Increased competition to retain and/ or win new shipping line customers in Australia’s container stevedoring industry has pushed prices to their lowest level in 17 years, according to the Australian Competition and Consumer Commission’s (ACCC) 2015-2016 Container Stevedoring Monitoring Report.
Rod Sims, the ACCC chairman, said: “The industry is experiencing a period of increased competition and investment in infrastructure.”
Industry margins and rate of return on assets are also at the lowest level recorded by the monitoring programme. The ACCC report said a new entrant, Hutchison Ports Australia, has established new terminals in Brisbane and Sydney while the incumbent stevedore companies, Patrick and DP World, have been upgrading and expanding the capacity of terminals as well as investing in automation and cranes.
Competition is expected to be further enhanced at Melbourne following the Victoria International Container Terminal (VICT) launching Australia’s first fully automated terminal late last year. Mr Sims pointed out: “However, there continue to be challenges for new entrants. Hutchison has been operational since 2013 but is yet to attract adequate market share to match its investment in the industry. It is also possible that VICT may face some issues in establishing itself when it commences operations.”
The report noted that as a result of substantial investments by new container stevedore companies, there is now an infrastructure in place to support a third company in each of the three largest container ports in Australia.