Shipping reliability remains on a knife edge despite covid’s disruption being well in the rear view, while port productivity around the country also remains in a slump.
Latest shipping and port productivity data from the Ministry of Transport sheds some light on how the shipping and logistics sector has, and has not, recovered in the wake of the pandemic.
A dashboard of key industry productivity metrics indicates that, as a sector, the throughput experienced prior to early 2020 is still elusive.
Data for Port of Tauranga, the country’s largest export port, has “vessel rate”, the number of containers moved by stevedores on and off a ship per hour, languishing at around 60 an hour average for the first quarter of this year.
That compares to a port peak of 77 per ship per hour back in late 2019, slumping to half that in early 2021.
Napier’s productivity has been progressively declining since 2019 from 40 to 25 an hour.
Meantime the number of container ship visits to New Zealand also remains in the doldrums compared to pre-covid levels, with visit numbers down by almost 15%.
Back in 2018 NZ had 956 container ship visits, slumping to 685 ion 2021.
The post-covid recovery had numbers at 830 by 2023, still well short of 2018-2019 visits.
That decline reflects a consolidation of shipping routes, lower frequency of visits and outright cancellations in the past two years.
Mark Scott, general manager for Cosco NZ, confirmed the sector still faces issues.
“Port reliability is better, but it has its moments. These can often be the usual issues, but the problem is there is not a lot of resilience in the system, it’s pretty tight and it can mean a snowballing effect if one thing goes wrong,” he said.
He could see there was never going to be any surplus capacity in the current port system while every port is also still trying to lift its productivity.
The pressures come as fresh produce exporters are looking at opportunities in overseas markets to grow sales.
The International Fresh Produce Association, of which NZ is a member, has recently had a delegation return from South Korea, eyeing opportunities there as increasingly discerning South Korean consumers seek out new food products.
Domestic horticultural production in South Korea has traditionally been and continues to be important.
However, severe weather events in 2022 significantly impacted apple and tree crops, leading to increased imports. South Korea now relies heavily on imported food with annual imports totalling approximately $50 billion (food and agricultural products).
It is now importing $1.7bn worth of fresh fruit, nuts and processed fruit and expects a further increase in imported fresh fruit.
This is due to climate change and the need to diversify and satisfy a population of some 51 million that has an appetite for healthy, fresh produce.
Shipping to South Korea has proven a fraught avenue for NZ’s chilled meat trade, despite the market’s high value opportunities. Delays in transhipment in Japan exceed importers’ acceptable limits for chilled shelf life on arrival in South Korea.
Ken Harris, managing director of NZ’s largest container company, ContainerCo NZ, said port productivity indicators are all going in the wrong direction, and have been for some time.
“There are structural problems there. These include the time taken to get consents for approval on things like port space and facilities.”
He has taken five years to get approval for a container facility on the outskirts of Tauranga that is still not finalised.
Port of Tauranga has been embroiled in a lengthy consent process to lengthen its wharf by 280m; it has dragged on for over seven years. The port may be eligible to apply for a fast-track consent under the new government’s infrastructure programme.
Harris said there is a dire need for NZ’s ports to be networked together, rather than the current competitive model that makes investment in long-term infrastructure less appealing to individual ports when they could lose customer shipping companies to another port down the coast.
