ministerial operational efficiency, to enable ports to Council will focus on delivering a real plan with certainty to introduce additional implementation plan and will not seek to capacity to meet trade forecasts, Progress so far water down the essence of the strategy. unimpeded by unnecessary and These events of themselves represented Much of the traffic that was circulating capricious regulation and process. The a key milestone for the members of in the lead up to COAG suggested strategy importantly also has as a central Ports Australia in that they signified a that the strategy had not been the focus an outcome that ports and their long-sought elevation of key port and subject of adequate consultation or surrounding communities can support port related issues on the public policy that it represented a threat to state each others’ goals and aspirations. agenda to the extent that the Prime prerogatives attached to port ownership We support the four point framework Minister has recognised their significance and management. Any assertions described by the strategy in that it and the priority which should be along these lines are not supported by assimilates in a logical way and in a way accorded to addressing them. a careful reading of the documentation that is easily understood, the key matters released over the course of the strategy’s There is a genuine national interest at that should be addressed to support port development. stake inherent in the NPS to deliver efficiency and growth. These included stronger performance in national There is accordingly still a job ahead of streamlining planning and environmental productivity, trade and international us in progressing what is a critical and processes, preserving freight corridors competitiveness that live up to the important national initiative designed to and freight precincts and addressing the Australian community’s aspirations bring more certainty to the future ability infrastructure requirements of road and rail corridors. relating to jobs, increased standards of of our ports community to address our living and access to world markets. burgeoning trade task. There is a substantial benefit inherent The strategy and its consideration at in the strategy having, as one of its COAG level, represented an opportunity The essence of the strategy essential foundations, the development in the very first instance to impress upon of long term plans. Such plans need to The principles supporting the National be formulated along with those of other governments and their advisors the Ports Strategy are conceptually simple port stakeholders so that all have some substantial and serious implications for and that is one of the reasons why it is ownership, the aspirations and growth of our ports and ports related infrastructure. easily understood as representing good port businesses are well understood, and It is still not widely appreciated that the policy. local councils and state agencies can growth in container trades will exceed plan in a way that has an appropriate fit twice annual GDP growth, and that there It calls for the formulation of long with the development of the port and port are very big numbers in prospect in our term port plans and a process that related infrastructure. major bulk and energy trades. It is now ensures compatibility with those of a increasing reality that if governments other stakeholders including local Recently I received representations do not act to embrace the measures government, measures to ensure that from a state agency that all was well recommended in the strategy then plans can be realized, and to address within their state as it applied to port the growth now in prospect will not be improved landside efficiency including development, governance and planning

112 Autumn 2011 AUSTRALIA and that there was no need for “intrusion” political dimension in terms of our Where to from here from the Federal Government in this area. relationship with our constituency Ports Australia will continue to make or because of some generalised How can this assertion be made when strong representations to Ministers to notion of fairness. It was raised on we are witness to apartment blocks and progress the measures embodied by the the very legitimate basis that smaller housing estates appearing within metres NPS. We have a belief that it is sound ports, including regional ports, will be of port rail corridors, including in that and necessary policy and that it should amongst the large ports of the future, context that a number of governments be pursued. We also have a belief that and secondly that their operation and have a goal of assigning a greater share if the strategy delivers two or three key development are as equally impeded by of port container traffic to rail which now improvements such as more meaningful slow moving and uncertain regulatory and stands to be constrained by the intrusion measures to protect port land, enhanced approvals processes as those of their of well healed voters complaining about ability of ports to plan their supply chains larger peers, even if the overall economic noise and vibration. Avoiding such land or streamlined dredging approvals then impact is not immediately as great. It use conflicts by introducing planning it will be worth the work that has gone is accordingly a logical proposition that regimes with statutory force, and where into it. everyone knows the rules, is a central smaller ports, particularly those with goal of the strategy. opportunities for substantial future growth, The National Ports Strategy represents should be equally protected by regimes a unique opportunity to secure a The assertion about Federal Government that seek for example, to provide support quantum leap in the capacity of our intrusion is equally misplaced. Ports to dredge channels to accommodate ports community to carry out its task as Australia could not support a position larger vessels, preserve road and rail effectively as possible to plan additional that had as its core some sort of corridors and land for future expansion capacity with confidence and certainty Commonwealth “takeover” The Federal and put in place the settings to avoid and to position the nation effectively to Government is , as we see it, seeking to future land use conflicts. This is also a handle growing freight volumes in our reach agreement to a set of nationally relevant point as we explore further with trades. It also presents an opportunity based measures to support the national the Government a possible relationship to enhance the country’s languishing economy but which must necessarily be between infrastructure funding and the productivity on a broad basis and to implemented at a state and port level. requirements of the strategy. ensure that we are better positioned to deliver in competitive international Ports Australia has gone to lengths to It is our interpretation that the long ensure that the discussion about the markets. term port plans (for ports of national strategy, from its perspective, does not significance) required in the strategy The growing limitations imposed by get side tracked by unproductive debate should drive the right outcomes in this regulation and by landside and other about port ownership and management particular regard. That is, it places an constraints render it imperative that and this is reflected in the strategy onus on individual jurisdictions, within the strategy be delivered with some document. The Federal Government the broader strategic planning of their is not interested in managing and resolve otherwise the literature warns respective states and regions, to identify developing ports from Canberra. that our trade performance stands to be those ports by bringing them into the compromised. We are best placed now planning framework envisaged by the to implement the strategy while economic Some further issues for strategy and developing long term plans conditions are relatively buoyant. When consideration for those ports. This process may also the resource boom subsides as it Many of our container and bulk ports are place some incentive on individual inevitably will, commodities drop in price involved in billion dollar infrastructure jurisdictions to make determinations, in a as they inevitably will and we return to programs portside in new berth and rigorous way, about the manner in which drought conditions and perhaps higher terminal capacity. Unless there is future trade growth that goes beyond the interest rates and unemployment levels capability and some enthusiasm to projected capacities of their current major that is when we will see it more starkly match this increased capacity with ports, will be addressed. as an opportunity lost if we do not collectively press on with making the NPS commensurate road, rail and channel Channels are deserving of special work. capacity then the benefits of this massive mention in the discussion about the portside investment will never be fully strategy. Channels servicing international Channels servicing international trade realised. Again the strategy endeavours trade are infrastructure of national are infrastructure of national significance to deliver a framework to tackle these significance and, like road and rail and, like road and rail infrastructure, critical issues. infrastructure, key to ensuring that ports key to ensuring that ports can address There has been a perception that the can address their full portside capacity. their full portside capacity. It is our strategy has in some absolute way It is our contention that there is a need strong contention that there is a need defined those ports that are inside and for strong government support for the for strong government support for the those ports that lie out of the strategy consistent application of dredging consistent application of dredging framework. The strategy is saying that approvals conditions, for faster approvals approvals conditions, for faster approvals at our larger ports the issues are more and for much improved transparency and for much improved transparency critical and have the largest national in the processes involved. Political in the processes involved. Political economic impact but there is no sense of support is also required to engage with support is also required to engage with exclusion specified or implied. the community in an objective manner the community in an objective manner the scientifically derived results of the the scientifically derived results of the In our submissions to Infrastructure impacts of dredging in order to address impacts of dredging in order to address Australia we have been adamant about what is now an orchestrated program of what is now an orchestrated program of the legitimate place that our smaller disinformation about dredging. This area disinformation about dredging. This area regional ports should hold in the strategy. alone stands to prejudice the country’s alone stands to prejudice the country’s Ports Australia did not raise this issue trade performance if not addressed by trade performance if not addressed by because it has some sort of quaisi some political resolve. some political resolve.

Autumn 2011 113 AUSTRALIA Ports Albany “Whose Port is it Anyway?” By Brad Williamson, chief executive officer, Albany Port Authority

n the previous editions of program of 12M m3 for a new iron philosophy that it would be absurd Shipping Australia I have ore trade. This dredging will result for the Port to sublease parts of Idiscussed broad issues of port in the dumping of dredge spoil, its waters to a part time operation policy, considering the politics and well away from the mussel farms, which could imperil the normal port philosophy of running a port. In in deep water (42m). Although operations, which are responsible this article I wish to explore the this is the deepest dump site in for $1 billion worth of trade passing question “whose port is it anyway?” Western Australia by a factor of two, through it. In effect, this is a policy To explore this concept I will use and well away from beaches (in an issue developing in the Albany comparison to dredging operations expressing the primacy of the trade Port concerning a conflict between in other ports), dredging is now a over other uses that the Port has aquaculture, particularly the growing highly emotive issue where science allowed to operate in its waters. of mussels, and normal port takes second place to emotion. A Without this hierarchy of interests, operations, such as dredging. campaign is now running against the the Port Authority would be better off dredging operation. not having the aquaculture business Mussel farming is a well established operation in the Albany Port and The Port Authority has conducted altogether and as the leases expired, there are seven mussel farm leases public meetings about the not renew them. controlled by the Port Authority. The proposed dredging and at one Port Authority leases out the sea of these meetings there was bed and the water column above it, complaint from a mussel farmer which allows mussel farmers (once about the Port Authority imperilling they have secured the appropriate his business through the risk of licence from the Department of increased turbidity. After being on Fisheries) to put in place floats and the receiving end of this spirited strings from which mussels can be criticism, I decided to review mussel grown. Leases are on a nominal rate farming leases and on comparing ($750 per year) for an area of water, it with leases in other ports, I found for a period of up to five years. that mussel farm leases in other Until recently there has been little ports were far more onerous on conflict between the Port Authority leaseholders. and mussel farmers, although there It is quite common in commercial are annoying housekeeping issues leases for the landlord to put all where mussel leases are not well the risk onto the tenant. This is not maintained or lit, and floats wash up surprising, as it would be ridiculous on the beach. The public assume for a landlord to imperil their own that the Port Authority is responsible business as a result of leasing out for litter (such as floats) washing up a portion of their land. Therefore on the beaches and complain to the I copied many of the provisions Port. Faced with inaction from lease used in other ports that reduce risks holders, we usually pick up this from mussel farms, into the new rubbish. It is an annoyance and we mussel farm leases. In effect this probably end up spending about as meant that mussel farmers would much money tidying up after mussel have to acknowledge that the Port farmers as we make from the lease, can dredge in the future and they but it hasn’t been a major drama. would have no claim over the Port Recently things got more difficult. as a result of an adverse outcome The Port has environmental approval on their mussel operation due to to undertake a major dredging dredging. This is based on the Grain ship being loaded at Albany

114 Autumn 2011 AUSTRALIA As these new leases rolled out, concern was expressed over the new mussel farm leases, resulting in parliamentary questions, letters to the paper and questioning at a parliamentary estimate review committee over the treatment of mussel farmers. The Port Authority is seen as arrogant by some mussel farmers and the question is asked “whose port is it anyway?” This is a fascinating question and deserves to be explored further. Of course for a government owned port, the Port Authority is ultimately owned by the people of that jurisdiction, represented by the elected government. A further extension of this concept sometimes mentioned, is that ports must also have a “community licence” to operate, which translated means that the port must have the consent of its community to operate. These are slippery concepts and can easily be manipulated to serve Aerial view of Albany certain interest groups. interests in an attempt to reach To answer “whose port is it anyway?” At one level it is easy to agree with mutual benefit. “Community licence” causes you to wade through a a community licence concept. If negotiations on the other hand can treacle of political meanings, a Port Authority is constantly in be a corruption of this term, where ideology and vested interests. I breach of its environmental, safety the rights claimed by the community would argue that ports certainly can and industrial relations regulatory representative are not legal rights, be multi-user (involving merchant requirements, naturally it is going to but shared interest rights, simply shipping use, aquaculture use and lose the support of its community. acquired by the person asserting recreational use) but to enable So at the common sense level, the them. In other words, anyone scarce and critical infrastructure like community licence is valid. It is also can call themselves a community ports to operate effectively, there recognised that there are people in representative, often based on the needs to be a hierarchy of use. the community who can legitimately slimmest community representative At the top of the hierarchy needs claim community representation. base, and bargain on the basis of to be the orderly operations of This recognition may be conferred withholding community consent. merchant shipping. This is because by Local Government election, Another dimension is that such Australia is a trading nation and or being an office bearer of a people can soon become addicted to enable the maximum benefit significant community organisation to the media attention that such for as many people as possible, or an office bearer with a position conflicts often attract. there needs to be a priority for port of responsibility. But it must also operations over other uses. This can be recognised that the concept Other people who claim community be recognised by normal commercial of community representation can, representation may be motivated arrangements such as leases, which and is, easily abused. Concepts by narrow sectional interest (often a assert this priority. Naturally, for any like community licence soon form of rent seeking where they wish government owned instrumentality become a magnet for rent seekers to gain a commercial advantage out there will be a political dynamic and those with no responsibility of the dispute); or by ideological as well. It is not inappropriate for or accountability other than self positions where they are opposed this to happen, it just needs to be appointed representation. to industry in all its forms. I think recognised that this is inevitable. I have heard some experts say that the community licence concept However I suggest that once a Port Ports need to “negotiate” with the is easy to trot out but can mean stops having a priority of use over its community before undertaking major whatever people want it to mean. waters, the port becomes something development. Negotiation is based “Community licence” can be like other than a normal operating on rights or shared interests, where terms such as “social justice” – port, and the critical role of trade one party bargains with another vague, self righteous and ultimately can become subservient to other, Grain ship being loaded at Albany based on the rights or shared meaningless. narrower interests.

Autumn 2011 115 AUSTRALIA Ports Brisbane New management and upgraded port facilities

ocated in one of Australia’s to promote efficiencies of trade increasing 7% to 515,000 teus, fastest growing regions, South across the port’s wharves and compared to the same period last year. LEast Queensland, and with over facilities and is focused on producing $34 billion worth of cargo crossing strong performances right across the Coal capacity to 10 million organisation. its wharves every year, the Port of tonnes Brisbane plays a crucial role in the PBPL’s Managing Director, Alistair country’s economy. Coal exports to December 2010 are Baillie, said that QPH plans to ensure up 35.1% to nearly four million tonnes that the port’s facilities continue to Over the past 18 months, despite compared to the previous year, and operate effectively, safely and in an a number of economic and in fact, the first quarter of the financial environmentally responsible manner. environmental challenges, the Port of year produced the best three months Brisbane Pty Ltd (PBPL) has upgraded for coal exports on records. facilities to improve cargo handling Positive trade results efficiencies, increased the use of New mining developments in the Surat the port’s new multi-user facility, and Recovery from the global financial Basin (south western Queensland) are experienced solid trading over a crisis has steadily improved, with expected to push coal exports through diversity of commodities. solid trading across a number of the port to new records. Queensland commodities in the last six months of Bulk Handling’s (QBH) $65 million Privatised in December last year by 2010. The diversity of the commodities expansion project, completed in the Queensland State Government, handled by the port has helped to November 2010, has boosted its PBPL is now managed by Q Port sustain its trade results, with total trade potential throughput capacity to Holdings (QPH), a majority Australian- to December 2010 increasing 5% to 10 million tonnes per annum, and owned consortium. QPH will continue 17.1 million tonnes, and containers increased its storage capacity from 300,000 tonnes to 900,000 tonnes. The redevelopment of the bulk precinct at Fisherman Islands, which provided QBH with six hectares of land located beside its stockpile area, also accommodated the construction of the General Purpose Wharf.

Multi-use wharf busy The multi-use of the General Purpose Wharf is increasing, with scrap metal exports and gypsum/limestone imports, performing well to December 2010, up 2.5% and 4.1% respectively. Sunstate Cement’s expansion of its cement milling and distribution plant, and the handling of clinker at the General Purpose Wharf, which was previously imported across the coal wharf, has alleviated any potential congestion at the coal facility. The $85 million project included a new wharf receival system consisting of three mobile hoppers located at the General The Port of Brisbane has experienced solid container and bulk commodities growth Purpose Wharf, with several conveyors in the past six months to December 2010 linking back to the cement facility.

116 Autumn 2011 AUSTRALIA The project’s productivity and environmental benefits earned Sunstate Cement the 2010 Bulk Handling Facility of the Year (Resources and Infrastructure) at the 5th Annual Australian Bulk Handling Awards. Project cargo has also contributed to the port’s trade volumes, with more than 22,500 pipes to be imported across the General Purpose Wharf over the next nine months. This project cargo will be delivered to QGC’s Queensland Curtis LNG Project to construct the southern end of a 540 kilometre underground gas pipeline. The General Purpose Wharf is also being used to handle the import of bulk bitumen for the newly opened SAMI Bitumen facility. The storage and processing facility is capable of producing a variety of high performance bitumen grades for road construction and various industrial applications. The facility’s bulk storage tanks are connected directly to the General Purpose Wharf via a pipeline.

Grain delivery streamlined While grain failed to reach the bumper- export tonnages of the previous year, down 47.7% to 273,743 tonnes in the last six months, forecasts for the next six months are promising. Currently, nearly two-thirds of all grain bound for GrainCorp’s facility at the Port of Brisbane is transported by road. With road-freight grain anticipated to increase, improving safety and alleviating truck congestion is a high priority. In October 2010, a truck scheduling system was implemented at GrainCorp’s grain handling facility. The system, developed collaboratively Fisherman Islands, located at the river mouth, has deep water berths to between GrainCorp Operations handle a diversity of cargo Limited, PBPL and trucking companies, has resulted in reduced waiting time teus, compared to the same period last DP World Brisbane is also planning for carriers delivering grain to the year. a major investment to expand and facility. A proposed upgrade to the re-engineer its container terminal, and The completion of wharves 11 and truck parking area in front of the Patrick has made significant investment 12, in 2012 and 2014 respectively, will terminal will also increase the number in its Autostrad Terminal over the last increase the port’s container handling of parking slots and address any five years. potential congestion issues. capacity by 25%, and take the number of dedicated container wharves to nine. These factors all combine to ensure Brisbane-based construction company, that the Port of Brisbane is well Container trade positive Smithbridge Australia, commenced equipped for future container growth The port’s container trade figures to building wharf 11 late in 2010, and and shipping. December 2010 have been largely both wharves will be operated by Hutchison Port Holdings (HPH) on driven by increases in retail imports, Swift action opens port and cotton and empty container completion. PBPL has invested $90 exports. Imports increased by 6.5% to million in the development of the facility As the beginning of 2011 has 250,000 teus and exports have been and HPH will invest significant capital proved, the environment can present pushed up 8.3% to reach 246,000 in the development of terminal 11. challenges that have widespread

Autumn 2011 117 AUSTRALIA Ports Brisbane

impacts. The Queensland flood crisis According to Alistair Baillie, the $127,000 to the Premier’s Flood Relief caused extensive flooding across teams had to work under very difficult Appeal. South East and central Queensland in conditions and significant time December 2010 and January 2011, pressures. affecting both trade and shipping Looking ahead through the port. “As Queensland’s principal diversified cargo port, reopening the Port of Over the next 12 months we will The western rail corridor connecting Brisbane was an absolutely critical continue to address the impact of coal mines and agricultural growing step in restoring the supply chain and the flood and plan to undertake an areas to the Port of Brisbane suffered enabling the delivery of critical fuel and extensive maintenance dredging damage during the floods. However, other commodities,” Alistair said. program to ensure that the declared alternative transport plans are being depths of the shipping channels and developed to minimise the long-term PBPL crews worked with Maritime berths are maintained. effect on trade volumes. Safety Queensland, the Navy, other commercial contractors and community Work will continue on Wharf 11, which Swift action from PBPL’s hydrographic groups in clearing remaining debris is ahead of schedule for completion surveying and dredging teams helped from the port and river areas. to return the port to operation, just five in mid-2012; and the duplication of days after the flood closed the port to Over 60 sunken objects, including the bridge to the port, Captain Bishop shipping. boats, wheelie bins, concrete mooring Bridge, and associated the road works blocks and large trees, were removed will be completed mid-2011, ensuring The teams surveyed over 10km2 from the port limits. Landside crews efficient and safe road access to and across the shipping channel and 38 also worked to lasso debris from the from the port. shipping berths, enabling the Harbour banks of the river and secure it to Master to safely reopen the port. It the shoreline, before excavators were As the Port of Brisbane enters the took over 600 man hours to collect and brought in to collect the debris and rapidly process the survey data, with second decade of the new millennium, transfer it to disposal sites. many berths surveyed multiple times to it has the resilience and leadership to ensure vessels could continue to berth As well as assisting with the clean ensure it is well positioned to handle safely. up, PBPL and its employees donated the challenges of the future.

PBPL work boats retrieve items from the river bed, washed downstream during the flood

118 Autumn 2011 AUSTRALIA Broome Port – Niche Support Base for the Browse Basin

Western Australia’s Broome Port is strategically located to support north-west- ern Australia’s offshore oil and gas exploration, and is a growing break-bulk, general shipping and tanker intermodal hub for the Kimberley and adjacent Pilbara regions. With 600 metres of available wharf face and 10-metre alongside depth, Broome offers 24/7 cargo operations for multiple vessels and vessel types.

Supply vessels such as Lady Sandra regularly transit between Broome and the Browse Basin, and as far afield as the Carnarvon and Bonaparte Basins.

Fuel, water, other offshore supplies and 100-tonne cranes are available plus a wide range of logistic support infra- structure and equipment. Broome has a stockpile of OSR equipment available Supply vessel ‘Lady Sandra’ loads for an August 2009 at short notice. Browse Basin drilling campaign

Broome’s handy geographic location and fast turnaround times can save an op- erator significant amounts of time and money throughout a drilling campaign.

Our experienced and well trained staff provides surety in the areas of opera- tions, safety and availability. The Port won an IFAP Safe Way Achiever Gold Award in 2010 and has been commended by major clients for safety initiatives.

The Broome township provides facilities required of a support base, including the busy regional airport linked to capital cities, a large well equipped hospital, commercial and industrial hubs, primary road network to Dampier and Darwin, abundant accommodation, and oil field service/logistics industries.

To discuss quality shore-based support for your project, please call our Commercial Manager Sean Mulhall, or, for operational queries, our Operations Manager Rob Wilkinson.

For all inquiries phone (08) 9194 3100 E-mail [email protected] Website www.broomeport.wa.gov.au Autumn 2011 119 AUSTRALIA Ports Darwin Investing in the future

Robert Ritchie, CEO, Darwin Port Corporation

ustralia’s nearest Port to Asia, the tonnes annually. These facilities will be The Port’s offshore oil and gas rig Port of Darwin is a multi-modal, supplemented by the construction of a tender berth facilities currently service Afuture focused and proactive new conveyor system to move dry bulk over thirty vessels, eighteen of which Port which is strategically positioned cargoes from the stockpiles to the bulk are based at the Port. These rig tender to service Australia’s increasing trade loader. vessels support the operations of drilling needs. Located at latitude 12° 28’S, platforms in the Arafura Sea, Timor Sea In just four years of operation the $24 longitude 130° 50’E, the Port’s East Arm and waters off the coast of Western million bulk materials handling facility at Wharf is the northern terminus of the Australia including those in the Bayu- East Arm Wharf saw trade increase by AustralAsian railway and the regional Undan field which supplies the LNG 37% on the previous year and exports supply, service and distribution hub for production facility at Wickham Point. rise by 35% on the previous year. the Timor Sea oil and gas industry. The Port annually handles in excess of The Corporation has signed a Heads of 510 vessel calls and 350,000 tonnes of The Darwin Port Corporation (DPC) is Agreement with Minemakers Limited and cargo. currently in the process of upgrading planning for this development is well facilities to meet the growing needs Oil and gas exploration and production, advanced for the export of phosphate of exporters and importers. The both offshore and onshore at Wickham rock from their Wonarah project. The infrastructure program involves the Point has fuelled the development of project will initially produce around 1 implementation of the East Arm Wharf manufacturing industry and opened new million tonnes per annum which will Facilities Masterplan 2030 which opportunities for additional downstream, increase to 3 million tonnes per annum provides a long-term land management gas-related industrial projects. when market conditions permit. strategy and a staged Port Development INPEX’s decision to move to the FEED Plan for East Arm Wharf. But it isn’t only bulk cargo that is on the stage in building its gas processing increase. Container vessel calls have “It was pleasing to again report strong facility at Middle Arm within the Port growth in key cargo segments at increased substantially with Mariana of Darwin is an enormous vote of the end of the last financial year,” Express Lines introducing new and confidence in the Territory. The $23 said Robert Ritchie, the Darwin Port larger vessels for its fortnightly service billion project will be a catalyst for Corporation’s CEO. “This parallels into the Port of Darwin which includes development, driving economic and growth in the Northern Territory and direct calls from Kaohsuing in Taiwan social growth. quantifies the increased business and Shanghai. Swire Shipping now has In conjunction with the Darwin Port throughput of the Port’s customers.” four vessel calls each month servicing Corporation, the Land Development container and break bulk customers The port infrastructure includes a 1,500 Corporation has developed a common- trading with Singapore and south-east tph rail dump which has the capacity user area at East Arm. Hardstand Asia. to handle 25 ore trains per week licences are available on short to and a bulk ship loading facility with Cattle exports too remain strong with medium terms to companies that service a capacity of up to 2,000 tph which record shipments being achieved in the oil and gas industry. currently handles around 3.6 million recent years. The Port took the world Says Mr Ritchie, “The Port has record for a single livestock shipment successfully managed significant when 22,184 steers and heifers were changes to infrastructure, trade and loaded aboard the ‘Stella Deneb’ bound corporate strategies in order to provide for Indonesia. superior services and additional With impressive increases in overall capabilities to its customers and export tonnage in all sectors in recent stakeholders.” years, the Port of Darwin has earned The Port of Darwin is the regional an enviable reputation as Australia’s transport and logistics hub that links ‘Gateway to Asia.’ Australia with its Asian trading partners. Darwin is regarded as Australia’s Its ability to service and supply the second offshore industry support hub growing needs of Australian trade and and the Port of Darwin is the import and the oil and gas industry ensures its distribution destination for most cargoes position as the port of choice and a key used in the oil and gas industry in the player in the economic development of seas off northern Australia. the Northern Territory.

120 Autumn 2011 AUSTRALIA DPC3087_MINERALS_210x297mm_vert_DPC new MINERALS A4 5/03/11 9:03 AM Page 1

PORT of DARWIN Australia’s northern gateway of choice

Strategically located half way between Sydney and Singapore, the Port of Darwin is Australia’s nearest port to Asia, the terminus of the AustralAsian Railway and the only port between Townsville and Fremantle with full access to multi-modal transport services.

The Port provides 754 metres of continuous deepwater berths capable of handling containers, bulk liquids, general and project cargoes. There is also a dedicated bulk materials handling facility with a 2,000 tph shiploader and a 1,500 tph rail dump.

The Port of Darwin is the recognised supply base for the Timor Sea oil and gas industry and is to become the site of a second LNG plant. The Port also holds the world record for the largest single export shipment of live cattle.

With more than AU$150 million currently being spent on capital infrastructure programs, the Port of Darwin is gearing up to meet Australia’s future trade needs.

Phone: +61 8 8922 0660 Fax: +61 8 8922 0666 [email protected] GPO Box 390, DARWIN NT 0801 Australia www.darwinport.nt.gov.au

Autumn 2011 121 AUSTRALIA Ports Flinders Forward thinking now to meet customers’ future demands

By VINCENT TREMAINE, chief executive officer

linders Ports, the operator of expanded and upgraded the high partner contributing a vessel, and the seven South Australian voltage network for Outer Harbor takes in Port Kelang, Singapore, Fports of Port Adelaide, Port and included upgraded switching Fremantle, Sydney, Melbourne, Lincoln, Port Pirie, Thevenard, and distribution systems for the new Adelaide, returning to Port Kelang. Port Giles, Wallaroo and Klein crane and the container terminal With such a diverse group of Point, continues to expand its port operations. partners, the service has excellent facilities to meet the demands of its connections to most worldwide customers. New shipping service destinations. The South East Asia Australia loop Container terminal service (South East Asian relay), Mineral exports - Port developments operated by UASC, Hapag Lloyd, Adelaide April 2010 saw the arrival of a China Shipping and Hyundai Flinders Ports has been working new post-panamax crane for the Merchant Marine, commenced in with IMX Resources for the past 18 Port Adelaide container terminal. September 2010. Hapag Lloyd, months on a port solution for the Arriving by ship, the crane - a major China Shipping and Hyundai export of magnetite ore. investment by co-owners DP World already have established offices in and Flinders Ports, has given the South Australia but UASC (United The solution needed to utilise terminal a productivity boost. The Arab Shipping Corporation) is a existing key infrastructure and crane has the capacity to twin-lift new entrant into Adelaide and the equipment and be environmentally two 6m containers simultaneously at Australian trades. responsible and sustainable. faster operational speeds. The weekly service is operated with A review of traditional bulk Flinders Ports has recently 2,200 TEU size vessels with each loading processes culminated in the development of the following process: • IMX product will be railed to the port in purpose built containers. • The containers will be used to store the product at the port. • Flinders Ports and DP World Adelaide will utilise the container terminal berths and equipment to cycle the containers from the storage area to the cranes. • A container tippler system spreader will be used to load the container, lowering and tipping it into the vessels hold. • The empty containers are then cycled onto rail wagons and transported back to the mine for The new post-panamax crane arrives at Port Adelaide loading and return to the port.

122 Autumn 2011 AUSTRALIA A vessel engaged in the new South East Asia Australia loop service

The first vessel for IMX Resources was loaded during December 2010 and was a record for Port Adelaide with 68,000 tonnes of iron ore loaded. The loading was undertaken with the tipping spreader commissioned by Flinders Ports. The EPA was on site and was pleased with the dust control measures during ship loading with no issues raised during post vessel loading discussions. Additional projects by Flinders Ports to assist the minerals sector demands have been a staged development of a bulk precinct located at the inner harbour in Port Adelaide. The development has incorporated: • Upgrades to wharf drainage systems • Construction of a bulk ship loader • Construction of storage facilities • Proposed construction of rail directly into the precinct • Weighbridge and wash down facilities The first iron ore export vessel Genco Leader being loaded at the container terminal

Autumn 2011 123 AUSTRALIA Ports

The first iron ore export vessel Genco Leader departing Port Adelaide

Outer Harbor developments Following a request received from the motor vehicle industry, Flinders Ports has assisted with the implementation of vehicle scanning and priority parking processing in Port Adelaide. The development of the Outer Harbor area to cater for this process has now been completed with the creation of designated parking bays so vehicle deliveries can be processed from the vessels and on the wharf. This initiative has brought Port Adelaide in line with other ports delivering on-wharf processing facilities complete with fully integrated customer focused electronic vehicle tracking. The The Queen Mary 2 arrives at Port Adelaide technology delivers real time information available to all importers to track the location and status of their vehicles. Additionally the development has led to quicker turnaround of vehicles onto and off of port facilities and reduced the risk of vehicle damage caused by less structured planning. Vehicle parking capacity has increased from 1200 vehicles to 1500 vehicles through this process.

Cruise ship season Port Adelaide had visits from large cruise vessels during the 09/10 cruise ship season with the highlight being a visit from the world’s largest ocean liner, Cunard Lines, Queen Mary 2, which arrived in Adelaide in Plenty of room – the Queen Mary 2 swings near the container terminal early 2010.

124 Autumn 2011 AUSTRALIA The 345-metre long liner carried Sister-port relationship with Under the agreement, the ports will approximately 2,500 passengers Xiamen Port undertake an information exchange in areas including port development, and 1,300 crew. Flinders Ports has established a management innovation, logistics, Prior to her arrival, Flinders Ports sister port relationship with Xiamen Port – China’s seventh largest port, shipping, planning, construction Marine Pilots conducted vessel and one of the 50 busiest ports in and information technology. Further, simulations at the Australian the world. independent third parties will Maritime College in Launceston be encouraged by both parties Tasmania to ensure the port could A delegation from the Xiamen Port to investigate the benefits of Authority visited Adelaide in June handle a vessel of this size. conducting business with each port. 2010 to sign a letter of intent with All preparations on water and on Flinders Ports, and also tour the The China Australia Entrepreneurs land including traffic control proved facilities at Port Adelaide. Association which established its national office in Adelaide in 2008 successful. Flinders Ports believes this sister to help foster businesses trading port relationship will yield significant The Queen Mary 2 will return to commercial benefits for both parties. between the two countries – has Adelaide in February 2011. played an integral role in developing With mining in South Australia the sister port relationship A record 27 cruise ships arrived at expected to continue to be one agreement. South Australian ports during the of the major economic drivers in 09/10 season. this state, and increasing Chinese Flinders Ports and a delegation investment in a growing number including the Hon Paul Holloway There was a large number of of resources industry projects, MLC, Minister for Mineral Resources passengers joining and leaving Flinders Ports is keen to develop Development visited Xiamen the ships. The new roadways and new relationships in a broad range Port in November 2010 for a terminal design worked efficiently. of areas. reciprocal visit.

The Xiamen Port delegation during their visit to Port Adelaide

Autumn 2011 125 AUSTRALIA Ports Fremantle Land use and infastructure plus technological strategies will maximise capacity Chris Leatt-Hayter, CEO, Fremantle Ports

remantle Ports continues to “The newly reclaimed land at Rous Fremantle Ports has put significant take a long-term perspective to Head has provided an outstanding effort into controlling truck Fensure the ultimate sustainable opportunity to expand the availability movements and operations in the capacity for its operations can be of Inner Harbour land and to plan port precinct. Availability of the achieved through triple bottom line the area to improve landside access reclaimed land has enabled the planning and development. and efficiency,” Chris Leatt-Hayter development of a truck marshalling area as part of a congestion said. The Inner Harbour Port Development management system that includes Plan is a strategic document “Fremantle Ports has undertaken communication and control systems setting the framework for future port extensive planning work and to direct heavy vehicle flows. development over the next 30 years, consulted with key parties in the explains Fremantle Ports Chief “Our ultimate aim is to have no on- Executive Officer, Chris Leatt-Hayter. supply chain to ensure that the road queuing in the precinct,” Chris future layout of the port precinct Leatt-Hayter said. “Since 2000, this plan has provided meets a range of requirements for “Fremantle Ports sees improvements a basis for making coordinated land- the future.” use and transport decisions. in trucking productivity as critical Aims in the planning for the new to both managing impacts on the “The various elements of the land include providing adequate community and enhancing the plan are being progressively capacity for key functions, improving efficiency of the container supply implemented, including our two very efficiency of operations and chain. big major infrastructure projects of providing flexibility to accommodate the moment - upgrading of the North “Improving efficiency in road Quay berths and the deepening of possible future changes. transport remains a key priority the Inner Harbour. Both of these projects catering for bigger ships and increasing port capacity are very close to completion,” Chris Leatt-Hayter said. “As a by-product of the Inner Harbour deepening Fremantle Ports now has 27 hectares of newly reclaimed land at Rous Head. This has provided an opportunity to significantly alter the layout of the port precinct and achieve an outcome which will benefit industry through improved road and rail operating efficiency. “Over the six months to December 2010 considerable work was carried out to define land uses and planning infrastructure for the precinct. A tender process for allocating the new land is expected to be completed in 2011. Fremantle Ports busy Inner Harbour

126 Autumn 2011 AUSTRALIA with a focus on reducing the extent of empty truck trips and reducing the need for truck trips to the port to pick up and drop off empty containers. “As a member of the WA Port Operations Task Force we were actively involved in the development of an initiative with container terminal operators, DP World and Patrick, to increase dual running through preferential treatment for trucks that are two-way loaded. This initiative was authorised by the ACCC, clearing the way for its introduction.” In recognition of the importance of land transport issues to the future of the Inner Harbour, a Land Transport Linkages Strategy has been developed to clearly establish the key actions which need to be addressed and to clearly delineate division of responsibilities between FPA’s Kwinana bulk terminal Government agencies and industry. also placing focus on the need closely this year.” The strategy is now being discussed for greater use of information with other agencies and it is communications technology. Fremantle Ports is working with State planned that further consultation and local government authorities will take place with supply chain Fremantle Ports will be participating and industry bodies on land use stakeholders, the aim being to with other ports and parties in planning issues in relation both to its improve communication and the supply chain to promote Fremantle and Kwinana operations. coordination across a large number development of nationally-based An important issue in this context of complex issues. Port Community Systems which is to continue to progress initiatives are designed to provide integrated Increasing the use of rail for land information and messaging that will support the protection of freight transport to and from the capability across the chain. While freight corridors to existing and Inner Harbour is very important well established in a number of large planned port facilities. from an economic and community ports overseas, these systems are impact point of view. With the “Urban encroachment, particularly yet to be developed in Australia. construction of a $32 million, dual in relation to encroachment on gauge rail loop to North Quay in In the Outer Harbour at Kwinana existing or planned freight corridors 2006 and State Government funding major infrastructure upgrades continues to be a concern. to encourage the use of rail, the are planned for the Kwinana Fremantle Ports has undertaken volumes transported by rail have Bulk Terminal. Fremantle Ports is consultation with a number of State grown substantially since 2002. also exploring the potential and and local government agencies on timeframe for the construction of Although, the economic downturn this issue over the past 12 months an additional berth at its other bulk hit rail hard, the market share with the aim of raising awareness handling facility, the Kwinana Bulk is building again and is now Jetty, with associated landside of the issue and to explore ways of approximately 12 per cent towards infrastructure for efficient high addressing it,” Chris Leatt-Hayter the ultimate target of 30 per cent. volume bulk exports. said. Initiatives to further grow the rail share will focus on development of “Looking further ahead, additional “It is pleasing to see that the inland intermodal terminal facilities, port development will be needed in growing pressure from sensitive upgrading the capacity of the rail the Outer Harbour to handle growth uses such as dwellings locating line servicing the port and improving in containerised and general cargo in close proximity to ports is well interface arrangements between rail trade beyond the capacity of the recognised in the National Ports and key facilities. Fremantle Inner Harbour,” Chris Strategy. This is a national and Leatt-Hayter said. The increasing volume, complexity international trend which has and speed of transactions in “The future provision of additional competitive and operational impacts Fremantle Ports busy Inner Harbour the container supply chain are facilities will be looked at more on transport corridors and ports.”

Autumn 2011 127 AUSTRALIA Ports Melbourne

Ports to benefit from a national strategy

By Stephen Bradford, chief executive officer, Port of Melbourne Corporation

hile the National Ports importance of a robust policy these are sufficient to meet the Strategy has yet to be put framework. demands and resources needed in to the Council of Australian planning, operations and regulatory W Whilst it is appropriate to consider Governments (COAG) for their compliance. the planning and development for consideration, a framework for future nationally significant ports, it is also port development is a welcome important to recognise that ports Port planning addition to the port infrastructure do not operate in isolation and they discussion as governments, federal PoMC supports recommendations must be effectively integrated into on the publication of port planning and state, turn their attention the the land side transport networks. trade facilitation needs of this island instruments which encapsulate Further, the port freight demand on our strategic thinking with a vision nation. land side transport networks needs to the future. The publication of to be effectively balanced with For its part, Port of Melbourne PoMC’s Draft Port Development Plan other transport capacity demands Corporation (PoMC) is pleased in 2006 and the subsequent Port including domestic freight and non- to note that the draft strategy Development Strategy in 2009 has freight transport needs. recognises and reinforces the demonstrated the value in providing important economic role of Fundamental to the strategy’s a conceptual planning framework to ports, the need for integration success will be the capacity and the community and private sector. and coordination, as well as the capability of ports and whether Naturally, these plans are predicated

The Port of Melbourne’s Swanson Dock at night

128 Autumn 2011 AUSTRALIA Port of Melbourne on detailed trade forecasts for • support for the early reservation to evolve along with changing land various cargo types drawn from a of dedicated freight corridors. use priorities and competing user wide range of data and analysis. These land reservations should demands which is placing increasing be strategically linked to long constraints and costs on international Against the backdrop of term terminal locations and freight flows. gentrification and urban future options to ensure flexibility The need to manage and maintain encroachment, particularly for of development is maintained. landside transport efficiencies ports surrounded by urban • support for the concept of and reliability is critical to the long municipalities, PoMC would welcome economic strategic assessment term efficiency of ports and the comprehensive assessment criteria processes but recognising that international competiveness of the for development alongside time-lines such processes need to have Australian economy. Indeed, PoMC required for assessment processes a solid legislative basis if they are supports the initiative for BITRE to so that ports can incorporate them to assist in streamlining approvals explore the case for dedicated road processes. as part of their planning time-frames. and rail freight infrastructure. There is a need to consider these PoMC fully supports Infrastructure Landside connections longer term requirements now so that Australia’s recognition of the need to Landside transport connections appropriate plans and reservations maintain the ability to execute plans. serving metropolitan ports are may be employed to preserve these In this regard, PoMC supports the increasingly challenging. The options for the longer term when they recommendations under Priority Area demands on the supporting will become critical. The introduction 2 of the Draft Strategy including: transport networks are continuing of dedicated freight land transport

Autumn 2011 129 AUSTRALIA Ports Melbourne

infrastructure segments will minimise work which you would expect ports In a post 9/11 world of secure conflict with passenger transport to do to reach a contemporary maritime zones and restricted and reduce economic loss. As part understanding of the wider logistics access, there remains an of its due diligence, we believe it network. The study is the most overwhelming need for ports to is appropriate that BITRE should comprehensive analysis to date of clearly articulate and communicate consult with ports as part of its container movements through the their important economic role assessment process. Port of Melbourne and we thank in servicing the trade needs of all the participants for helping us bourgeoning cities and export Understanding the logistics generate reliable quantitative data to regions. It may seem a simple network help policy makers and stakeholders equation – that better understanding in their planning decisions. might lead to greater consensus Continuing the theme of landside and acceptance – yet the challenge connections, ports are acquiring The 2009 Container Logistics Chain remains and drives our wider greater responsibility for the efficient Study is available on the PoMC community stakeholder strategies movement of freight beyond the website at www.portofmelbourne. and programs. traditional space where the water com meets the wharf. There are twin priorities for ports which the draft Technology Stakeholder engagement National Ports Strategy recognises In terms of technology, PoMC – to accommodate trade growth We also recognise that it is strongly supports the development – AND to do so efficiently, giving incumbent upon us to consult of nationally consistent information greater attention to landside logistics and inform the diverse range systems and to improve coordination networks and integration. of commercial and community of freight flows across the supply PoMC recently released the 2009 stakeholders, to appraise them of chain. These recommendations Container Logistics Chain Study development plans and build a case are generally reflective of those which tracked over 75,000 container in their consciousness for future proposed by Ports Australia as part movements. With an increasing port development. Our experience of a Port Community Information emphasis on inner urban amenity, suggests that there is an appetite System. Further consideration should specifically congestion issues, amongst the community to better also be given to: alongside landside transport understand the role and operations • compatibility with international efficiency, this study is the type of of the port. trading partners • incorporation of empty container parks and intermodal terminals into the system

Trade growth drivers Much of the policy framework discussion pre-empts the forecast trade growth which we have seen in the rebound after the global financial crisis. Trade through the Port of Melbourne for calendar year 2010 surged to record heights with stronger than expected growth in the port’s core trades of containers and new motor vehicles. Overall trade of 78.8 million revenue tonnes increased 13.2% on calendar year 2009 and was boosted by a record container throughput of 2.348 million TEU increasing by 12.6% over the same period. The platform for the strong trade performance was set in the first half of the calendar year when container volumes grew at an average monthly rate of 15.8 % during the six months from January to June - the strongest ever result for View from a Pilot Boat as a container ship transits through Port Phillip Bay that period.

130 Autumn 2011 AUSTRALIA In the second half of the year, the Port of Melbourne recorded four separate months where container throughput exceeded 200,000 TEU, including a national record of over 217,000 TEU in October. By any measure this strong trade result necessitates a planning and infrastructure response. As a strategic manager for the nation’s largest container port, we remain acutely aware of our role as facilitators rather than the generators of this increased trade and our focus is firmly fixed on developing the essential port infrastructure to accommodate future trade growth.

Changing dynamics of maritime trade Swanson Dock West at the Port of Melbourne SAL and its many stakeholders are of capacity contracted being in the configured to accommodate them. acutely aware that the surge in trade 8000-plus TEU range. In the latter But the ‘cascading effect’ generated growth has multiple effects. Not only part of 2010, major shipping lines by the deployment of these does it compel ports to focus on including CMA CGM and MSC took vessels will inevitably result in the landside connections and capacity delivery of a series of vessels with reassignment of the current fleet of matters, the changing dynamics of a capacity of over 13,000 TEU. large vessels in service, increasing maritime trade demand attention Reports of Danish shipping line the need for Australian ports to host – as was the case for the Channel Maersk seeking to finalise designs them. Deepening Project. for a series of 18,000 TEU vessels Vessel size has doubled on The trend for shipping lines to provides compelling evidence of the Australian trade routes over the deploy larger capacity vessels, ambitions of major shipping lines in last 30 years, and as the amount typically with a deeper draught, is deploying larger vessels. of cargo increases, shipping lines unambiguous. As of August 2010, will increasingly look to reduce time the super post-Panamax sector These vessels are not expected to and costs by working to economies dominated new ship building order call at Australia and the Channel of scale using larger vessels. In the books with 66% Deepening Project was never financial year to 30 June 2010, the average gross tonnage of vessels calling at Melbourne increased 7%.

Conclusion There are challenges and opportunities inherent in devising and agreeing a National Ports Strategy. We do not expect that such a framework will be a panacea to the myriad of planning and investment decision-making required of all ports. However, to the extent that a national framework, integrated with relevant state policies, can effectively address trade facilitation by taking into account short and long-term planning needs to accommodate trade growth, landside integration and larger vessel tonnage, PoMC remains an engaged and enthusiastic participant in the discussion.

Autumn 2011 131 AUSTRALIA Ports Newcastle National importance underlined by new research study By gary webb, chief executive officer, Newcastle Ports Corporation

he Port of Newcastle is one create, on average, about 2,140 full- 2009. Non-coal trade also increased of Australia’s most diverse time positions. for the six months with 2.95 million regional ports and one of the tonnes of throughput being up by T Some of the major infrastructure world’s largest coal export ports. It more than 104,000 tonnes on 2009. projects in the HVRF study are: also has the honour of being the Contributing to the increase was: nation’s oldest commercial port • Newcastle Coal Infrastructure Fuels: 177,450 tonnes (up by following the export of 50 tonnes of Group’s new $1 billion coal 17,754 tonnes on 2009) coal to Bengal in 1799. terminal Steel: 166,011 tonnes (up by The growing importance of the • Newcastle Coal Infrastructure 76,325 tonnes on 2009) development and operations of the Group’s $900 million Stage 2AA port during the past 211 years has expansion in 2011 Woodchips: 189,357 tonnes (up by been supported by a new study by 4,239 tonnes on 2009) independent research organisation, • Port Waratah Coal Services’ $670 Hunter Valley Research Foundation million expansion plans Grain exports remained strong at more than 516,000 tonnes while (HVRF). • Newcastle Port Corporation’s new log exports, rail wagon imports and $25 million general cargo Estimates of Economic Impacts leisure craft imports all contributed to Mayfield No.4 Berth in the Hunter Region from the the increase in non-coal trade. development and operation of the The content of the report is Container trade also improved. The Port of Newcastle was prepared by supported by the port’s increasing total of 9,299 containers was up by the HVRF for the Newcastle Port growth during the past decade. 2,551 on 2009, mainly due to regular Corporation. The study estimates Trade records have been export cargoes for the Pacific Islands about $10.7 billion of economic established for each of the past 10 and Papua-New Guinea. activity will be generated from financial years with the port breaking operation and development of the through the 100 million barrier for the port during the seven years between first time in 2009-10. Growth and diversity 2008-09 and 2014-15. Throughput in 2009-10 totalled The purpose of Newcastle Port Importantly, port operations will 103.02 million tonnes and was Corporation is to provide safe, generate about $5.5 billion while port valued at $13.05 billion. effective and sustainable port development expenditure will amount operations and deliver efficient to about $5.2 billion during the seven port development that enhances Half year trade 2010-11 years. the economic growth of the Hunter Our latest half year trade results Region and New South Wales. This growth has a flow-on effect (July-Dec 2010) show throughput for employment across the region The export of coal is the port’s continuing to increase, especially with about 1,900 people directly core trade however more than 40 with NCIG’s coal terminal now employed in the port in 2009-10. different commodities are handled contributing to the total export figure. About 3,470 jobs are indirectly through the port including alumina, supported across the region. Given More than 57.5 million tonnes of aluminium, cement, fertiliser current growth, it is expected that imports and exports passed through products, forestry products, grain, by 2014-15 the direct employment the port for the six months, the figure mineral concentrates, petroleum of the port will have risen to more being more than 5.5 million tonnes products and steel. than 3,360 jobs with about 6,180 higher than for the same period in Infrastructure within the port can jobs indirectly supported across the 2009. accommodate all types of cargo region. Coal exports totalled 54.6 million including dry bulk, bulk liquids, Port development between 2008 tonnes which represented an break bulk, project, passenger and and 2015 will directly and indirectly increase of 5.4 million tonnes on containers. The port is a critical

132 Autumn 2011 AUSTRALIA supply chain interface for the movement range of development opportunities still No.4 Berth consists of a 265 metre long of cargo and includes 18 operational exist for port related industry. wharf area and 10,000m2 adjoining berths, 11 of which are allocated to The former BHP Steelworks site hardstand for port-related uses such as handling a range of cargoes and seven located within the Mayfield Precinct cargo handling, storage and assembly dedicated to the handling of coal. has 90 hectares of river front land area. and can support a diverse range Whilst coal continues to be the port’s A recently completed refurbishment of infrastructure, including bulk and project saw the re-commissioning of the major export, expertise in handling general cargo, bulk liquid and container Channel Berth for tie up purposes and project cargo, dry bulk and bulk liquid terminals. Newcastle Port Corporation as a dedicated facility for P&O Cruises’ products has enabled strong growth in envisages development on this site will Pacific Sun and visiting international these commodities. focus on new trade opportunities. The cruise ships. Mayfield site is close to the Newcastle Newcastle Port Corporation owns and CBD and perfectly positioned within the More than 1,700 ships are now visiting manages over 610 hectares of port Port of Newcastle and is accessible by the Port of Newcastle each year. This land within five defined precincts – effective road, rail and sea links. results in a thriving commercial port Carrington, Mayfield, Walsh Point, In support of this unique development recognised as a major strategic asset Kooragang Coal and Kooragang Future opportunity, Newcastle Port Corporation for the New South Wales economy, Development. Much of this land is invested $25 million to provide new and renowned internationally as one of allocated to current or future trade but a berth infrastructure at the site. Mayfield Australia’s main trading port.

The Port of Newcastle is focussing on growth and diversity of trade

Autumn 2011 133 AUSTRALIA Ports North Queensland Record figures achieved despite global crisis By BRAD FISH, CEO of North Queensland Bulk Ports

ORTH Queensland Bulk Ports and Abbot Point, Australia’s most It is extremely exciting and requires Corporation Limited (NQBP) northerly coal port. a lot of careful planning and Ntook no notice of the global coordination. financial crisis to produce record port Despite the considerable challenges of To demonstrate its commitment to throughput figures last year, and is on a shaky global economy and flooding the communities it operates in, North track for even further expansion in the throughout Queensland, Mr Fish said Queensland Bulk Ports Corporation 2011 calendar year. major projects were on track, allowing formed the Port of Hay Point the corporation to not only meet Despite unprecedented global Community Reference Group (CRG) economic turmoil, the corporation had demand, but keep ahead of expected several years ago. continued with large-scale expansion growth. This CRG provides a vital connection plans for its ports, and was looking While severe flooding in January has to the community through a forum at one of its most significant years to caused access problems and delays for discussing issues relevant to the date. at the mines, Mr Fish said that growth operations and development of the Port NQBP manages five Queensland was still likely to be evident as early as of Hay Point. The principal objective of the CRG is to obtain feedback from the seaports, including Hay Point, one of this financial year. the world’s largest coal export ports, community and industry on Hay Point Throughput may be less than it could Port-related issues. have been for the year. We won’t Adjacent to Hay Point is the Dalrymple recover everything lost by flood, but we Bay Coal Terminal, leased by DBCT are still predicting a record year for the Management. Port of Hay Point. The terminal recently expanded to The prediction follows a record 85 million tonnes per annum - the throughput of 99,465,091 tonnes for the maximum capacity on the available port in 2009-10 – more than 36 million footprint. DBCT Management plans to tonnes through the Hay Point Coal provide new capacity in the Port of Hay Point in response to requests from the Terminal and about 63 million tonnes mining industry. through the neighbouring Dalrymple Bay Coal Terminal. That total was close We are seeing very strong growth from to 17 million tonnes higher than the the Goonyella System, particularly from previous year. coking coal. Both the Hay Point Coal Terminal and The corporation is also looking to an the Dalrymple Bay Coal Terminal serve expanded future at Hay Point, with the coal mines of Central Queensland. master planning studies under way The mines are linked to the terminals which will include the development of through an integrated rail-port network. new coal terminals at Dudgeon Point, Both terminals have purpose-built rail four kilometres north of the existing in-loading facilities, on-shore stockpile coal terminals. yards, and off-shore wharves.

Dudgeon Point offers huge potential, Another of NQBP’s ports is Abbot with preferred proponents the Adani Point, 25 km north of Bowen. Group and DBCT Management working The port has the rare advantage of with NQBP to plan and construct deepwater facilities close to shore. additional coal infrastructure. The port services the Newlands, Collinsville and Sonoma mines, and We are expecting to see about 120 The Port of Abbot Point is of significant at times handles export coal from strategic value to NQBP and the State, million tonnes in place at Hay Point in the will expand to 50 million tonnes offering a deepwater port close to shore. five or six years. by 2015-16. That is pretty strong

134 Autumn 2011 AUSTRALIA growth. Goonyella system. In 2009–10, At present, we are talking about total throughput at Abbot Point was four more terminals. The market will 16,933,596 tonnes. determine how this progresses.

Abbot Point has seen a rapid rate This development is right across of expansion to meet the offshore metallurgical and thermal coal. We are demand for Queensland coal, and seeing a very strong demand - many the massive growth shows no sign of existing partners wishing to expand, abating. and a number of new partners seeking NQBP is assisting the Queensland to enter the market. Government with the divestment and The coal terminal at Abbot Point is currently long term lease of Abbot Point Coal These expansion plans showed the undergoing significant expansion works Terminal’s terminal one, and is also extent of anticipated growth in export preparing for the completion of the X50 coal in the near future. NQBP, in consultation with expansion at the port in the next few stakeholders, is progressing months. But NQBP is looking beyond coal to progress a multi cargo facility at Abbot development planning which is Current exports are 17-18 mtpa, that Point. expected to be 70 per cent complete will expand to 50 million tonnes by by the end of 2010/11. 2015-16. That is pretty strong growth. In announcing the project, Queensland NQBP’s bauxite and cattle port of Premier Anna Bligh said with such a On top of that, we have awarded Weipa on the north-west coast of Cape facility, Abbot Point could become preferred developer status to BHP York Peninsula has also remained an industrial powerhouse capable of Billiton and Hancock Coal Pty Ltd strong during difficult financial times. rivaling Gladstone. for two major expansions (known as The port also handles fuel and general terminals two and three) at the Port of The Multi Cargo Facility proposal cargo. Abbot Point. That will happen over the includes a new protected harbour on next three to four years. With major expansions coming to around 320 hectares of reclaimed land completion and more yet to begin, Mr The two additional terminals will designed to handle different exports or Fish said 2011 was likely to be a very eventually add an estimated 110 million shiploads of raw materials for mineral big year for North Queensland Bulk tonnes of coal per annum to the port’s processing. It will include 12 shipping throughput, with an initial capacity of Ports Corporation. berths, a tug harbour and a dredged 50 million tonnes per annum. access channel, swing basin and berth This level of development is on the NQBP Chairman of the Board, pockets in its initial stage. same level with what is happening with Leonie Taylor has said BHP Billiton iron ore in West Australia. “The two go and Hancock Coal’s projects had The project is aimed at diversification hand in hand. As iron ore develops, it the potential to deliver a “massive of the port and the development needs coal to support it. economic injection to central and of major industry in Queensland’s From the Queensland perspective, northern Queensland”. declared State Development Area. and to some extent from the national The BHP coal terminal will be fed via We are going to the market with the perspective, this is development on an the existing Newlands coal rail system, Multi Cargo Facility construction as we unprecedented level. while the Hancock Coal proposal is a speak. comprehensive mine to port proposal Yet despite the challenges of which includes a purpose-built rail line It is looking very positive. Subject progressing and guiding some of the from the Galilee Coal Basin to its coal to gaining the approvals and biggest projects Australian ports have terminal at the Port of Abbot Point. support required, we will be starting seen, NQBP continues to deliver. construction by the end of the year. NQBP is looking beyond even these We are meeting demand all the way major projects, and is in discussions NQBP also manages Queensland’s through, and we are comfortable we with the coal market about future fourth busiest multi-commodity port in can continue to meet demand. terminals past terminals two and three. terms of cargo throughput – the Port of The high level of growth across the Mackay. industry was likely to cause unrealistic Mackay has four berths catering for the construction expectations elsewhere, export of sugar and sugar products, but this might only prove to make the molasses and grain and the import of industry stronger. petroleum. It won’t all happen in the timeframe some people are suggesting it will. Mackay also experienced strong growth despite the Global Financial There aren’t enough resources to build Crisis, with a record throughput of Abbot Point has seen a rapid range of everything in the time business will expansion to keep pace with the demand for close to three million tonnes in want to build it. But that helps filter the Queensland coal 2009-10. projects that should be going ahead.

Autumn 2011 135 AUSTRALIA Ports Port Kembla 2009/2010 busiest year on record

By dom figliomeni, chief executive officer, Port Kembla Port Corporation

The port of Port Kembla had its busiest year on record in 2009/2010 seeing higher trade volumes and more vessel visits than ever before. Figures for the port show that total trade in the 12 months ending 30 June New pilot vessel PV Shearwater 2010 reached 31.05 million tonnes, up 17.7% from the 26.4 million tonnes recorded in 2008/09. This trade figure is an all time record for the port and surpasses the previous record by 13.7%. The previous record of 27.3 million tonnes was achieved in 2007/2008. The port saw a substantial increase in motor vehicle imports recording 3.92 million revenue tonnes – an 80% increase on the previous year. This record was supported by total coal and Aerial view of Port Kembla coke exports of 14.04 million tonnes, for the development of the port’s Outer Planning (DOP) and other government 385,000 more than in the previous Harbour. This development will ensure agencies on all the matters raised year, accounting for 46% of total trade that the port continues to support the during the community consultation throughput. growing economic requirements of the process. The other major achievement for the region and the state of NSW. port was the number of vessel visits. As at February 2011 the DOP is still Port Kembla recorded 1001 vessel Outer Harbour development considering the PKPC request for visits for the 2009/2010 financial year development approval. A decision on surpassing the previous record of 862 Following the approval in 2008 of the DA, together with development achieved in 2008/2009. the Outer Harbour Master Plan, 2010 conditions, is expected within the saw the Port Kembla Port Corporation coming weeks. (PKPC) continue with the environmental On target for another record investigations necessary to obtain Subject to receiving final environmental year in 2010/2011 approval for development of the Outer approval for the first stage of the The trade figures for the six months to Harbour. The work involved extensive development, which includes land analysis on the potential impacts of 31 December 2010 showed promising reclamation for the entire 42ha site plus the development on the environment, signs that the port was on track to construction of two berths (a bulk berth further set financial and trade records. the community and infrastructure both and a container berth), construction A total of 17.21 million revenue tonnes within and outside the port. passed through the port in the first six of the first 7ha of land reclamation is PKPC is seeking concurrent Concept months of the 2010/2011 financial year. expected to commence in the first Plan Approval and Major Project This is an increase of 1.55 million on quarter of 2011. Approval under Part 3A of the the 15.66 million tonnes for the same NSW Environmental Planning and In positive news, one major customer period last year. Assessment Act 1979. has already lodged a preliminary EA In the six months to December 2010, Following a six week community with the Department of Planning to the port recorded 517 vessel visits, up consultation process (including two establish facilities in the redeveloped by nine for the same period last year. community information sessions) a Outer Harbour area and a number of This growth in trade and ship visits total of 18 submissions were received. other parties have expressed interest have been the catalyst for the planning PKPC responded to the Department of in the site.

136 Autumn 2011 AUSTRALIA ports future transport requirements. $13 billion in trade passed through the The master plan contributes to the port, supporting close to 4,000 jobs. PKPC vision of providing integrated logistics solutions within the port and to The research project will make encourage modal shift where practical it possible for PKPC and rail from road to rail. infrastructure owners and operators to analyse and decide on possible It is expected that the plan will be infrastructure upgrades and discussed with key stakeholders in the expansions, and allow for a more second half of 2011. efficient management of port facilities. The model will enable decision Rail modelling project makers to test various scenarios. For Also at the end of 2010, along with instance, what will the rail capacity be various key stakeholders, PKPC if the trains were longer or there were awarded a contract to the University dedicated freight lines or increased of Wollongong SMART Infrastructure ship handling capability. The project Facility and CSIRO to conduct a is scheduled to be completed in the research project to model the rail second half of 2011. capacity and capability servicing the port. New pilot vessel New pilot vessel PV Shearwater The research project will examine the During 2010, in order to efficiently Tug facility underway supply chain of bulk products – such service the growing number of vessels Another key activity that took place as steel, grain and coal - to the port using the port, the port corporation during 2010 was the commencement of Port Kembla, including how the took delivery of a new pilot boat, PV of construction of the new permanent existing rail network can support a Shearwater, to replace the PV Alvina, location for the port’s tug fleet. Worth possible future expansion of the port. which was some 35 years old and has about $15 million, the facility will initially The project will also identify potential been performing pilotage duties in the allow for the permanent berthing of four bottlenecks in the rail network and port for in excess of 20 years. tugs with provision for a further two in opportunities for improvement. In launching it into service, the the future. The research will focus on issues vessel was also officially named. In such as future demand on train The facility will include the construction a competition conducted hundreds lines, passenger and freight trains of a new breakwater of approximately of suggestions were received from sharing the same tracks, and the Aerial view of Port Kembla 250m in length, reclamation of students of the local primary schools. interconnection of the Illawarra and approximately 3000 square metres This competition gave students an Sydney rail networks. and dredging of approximately 28,000 opportunity to engage with the port cubic metres of sandy clay which will Port Kembla is a key coal exporting and learn more about its role in the be relocated to form part of the fill facility which services two of Australia’s local community. (The vessel’s name material for the second stage of the richest coal reserves, the Southern and Shearwater was inspired by a local Outer Harbour development. Western coalfields of NSW. Last year species of seabird). As at February 2011, site establishment and dredging is complete. The cutter suction dredger that was used on the Port Botany project was towed to Port Kembla along with 1.2km of floating pipeline to undertake the work. Work has also commenced on the reclamation area that will become the new tug base administration amenities and workshop area.

Rail master plan Toward the end of 2010, PKPC commenced work on a rail master plan. The plan, to tie in with Outer Harbour Master Plan, will investigate ways in which the port can most efficiently utilise the rail network within the port. Ownership of all major rail assets in the port ensures that rail is given a high priority in the consideration of the Entrance to Port Kembla

Autumn 2011 137 AUSTRALIA Ports Sydney It’s a century of infrastructure improvements By Grant Gilfillan, chief executive officer and director, Sydney Ports Corporation

n key strategic areas of Port Botany is the State’s premier Container trade remains the infrastructure, Sydney Ports is port and Sydney Ports Corporation dominant type of trade through Icommitted to improvements, continues to invest in new and Sydney ports accounting for 83 which will deliver world-class improved port infrastructure to per cent of total trade revenue. In facilities in our ports well into this secure future container trade growth 2009/10 container trade through century. in New South Wales. Sydney’s Port Botany increased Port Botany is Australia’s second by 8 per cent reaching almost Port Botany largest container port generating 1.93 million TEUs. This was the more than $1.5 billion a year in first time Sydney Ports recorded Just this month the Hutchison economic activity for the Australian over 1.9 million TEUs in container terminal at Port Botany is scheduled economy. throughput. to be ready for fit-out. Construction of the third terminal began in The new terminal will provide Australia endured the global July 2008. additional capacity to meet financial crisis better than other projected long-term trade growth for developed nations, largely as a The completion of the terminal is Sydney and provide better access result of our robust financial systems a major milestone in one of the to shipping lines for the State’s and also strong trading relationship most extensive and innovative port exporters and importers. with Asia, and particularly China. infrastructure projects undertaken The Asian region is Sydney Ports’ in Australia in the last 30 years—the Despite the lingering effects of the strongest market for both import and $1 billion Port Botany Expansion global financial crisis, Sydney Ports export containers, accounting for 62 is looking to the future, building project. per cent of all container throughput capacity now in preparation for a in and out of Sydney ports. Hutchison has interests in 308 world economy which is expected berths in 51 ports. The Hutchison to recover further over the next few Port Botany currently handles terminal is due to be operating for years. approximately one third of trade during 2012. The current port facilities provide six berths for container trade and landside area of over 210 hectares, with road and rail access. Sydney Ports Corporation, the manager of Port Botany, is expanding the container facilities to provide an additional 1850 metres of quay line, five new shipping berths, dedicated road and rail access, a secure estuarine environment and a new four lane boat launching ramp with pontoons and parking for the community, located adjacent to the current port facilities. It is expected the new terminal will deliver 9000 new jobs and boost the State’s economy by $16 billion over the next 20 years. The new third container terminal at Port Botany

138 Autumn 2011 AUSTRALIA Intermodal Logistic Centre at of new light industrial/commercial Enfield areas. Tenants and operators have been sought for Sydney’s newest freight Port Botany Landside terminal facility, Intermodal Logistics Improvement Strategy Centre (ILC) at Enfield. The 60 As part of the final industry trial hectare site will incorporate an conducted in February 2011, intermodal terminal, empty container performance reporting will be storage facilities, distribution centres available for stevedores and truck and warehouses. carriers to understand their current Due to commence operations performance against the Operational progressively from late 2013, the Performance Management (OPM) ILC at Enfield will become part of Standards. a network of existing and planned The trial measured truck carrier and intermodal terminal facilities in stevedore performance against the Sydney and will service around OPM standards. Australia’s container traffic. And a quarter of the total intermodal remarkably, given the world demand. The Regulation (Ports and Maritime economic downturn in 2009- Administration Amendment (Port Sydney Ports Corporation’s goal Botany Landside Improvement 10, Sydney Ports posted its is to move more goods by rail to Strategy) Regulation 2010) and ninth consecutive year of record manage the expected growth in Mandatory Standards that govern container growth. Sydney Ports freight, and the NSW Government the OPM framework were published experienced exceptionally strong has set a long term target of 40 per in December 2010. trade in the final three quarters of cent rail modal share to and from 2009/10 financial year, in the nine Port Botany. A network of intermodal Prior to these being enforced, months from October 2009 to June centres of which Enfield is a critical the final industry trial was used to verify that the data is valid for this 2010, container volumes produced component, is crucial to achieving purpose, and provide truck carriers the strongest ever performance for this target. and stevedores the opportunity Port Botany’s trade. This project is currently the largest to understand the commercial fit-for-purpose facility of its kind Recent container trade statistics implications of their current in Australia and is integral to the performance. show this steady container growth efficient running of an expanded continuing, with over 1,052,028 Port Botany. Addressing ongoing congestion at TEUs handled at Port Botany during Port Botany through the Port Botany the first six months of the 2010/11 The ILC will provide open access Landside Improvement Strategy facilities close to the catchment financial year, up 5.9 per cent (PBLIS) at Port Botany is a priority of metropolitan import and export on the corresponding period the issue for Sydney Ports Corporation. businesses and provide much previous year. needed empty container storage Sydney Ports Corporation has A third stevedore will deliver capacity for Sydney. been working with the road and rail increased competition to the sectors to develop and implement It is expected to achieve up to this significant reform program market—for the benefit of exporters 300,000 Twenty Foot Equivalent for industry. The program aims to and associated industries such as Units (TEUs) of port related improve efficiency, consistency transport and logistics—as well as throughput by rail once fully and transparency at the port’s operational. for the wider community. landside interface by reducing Hutchison Port Holdings (HPH) is Currently around 19 per cent of road congestion and transforming a subsidiary of the multinational containers out of Port Botany are Port Botany into an efficient, 24/7 conglomerate Hutchison Whampoa moved by rail. In 2009/10 317,000 operation. TEUs were transported via rail to Limited (HWL). It operates in Asia, Following on from the Independent and from Port Botany. the Middle East, Africa, Europe, the Pricing and Regulatory Tribunal final Americas and Australasia. The base infrastructure works report on Reforming Port Botany’s at Enfield will cater for a new 12 Links With Inland Transport in 2008, It is expected HPH will have hectare intermodal terminal, eight Sydney Ports has been leading completed its design, major hectares of new empty container the implementation of the NSW equipment purchases and fit-out storage areas; new warehouse Government’s response process works to enable the first berths to distribution areas of 52,500 square through the Port road taskforce and be available for trade from 2012. metre floor area and four hectares Port Botany rail team.

Autumn 2011 139 AUSTRALIA Ports Sydney

We have been working closely with With growth in trade at double estimated $190 million into the NSW all stakeholders which include all digits, ship queuing is likely to economy. port users on implementing the occur, increasing costs which are The record cruise season included PBLIS reforms to reduce congestion then passed on to industry and the 50th Anniversary of the opening at the Port Botany container ultimately to NSW consumers. terminals including an OPM of Sydney Cove Passenger framework between stevedores and The BLB2 project comprises Terminal, now known as the transport operators since late 2008. construction of a steel piled pier Overseas Passenger Terminal. berth adjacent to the existing This framework establishes a clear Sydney is the only Australian commercial relationship between BLB1; associated infrastructure city to operate two dedicated carriers and stevedores whereby such as marine loading arms, fire passenger terminals, with facilities penalties will be paid by either party fighting equipment, onshore support at Barangaroo and the Overseas to the other, for failing to achieve facilities and pipelines from existing Passenger Terminal. agreed performance benchmarks. user sites to the new berth. The open access, multi user berth will Sydney Ports has obtained planning Carriers will benefit from the new approval for a new purpose-built scheme through greater certainty operate on a 24 hour/ 7 day per cruise terminal at White Bay and of access and reduced terminal week basis. construction will begin in coming congestion with the result of BLB2 has been designed to months, with the opening scheduled reduced detention costs for their accommodate 120,000 dead weight clients. Stevedores will also benefit for the second half of 2012. tonne vessels to a maximum of from more predictable carrier 270m length overall. The new terminal will secure arrivals at the port precinct and Sydney’s future as a world leading thus be able to manage their labour cruise passenger destination. more efficiently. Cruise Sydney Ports is heading in the At the start of the process the Sydney is now firmly established as right direction as a world-class NSW Government committed to Australia’s major cruise hub and the port operator, with our major allow industry the first opportunity country’s leading cruise destination. to implement these reforms on infrastructure projects and industry a voluntary basis before the Sydney is hosting a record reform to meet growing trade in and Government considered regulation passenger cruise season this year, out of Australia. or direct involvement. with 150 scheduled cruise ship visits, including 27 visits in In January 2010, the NSW February 2011. Government publicly indicated that regulation was an option if The visits included a first on the stevedores failed to agree to 3 February by P+O’s newest cruise implement the reforms voluntarily. ship Pacific Pearl and a maiden visit By late 2010, it was clear that a by Seabourn Sojourn two days later. voluntary solution was not possible and the Minister subsequently However, the spectacular cruise moved to enact the Regulation. event of the season was the ‘royal double’ on 22 February, when Bulk Liquids Cunard’s new Queen Elizabeth sailed into Sydney Harbour for the Sydney Ports has received planning first time, accompanied by her sister approval from the Department of Planning to develop a second Bulk ship Queen Mary 2. Liquids Berth (BLB2) at Port Botany. The arrival of two of the world’s Sydney Ports has operated a Bulk most luxurious cruise liners at the Liquids Berth (BLB1) at Port Botany same time demonstrates Sydney’s since 1979. This berth has been esteemed reputation within the occupied on average between cruise sector. 50-60 per cent of the time for the The number of cruise ship visits this past ten years and more recently has experienced 60-65 per cent season is up by 26 per cent, from average berth occupancy. The main 119 visits in the previous season. products handled at the BLB are It is also the first time passenger refined fuels, gases and chemicals / numbers are expected to break the other bulk liquids. 300,000 mark, injecting an

140 Autumn 2011 AUSTRALIA Welcome to the port waters of Geelong

Every ship that visits the Port of Geelong needs to know it can get in and out safely and efficiently.

The Victorian Regional Channels Authority has invested heavily to ensure its marine logistics and control systems are up-to-date.

The VRCA’s 24/7 marine traffic management system uses equipment such as automated ship identification (AIS), very high frequency radio (VHF), mobile telephony, satellite communications and state-of-the-art real-time tide and wind sensors, available online.

A Smart Dock system enhances the ability of even the biggest ships to berth safely in all weathers. The VRCA also commissions annual hydrographic surveys.

The channel has new high-visibility markers. The VRCA welcomes ships visiting the Port of Geelong.

Level 2/235 Ryrie St, Geelong / GPO Box 1135, Geelong, VIC 3220 03 5225 3500 Autumn 2011 141 [email protected] www.regionalchannels.vic.gov.auAUSTRALIA Ports Townsville More than $230m in capital works in the pipeline By Andrew Strutton, marketing and customer relations officer,

Barry Holden, CEO, Port of Townsville Limited Port of Townsville Ltd

STRONG program of capital sustainably,” Mr Holden said. “Works on the cruise terminal are upgrades and expansion due to begin in October 2011 and Included in the raft of capital works Ais underway at the Port the facility, once completed, will is the new $110 million Townsville of Townsville as record trade provide additional commercial Marine Precinct; an $85 million throughput continues to boost capacity to the existing Berth 10 the port’s reputation as one of cruise terminal; multi-million-dollar as well as accommodating the new Queensland’s key economic upgrade of the Port’s existing Berth “Canberra” class naval vessels and contributors. 8; and environmental studies for the improve military and cruise shipping Port Expansion Project. schedule flexibility. Port of Townsville Limited CEO Barry Holden said more than $230 “These are all significant projects “And the upgrade of Berth 8, million in capital works to secure that will add new dimensions to the also scheduled to begin in new and existing trade were in Port of Townsville’s already diverse October 2011, will ensure the progress or about to be undertaken array of services and facilities,” Mr long-term export future of mineral at northern Australia’s port of Holden said. concentrates and fertiliser products choice. “The Townsville Marine Precinct, for valued at more than $1 billion a year to the Queensland economy.” “This is an exciting time for Port example, is on track for competition of Townsville Limited as we carry in November this year, and will Mr Holden said the upgraded out a significant program of work bring together a range of marine capacity was essential with the port to allow us and our business industry in a first-class, purpose- strategically positioned to service partners to grow and move forward built facility. the vast North West and North East

Loading of lump iron for export to China General cargo loading on berth 3.

142 Autumn 2011 AUSTRALIA Mineral Provinces and with direct “Negotiations are also ongoing with access to hungry Asian markets. CuDECO as they look to construct a bulk receival, storage and export “Total trade through the Port of facility for copper and cobalt Townsville in 2009-2010 reached concentrates, while the first import 10.25 million tonnes – the highest of BP Bitumen is scheduled for volume ever traded through the June. Townsville Port in its 115-year history,” he said. “BP is currently constructing eight new storage tanks valued at more “International exports out of the port than $32 million in the port to store last financial year were alone valued this new commodity that will play an at more than $5.58 billion, up more integral role in the maintenance of than 13 per cent on the previous North Queensland’s roads.” year, and trade is undoubtedly Xstrata Copper’s $8.6 million continuing to grow. storage facility expansion works at “Although we still have some way the port will meanwhile be complete Port of Townsville berths 8 and 9 at night to go in the current financial year, by the end of March to allow the and considering the challenges of railing of 1.2 million tonnes per extreme weather, I am confident annum of magnetite concentrate we will see another record trade from Ernest Henry Mine to begin in performance.” May. Mr Holden said the prospects for Mr Holden said Port of Townsville sustained growth were strong, with Limited was also continuing to a number of new trades coming work with Legend Holdings as they online this financial year and many explore the export options of their others on the horizon. phosphate products proposed to be manufactured in Mount Isa. “A great example of new trade is the export to China of trial “Whether they decide to undertake beneficiation in Australia or offshore, shipments totalling 200,000 tonnes the Port of Townsville is ready to of lump iron ore from Curtain Bros’ meet their needs,” he said. Mount Moss mine 150km west of Townsville,” he said. photos By Cameron Laird PB Towage-owned tugs at the Port of Townsville

Copper Cathode being loaded on berth 3

Autumn 2011 143 AUSTRALIA Environment

Awareness and protection are core objectives By michael julian, executive director, AUSMEPA

Last year AUSMEPA celebrated its Unfortunately, the relatively very few active steps to minimise stormwater 10th Anniversary in Brisbane with a incidents of oil pollution from ships in pollution both from their school and gala dinner attended by 70 AUSMEPA Australian waters, such as from the their home. They can investigate what members, sponsors and guests who Pacific Adventurer in March 2009 off ships do to prevent pollution. Tools were provided with the opportunity Moreton Island in Queensland, colours are provided so students can design to look back at how the initial small the perspective of the shipping industry stormwater pollution communication number of dedicated members and by media and the general public, into products to present to their community. sponsors had grown the association to believing that all ships are bad polluters. This is clearly not the case. Ships and the marine environment – its current internationally recognised and students learn about the role of shipping successful level. We also looked to the and the transportation of cargo, the future on how to continue achieving the Education programs for school journey of containers and other types core AUSMEPA objective of bringing students of cargo. They can experiment finding awareness to the Australian community AUSMEPA, through its free internet out how ships stay afloat. In addition and to seafarers about the importance of based marine environmental education they will learn how ship’s crews play an the marine environment and its protection resources including free posters aims to important role in making sure their ship for future generations. help young Australians grow up having does not cause pollution. Information on basic shipping economics is provided in While it is well known in the shipping a better understanding about the causes that ships are essential for our existence and its related industries that about 80% and effects of marine pollution and what and livelihood. Australia imports and of pollution in the sea, mainly garbage the shipping industry is doing to minimise environmental harm from its operations. exports millions of tonnes of goods each and urban run off, comes from the land, year which helps maintain the Australian this is generally not understood by the Five education programs, available on economy Australian community, which often turns a the AUSMEPA website, currently provide blind eye to effective and environmentally school students with the awareness they Ports and the marine environment sound means of disposing of domestic need to better understand these matters, – students are often surprised at the and commercial waste. these include: many layers of organisations and types of transport that are required to get Marine Pests and Threats – this program their favourite ‘gizmo’ from where it has recently had a major re-write to bring is made overseas to their local shop. it up to date with the latest international They learn about the role of ports, convention requirements that deal with types of ships visiting Australian ports, the problems of marine pests in ships’ safety and environmental issues and ballast water and in hull fouling. the organisations required to operate The Effects of Climate Change on a port. They also learn about the many Coral Bleaching – climate change is a fascinating types of equipment used in concern for many children. In this unit of ports. A port can have a large impact work students discover why coral reefs on the marine environment and must are being damaged by increases in sea take a number of precautions to ensure temperatures, and how this can be linked its operations do not harm the marine to climate change. The program brings environment. Ports are equally essential together all the science and conservation for the Australian economy, being the issues of these current environmental interface between ships importing or topics. The unit helps students to find exporting cargo and the land transport ways to reduce both their and their system. community’s carbon footprint. Student Leadership in Coastal Marine Stormwater Pollution – most Conservation – this leadership program students are stunned to discover that the is designed to help students identify majority of marine pollution is actually a coastal conservation project either washed there from the land. In this unit independently or with a partner. It has of work they learn about marine wildlife a wide range of planning tools to help and the problems caused by stormwater students understand all the necessary pollution and how they can prevent it. stages that they need to address when Students are shown how they can take planning a project. Throughout their

144 Autumn 2011 AUSTRALIA operates a ship membership scheme for and was particularly interested in the Australian as well as foreign ships which education of younger Australians in acknowledges quality shipping trading to marine environment protection and Australian ports. conservation. To honour Rhonnda the AUSMEPA Board has agreed to set up Ships approved for membership are the annual Rhondda Alexander Memorial presented with a certificate and an Award. AUSMEPA flag which can be used in Australian ports to signify the ship’s The Award will take the form of a grant partnership with AUSMEPA and as a sign of up to $3,000 towards a school of quality. For a ship to be approved for marine education project that leads to ship membership, AUSMEPA has set students actively improving the marine guidelines to determine ship quality and environment. Schools will be encouraged assess potential ships for membership. to submit applications on their proposed Meeting any one of the following criteria project which meet the required criteria. will qualify a ship for consideration for A key objective will be the educational ship membership: outcomes for the students and if relevant, the community. The school that submits • Two consecutive years free of the winning application will be awarded detention under Australia’s port State the grant funding to complete their control regime, project and provide a three minute video • A US Coast Guard QUALSHIP 21 about the outcomes of their project which Certificate, will be loaded on the AUSMEPA website. project, students develop their leadership • A Green Award certificate, Changing of the Guard skills. Four project areas are covered: • Any other internationally recognised At the AUSMEPA AGM held in November • Coastal photo surveys to monitor the certificate or record providing evidence Neil Baird, who had been AUSMEPA’s changing environment of the ship’s quality and safety, eg. from a ship vetting company. chairman for the previous four years, • Communication projects for coastal stood down from the Board but will environments using a multitude of The benefits to owners and operators continue his support for AUSMEPA as a communication tools of AUSMEPA Ship Members include member of the Advisory Committee, he exposure on the AUSMEPA website will also continue his role as the Roving • Coastal re-vegetation with links to the owners/operators Ambassador to INTERMEPA.. website, listed as an AUSMEPA • Working with international schools Captain Conrad Saldanha, Marine sponsor, recognition of operating quality Manager LPG for Origin Energy was Funding for the Student Leadership in shipping, promotional opportunities as an elected the new Chair has been actively Coastal Conservation education program AUSMEPA recognised ship member. involved in AUSMEPA since its early days was provided by the Commonwealth and as Deputy Chair since 2006. Government’s Caring for our Country Ships approved for membership pay an annual fee. Money collected is used to grant scheme for environmental projects. fund AUSMEPA’s school and seafarer Support to AUSMEPA education programs. Discounts are Education services for seafarers available for ship fleets of 6 and over AUSMEPA is primarily funded through and to those ships which are members of corporate sponsorship, the Ship Last year, AUSMEPA in partnership another MEPA. Membership scheme and individual with AMSA, produced the second membership fees. If you would like to edition of the DVD Welcome to Australia The AUSMEPA ship membership become an AUSMEPA partner in one protecting our marine environment. The scheme provides an ideal opportunity of these categories please show your DVD reinforces Australia’s MARPOL for quality shipping companies wishing interest using the AUSMEPA website at requirements for ships sailing in our to demonstrate their commitment to a www.ausmepa.org.au. waters. The DVD is placed on every ship sustainable marine environment. coming to an Australian port by its agent. Current ship membership includes a wide Distribution of the DVD is handled by range of flags from: Australia, Bahamas, Shipping Australia Ltd and its member Bermuda, Greece, Isle of Man, UK and agencies. Back up support is also Vanuatu. provided by The Apostleship of The Sea Stella Maris seafarer centres at various More information about the scheme ports. Also AMSA surveyors take copies including a list of ship members can be with them when undertaking ship survey found on the AUSMEPA website just click visits. on Ship Membership.

AUSMEPA Ship Membership Rhondda Alexander Memorial Scheme Award AUSMEPA strongly believes that those Rhondda Alexander, who was the wife of ships that ‘do the right thing’ in protecting AUSMEPA’s founding Chairman, Captain the marine environment, should be Michael Alexander, died tragically in a recognised in some way and given car accident in July 2010. Rhondda had the opportunity to promote their green been a great supporter of AUSMEPA credentials. To this end AUSMEPA since its inception in the late 1990’s Michael Julian presents Captain John Watkinson with an award for services to AUSMEPA

Autumn 2011 145 AUSTRALIA Towage

Svitzer set to take operations to yet another level

By a company reporter

STEFFEN FAURBY arrived in to move with the times,” Mr Faurby are simplification of payroll Australia in August 2010 with a said. processes and the streamlining of invoicing and ordering procedures. brief to take local operations to “Our customers are quite another level. The ground had demanding when it comes to cost “Ensuring the cogs of the business been set by his predecessor and reliability, meaning we always work in a more synchronised Anders Egehus, whose mission have to be mindful of listening to manner is the aim of the game.” was to bed the business down and the market and delivering what the create stability following Svitzer’s market expects. Faurby says his mindset comes acquisition of Adsteam Marine from his experiences at the A.P. “We’re about to shift up several in 2006. Following a successful Moller-Maersk Group, where gears in terms of simplifying the integration with a strong focus on he spent 10 years in various way we do business which will management positions, most business continuity and robustness, enable our customers to benefit recently as vice president of it’s now time to look ahead and and result in us controlling our Maersk Line, in charge of global set the direction for Svitzer going costs more effectively. cost and strategic planning. forward. “I see many areas where we can There, a heavily entrenched and “As a key player positioned at the become leaner by cutting red tape disciplined culture of efficiency, ends of major Australian supply and simplifying operations – mainly simplification and ‘empowerment chains, there’s an onus on Svitzer in back room settings. Examples within’ reigned; resulting in a significant operational and profit turn around amidst the financial crisis that rocked the shipping liner industry. But while his focus is on doing things more efficiently at the shipping end of supply chains, the overall functions of supply chains are also in his sights. “I’m a newcomer to Australia and am investing heavily in observing supply chain functions and listening carefully to people who have had involvement for many years,” Faurby says. “Our aim to improve the overall efficiency of the supply chain starts with improvements we can make ourselves. “This includes asking our customers where and how they would like us to improve. Clearly there is room for improvement and we are working very hard on this.

146 Autumn 2011 AUSTRALIA costs - or additional port calls – meaning increased revenue. Further, Faurby argues, in addition to the operational cost savings customers would simply find it easier to deal with compliance of security and environmental matters. Supply chain operators also reap benefits, including process simplification, which means less errors as well as reduced staffing and overhead costs in back office functions such as invoicing, payroll and dispatching. Stable and more reliable operations are obviously a key ingredient of cost containment. “At Svitzer we run towage operations in 35 ports across Australia and until now we Yet if I’m to do some tidying up in or a trucking company just to have managed our operation my own back yard, I need to do it name some of the other links in through 4 internal operations in a context of how that might make the supply chain. But are these centres located in 4 different Svitzer a better and more valuable individual success criteria aligned places. This arrangement has contributor in the overall scheme of throughout the supply chain or are worked well for our customers, Australian supply chains.” they detached or sometimes even conflicting? but we’ve also realised several This, Faurby says, is an approach areas of improvements around and attitude that could yield “If there was a bigger focus on standardisation and improvement staggering benefits to supply everyone pulling in the same of work processes. chains nationally if every participant direction, of embracing efficiency took a similar approach. drives collectively, of ‘shifting up “We’ve therefore decided to gears’ collaboratively, many of the consolidate all those centres “An early and clear observation is impediments that hamper supply into one. While we’ll keep key that there is significant capacity chain functions could be ironed operational people in each of the for local supply chains in Australia out. ports to action local operational to make adjustments that would issues during business hours, a bring about better simplicity and “Every supply chain has its weak national operations centre will be efficiency.” links, but it’s how the chain players established in Newcastle by the work together to strengthen those He notes the efforts - in some expansion of the current centre links that make the difference. cases extraordinary efforts - which will have increased manning When supply chain participants are some individual supply chain on a 24/7 basis. This will ensure on the same page and wave length stakeholders put into optimising consistency of service delivery the overall benefits to the industry their own part of the overall and provide a solid base for future and the economies they support function, be it a shipping line, tug can be enormous. growth and development”. operator, stevedore, pilot, agency, port authority, trucking company or “For starters, customers - be they a However, when dealing with supply rail provider. container shipper or a coal exporter chains that are large, complicated - would see the entire value chain and varying from place to place, But are they always working being easier to do business with, there are never silver bullets or collaboratively, collectively and and more prone to come forward magic answers. This is particularly cooperatively to optimise for the to do business. Integrated work the case where participants guard greater good? processes with less administration their commercial information “As a towage operator I have a and lower cost would improve closely, where communication clear view on what good looks end-to-end productivity. Less time has historically been poor, where like for us and I am sure the in port would mean more time on historical mistrust runs deep, or same is the case if you ask a the water which again could be where ‘blame games’ for poor shipping line, a stevedore, a pilot, converted into either slower speed supply chain performance may a shipping agency, a port authority on the vessels - meaning lower fuel be rife.

Autumn 2011 147 AUSTRALIA Towage

Coal Infrastructure Group (NCIG) – is also in expansion mode, despite commencing operations only recently. The next priority is to ensure that rail and train capacity keeps up with loader capacity. This creates a more certain environment for the Australian Rail Track Corporation to deliver required rail capacity. The Newcastle Port Corporation also introduced a new ‘vessel arrival’ system to reduce queuing near the port, which has seen a significant improvement in safe operations and port efficiencies. Even Svitzer is in on the act, recently announcing a 25 million dollar plan to expand operations in Newcastle Harbour in preparation of handling growing coal exports. “The Hunter Valley story seems to be a text book case in how working together can make a difference,” “It’s in the interests of every timely infrastructure investment, Faurby says. supply chain participant to agree resulting in long vessel queues and on transparent measurements yearly pro-rata nomination cuts. Faurby says he sees great potential that accurately reflect overall There were a dozen elephants for improved long-term supply performance,” Faurby says. stampeding through the room, but chain collaboration elsewhere. no one knew how to manage them “This is usually always for the “At the end of the day our – and certainly no single coal chain greater good. Processes should be customers end up paying for our participant was game to try. transparent in order to all to look for inefficiencies, and let us remember process improvements. Are there In 2008 the coal industry decided that customers have a choice in ways, for example, that technology enough was enough and embarked deciding where they source their such as IT could be shared? on a gruelling round of discussions goods and materials from,” he Consideration of the ultimate goal to find a better way of doing things says. – to shift goods in a seamless - the process overseen by the “Passing on the burden of reducing and timely manner – should be New South Wales Government and costs from one link in the supply the foremost consideration and former Premier Nick Greiner. chain to another doesn’t make not some piecemeal objective. The outcome was the “Long term things more efficient. The value lies This requires mutual trust and Contractual Framework’ (LTCF), in eliminating costs throughout the openness, and also a mindset which came into effect on 1st supply chain. We’ll all benefit from amongst all participants of winning January 2010. This essentially that. together. enables coal producers to lock “Market dynamics do change from “Is there a success criteria that into ten-year ‘take-or-pay contracts time to time, leading to bottlenecks can be universally embraced? How with the ports loaders. It has and over-capacity. However, with stimulated massive infrastructure can ‘winning together’ become the better transparency throughout the mantra?” investment, with one loader supply chain we will be able to – Port Waratah Coal Services Faurby cites the New South Wales respond faster to such changes. (PWCS) – committing another Hunter Valley Coal Chain as a 670 million dollars to terminal “Svitzer will look to work with other prime example. expansion within a month of the supply chain stakeholders to seek For years Hunter Coal Producers agreement coming into effect, and further innovation. The reality is that operated on a year-in-year-out now readying to deliver a new at the moment we have too many annual coal export allocation multi-billion dollar terminal. The hand-over points and too many system that did little to stimulate neighbouring loader – Newcastle different success criteria”

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Autumn 2011 149 AUSTRALIA International developments

Looking forward to FONASBA annual meeting in Sydney

By JONATHAN C. WILLIAMS, general manager, FONASBA

t always gives me pleasure decision-making body comprising expand membership in the Asia- to contribute an article for the representatives of all member Pacific region have continued IShipping Australia annual but associations present. under the excellent guidance of particularly so as we move into The whole event will be overseen our Regional VP Takazo Iigaki 2011, a year that will see SAL come by a new Executive Committee who, accompanied by Tonny to the forefront within FONASBA as – FONASBA’s main board – the Paulsen, made an extensive tour the eagerly awaited Sydney Annual members of which were elected of the Far East in September last Meeting approaches. The prospect in Varna for a two year term. year, taking in Bangkok, Korea, of a week in Sydney in the very FONASBA’s new President is Indonesia, Singapore and Vietnam. capable hands of Michael Phillips, Christakis P. Papavassiliou of Their efforts were rewarded shortly Llew Russell and the rest of the SAL Cyprus. His predecessor Tonny D. before the Varna Annual Meeting team has generated considerable Paulsen of Denmark remains on when the Indonesia Shipping interest within FONASBA’s the Committee as Immediate Past Agency Association applied for membership and many of us, myself President and for the first time in and was granted membership. included, will be bringing our wives, its history FONASBA has a female It is hoped that the combination partners, and other family members President Designate in Marygrace and either arriving early or staying of regular contact with potential Collins of the USA. Marygrace Asian members and the hosting on after the meeting finishes in also remains Chairwoman of order to enjoy more of the country. of the 2011 meeting in Sydney will the Chartering & Documentary encourage other associations in the Whilst partners will be out and about Committee whilst Antonio Belmar region to apply for membership in in Sydney, a full week of meetings da Costa of Portugal and Glen the coming year. awaits the delegates. As reported in Gordon Findlay of Brazil were re- Elsewhere, membership was this publication last year, the sheer elected as Chairmen of ECASBA volume of issues to be discussed and the Liner & Port Agency boosted by the election of two new at our meetings, combined with Committee respectively. Also re- member associations in Turkey, the the enthusiasm of the delegates elected were Charles Génibrel of Turkish Shipbrokers Association in expressing their views, required France (Executive Vice President) and the maritime Association of and Regional Vice Presidents Aziz that the Plenary meetings of Shipowners and Agents, and the Mantrach of Morocco (Africa), FONASBA’s three committees upgrading of Malta’s membership Patricio Campbell of Argentina (the – Chartering & Documentary, status from Associate to Full. Efforts Americas), Takazo Iigaki of Japan European (ECASBA) and Liner & to secure a membership application (Asia) and Gunnar J. Heinonen Port Agency – being extended so from FEDSAI in India are continuing of Finland (Europe). Completing that each now occupies almost a and the Regional VPs responsible the team are the Committee whole day. The decision to do this for Africa, the Americas and Europe Vice Chairmen, Botond Szalma was fully vindicated during the 2010 continue to be proactive in their of Hungary will be supporting Annual Meeting in Varna and is areas. Marygrace Collins as Vice Chairman being carried over to the Sydney of the Chartering & Documentary meeting and beyond. Meetings of The flagship Port Procedures Committee whilst Barry Stokes FICS the executive boards of ECASBA Survey initiative continues to make and John Foord FICS, both of the and FONASBA, a half day seminar, excellent progress, coordinated and UK are respectively Vice Chairmen meetings of the regional “range” guided by our Brazilian association of ECASBA and the Liner & Port committees and one specifically FENAMAR. As reported last year, Agency Committee. for association secretaries fill all this aims to collate, codify and the available gaps and the week Moving on to actions taken and present a detailed overview of the concludes with the meeting of developments within FONASBA wide range of activities undertaken Council, FONASBA’s highest over the past year, our efforts to by ship agents before, during and

150 Autumn 2011 AUSTRALIA after the vessel’s call and to date gain access to the data to support e-Maritime continues to make slow more than 150 separate actions its actions to harmonise vessel progress but ECASBA is maintaining have been identified across 13 reporting procedures and timelines pressure on the Commission and discrete functions. The objectives across the EU. others to recognise the vital role of this project are manifold and of the agent in the transmission of That very neatly brings me on to include providing documentary information between the ship and European developments. proof to shipowners, operators and shore, to appreciate that electronic charterers of the complexity and The main policy initiatives reported transmission of data is only a very value of the agency function and last year, modernisation of the small part of the process and that demonstrating to legislators and European Customs Code, port people are still required to input, authorities at national regional and development, port security and the review - and where necessary international level the wide variation “E-Maritime” project, all continue correct – data, to follow up on in the number of procedures to a greater or lesser degree and issues and of course to carry out all applicable and the lack of ECASBA is continuing to monitor the other agency functions. We have harmonisation in reporting timelines developments as appropriate. presented this view in a number of and information requirements. fora, including IMO and at European 1st January 2011 saw the Above all however, it will provide Maritime Day in Gijon last year, clear evidence of the range, scope implementation of the EU Advance where we held a very successful and detail of the agent’s role, the Cargo Declaration regime which and well attended workshop skills and professionalism required in terms of its objectives is very entitled “The Ship Agent IS the Port to carry it out effectively and the similar to the US Container Security Single Window”. ECASBA hopes to poor return gained as a result of Initiative introduced after 9/11. The arrange another workshop at the continued downward pressure on European scheme differs in that 2011 Maritime Day event in Gdansk agency fees. it covers all cargo, containerised, where the main theme is the Human bulk and mixed, and has different National associations are now Element in Shipping. timelines for different cargoes, reviewing the information already from 24 hours prior to a vessels’ Elsewhere, FONASBA is now held in the system, resolving arrival at its first port in Europe for represented on BIMCO’s any anomalies that have arisen containers, through 4 hours for Documentary committee so has and adding new data and new bulk cargo to 2 hours for short sea the opportunity to monitor and ports ahead of a “go live” date cargo. Additionally, the scheme contribute to the development of anticipated for mid 2011. To also covers export shipments. charterparties and clauses. The assist this process, FENAMAR has All information is required to be Quality Standard continues to attract developed an online update form input to the system electronically support from external organisations which uses forced fields to ensure and data on all cargo bound for although take up from within the that all data input from now on will a European destination is lodged membership has slowed. If any be consistent. Once live, members SAL member companies wish to will be able to monitor the data and with customs at the first port of arrival. Relevant data will then, the apply for the Standard, full details update it as necessary. Access to of the relevant criteria are available the survey results will be via the theory goes, be seamlessly passed on to the customs authorities in from SAL (an accredited member FONASBA website (www.fonasba. association) so application is just a com) and in the public area to the country of destination. As this article is being written in February matter of ensuring that the company ensure the widest possible access. can comply with the criteria. Over Data can be viewed in a number (and in spite of dire predictions that European imports would grind 200 companies worldwide are now of different formats, for example by accredited to the standard. Further country or by specific function and to a halt on 1st January) the input side of the operations seems to be information on the Standard itself much of the information can also be is available from the FONASBA viewed graphically. holding up well, due in part to good website. preparatory work by shipping lines, The project gained a major boost their agents and national customs Regrettably I am rapidly filling the in January this year when it was authorities. Issues have however space allocated for this article so I the subject of the main feature arisen in relation to the sharing will finish by reiterating how much in Fairplay magazine (“Agent of information between national everyone at FONASBA is looking Provocateur” 13th January 2011). authorities with the result that grace forward to coming to Sydney for the We anticipate that one of the first periods of varying length have been 2011 Annual Meeting and - Michael, users of the system will be the implemented to ensure that the lines Llew and I hope - going away with European Commission’s Directorate are not penalised if information they just a glimpse of what makes it such General for Mobility and Transport lodged correctly on time is not on a wonderful country. See you in (DG-MOVE) which is very keen to forwarded correctly. October!

Autumn 2011 151 AUSTRALIA International developments

Important changes to accounting standards for lease contracts By Simon Bennett, director, external relations, International Chamber of Shipping*

he International Accounting contracts. Furthermore, ICS does not be considered as a lease since the Standards Board (IASB), which believe that third parties’ understanding transaction is essentially the same as Tis based in London, has made of the true financial position of shipping booking space on a ship to transport radical proposals to overhaul those companies will be greatly enhanced cargo, except that the whole ship is international accounting rules which by requiring ‘time charters’ and usually utilised. affect the treatment of leases. While similar contractual arrangement for In the case of a ‘trip time charter’ the the proposals have been developed transportation services, to appear on charterer-in has no more control over over the last 18 months, and a number company balance sheets. of national shipowners’ associations the vessel than with a ‘voyage charter’, have already submitted comments, ICS is therefore hoping that the IASB the main difference being the way in the deadline for final comments was might provide clarity in the rules on the which the charterer-out is remunerated. December last year, which provided definition of leases in order that this will Such arrangements cannot, in the the shipping industry with an important not extend to ‘time charters’, ‘voyage view of ICS, be considered as creating opportunity to reiterate its concerns. contracts’ and similar arrangements assets or liabilities which should used within international shipping. appear on a balance sheet. In particular, there is continuing worry amongst ICS members about the The shipping industry is responsible for For ‘period time charters’, the lack of precision in the proposals the movement of 90% of world trade charterer-in does have some control with regard to the definition of leases, and has developed long established over the employment of the vessel especially with regard to possible business mechanisms to match supply (such as place of loading/unloading, implications for ‘time charters’, and and demand for the transport of goods and cargo carried) but does not other contracts governing operational and raw materials, in what are very have possession of the vessel and arrangements. cyclical and highly volatile markets. does not control its operation. The Included amongst these are ‘time control/right to direct the use of the Most importantly, one of the possible charters’ and ‘voyage charters’ as vessel is not unconditional. The consequences of requiring contractual described briefly below. crewing, maintenance and regulatory arrangements such as ‘time charters’ compliance remain with the charterer- • A ‘time charter’, under which to be recorded on company balance out. Since the charterer-in does not the services of a ship hired for a sheets is that some companies have unconditional control of the specified period of time for could suddenly become in breach of vessel and the charterer-out retains payment of a daily, monthly or existing covenants with their financing responsibility for the crew, safety, an annual fee, with the charterer institutions. and maintenance of the vessel, ICS in paying certain voyage costs again does not consider that these For other companies, however, the as may be agreed, such as fuel contractual arrangements - which are proposed rules may have a dramatic and port dues. effect on the way in which they must for transportation services - create conduct their business after the • A ‘voyage charter’ whereby assets or liabilities which should changes come into effect in about two the charterer-out earns freight appear on a balance sheet. years’ time. per tonne of cargo transported Concern has also been expressed on its ship on terms set out in the by shipowners about the potential The lack of precision in the IASB voyage charterparty contract complexity and compliance burden proposals with regard to the definition which specifies the precise nature of these proposed new standards, of leases could give rise to an and volume of the cargo, the especially if large numbers of charter interpretation that ‘time charters’ and port(s) of loading and discharge transactions were to be affected, other contracts governing operational etc, with all costs being paid by and if the computations required a arrangements utilised by international the charterer-out. ship operating companies fall within recalculation each year, and elements the definition. ICS believes, however, In the case of a ‘voyage charter’ such as effective interest rates had to that such arrangements should not there is no control of the ship by be calculated back to the beginning be treated as leases, and certainly the charterer-in. The charterer-out of the lease or charter (when the not as financial leases for accounting remains in possession of and operates circumstances of the company may purposes, since they are more in the ship throughout the contract. A have been quite different and even the nature of transportation service voyage charter should not therefore under different ownership). Many ship

152 Autumn 2011 AUSTRALIA operators, especially those who are industry as a whole, and the smooth for the lessor are aligned with these solely charterers-in and have no other flow of international trade. and are implemented at the same ship operating activity, would find such time. It is of course a characteristic ICS has therefore respectfully complexity extremely burdensome and of many shipping companies that requested that the final IASB rules expensive to satisfy. they charter out the same ships that are amended in order to clarify that they have leased or chartered in, Most importantly, one of the possible ‘time charters’, ‘voyage contracts’ and and any inconsistency would create consequences of requiring contractual other similar contractual arrangements unacceptable anomalies. arrangements such as ‘time charters’ for transportation services used by to be recorded on company balance shipping companies need not be It remains to be seen whether sheets is that many companies treated as leases to be recorded on comments submitted by the shipping could suddenly become in breach of company balance sheets. industry will be enough to explain the existing covenants with their financing special characteristics of international In the event, as is likely, this institutions. Such covenants, in relation shipping, and the need for clear recommendation is not accepted, ICS to capital gearing for example, have and consistent accounting rules that has also suggested that it might be been entered into on the basis of take account of business practice more appropriate for changes to the current accounting rules, and there while avoiding excessive compliance treatment of such arrangements to be can be no presumption that financing burdens. The final rules are expected applied prospectively only to future institutions will be able to revise or to be published by IASB in the summer contracts. renegotiate contracts. However, such of 2011. technical breaches of covenants If, as proposed - and ICS still hopes The latest draft of the proposals – could potentially trigger defaults with this will not be the case - ship charters ED/2010/9 can be found at http:// unpredictable consequences for are indeed to be treated as leases, it www.ifrs.org/Current+Projects/ individual companies, the shipping is vital that accounting requirements IASB+Projects/Leases/ed10/Ed.htm

Operating charters used in international shipping There are a variety of forms of charter, loading/unloading and cargo to of cargo, the port(s) of loading with documentation usually based on be carried, to whom bills of and discharge. All voyage costs a series of internationally accepted lading to be issued) from the are paid by the charterer-out. standard terms, though subject to charterer in. The charterer-out the individual variation and varying lengths remains responsible for safety, • Bareboat or demise charter: (from less than one day to 15 years or navigation, maintenance and charterer-out of the ship contracts more). It may be helpful to summarise regulatory compliance of the (for a fee, usually long term) to the key characteristics of the main vessel. The charterer-in is the charterer-in for its operation. types of charter relating to whole ships. responsible for fuel and port The ship is then operated by the voyage costs (such as port latter as if they owned it. dues). • Time charter: the vessel is The period of the time charter is almost hired for a specified period of 2 Trip time charter: fixed on a always flexible to allow for practical time for payment of a daily, time charter basis for the redelivery at the end of a voyage and monthly or annual fee, to carry period of a specific voyage in an agreed location, with the hire cargo to/from places as ordered and for the carriage of a expressed as a daily rate for a period by the charterer-in. The specific cargo. The charterer expressed as +/- days, weeks or charterer-in pays voyage costs. out earns ‘hire’ per day for the months. The actual duration can only There are two types: period determined by the be determined when the chartered voyage. The charterer-in is ship is redelivered. In practice a large the ship 1 Period time charter: responsible for all voyage proportion of all charters would fall into earns daily hire, paid monthly costs. two or more accounting periods. or semi-monthly in advance. The charterer-out retains • Voyage charter: the ship (It is recognised that for bareboat/ possession and mans and earns freight per tonne of cargo demise charters, the charterer-in has operates ship under transported on terms set out in effective control over the ship and, in instructions as to its the charterparty, which specifies many cases, the arrangement is similar employment (such as place of the precise nature and volume to a finance lease.)

*The International Chamber of Shipping (ICS) is the principal international trade association for shipowners and operators, representing all sectors and trades. ICS membership comprises national shipowners’ associations from 35 countries - from the Americas, Asia and Europe - representing around 80% of the world merchant fleet. Members include the Australian Shipowners Association and – as an Associate Member - Shipping Australia Limited.

Autumn 2011 153 AUSTRALIA Maritime law

Two topical issues that concern the salvage industry... By Stuart Hetherington, partner Colin Biggers & Paisley*

This article discusses two topical time the Convention was originally did not include any element of profit. issues concerning the salvage drafted. In addition, the ISU argues The Nagasaki Spirit decision has industry. The first is the review that the Convention does not properly been said to have been the straw that of the Salvage Convention by reward its members for protecting broke the camel’s back in relation to the Comite Maritime International the environment because the awards Article 14. Proving to be unwieldy, (CMI)1. The second concerns the are generally capped at the value complicated and expensive for the role of Emergency Towage Vessels of the salved property and, in parties in making Article 14 claims (ETVs). The issues, whilst not directly circumstances where the property’s connected, overlap. value (the ship and any cargo being and having them adjudicated, the the most significant items) is relatively industry has since negotiated an In December 2008, the International low, the available award will be agreement known as the “SCOPIC Salvage Union (ISU) wrote to the correspondingly low and not reflect Agreement” pursuant to which, CMI pointing out that the Salvage the danger, time and effort put into standard rates have been agreed Convention 1989 (the Convention) salving a vessel. for personnel and equipment. The was nearly 20 years old and it SCOPIC Agreement is incorporated was over 30 years since work had Whilst the “Special Compensation” into the standard form marine salvage first begun on its drafting. The ISU article in Article 13 of the Convention contract, the Lloyds Open Form suggested that certain aspects of was originally intended to alleviate (LOF). the Convention warranted review and some of Article 13’s limitations, invited CMI to take up the task. subsequent judicial interpretations Whilst salvors are generally satisfied have made Article 14 problematic that the SCOPIC Agreement works The central issue raised by the ISU also. Article 14 allows salvors to be well, they emphasise that it is only a concerns “environmental salvage”. paid “special compensation” greater “safety net” and does not reward the For the first time in the international than what they would have received salvors for what is often a dangerous law of salvage, the 1989 Convention under Article 13. Unlike Article 13 and risky activity. For this reason, had allowed a court or tribunal to which requires the salvors to show salvors have suggested that an take into account “the skill and they have actually prevented or appropriate reform of the Convention efforts of the salvors in preventing minimised environmental damage, would involve the introduction of a or minimising damage to the Article 14 is payable where there separate, dedicated “environmental environment” when assessing an is merely a threat of environmental award” under a revised Article 14 appropriate salvage award (Article damage. It is noteworthy that only which would apply where salvage 13(1)(b)). the owner of the vessel is liable to operations have been undertaken The words “damage to the pay the special compensation. Under on a vessel threatening damage environment” are defined in Article this provision, the only remuneration to the environment. Equally, Article 1 of the Convention as meaning payable to the salvor is its “out 13 would be amended to exclude “substantial physical damage to of pocket expenses” and “a fair environmental considerations from human health or to marine life or rate for equipment and personnel being factored into an Article 13 resources in coastal or inland waters actually and reasonably used in the salvage award. In assessing any or areas adjacent thereto, caused salvage operation” (Article 14(3)). Article 14 environmental award, the by pollution, contamination, fire, Article 14 also provides that special ISU suggests that a court or tribunal explosion or similar major incidents”. compensation could be increased would take into account any Article 13 by no more than 100 per cent of the compensation. Whilst the ISU has criticised the expenses incurred. narrow geographical scope of the A rare example of Australian Courts words “coastal or inland waters or However, in the case of the Nagasaki hearing salvage cases was the areas adjacent thereto”, its main Spirit 2, the House of Lords held that case of United Salvage Pty Limited concern in relation to Article 13(1) “fair rate for equipment and personnel v Louis Dreyfus Armateurs S.N.C3, (b) is that the significance of the actually and reasonably used in the when Tamberlin J and the Full Court environment in relation to salvage salvage operation” in Article 14(3) of the Federal Court, considered work is far greater now than at the meant a fair rate of expenditure and the provisions of Article 13 and

154 Autumn 2011 AUSTRALIA in particular Article 13(1)(b). The industry is collapsing”. The article Conclusion Full Court approved Tamberlin J’s also referred to the recent decision The CMI is not a lobby group, and interpretation of that provision (he of the British coalition government has as its raison d’etre unanimity for had said that the provision was not to cancel the budget for providing concerned with “possible, remote or ETVs around the UK coast. The article international maritime law. Whilst it hypothetical damage”) and his finding suggested that “government support would be a concern for the CMI if that there was no major incident means market distortion and in the the regime pursuant to which salvors which seriously effected, or posed are remunerated is not working, and a direct threat to the environment. end this equals unfair competition”. if coasts are likely to be exposed to The Full Court accepted that “There Tsavliris accepted the need for was no notable escape of pollutants Government to “fill the vacuum” in major oil pollution incidents due to the or any contamination which required order to have the facilities to protect unavailability of tugs, it is ultimately a measures to be taken. The grounding coasts but suggested “there will be matter for industry to determine how it of the “La Pampa” and consequential no vacuum if ship managers and best deals with these issues, whether salvage operations might be referred insurers supported entrepreneurial by reform of the Convention or some to as incidents, but they were not commercial salvage stations in the other arrangement. major incidents which affected or traditional way, thus making them threatened the environment in the viable, which sadly they do not”. It is clear that there is a considerable way spoken of in the article. Having divergence of views between salvors regard to the position in which the The comments quoted in the Lloyds and property insurers on the one oil was stored, well away from where List DCN article by Nicolas Tsavliris hand and shipowners and their there was any prospect of rupture therefore echo what was being said insurers on the other, as to whether or failure, His Honour had found that by Bureau Veritas in the early 1990s the system for rewarding salvors there was only a remote possibility and is pertinent to Australia. In under the Salvage Convention 1989 of a failure which could have led to February 2008 an intergovernmental contamination or pollution”. is working adequately. CMI is seeking agreement on the National Maritime further information from its constituent Emergency Response Arrangement members at the present time. Emergency Towage Vessels (NMERA) was entered into. Pursuant (ETV) to those arrangements, the NMERA The CMI, through its International An important review of the salvage has undertaken to provide an Working Group, and at future industry was undertaken by Bureau appropriate level of emergency conferences, will continue to review Veritas in the early 1990s. I referred towage capability around the these issues. Industry has shown in to this review in the Discussion Australian coast. The Australian the way it developed the SCOPIC Paper, which I prepared for the Government agreed to establish a International Subcommittee Meeting agreement, and through other similar national capability for emergency of the CMI, which was held in industry agreements, that it is capable towage at strategic locations around London in May 2010. In that paper of self regulating by developing Australia, funded through the I identified its conclusions as workable and practical alternatives to protection of the sea levy, which is being that “international salvage international treaties. The CMI stands resources were in serious decline made under the Protection of the Sea ready to assist industry in reaching a as a result of a reduction in casualty (Shipping Levy) Act 1981. workable solution. rates, falling levels of remuneration The UK Government, in scrapping and compensation created by the the ETVs which protected the UK *Vice President, Comite Maritime availability of offshore support vessels International; Chairman, International Coast, has not seen fit to follow and other ancillary crafts leading Working Group and International Australia’s example. Australia has to the withdrawal of professional Sub-Committee on Review of Salvage clearly accepted that industry is salvors from the market, the reduction Convention 1989. of dedicated salvage craft and no longer capable of providing the the closure of additional salvage necessary resources to meet salvage 1 The CMI is the ‘parent’ body of National stations”. requirements and has done so at no Maritime and Law Associations (NMLAs) around the world. The CMI does much A recent article in Lloyds List DCN direct cost to the tax payer although, of the preparatory work and drafting of (23 December 2010) would suggest presumably, the levy finds its way proposed international conventions which that the position has not improved. into freight rates and ultimately, The article quoted extensively from particularly, the cost of fuel. are then submitted to the appropriate Nicolas Tsavliris of the Tsavliris United Nations body such as the It is ironic that the country which has Salvage Group. The article referred International Maritime Organisation now taken steps to reduce its ability to the fact that his organisation now (IMO) or the United Nations Commission only maintains three of its own tugs to prevent oil pollution, and assist on International Trade Law for further on international salvage station, a where casualties occur, is the venue development. reduction from seven a few years where a substantial percentage 2 (1997) 1 Lloyds Rep 323 ago and from 12 a generation ago. of the world’s salvage claims are Tsavliris is quoted as saying that “the determined by Lloyds arbitrators. 3 (2007) FCAFC 115

Autumn 2011 155 AUSTRALIA Maritime law

The unpaid seller’s right of stoppage in transitu - what carriers need to know By Geoff Farnsworth, principal, Macpherson + Kelley Lawyers

An unpaid seller who has delivered containers to a nominated and charges had not been paid and goods is in an invidious position. container terminal. bills of lading had not been issued to ACM in relation to some 190 • The buyer books freight with a Providing a buyer with credit is containers. a necessary evil of business. shipping line. The shipping lines did however have Simplistically, if the seller is unpaid • As part of that booking, the buyer security for freight and charges in the he may demand the return of the arranges for shipping containers form of the contractual lien written into goods. However, what if the buyer to be released to the seller, or their bills of lading under which the has become insolvent, and/or the often direct to a container packer lines could refuse to deliver the cargo goods have been shipped interstate, contracted by the seller. or overseas? to whoever presented the original • The seller contracts with a packer, bills, until freight and charges had These were the issues which and provides that packer with been paid. confronted Gilgandra Marketing grain which the packer then packs The commercial relationship between Co-Op Ltd (GMCL) in its dispute into the containers released by the ACM and GMCL broke down at with Australian Commodities & line. a time when ACM owed GMCL Merchandise Pty Ltd (ACM). • Once the containers are packed, approximately $3 million. GMCL, as its name suggests, is an they are delivered to the In light of the fact that bills of lading agricultural co-operative principally in nominated container terminal, had not been issued, and the subject the business of marketing wheat for within the delivery period agreed containers could not therefore have local growers. Following deregulation between the buyer and seller. been “delivered”, GMCL issued the of the Australian export wheat market, This transport is often arranged shipping lines with “stoppage in GMCL began selling wheat to ACM. by the packer based on transitu” notices under section 48 instructions provided by the buyer. of the NSW Sale of Goods Act 1923 ACM is an Australian company. Its (“the Act”). principal was an Australian resident • Once the containers are shipped, of Bangladeshi origin whose expertise bills of lading are issued by the The unpaid seller’s right to stop the lay in selling Australian commodities, line to the DCT buyer/Shipper. goods while they are in transit is an including wheat, to buyers in In the course of the business ancient one, which appears to be Bangladesh. relationship between GMCL and rarely used in current times. While it ACM, 610 containers of wheat were is codified in the Act, it is a common The terms of business between sold by GMCL to ACM on terms law remedy which appears to have its GMCL and ACM were “Delivered “DCT Port Botany”, and shipped to origins in the 18th century. Container Terminal”, or “DCT”. As an Bangladesh. aside, while DCT is a commonly used The relevant provisions of the Act are term particularly in relation to grain That relationship broke down. ACM set out below. in containers, it can be a dangerous became late in making payments, term to use in that while it appears then ceased to pay altogether at 46 Right of stoppage in to be an Incoterm, it is not, so there a time when approximately 190 transitu containers were either “on the is no standard definition of precisely Subject to the provisions of this act, water”, or had been discharged at what DCT means. when the buyer of goods becomes Chittagong. Through trade custom, under a DCT insolvent, the unpaid seller who contract; For its part, ACM also appeared to has parted with the possession of have had a credit relationship with the goods has the right of stopping • The buyer and seller agree on a certain shipping lines and freight them in transitu, that is to say, the delivery period within which the forwarders such that while the seller may resume possession of the seller must deliver grain in containers had been shipped, freight goods as long as they are in course

156 Autumn 2011 AUSTRALIA of transit, and may retain them until possession of the whole of the In a judgment handed down on 4 payment or tender of the price. goods. February 2011, Justice Slattery in the 48 How stoppage in transitu Supreme Court of New South Wales 47 Duration of transit is effected found that the transit continued after (1) Goods are deemed to be in shipment and that GMCL had the (1) The unpaid seller may exercise course of transit from the time right to possession of the goods. The the seller’s right of stoppage when they are delivered to a Court referred to the judgment of Lord in transitu either by taking actual carrier by land or water or other possession of the goods or by Esher MR in Bethell v Clarke (1888) bailee for the purpose of where his Lordship said; ransmission to the buyer until the giving notice of the seller’s claim buyer or the buyer’s agent in that to the carrier or other bailee in “Where the transit is a transit which whose possession the goods are. behalf takes delivery of them from has been caused either by the terms The notice may be given either the carrier or other bailee. of the contract or by the directions of to the person in actual possession the purchaser to the vendor, the right (2) If the buyer or the buyer’s agent of the goods or to the person’s in that behalf obtains delivery of principal. In the latter case of stoppage in transitu exists.” the goods before their arrival at the notice to be effectual must be the appointed destination, the In this case, the Court found that given at such time and under such transit is at an end. the buyer had issued directions to circumstances that the principal, the seller (through the agency of the (3) If after the arrival of the goods at by the exercise of reasonable packer) to deliver the containers to the appointed destination the diligence, may communicate it Port Botany within a specific window carrier or other bailee to the principal’s servant or agent acknowledges to the buyer or the in time to prevent a delivery to the to permit shipment. These directions buyer’s agent that the carrier buyer. identified both the relevant shipping or other bailee holds the goods on line, and carrying vessel. the buyer’s behalf and continues (2) When notice of stoppage in in possession of them as bailee transitu is given by the seller to His Honour observed; for the buyer or the buyer’s agent, the carrier or other bailee in “It is not possible to send a container the transit is at an end, and it is possession of the goods, the to Port Botany by rail and then to immaterial that a further carrier or other bailee must destination for the goods may edeliver the goods to or according hope that somehow at Port Botany the have been indicated by the buyer. to the directions of the seller. The right train meets the right vessel. The evidence is that Port Botany terminal (4) If the goods are rejected by the expenses of the redelivery must buyer, and the carrier or other be borne by the seller. is organised far more efficiently than that. It is not possible to load a bailee continues in possession GMCL gave notices to the shipping of them, the transit is not deemed container on a train destined for Port lines under section 48(1) of the Act. to be at an end, even if the seller GMCL subsequently commenced Botany which would be received at has refused to receive them back. legal proceedings against ACM and the container terminal without the (5) When goods are delivered to obtained injunctions preventing ACM shipper submitting a pre-receival a ship chartered by the buyer, from dealing with the wheat. The lines advice on a computerised system it is a question depending on the then joined the proceedings, being known as “1-Stop”……The obvious circumstances of the particular concerned (in particular) to ensure efficiency of a system such as this case whether they are in the that their freight and other charges needs no elaboration.” possession of the master as a (including container detention) would carrier or as agent to the buyer. be paid. Lessons for Carriers (6) Where the carrier or other bailee The main question that the court wrongfully refuses to deliver the had to determine was whether the Rights of stoppage in transitu are goods to the buyer or the buyer’s relevant transit under a “DCT Port rarely exercised. Nevertheless, agent in that behalf, the transit is Botany” contract ended when the carriers in receipt of such notices deemed to be at an end. containers were delivered at the must treat them seriously. A carrier (7) Where part delivery of the goods container terminal, or whether the who fails to comply with a valid has been made to the buyer or transit continued once the goods had notice may be exposed to a claim the buyer’s agent in that behalf, been shipped. in conversion. If a carrier is in the remainder of the goods may any doubt about the validity of a be stopped in transitu, unless the ACM argued that there were two part delivery has been made “transits”; the first from the packing stoppage notice, it should commence under such circumstances as plants to Port Botany, and the second “interpleader” proceedings in order to to show an agreement to give up from Port Botany to Chittagong. seek the guidance of the Court.

Autumn 2011 157 AUSTRALIA Maritime law

Application of Australian employment law to permit ships engaged in the coastal trade

By Robert Springall, partner, Holman Fenwick Willan

Introduction The Act does not apply to permit maritime employee will, therefore, ships that fall outside the scope include both Australian and foreign After 1 January 2010, employers of Regulations, that is, in general employers. of masters, pilots or seamen (i.e., terms, a ship that has not been “maritime employees”) working on regularly engaged in the coasting Effect of operation of Act permit ships that regularly engage trade before 1 January 2010. in Australia’s coasting trade are Seagoing Industry Award 2010 required to comply with new In addition to the obligations (“the Award”) Commonwealth legislation known on employers, the Ministerial The Award was handed down as the Fair Work Act 2009 (“the Guidelines for issuing coasting in December 2009 by Fair Work Act”). This includes complying trade permits specifically state that Australia’s predecessor, the with the decisions handed down failure to comply with the Act will Australian Industrial Relations by the national workplace relations be one of the factors considered in Commission, and is divided into two tribunal, Fair Work Australia, with assessing whether the issue of any parts: regard to pay entitlements and the further permits to the permit holder payment of an award or, where an would be in the public interest. 1. Part A provisions apply to all award does not apply, the national vessels except those which minimum wage. How the Act applies to crews have been granted a permit on permit ships under the Navigation Act 1912 Unlike previous legislation, the (Cth). Act has implications not only The object of the Act includes for Australian employers and “ensuring a guaranteed safety net 2. Part B provisions apply to employees, but also for employers of fair, relevant, and enforceable vessels granted a permit under of foreign crew. minimum terms and conditions the Navigation Act 1912 (Cth) through the National Employment and which are subject to the Standards, modern awards and Act. Application of the Fair Work national minimum wage orders.” Act to permit ships The Award covers employers These terms and conditions are which are engaged in the seagoing The Regulations to the Act set by Fair Work Australia, which industry and their employees in the specifically extend its operation to is empowered to set and vary classifications listed in the Award. a ship operating under a Single minimum wages where an award Under the Award “employee” Voyage Permit (“SVP”) that is does not apply and to make, vary and “employer” have the same issued on or after 1 January 2010 and revoke modern awards . meanings as those defined in the where that ship has also been Act. issued with either: The Act covers employers who, in the course of trade or commerce, The Award covers any employer 1. a Continuous Voyage Permit usually employ a master, seaman which supplies labour on an on-hire (“CVP”) in the 15 months before or pilot (“maritime employee”). basis in the industry in respect of the date of issue of the current In doing so, the Act relies on on-hire employees in classifications SVP; Parliament’s power to legislate with covered by the Award, and those or respect to foreign corporations and on-hire employees, while engaged trading or financial corporations, in the performance of work for a 2. two or more other SVPs in the and also in relation to interstate and business in that industry. 12 month period before the overseas trade and commerce. date of issue of the current SVP. While the Part A provisions Insofar as the Act applies to permit commenced on 1 January 2010, The Regulations also extend the ships that fall within the scope of the Part B provisions will not operation of the Act to a ship the Act, it follows that any reference commence until 1 January 2011. operating under a CVP issued on or to an employer engaged in trade The delay in implementing Part B after 1 January 2010. or commerce which employs a provisions is to enable Fair Work

158 Autumn 2011 AUSTRALIA Australia to consider amendments coasting trade will be under a engaged in trade or commerce, it to the Award as it applies to permit legal obligation to pay the National follows that they will be obliged to ships. Minimum Wage to the crew as from pay Australian entitlements to those 1 July 2010. crews whilst the ship is operating in National minimum wage Australian waters. This obligation Until such time as Part B of the Non-compliance will apply to employers of both Award comes into force, and no Australian and foreign crews. other award applies, foreign crew Non-compliance with the Act on permit ships to which the Act has several implications for both As the extension of the Act to applies are required to be paid employers and permit holders. permit ships with foreign crews is not less than the minimum pay While employers may be subject a new development in Australian entitlements as set down by Fair to orders under the Act for employment law, it remains to be Work Australia. retrospective payments (up to six seen how effectively compliance years) and financial penalties, non- On 3 June 2010 the Minimum with the Act will be monitored. compliance with the Act will also Wage Panel of Fair Work Australia In the meantime, employers handed down its first minimum be one of the factors taken into should ensure that they meet account in considering the granting wage decision with the new rates of their obligations as set down of further permits to the operators of pay to take effect from the first full under the Act with regard to such ships. pay period on or after 1 July 2010. crew entitlements, bearing in As employers who are subject to mind that failure to comply will General comments the operation of the Act, employers have implications not only for the of foreign crew working on permit As employers of foreign crews on employer but also for the permit ships regularly engaged in the permit ships subject to the Act are holder in seeking further permits.

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Autumn 2011 159 AUSTRALIA Maritime law

Is my foreign arbitral award enforceable? The effect of COGSA on foreign law and jurisdiction clauses and enforcement in Australia

By Rachel Deane, senior associate, HWL Ebsworth

his article looks at the effect Section 11 of COGSA operates as within the meaning of the Hague that section 11 of the Carriage follows: Visby Rules, such documents not of Goods by Sea Act 1991 being documents of title (like T 1. in relation to outbound shipments, (Cth) (COGSA) can have on the a Bill of Lading). This effect section 11(1) of COGSA would prospects of enforcing, in Australia, likely came about as a result of strike down a choice of law a foreign arbitral award pursuant amendments to COGSA in 1997 clause in a sea carriage to a foreign jurisdiction/arbitration document which did not stipulate which probably had the clause in a “sea carriage document”. Australian law. Section 11(2 (b) unintended consequence of The issue is nothing altogether would then strike down a rendering voyage charterparties new, however, it still seems to take foreign jurisdiction clause in (at least) subject to section 11(2 maritime practitioners by surprise! relation to the same outbound (c) by reason of the use of the words “sea carriage documents” COGSA seeks to implement, shipment; consistent with what was amongst other things, the Hague 2. in relation to inbound shipments, formerly the position under the Visby Rules which deal with the a foreign choice of law clause in 1924 Act (as found by Carruthers liability of a carrier to cargo interests. the sea carriage document would J in The “Blooming Orchard” ) But COGSA also has a protectionist be valid, however, and notwithstanding that COGSA aspect – namely, protecting section 11(2(c)(i) of COGSA Australian courts from having their would strike down a foreign when originally enacted in 1991 jurisdiction “ousted” by parties to jurisdiction clause; was enacted in terms that certain contracts. It does so by removed charterparties from rendering invalid any clause in a sea 3. section 11 of COGSA seems section 11 so as to overcome The carriage document that purports to to apply to voyage charterparties, “Blooming Orchard”. preclude or limit the jurisdiction of contrary to the meaning of “sea an Australian court in respect of that carriage document” in the Hague So, it seems, that under Australian sea carriage document (although Visby Rules. This is despite law, section 11 of COGSA would it expressly preserves Australian what is normally a maritime strike down a foreign arbitration arbitration). Such a provision is not practitioner’s initial reaction clause in a voyage charterparty. unusual. However, the Australian that it should not apply to So what? A foreign arbitrator provision arguably seems to go a voyage charterparties, as they determining a dispute, and any couple of steps further, applying are not “sea carriage documents” foreign court called upon to enforce to (a) voyage charterparties and (b) both outbound and inbound shipments. The International Arbitration Act 1974 (Cth) seeks to domestically implement the New York Convention (the regime for the recognition and enforcement of foreign arbitral awards). There are certain instances when a party can ask an Australian court not to enforce a foreign arbitral award, including, where to do so would be against public policy. The International Arbitration Act, in its own terms, surrenders itself to the Joe Hurley, partner and national head of Danella Wilmshurst, shipping specialist primacy of COGSA (section 2C). shipping and trade and partner

160 Autumn 2011 AUSTRALIA any award, is likely to ignore the behind it, and therefore be contrary comfortably within the description of purported effect of section 11 of to public policy so that the court a “sea carriage document”. COGSA, and so would not find could refuse to enforce it. that a foreign choice of law/foreign Therefore, parties to a voyage jurisdiction clause was invalid, This places parties in a position charterparty or other sea carriage and would not find that it (as an where they must make a choice document for inbound or outbound arbitral tribunal) had no jurisdiction, – abandon the idea of a foreign voyages should be aware of section as a result of the application of arbitration and commence 11 of COGSA, and should consider section 11. However, the real issue proceedings in Australia; or take a its possible effect on enforcement of arises if a (successful) party to any risk and see the foreign arbitration a foreign award in Australia. Clients arbitral award needed to enforce through to finality, and attempt to should consider early whether the that award in Australia. This is enforce it in Australia (hoping that assistance of Australian courts may because any attempt to enforce the either the court does not find that be needed to enforce any arbitral award may fall foul of section 8(7) a voyage charterparty is a “sea award (for example, because the (b) of the International Arbitration carriage document” within the defendant’s assets are in Australia), Act 1974 (Cth), which provides that meaning of COGSA, or that the court due to the later issues that may if enforcement of an award would might nonetheless enforce the award arise with enforceability if the award be contrary to public policy, then (noting that refusal to enforce it is was made contrary to COGSA. The the Australian court can refuse to enforce it. The argument would likely discretionary). The issue is not one parties could also consider an “ad be that, to allow the foreign award to of Australia’s failure to domestically hoc” agreement or submission to be enforced in circumstances where implement the New York Convention. arbitration which, being apart from the arbitration agreement would Rather, it is the protectionist stance or outside the voyage charterparty, be invalid in Australia would be to taken by COGSA and its anomalous would be beyond the reach of circumvent the prohibition in section application to voyage charterparties section 11 of COGSA and therefore 11(2)(c) and the intention/policy which does not generally sit valid.

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Autumn 2011 161 AUSTRALIA Maritime law

After the floods – Potential legal implications relating to the recent Qld/Vic floods

By Nathan Cecil, partner, Norton White Lawyers

he impacts of the floods were Australian export trade is conducted to the general maxim “once on far-reaching and do not stop on FOB terms, this means that the demurrage, always on demurrage.” Tat the personal lives of those Australian exporters under voyage directly affected by the event. In charterparties could become liable Force Majeure addition to the physical ruin that for very significant demurrage costs will remain, as the flood waters extending into the future until the There is no doctrine of force subsided they have left behind road and rail corridors servicing the majeure at common law. a murky residue of uncertainty ports are repaired, assessed and Accordingly, force majeure can only over many aspects of maritime operating at ordinary capacity and arise where it is expressly provided commerce that may take a long export back-logs are cleared. for in a contract. time to clean up. Under a voyage charterparty, Force majeure clauses generally laytime starts to run once a valid operate by providing that upon the Demurrage notice of readiness is served. happening of an event falling within the clause which is beyond the The Queensland floods caused the Often, only “weather working days” control of either party and unable closure of the Ports of Brisbane, count towards laytime and any time to be avoided, a party whose Bundaberg and Port Alma. Even during which the weather prevents performance of the contract is the Queensland bulk ports that were the actual operation of loading is not prevented by the event is excused not closed were still affected by the counted towards laytime. This may from liability for non-performance floods due to the impact of the flood extend to include days on which a for the duration of the force majeure waters on the surrounding mines port is closed due to bad weather, event. and road and rail infrastructure which occurred at a number of used to transport cargo to the ports. ports in Queensland during the The Queensland floods in particular severe rain and flooding. have resulted in physical damage As a result, both during the floods to various ports in Queensland, and potentially for a significant However, the lasting effects of although such damage appears time afterwards (for example, until previous bad weather which does to have been relatively minor. mines are re-opened and road and not directly affect loading operations Perhaps of more significance is the rail assets repaired and/or cleared at a port is not generally excluded extensive damage that the floods for safe use) it can be expected from laytime. Accordingly, loading have wreaked on the railway lines that the affected ports will operate delays caused by the closure of and roads servicing the bulk ports. below capacity as suppliers of raw mines or damage to road and rail Potentially of equal significance is materials for export may not be corridors servicing ports as a result the damage that the floods may able to deliver cargo to the ports for of the floods will not automatically have caused to the mines and loading at all, or at least not at the be excluded from laytime or prevent mining infrastructure. Damage to usual rates. the accruing of demurrage charges. the infrastructure at any of these Absent any special considerations Any claims for an exception to points along the export chain will (see below under “Force Majeure”), laytime due to adverse weather result in very significant delays to the impact of the delay in having during the period of the floods the mining, transport and loading cargo available at ports for loading should be scrutinised closely in of bulk cargos for export. At this will mean that vessels waiting off order to ensure that laytime is not point, it pays to note that Australia the ports will go on demurrage at sought to be extended improperly. is reported to be the world’s largest the expiration of the contractual In this respect, the impact of mere exporter of coking coal and the laytime contained in any applicable hours either way can have very second-largest global exporter of charterparty. As much of the significant consequences, due thermal coal.

162 Autumn 2011 AUSTRALIA A similar situation arose as a result railway access line is washed away returning them to the Carriers and/ of the serious flooding of the Hunter but there is another available line or or paying container detention or Valley coal chain in June 2007, as other available means to transport replacement charges as appropriate part of the severe weather pattern cargo to a port (even if such other (especially now that the Supreme that resulted in the grounding of the means cost significantly more), a Court of NSW has overturned “Pasha Bulker”. The 2007 floods party may not be able to rely on the caused mines to be closed and force majeure clause. the decision in DV Kelly v China damaged or washed away road and Shipping). Further, force majeure clauses rail access from some mines to the No doubt, industry stakeholders will port of Newcastle. Consequently, generally have very prescriptive a number of the coal producers/ notice provisions and/or time limits discuss how to address the impacts exporters sought relief from their and it is an essential requirement of the floods on the return of of relying on such clauses that the obligation to load coal on the shipping containers and appropriate notice provisions are adhered to basis of force majeure, including consideration will be exercised on strictly. Parties wishing to claim relief from liability for what would a case-by-case basis. Whilst those otherwise be demurrage charges force majeure must therefore in the industry adversely affected of many hundreds of thousands of carefully consider and comply with dollars per vessel. any notice provisions. Conversely, by the floods may seek a blanket parties wishing to challenge any waiver of detention/replacement The first question to ask is “are the claim of force majeure must look charges, this is perhaps not a floods a force majeure event?” As carefully for any failure by the other fair position to expect Carriers to force majeure clauses are strictly party to comply fully with such adopt as it is rife for exploitation creatures of contract, the answer provisions. to this question will turn on the and would effectively amount to precise wording of the clause in One final word of warning – a Carriers writing off a significant and wrongful claim of force majeure question. Typical clauses usually very valuable proportion of their list events such as “act of God, and consequent refusal to container stock. war, riot, strikes, fire, floods, acts of perform a contract may amount Government” and so on as being to a repudiation of the contract, In considering any request for force majeure events. In the entitling the other party to consideration on a case-by-case terminate the contract and sue for context of a charterparty, the weight basis, Carriers should be mindful to of authority suggests that such breach. Accordingly, very careful ensure that any claim for damage events should be given operation consideration must be given prior to only to the extent that they actually claiming force majeure and it is very or loss of containers due to the prevent the physical loading of the strongly recommended that advice floods is reasonably supported, for vessel by the Master. is sought prior to making such a example, with the lodgement of a claim. Ordinarily, this means that ‘upstream timely police or insurance report. events’, such as “disruptions or In respect of the latter, Carriers delay to supply, shortage of raw Container Detention should also carefully consider materials, unavailability of transport Those in the shipping industry with the position where it appears that or failure of plant and equipment” a keen eye would have noticed a a Merchant may have in place are not covered unless they are large number of shipping containers business insurance which covers expressly referred to. Uncertainty taken by the flood waters and them for the value of any damaged may arise where the force majeure shown floating down rivers or main or lost containers (or the Merchant’s clause includes words to the effect streets in the footage taken during liability to the Carrier in respect of of “any other cause whatsoever the floods. Presumably, many of which prevents a party from these containers will never be seen the same). Obviously, if a Merchant performing”. again, or, at the very least, only has insurance in place which will Whether or not the impact of the found much later and in a damaged respond to the damage or loss of floods will excuse performance state not fit for use. shipping containers, a Carrier may under any charterparty is therefore As discussed above, there is no be less inclined to compromise any a matter of how widely the particular general or common law concept of claim for detention or replacement force majeure clause is drafted. force majeure. Under the common charges. In addition, a party is generally law, no act of God, no matter not able to rely on force majeure how devastating, will relieve those The flood waters may have receded, if it can reasonably overcome the persons previously in possession of but their effects will continue to be problems faced. For example, if a such shipping containers from felt for some time to come.

Autumn 2011 163 AUSTRALIA Young Shipping Australia Victoria The momentum grows through industry events

ince the establishment of the Whilst 2009 saw the implementation Victorian chapter of Young of a calendar of events of SShipping Australia in 2009, alternating social networking and YSA VIC have kept the momentum information seminars, 2010 sought going through the planning and to gain increased participation implementation of various industry by combining the 2 forums which events and social networking was well received by industry and sessions. members. The aim of YSA VIC is to promote YSA VIC kicked off 2010 with the industry and provide an avenue a port tour sponsored by Port for up-and-coming generations of Melbourne Corporation in to keep up to date on industry April which was attended by innovations and broaden the 54 participants. The event was knowledge of individuals on an ever open to members, non-members expanding and evolving industry. and SAL senior members who were also invited to network with YSA members at the West Gate port tour The YSA VIC committee consists of young professionals to share their contribute to the success of the port 6 individuals from Shipping Australia words of wisdom with the group. and its supply chain. member companies. The committee The members were given a up is chaired by Lisa Jinnette, Port of close and personal view of the A transport industry seminar and Melbourne Corporation and includes port of Melbourne in action with networking function was held in Fleur Walsh, ANL Container Line, commentary on statistics and the June and was sponsored by Victoria Greg Mawer, Pacific Asia Express port’s facilities, as well as food and University’s Institute for Logistics & Pty Ltd, Reid Bettridge, Holman beverage to enjoy. The event was Supply Chain Management. The Fenwick Willan, Jesse van der Tang, a huge success and along with presentation, given by Mr Peter ANL Container Line, Matt Treeby, good weather, gave the attendees Van Duyn, focused on the future of Pacific Asia Express Pty Ltd. an opportunity to see how we all shipping and logistics and included such topics as Global Stevedoring, Coastal Shipping, Landside Logistics, current research projects undertaken by the University, Career Development and Training Opportunities. The Port Education Centre hosted an evening of general trivia with a shipping flair in September. The members were divided into groups and competed against each other on general knowledge, sports, music, entertainment, as well as specific shipping related questions. Although there could only be one winner on the night it was apparent that there is always something new to learn every day in the maritime YSA members listening to Luke Duffy at the West Gate port tour industry.

164 Autumn 2011 AUSTRALIA YSA members enjoying the 1st anniversary port tour Members of YSA at their end of year function at the Blue Diamond Westgate Ports (October) an explanation of the bulk paper provided a wonderful atmosphere to facilities. YSA members visited the Westgate cap off the second successful year Ports facility in October. The CEO, of YSA VIC. Christmas networking Luke Duffy, provided an informative The YSA VIC committee is looking tour of the terminal and warehouse function (November) forward to providing its members facilities whilst also providing an The 2010 Christmas networking with innovative, informative and overview of the operations and third function was held at the Blue party provider services available. Diamond and was well attended contemporary topics for discussion Notable highlights included tours of by members. The stunning views though an exciting calendar of the old and new warehouses and of the city from the Blue Diamond events in 2011. New South Wales A year full of success

uring 2010 YSA Sydney held In response to a lack of visible Bills of Lading, the Rotterdam Rules six events for its 60 plus options for further education in the and one of the hot topics of 2010, Dmembers and guests. The industry, YSA organised and held container detention. Along with case first event was the CEO outlook, an Education Expo in April. The studies, obligatory images of cargo which has now become the keynote objective of the event was to allow spilling in hatches and explosions event. Over 80 people attended maritime professionals interested in were included to resounding sighs the event at NSW Parliament House further studies, the opportunity to in the audience. The event was to hear Wallenius Wilhelmsen obtain information from a selection extremely well attended, with over Logistics Oceania chairman Peter of institutions. Participants included; 50 members and guests. Dexter, along with OOCL Australia The Institute of Transport and managing director Eddy Declercq Logistics Studies/Sydney University, and Hapag-Lloyd managing director the Australian Maritime College, John Bradley. The speakers shared Australian School of Business/ their cumulative 120 plus years UNSW, Institute of Charterted of experience in the industry, Shipbrokers and My Freight outlining what attracted them to the Career. Each institution prepared industry and their progression in the a presentation covering programs, industry. Speakers also outlined the teaching methods, and funding importance of leadership, general options/costs. employment trends, opportunities within the industry and the value During September, we held a of education and professional Maritime law essentials presentation networks. In addition, an outlook for by Norton White. The major topics Hussein Chahine, Alex Faliotti and the shipping industry was provided. included a thorough coverage of Emmanuel Papagiannakis

Autumn 2011 165 AUSTRALIA Young Shipping Australia

YSA will seek greater sponsorship encourage members for their of events. The membership fee has input. A pressing requirement remained $50 per member since remains the establishment of inception, with a special corporate educational resources for maritime membership of $300. professionalsand we will work with SAL on this issue. Media YSA will also work on providing YSA was well represented in the greater member statistics media with coverage of our major and develop a closer working events. In 2011, YSA will continue relationship with shipping lines HR to expand its media, website and departments to deliver mutually external relations with related Outlook event: Eddie Declercq, managing beneficial events. parties. director OOCL Australia, Peter Dexter, chairman, Lastly, we thank all YSA members Wallenius Wilhelmsen Logistics Oceania , John Bradley, managing director, Hapag Lloyd and Strategic direction and guests who have attended Emmanuel Papagiannakis, Patrick Terminals events, the Committee for their hard and chairman NSW YSA Whilst pleased with progress work and importantly, those in the in 2010, it was apparent the maritime community that by allowing organisations growth was limited staff to attend events, develop their by its membership criteria. There staff, grow YSA and we hope, grow was immense interest from freight their companies profitability. forwarders to join; however, SAL directed that YSA continue to serve its members only at this Committee of 2010 stage. Going forward, this will Emmanuel Papagiannakis, be an interesting development, chairman, Patrick Container Ports as many shipping functions become commoditised or move Hussein Chahine, vice chairman, offshore such as operations/ Seaway Agencies vessel planning, with 3PL and 4PL opportunities continuing to flourish. Kylie Frost, secretary, Maersk Notwithstanding the latter facts, YSA Australia Outlook event: Alycia Elliott and Kylie Frost from Maersk, Paul Alexander from SAL, and will aggressively market its events Alex Faliotti, treasurer, Humburg Nathan Cecil from Norton White Lawyers in 2011 and industry participation Sud will determine the success of these Maritime legal events will continue events and indeed YSA itself. A Nathan Cecil, information officer, to feature annually, as the member survey was completed Norton White Lawyers presentations provide required in 2010, which provided valuable David Uncle, events planning training for both claims and feedback of the types of events, officer, Hamburg Sud operations maritime professionals. timing of events and industry issues In addition to a few social members are interested in. Paul Alexander, policy advisor, networking events, the Annual Shipping Australia Pty Ltd Dinner was held in November at Going forward 2011 the Russian Coachman restaurant. Tasha Vidaic, events officer, Guests mingled before enjoying YSA has focussed on planning high Seaway Agencies quality events well in advance, with a three course meal of traditional Andrew Fletcher, information officer, a full calendar already established. Russian food. For those who didn’t K-Line. partake in traditional Russian Apart from the annual CEO outlook beverages, I understand there event, a further 7 events have been was also other entertainment scheduled including presentations with Russian dances, a DJ and on maritime law, port landside a live violinist, a combination of interface, education, importer entertainers only Russians could supply chain and a site visit to a execute successfully. It was a great rail intermodal/packing facility. In night, with good food and even addition, members will also receive better company. a copy of each SAL magazine. YSA will seek to improve the Economic awareness of industry issues YSA was fully funded by as they affect younger maritime memberships and sponsorship from professionals, through media presenters. YSA did not receive and through the SAL HR Steering any funds from SAL. Going forward, Committee, hence would Education Expo

166 Autumn 2011 AUSTRALIA Australian Maritime Safety Authority

promoting the safety of shipping and seafarers, protecting the marine environment, coordinating maritime and aviation search and rescue, and progressing maritime reform.

MARITIME OPERATIONS DIVISON Issuing STCW certification to Australian seafarers, auditing the safe operation of Australian ships, conducting Flag State and Port State Control inspections, determining minimum manning of Australian registered ships, regulating pilotage in the Great Barrier Reef and Torres Strait, and registering Australian-flagged vessels. MARITIME STANDARDS DIVISION Providing a regulatory framework, strategic advice and operational oversight on maritime safety and navigational issues, the provision and maintenance of Australia’s marine aids to navigation network, and engagement with both the International Maritime Organization and International Association of Marine Aids to Navigation and Lighthouse Authorities. EMERGENCY RESPONSE DIVISION Coordinating maritime and aviation search and rescue, providing search and rescue aircraft, maritime safety communications, and vessel tracking. MARINE ENVIONMENT DIVISION Minimising the impact of shipping and marine pollution incidents on Australia’s marine environment by maintaining a regulatory system consistent with international standards and providing marine pollution response and management of Australia’s National Plan to Combat Pollution of the Sea by Oil and Other Noxious and Hazardous Substances. Operation of international liability and compensation schemes, developing, implementing, monitoring and enforcement of international environment protection standards, and providing a marine casualty and emergency towage response. REGULATORY AFFAIRS & REFORM Developing a maritime safety commercial vessel legislative framework and operating system, implementing Council of Australian Governments (COAG) single national regulator reforms and rewriting the Navigation Act. Education Expo www.amsa.gov.au

Autumn 2011 167 AUSTRALIA NOW AVAILABLE BY Education and training Distance Ed

NSW Transport and Logistics Workforce Advisory Group

By Joanna Quilty, deputy director general, Transport NSW; chair NSW TLWAG

ast year, 2010, saw the first full year Transport and Logistics Workforce For information on how you can get of operation for the NSW Transport Gauge involved in the 2011 Transport and Land Logistics Workforce Advisory Logistics Day or the Transport and In conjunction with the Transport and Group (TLWAG). The group has met five Logistics Workforce Gauge please Logistics Centre (TALC), the NSW times since its creation and is looking contact the TLWAG Program Manager, forward to an even more productive year TLWAG is currently commencing work Matt O’Neill, on 8202 3822 or email in 2011. on the NSW rollout of the Transport and Logistics Workforce Gauge. The gauge is [email protected]. The NSW TLWAG was created to a survey developed by the Queensland address workforce issues in the transport TLWAG who have made it available Illawarra Transport and Logistics and logistics industry and focuses on for use by TLWAGs in other states and addressing five key themes: Skills Pilot Program (ITLSPP) territories. • Collaboration and coordination The ITSPP is providing secondary The main objective in the provision of the students in the Illawarra with the • Skills supply and labour market gauge is to establish a highly relevant, opportunity to develop the practical skills low cost and flexible workforce survey • Education, training and and knowledge required to work in the qualifications with a high level of industry participation. transport and logistics industry through providing new Certificate II courses in • Careers The survey will collate Human Resource metrics from NSW-based transport and Warehousing and Storage, Logistics • Safety and security logistics businesses on their policies Operations and Coastal Maritime Operations (Coxswain). A workplace Relating directly to these themes, the for recruitment, retention, learning and NSW TLWAG is currently progressing development and ageing workplace component forms a part of these Get the professional edge with a three major projects: a 2011 Transport concerns. qualifications and can be undertaken as either. and Logistics Day, NSW Transport and The main purpose of the survey is to Logistics Workforce Gauge and the assist government and industry in: • A work placement of two weeks postgraduate qualification from AMC Illawarra Transport and Logistics Skills over a two year period whilst the Pilot Program. • Assessing the current state of the student is in Years 11 or 12; or industry • Through a school-based traineeship 2011 Transport and Logistics Day • Identifying barriers/limitations where the student is employed by a A major focus for the TLWAG this year to utilising available learning and local company to work on the Are you a maritime industry executive seeking to enhance your skills and knowledge? is the development of the inaugural development programs relevant trainee wage. Transport and Logistics Day (TLD), to be • Assessing employee participation held on 26 August. We offer a Master of Maritime Studies and a Master of Business Administration, each designed to in government programs The aim of the Illawarra project is to The TLD is a NSW based industry and develop the capability of employers, • Creating tailored workplace take your career to the next level. Our programs are offered via distance, meaning you can study government awareness day attempting schools and local Illawarra community to improve the image of a career in the initiatives to promote workforce stakeholders to collaboratively lead at your own pace from the security of your current job. T&L industry and was born through the capability effective school-to-employment pathways skill shortage currently facing the sector. • Gauging any future skills and into the industry. Companies currently Enquire about study opportunities at Australia’s premier maritime training institute today! Consequently the TLD has a long term labour shortages in the industry; offering their support to the program goal of recruitment, skilling and workforce and include: retention. • Proposing actions and issues that • Port Kembla Port Corporation On behalf of the NSW Transport should be explored in the future and Logistics Workforce Advisory • Bluescope Steel Group, Transport NSW is leading the Following collation and analysis of the For more information please contact AMC on +61 3 6324 9310 • Metal Transport Industries development and organisation of the survey data, a report will be compiled event. and distributed to participants. It will • Pacific National or email [email protected] The event will include a major launch include valuable information including If you would like to learn more about featuring selected secondary students the collective response from contributors the ITLSPP or are interested in getting from metropolitan Sydney in a ‘meet allowing organisations to compare www.amc.edu.au and greet’ morning tea with political and themselves to similar sized businesses involved please contact Debbie Joyce, industry leaders and open days and tours and highlight what works well and what Executive Officer, NSW Transport and CRICOS Code 00586B at major transport and logistics facilities may need improving in their respective Logistics Industry Skills Council, via across Sydney. organisations. [email protected]. YOUR TICKET TO THE WORLD 168 Autumn 2011 AUSTRALIA AN INSTITUTE OF THE UNIVERSITY OF TASMANIA NOW AVAILABLE BY Distance Ed

Get the professional edge with a postgraduate qualification from AMC

Are you a maritime industry executive seeking to enhance your skills and knowledge?

We offer a Master of Maritime Studies and a Master of Business Administration, each designed to take your career to the next level. Our programs are offered via distance, meaning you can study at your own pace from the security of your current job.

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YOUR TICKET TO THE WORLD Autumn 2011 169 AN INSTITUTE OF THE UNIVERSITY OF TASMANIAAUSTRALIA Education and training

Australian seafarer skills shortage requires co-ordinated response

By John Lloyd, director, National Centre for Ports and Shipping and Marcus Bowles, senior lecturer, National Centre for Ports and Shipping

uch hyperbole surrounds demand for a seafaring background The international seafarer labour debate over shipping in related industries of ports, force is highly regulated. The Mindustry crew shortages or terminals and pilotage remains agreed international standards skill gaps so one can be excused strong. of training and certification for for being confused. seafarers mean certificates of competency are generally Despite evidence of changing Domestic Supply and Demand required for anyone seeking to be global supply of skilled labour A labour market shortage is where employed on large trading ships. in the maritime sector, we will The Australian Maritime Safety confirm Australia has a medium the demand for people skilled in a specific occupation exceeds Authority (AMSA) is the agency to long-term disconnect between responsible for issuing certificates the available supply and existing supply. In effect, government or industry intervention is required of competency in Australia under demand for both labour and The International Convention on to shape supply-side industry personnel with the skills required to Standards of Training, Certification work in shipping. development strategies to meet demand. This includes addressing The latest Baltic International such areas as career pathways, Maritime Council (BIMCO) and recruitment and retention, and International Shipping Federation (ISF) 2010 results from their education and training. Depending comprehensive study of the on the nature of the work or the size worldwide supply and demand of the shortfall such strategies can for seafarers suggest the labour often take a number of years to be market is in equilibrium. The report effective. confirmed: At present the sheer scale of The worldwide supply of seafarers employment forecasts for planned in 2010 is estimated to be 624,000 oil and gas industry and off- officers and 747,000 ratings, while shore projects in Australian the current worldwide demand for waters suggest a labour market Marcus Bowles, senior lecturer seafarers is 637,000 officers and supply shortfall will be likely. To 747,000 ratings. operators in the blue water and As a result, many have concluded wider shipping sector, the concerns the world-wide maritime skills are that the salaries on offer in shortage is over and will continue oil and gas will result in many to be an issue of little importance employees exiting to the potentially while international trade recovers more lucrative offshore sector. As from the global financial crisis and a result, a labour shortage will economic activity remains sluggish. emerge in the shipping industry. For Australia this forecast is This will be triggered despite the misleading. The pressure in the fact the bluewater sector is seen as sector seems to be increasing carrying the primary responsibility, and the demand for officers and and ultimately the cost, of training Integrated Ratings suggests the majority of personnel to meet shortages will intensify while STCW certification requirements . John Lloyd, director

170 Autumn 2011 AUSTRALIA and Watchkeeping for Seafarers Types of Skills Supply-Demand Misalignments (STCW Convention). Misalignment type General response strategies Entry into the shipping industry (A) Aggregate labour shortages • Immigration is therefore contingent on a high standard of competence. The Aggregate labour shortages exist • Repatriation where there is an insufficient availability of workers achieving • Encourage entry by young people overall number of workers this standard has typically been available. • Re-skill other workers restricted. Training strategies take longer to realise and involve • Delay retirement decisions more commitment of resources to (B) Mismatch on the labour market Example response below for achieve workplace competence four typologies than other sectors in the maritime Whether they are on the supply- side or demand-side, mismatches or transport industry. There is the on the labour market can take a placement of trainees on board number of forms. These include the vessels to consider, along with the following: stringent sea service requirements of the regulator. 1. Qualitative mismatches (Information/Training response) Mismatch between qualifications of • Increase skills supply-demand As such, any shortage in shipping workers and qualifications employers information to/from industry, trainers is often compounded because require to fill vacancies. and workers the long-term problem rests in attracting new entrants to the Evidenced by: shortages or • Align/adapt content of training excesses of workers with particular offerings industry while providing sufficient skill sets access to seagoing training berths. In an Australian labour market 2. Regional mismatches (Information/Other response) where labour is already in short Where people and work are located • Increase skills supply-demand supply, the ability to attract workers in different regions and the jobs/ information to/from industry, trainers without significant incentives (most workers have been insufficiently and workers especially pay and conditions) is mobile to reach alignment. • Liaise with government on particularly problematic. Evidenced by: region-specific initiatives for possible worker To be successful, sectors such as unemployment and skills shortages industry relocation shipping have to deploy a range 3. Preference mismatches (Information/Other response) of smart strategies to fill shortages. The following tables identify Where there is a mismatch between • Liaise between industry and the types of misalignments and the work people are willing to take workers to find preferable working and the vacancies that are available circumstances for skilled labour skills imbalances that can occur. in their region. Strategies to address each are then • Liaise with government and canvassed. Evidenced by: underemployment, industry on strategic responses. unemployment Opportunities for employment in the maritime sector of Australia appear 4. Mismatches due to information (Information response) deficits likely to buck the international trend • Government, industry, employers with seafaring skills and experience Supply does not meet demand and professional bodies need to being sought after by a significant because of a lack of information create or to assist “matchmaking” number of employers. For the – qualified workers do not find out between worker and employers. school-leaver and the newly- about vacancies (especially short qualified officer the opportunities term), and/or firms do not have the information they need to find the are immense, but national strategies skilled workers they require. to address personnel pipeline management and training issues Evidenced by: underemployment, are long overdue and a coordinated unemployment, spikes and drops response across the sector will in demand, general supply-demand mismatch. strengthen the whole training and qualification environment. TABLE 1: SUPPLY-DEMAND MISMATCHES

Autumn 2011 171 AUSTRALIA Navigation

Are static UKC rules coming to an end?

By DR TERRY O’BRIEN OAM, chairman and executive director, OMC International

ewind to 2010 or fast significant cultural, administrative that this system will be used in a forward to 2011 and OMC and language differences. complex coastal environment in Australia and it is expected to be RInternational (OMC) is still This situation raises the issue operational in the first half of this making news headlines for winning not only of the cost of installing year. contracts to improve safety in and operating these systems international shipping channels. in more distant waterways, and The release of our Next Generation without compromising safety, but DUKC® product suite, DUKC® This year with further increasing also of educating and informing Series 5, which is web-based, will interest from overseas the prospective clients of the benefits. provide authorised users easier challenges for our company have access to our system. AMSA is the changed but not diminished. 2010 news first client. While the pioneering technology is Last year, AMSA announced it In other international news, OMC widely accepted as a better way had chosen our UKC management celebrates the first anniversary to manage under keel clearance system to enhance shipping safety this month (March) of the opening (UKC) its immense benefits are in the shallow and ecologically of our South American office in sometimes difficult to convey sensitive international waters of Bogota, Colombia. Senior engineer sufficiently where there are Torres Strait. This is the first time and South American Manager Dr Matthew Turner has been travelling extensively during the last year within Argentina, Brazil and Colombia. Our decision to open an office in this region has been more than justified by the interest we are receiving from maritime authorities, port regulators, mining companies and shippers. I believe the next few years will be very exciting for OMC in South America.

2011 news Fast forward to 2011 and we have just announced the winning of our first North American contract, a DUKC® desktop study, for the Columbia River Bar, a treacherous waterway known as ‘The Graveyard of the Pacific’. This study, commissioned by the Columbia River Bar Pilots with funding from the Oregon Department of Transportation, is expected to be completed by the Helicopter transfer of a pilot at Columbia River end of August.

172 Autumn 2011 AUSTRALIA Massive sea swells can make conditions at the mouth of the Columbia River similar to the challenging waters of Melbourne’s Port Phillip Bay entrance where ships have been transiting safely under DUKC® advice since mid- 2009. This aptly nicknamed Bar, at the mouth of the Columbia River which flows into the Pacific Ocean, has claimed about 2000 ships and 700 lives since 1792. In Melbourne, huge long swells of up to 5 metres significant wave height, combined with currents up to 6 knots on the ebb (which occurs at low water), cause, in extreme conditions, ships longer than 250 metres to plunge several metres downward. Having our technology already proven in Melbourne’s extreme A Columbia River Bar Pilot at work. Photo by Ed Kashi waters, I am very confident that this desktop study will be followed by tidal windows but safety is always WA news the commissioning of a customised paramount. It is so accurate that, Meanwhile, our Perth office, led DUKC® system for the Columbia under extreme weather conditions, by Brendan Curtis, still has an River because our technology will a 250,000 tonne carrier could ensure maximum safety for large increasing workload in WA which is vessels moving in and out of its negotiate a channel within a metre’s in the midst of a resources boom. waterways. clearance to the seabed. Mid last year, we announced a new contract to install our UKC As a refresher, our technology It is the only proven system management system in Rio Tinto’s mathematically predicts how much worldwide that has the capacity to Cape Lambert port. This is our 21st UKC ships have as they transit accurately determine the critical shallow channels. In most cases, DUKC® installation. vertical component of navigation it allows large vessels to load Last year, OMC also won dredging (what you can’t see under the more cargo and/or sail with wider optimisation studies for Anketell water). Point, Cape Lambert, Oakajee and This technology is already on its Port Hedland which are now all way to becoming a standard safety completed. implementation at Australian ports A key finding from OMC’s channel and is also in a number of ports design study for the Cape Lambert in Europe and NZ. Almost all of Port, to assess optimal channel the iron ore and most of the coal depths, was the potential for exported from Australia are shipped increasing the number of vessels out under DUKC® advice. able to sail at their maximum summer drafts. Interestingly, last year (and With regards to Port Hedland, OMC attracting huge media attention), was asked to review the channel the Chinese vessel Xin Yan Tai (the and advise on the depths needed biggest container ship to berth in per 100m section to achieve Australia) safely entered Port Phillip an increase in sailing draft from Bay under this advice to berth 200mm to 500mm. These values DUKC technology is being tested for the in Melbourne to load and unload Columbia River Bar, a treacherous waterway were converted into the port’s known as the ‘Graveyard of the Pacific’ some 3000 containers. dredging plans to identify target

Autumn 2011 173 AUSTRALIA Navigation

The Columbia River Bar is still known as a dangerous crossing for ships of all sizes

maintenance dredging which was on each tide. At the moment the to constructive industry feedback completed ahead of schedule in average is two to three ships on a and incorporate it into any new June last year. tide but this will need to increase to planned releases or products. We four to five ships per tide, as export Product launch strive to listen to our clients, and volumes grow. to market needs, by providing We have also recently launched a prototype ship scheduling As with Optimiser, under the day- the latest and best real-time UKC application, DUKC® Optimiser, to-day direction of my maritime solutions for large vessels. Over which is an optimisation tool to engineer son Peter O’Brien, the the past 18 years, we have reliably help shipping schedulers maximise OMC team will continue to respond delivered on safety and efficiency. total throughput of cargo at bulk ports, subject to priorities and UKC constraints. This prototype ship scheduling application is being implemented in stages at Port Hedland and the initial trial stage, still underway, indicates Optimiser will allow ports to reduce the workload for their schedulers, and also improve the efficiency of their schedules, benefiting port users in increased cargo throughput. It will also give greater flexibility in the timing of port visits which is a great plus for ship operators. The development of this latest new product follows an approach last year by Port Hedland Port Authority (PHPA) to see if OMC could help the port regularly repeat its record, set in June 2009, of five capsize bulk carriers laden with iron ore sailing on the one tide. Since then, we have been working with PHPA on ways to optimise the sailing drafts and times of multiple vessels

174 Autumn 2011 AUSTRALIA Future direction for UKC management Our latest contract for the Columbia River Bar desktop study again confirms the paradigm shift that our technology has caused in UKC management, from static rules to dynamic analyses of UKC requirements in real time during the actual transit. I believe that static rules are approaching the end of their usefulness because it is getting increasingly harder for port and water authorities around the world to ignore the proven safety benefits. It is, in my opinion, also increasingly unacceptable for ports without DUKC® systems in place to believe that they’re foolproof because they have so far enjoyed an unblemished safety record. To recall what happened the cargo-carrying capacity of large in New Zealand in 2003, two vessels are hard to ignore. tankers bringing crude oil in from the Middle East grounded within While static rules work in most three months of each other, in the cases, they are necessarily Marsden Point channel, yet there conservative and unforeseen had been no grounding in the circumstances such as engine preceding 30 years of operation. breakdown or deteriorating Subsequent analysis by OMC environmental conditions cannot be showed that if our system had been adequately managed. in operation, it would have advised I believe it will become increasingly that these sailings not take place on difficult for port and waterway those days due to inadequate UKC authorities to defend themselves and the two incidents would not in the event of a future grounding have occurred. A DUKC® system has been operational at Marsden under static rules, given that a more Point since 2004. accurate, and therefore safer, UKC management system developed by Consequently, there is now wider OMC exists and has been operating industry acceptance that our UKC safely in ports for the past 18 years! management system offers a more accurate solution because it Of course, being made a standard combines static information such safety installation would best ensure as mapping the channel bed with compliance. real-time information such as swells, * In June last year, in the Queen’s tides and currents to calculate Birthday Honours List, OMC very accurately how deep each founder and executive director Dr particular ship can safely travel through the water. Thereby the Terry O’Brien was awarded a Medal risk of groundings is significantly of the Order of Australia (OAM) for reduced and the increased services to the maritime transport economic benefits of maximising industry.

Autumn 2011 175 AUSTRALIA Advertisers’ List AUSMEPA 159 Australian Hydrographic Service 71 Australian Maritime College 169 Australian Maritime Safety Authority 167 Australian Quarantine and Inspection Service 105 Brisbane Marine Pilots 44,45 Broome Port 119 Coogans & Co Legal and Consultancy services 36 DP World Gatefold Flinders Ports 41 Fremantle Ports Inside front cover Hamburg Sud 7 Inchcape Shipping Services 21 Mediterranean Shipping Company 3 Newcastle Ports Corporation 37 Newcastle Stevedores 27 NYK Lines 5 OMC International 55 Pacific 2012 59 PB Towage 65 PM Grabs 101 PM Page Macrae Engineering 101 Port of Darwin 121 Port of Melbourne Inside back cover Port of Townsville 161 Rightship Outside back cover Smartship Australia 111 Sydney Ports 11 Tasports 48,49 Treasury Wines Estates 60,61 Tropical Reef Shipyard 149 TT Club 31 Victorian Regional Channels Authority 141

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