New Zealand is now viewed as an outlier for global shipping as cargo movers grapple with the soaring cost of getting products from port to port.
The country is seen as an expensive place to do business from a shipping operator’s perspective, Zespri shipping manager Alasdair MacIntosh told HortNZ’s annual conference in Tauranga.
MacIntosh is also a representative of the New Zealand Cargo Owners Council. He said the shipping industry is facing multiple challenges as it battles ongoing costs and longer travel times.
Nationally, the council is also concerned about poor productivity, with a lack of improvement post-covid.
A lot of this is due to port operations, labour requirements and the uncertainty of when vessels will arrive, MacIntosh said.
“Overall, nationally we are about 20% down since covid – Auckland 38%, Tauranga 14% in terms of their crane moves at the moment.”
The industry is coping with the amount of cargo coming through and with a weak economy and high cost of living. He said he is concerned about low productivity once the economy starts improving and demand increases.
“Where does that leave us? We can just see more congestion coming down the line.”
Ships are going to get bigger as larger ships are more fuel efficient and are better for the environment in terms of carbon produced per tonnes of cargo carried.
Nationally, the country faces major infrastructure challenges to be able to service these larger ships.
“We need to be in a position where we can expand, where we can make places for larger ships coming through, more efficient ships and more efficient movement of cargo.”
Most ports in New Zealand will not be able to take those larger vessels apart from Auckland, Lyttleton and Tauranga.
“Perhaps it goes offshore, perhaps Australia becomes a hub for New Zealand, and we end up having to go through Australian ports to reach the rest of the world.”
The issue needs to be depoliticised and cannot be resolved if consecutive governments continuously change or block plans.
“We need to have an infrastructure policy in place that covers at least 30 years so that we can have some good budget [funding] put aside to make sure that each of these projects that needs to be addressed does have the attention it needs and not just change every three years when a new government comes in.”
The council is working with transport agencies and the government to develop this, he said.
The sentiment was backed by Zespri’s executive officer for sustainability, Rachel Depree.
As consumers and markets became more climate conscious, New Zealand has to be well positioned to take up low-carbon shipping technology, she said.
“We’re small, down under and far away but very reliant on shipping to drive export value.”
There is also a limited supply of low-emissions fuel and NZ risks missing out if it does not act now.
The country could miss out on low-emissions supply chains and routes as larger trading partners move into this space, she said.
“This of course could resolve in higher emissions pricing in the future, or even reduce servicing by shipping providers including the risk that we are left with the high carbon options to ship product to market where we will essentially be paying other countries to decarbonise.”
Lowering these emissions reduces costs and helped contribute to the government’s goal of doubling export values.
Ports also need longer and deeper berths to accommodate larger ships and NZ trails other countries in transport policy investment, she said.
The industry needs all-government support to co-ordinate industry and government efforts around better port infrastructure, alternative fuels and increasing domestic fuel supply.
“We know we need to be infrastructure ready if we want to bring these ships to NZ.
“We need to take on this challenge if we are going to continue to offer high value products to the world and support NZ’s enviable agri-economy.”
