Auckland port prices to rise on back of inflation; Tauranga port mulls peak season levy increase

Ports of Auckland is bringing in a general price increase of 4.9 per cent for the 2022 calendar year, as Port of Tauranga mulls whether to increase levies to “incentivise” smooth cargo flows in this peak freight period.

The Auckland port said the price increase was in line with the rise in the CPI over the past 12 months. It would apply from January 1 and includes terminal break-bulk and the Waikato freight hub.

A wide range of services, including marine charges for small commercial fishing boats and garbage collection, charges for storage and wharfage for cars and containers, and general cargo exports would be adjusted separately from the general rate increase, a port notice said.

However a spokesman said these separate adjustments would have little impact on end users and consumers.He noted shipping lines had individual contracts with importers and exporters.

“We adjust our public rates each year based on inflationary costs for the past year. We don’t front load on projected inflation.

“We also adjust some charges at a greater or lesser rate than CPI based on levels of demand and impacts to the business in order to driver positive behaviour changes. For example, we have increased the charge for containers that stay on the port longer than eight days and as an incentive to remove containers from the port, and avoid congestion.”

Multi-cargo operation activities were charged as per the public tariff but at the container terminal the port operated contracts with the shipping lines against fixed term agreements.

On the bright side, the Auckland Council-owned port said some shipping lines had lifted their congestion surcharges of $200 and higher on containers as the port’s congestion situation improved.

The shipping companies were One Line, Cosco, MSC and Hapag Lloyd.

But the world’s biggest container shipping line Maersk has not removed the surcharge.

“We have not lifted the Auckland Congestion surcharge as we continue to see impact on productivity levels and vessel delays at Ports of Auckland,” said My Therese Blank, head of Maersk’s Oceania export market, regional ocean management.

“Performance remains impacted by the congestion which is increasing operational costs, examples of this is increased bunker costs, alternative cargo routings that increase costs for transhipment and empty positioning costs by using landside routings and lost sailings due to longer vessel turn time.”

Meanwhile, the country’s biggest port Tauranga said it was not due to do its annual review of general tariffs until June 30.

But the listed port’s commercial team was looking at additional levies to encourage shippers to move freight such as containers off the wharves, a spokeswoman said.

The port was very busy with import cargoes, with freight deliveries to Auckland taking 6-7 days instead of the ideal 3-4 days, she said.

However cargo movement was a great deal better than this time last year because about 20 more trains were available in this run-up to Christmas.

It’s also peak export season for the Tauranga port.

Ports of Auckland in its November report to the council said congestion at the port had improved so much that it had re-established berthing windows for five container servicers. Windows have been suspended since late last year.

The backlog of ships waiting for a berth had “long gone”. Empty container depots around Auckland remained full.

The port told councillors ongoing Covid lockdowns meant it would not be possible to go live with full automation of straddle carriers at the container terminal by the end of March as hoped. But the port was still on track to deliver full terminal roll out before the end of the financial year on June 30.

Presenting first quarter financial results for 2022, the port recorded total ebit of $14m, against the budgeted $11.5m, and revenue of $63.1m ($60.5m).

Net profit after tax for the quarter was $7m (Budget $5.2m).

Container volumes were forecast to reduce by 12,000 in the remaining nine months when compared to budget, mostly due to vessel schedule delays and vessel “bunching”.

The volume drop would unfavourably impacted full year revenue by $3.8m, the council heard.

Net profit after tax for FY22 was forecast to be $20.9m, up $300,000 above budget, and $100,000 below the key performance target.

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