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First published in 1891<br />
October 2018<br />
thedcn.com.au<br />
The voice of Australian shipping & maritime logistics<br />
The big<br />
rethink<br />
Low freight rates and<br />
high costs are prompting<br />
changes on the North<br />
America trades<br />
38 Diversification push for<br />
Australia’s regional ports<br />
42 Preparing for bigger<br />
ships in SA and the NT<br />
52 Salvage operations<br />
for the Kia Trader
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XXXXXX<br />
Contents<br />
38<br />
30<br />
FEATURES<br />
30<br />
38<br />
42<br />
46<br />
Liner trades to North America<br />
Market conditions and increasing operating costs plague carriers<br />
Regional ports<br />
Diversification is the name of the game<br />
South Australia & the Northern Territory<br />
Ports are gearing up for larger ships to call and more trade<br />
Training & education<br />
Educational institutions are preparing for a technological future<br />
COLUMNS<br />
46<br />
42<br />
8 A word from the minister<br />
Deputy PM McCormack<br />
discusses tech in transport<br />
16 Industry opinion<br />
Is the biosecurity levy a tax grab?<br />
18 Young Shipping Australia<br />
Lawyers on the competition act<br />
20 MIAL<br />
MIAL’s Teresa Lloyd takes a look<br />
at a “strategic fleet” for Australia<br />
22 Industry opinion<br />
FTA on detention and demurrage<br />
24 The customs broker<br />
CBFCA talks international risks<br />
26 Women in maritime<br />
A story of growing gender<br />
diversity at Port Hedland<br />
58 Maritime law<br />
An expert lawyer examines<br />
trends in safety management<br />
60 Workplace law<br />
Legal impacts of new technology<br />
in transport and logistics<br />
62 Mission to seafarers<br />
Operation Cruise Terminal<br />
64 Out & about<br />
Svitzer names a tug in Newcastle<br />
67 The grill<br />
From a garbage barge to giant<br />
tankers: Cameron Butchart<br />
4 October 2018<br />
thedcn.com.au
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First published in 1891<br />
October 2018<br />
thedcn.com.au<br />
EDITORIAL<br />
First published in 1891<br />
ISSUE NUMBER 1239 October 2018<br />
Publisher<br />
Lloyd O’Harte lloyd.oharte@thedcn.com.au<br />
Editor<br />
David Sexton david.sexton@thedcn.com.au<br />
Senior Journalist<br />
Ian Ackerman ian.ackerman@thedcn.com.au<br />
Creative Director Lee McLachlan<br />
Production Manager<br />
Grant Lopez grant.lopez@thedcn.com.au<br />
Electronic Services<br />
Linda Saleh, Oliver Buzzi<br />
Advertising Sales Director<br />
Lindsay Reed lindsay.reed@thedcn.com.au<br />
Tel: 0431 956 645<br />
Subscription Manager<br />
Amy O’Rourke amy.orourke@thedcn.com.au<br />
Tel: 02 9126 9713<br />
From the editor<br />
THE announcement of the NSW Freight and Ports Plan 2018-2023<br />
by the state government is a welcome development.<br />
Daily Cargo News recognises the necessity of long-term strategic<br />
thinking, particularly given the implications for Australia’s largest<br />
city and largest state economy. The focus on both economic growth<br />
and sustainability also suggests nuanced thinking.<br />
Minister Melinda Pavey noted how the plan highlighted<br />
government and industry plans for road, rail, air and shipping.<br />
Importantly, the document recognises a role for coastal shipping,<br />
noting it can be “a viable alternative to road or rail for certain<br />
types of freight”.<br />
The report makes some interesting points about the location of a<br />
future NSW container terminal, saying it should go to Port Kembla<br />
but that Newcastle also should be considered. Clearly there are<br />
competing arguments and no doubt there is some water to go under<br />
the bridge before that debate is closed for good.<br />
As the nation’s population soars, so does the freight task,<br />
something recognised earlier in the year in the Inquiry into<br />
National Freight and Supply Chain Priorities when it talked of<br />
“high domestic population growth rates” as a contributory factor<br />
in “driving massive changes in demand for freight in Australia and<br />
across the world”.<br />
In order to avoid our freight task becoming hopelessly bogged<br />
down in traffic congestion, bold and visionary thinking is required.<br />
The NSW Freight and Ports Plan may not have every answer but<br />
it is nonetheless an important step in the right direction.<br />
David Sexton<br />
Editor, Daily Cargo News<br />
The voice of Australian shipping & maritime logistics<br />
36 Diversification push for<br />
Australia’s regional ports<br />
The big<br />
rethink<br />
40 Preparing for bigger<br />
ships in SA and the NT<br />
Low freight rates and<br />
high costs are prompting<br />
changes on the North<br />
America trades<br />
50 Salvage operations<br />
for the Kia Trader<br />
<strong>DCN1018</strong>_CoverFinal.in d 1 28-Sep-18 2:47:47 PM<br />
COVER IMAGE:<br />
Container Ship<br />
Golden Gate Bridge<br />
San Francisco Bay<br />
California<br />
Christopher<br />
Boswell<br />
Published by<br />
PARAGON DCN PTY LTD<br />
ABN: 73 627 186 350<br />
PO Box 81, St Leonards, NSW 1590<br />
Tel: +61 2 9126 9709<br />
CEO<br />
Ian Brooks ianb@paragonmedia.com.au<br />
www.thedcn.com.au<br />
Daily Cargo News is available to interested<br />
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For enquires please call 02 9126 9713.<br />
The publisher welcomes editorial contributions<br />
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6 October 2018 thedcn.com.au
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WORD FROM THE MINISTER<br />
All roads lead to high-tech<br />
freight future<br />
Australia must be ready for a fast-paced, technology-rich transport environment,<br />
writes Deputy Prime Minister Michael McCormack<br />
TECHNOLOGY IN ROADS AND ROAD<br />
freight has come a long way since the Romans<br />
created networks for trade efficiency and<br />
military dominance across Europe with<br />
their famous roads.<br />
Now, two-way wireless communications<br />
between roads and vehicles allows realtime<br />
sharing of speed and position data<br />
to reduce congestion and avoid crashes.<br />
This technology is just one example of how<br />
quickly roads are evolving.<br />
Vehicle technology is also rapidly<br />
evolving with the development of<br />
automated vehicles and much more.<br />
The Liberal and Nationals government<br />
is acting to embrace technology and ensure<br />
the road-based supply chain connecting<br />
paddocks to ports is safe and efficient.<br />
The Australian government must ensure<br />
uniform regulation cross Australia to best<br />
exploit this freight technology revolution.<br />
Freight (which contributes up to 10%<br />
of Australia’s GDP) and general road users<br />
routinely operate across state borders.<br />
As minister for infrastructure and<br />
transport, I am chair of the COAG<br />
We are ensuring Australia’s road transport sector<br />
is well placed to realise the expected safety and<br />
productivity benefits of emerging technologies<br />
Transport and Infrastructure Council,<br />
which is working with jurisdictions and<br />
inter-jurisdictional transport bodies on two<br />
separate but connected bodies of work:<br />
• The first is the development of a<br />
National Freight and Supply Chain<br />
Strategy, which will provide an<br />
integrated national approach to ensure<br />
freight systems and infrastructure work<br />
across state and territory borders to<br />
enable the efficient delivery of goods.<br />
• The second is a nationally consistent<br />
approach to the deployment of transport<br />
technologies.<br />
We are ensuring Australia’s road<br />
transport sector is well placed to realise the<br />
expected safety and productivity benefits<br />
of emerging technologies. Real world trials<br />
and data collection are also underway. This<br />
will inform how our infrastructure and<br />
operational practices may change.<br />
For example, we are investing $84m<br />
towards a total $105m managed motorway<br />
systems project on the Bruce Highway<br />
between Brisbane and Caboolture.<br />
This technology enables road operators<br />
to control the flow of traffic on the road to<br />
reduce congestions, delivering measurable<br />
benefits for commuters and freight operators.<br />
We have recently committed $2.25m<br />
towards a study involving technology that<br />
will monitor heavy vehicle drivers’ level of<br />
alertness and produce safety warnings. This<br />
study involves Volvo Trucks, the Monash<br />
University Accident Research Centre, Seeing<br />
Machines and Ron Finemore Transport.<br />
There is also a trial of connected vehicle<br />
technology in heavy vehicles for safety<br />
applications between Port Kembla and the<br />
Hume Highway called the Co-operative<br />
Intelligent Transport Initiative trial.<br />
Another trial, involving some 110<br />
trucks, is being delivered in partnership<br />
with Cohda Wireless. In this project,<br />
traffic lights can detect participating heavy<br />
vehicles on approach and may provide<br />
priority green light signals at more than<br />
100 Sydney locations.<br />
Technology is opening up opportunities<br />
to improve the current system of road<br />
provision for heavy vehicle use – both in<br />
charging and investment. This is why the<br />
Australian government is also supporting<br />
heavy vehicle charging trials which place<br />
Michael McCormack, Deputy Prime Minister and<br />
minister for infrastructure and transport<br />
freight operators at the centre of the system.<br />
The Trials Business Case Program is<br />
currently accepting proposals for studies<br />
to scope industry’s willingness to pay an<br />
additional level of service on particular<br />
routes or networks.<br />
We are also investing nearly $225m<br />
towards putting in place an enhanced<br />
satellite positioning system. Many<br />
transport technologies, especially<br />
automated vehicles, are likely to benefit<br />
from accurate satellite positioning systems.<br />
This investment will improve the<br />
reliability and accuracy of positioning data,<br />
from five metres to 10cm across Australia<br />
and its maritime zone with the delivery<br />
of a Satellite-Based Augmentation System<br />
and improve GPS accuracy to within three<br />
centimetres in areas of mobile coverage.<br />
This advancement has enormously<br />
positive implications for many industries,<br />
like agriculture and freight.<br />
These developments will not be built<br />
in a day, but because this government is<br />
preparing today Australia will benefit from<br />
the emerging transport and infrastructure<br />
technologies of tomorrow.<br />
Image supplied<br />
8 October 2018<br />
thedcn.com.au
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News in brief<br />
Full details at thedcn.com.au<br />
Vessel released following<br />
wages agreement<br />
Operators of a live export ship had<br />
to sort out a dispute with their crew<br />
A live-export vessel was released from<br />
detention in Fremantle after the operator<br />
agreed to pay the crew’s wages.<br />
The MV Maysora, flagged in the<br />
Bahamas, was detained on Tuesday<br />
following an inspection by an AMSA<br />
surveyor which confirmed reports of<br />
the crew not being paid regular wages<br />
according to employment agreements.<br />
However, the situation changed.<br />
“An AMSA surveyor returned to MV<br />
Maysora and released the vessel from<br />
detention after the operator demonstrated<br />
crew had been paid and plans were in place<br />
for ongoing payment of crew wages,” an<br />
AMSA spokesperson said. “The vessel can<br />
now continue its voyage.”<br />
A new crew was flown in from the<br />
Philippines with the original Pakistani crew<br />
reluctant to sail the ship.<br />
The matter earlier attracted the attention<br />
of the Australian Border Force which<br />
confirmed 19 crew members were detained<br />
at Fremantle on Monday and Tuesday after<br />
their maritime crew visas ceased.<br />
“The ABF conducts regular operational<br />
activity at Australia’s ports to ensure all<br />
foreign crew comply with the conditions<br />
of their visas and is continuing to monitor<br />
this vessel and its crew,” the ABF said in a<br />
public statement.<br />
ITF inspector Dean Summers told Daily<br />
Cargo News there was an agreement in place<br />
between the Jordanian owners and the ITF.<br />
“There was back pay calculated and<br />
paid on board and three crew sought to be<br />
repatriated home which was granted with<br />
full entitlements paid,” Mr Summers said.<br />
Authorities also have faced criticism<br />
from the Royal Society for the Prevention<br />
of Cruelty to Animals which condemned<br />
the decision to let Maysora load 30,000<br />
sheep and “sail into uncertain conditions”<br />
in the Middle Eastern summer.<br />
RSPCA Australia senior policy officer Dr<br />
Jed Goodfellow said they were awaiting the<br />
results of a freedom of information request<br />
to access images and footage from live<br />
sheep export ships since the government<br />
began placing departmental observers on<br />
board in April.<br />
“Despite government and exporter<br />
assurances of improved conditions, we’ve<br />
seen no information, photos or footage<br />
from those observers, and that’s very<br />
worrying,” Dr Goodfellow said.<br />
Tug crew<br />
rescues parrot<br />
Through the heroic efforts of the<br />
crew of two tugboats in Victoria’s<br />
Western Port, an exotic Alexandrine<br />
parakeet named Buddy, lost for<br />
a week, found its way back to its<br />
owner.<br />
“It was exhausted and sought<br />
refuge on the stern of the Svitzer<br />
Olivia,” tug master Christian Messer<br />
said. “Amazingly, it was tame<br />
enough for us to approach it and<br />
even climbed onto my shoulder.”<br />
The crew of the Olivia and Svitzer<br />
Edwina contacted a local veterinary<br />
clinic, which advised them to put<br />
out an alert on the parrot-finder<br />
website, www.parrotalert.com.<br />
The tuckered-out parrot and its<br />
relieved owner were soon reunited.<br />
Buddy had flown 30km<br />
from home and survived<br />
a week in the wild.<br />
Kind-hearted mariners<br />
came to the aid of a feathered friend<br />
Svitzer Australia<br />
10 October 2018<br />
thedcn.com.au
Another crane is expected to<br />
boost productivity on<br />
the Freo waterfront<br />
DPWA, UNION BEGIN<br />
BARGAINING<br />
Fremantle Ports; Bluedog studio; Coprid<br />
Quay crane ship arrives at Freo<br />
A shipment of five quay cranes for DP<br />
World Australia terminals arrived recently<br />
at Fremantle on the ship Zhen Hua 24.<br />
The ship unloaded one of the cranes at<br />
Fremantle before departing for Brisbane to<br />
unload another crane, then to Sydney to<br />
unload two cranes, and then to Melbourne<br />
to unload the final crane.<br />
The shipment is the final tranche of<br />
DPWA’s nine-crane order from ZPMC, as<br />
part of $180m investment in equipment.<br />
The crane being delivered to Fremantle<br />
Ports’ North Quay will enable the DPWA<br />
terminal to service larger vessels and<br />
to work more efficiently. The previous<br />
shipment arrived in Australia in March.<br />
Agreement for Kangaroo Island<br />
woodchip export facility reached<br />
Kangaroo Island Plantation Timbers (KPT) recently announced it had entered into an<br />
agreement with Mitsui to develop, maintain and operate a woodchip-handling facility<br />
at the yet-to-be built KI Seaport, according to an announcement to the ASX.<br />
The agreement is subject to certain conditions, including development approval<br />
and the execution of final transaction documents.<br />
KPT is planning to build a deepwater port in Smith Bay on the northern coast of<br />
Kangaroo Island, which would be able to accommodate Panamax vessels.<br />
The woodchip-handling facility is proposed to include infrastructure capable of<br />
receiving, screening, stockpiling, sampling and loading woodchips into bulk vessels<br />
for export from the planned seaport.<br />
Central to the materials handling facility is a circular automatic stacker-reclaimer,<br />
which is to operate on a first-in, first-out basis, yielding quality advantages, and will<br />
have a storage capacity of 80,000 green tonnes.<br />
With this system the stockpile will be able to be built and reclaimed<br />
simultaneously and the system has the capacity to handle multiple products.<br />
KPT managing director John Sergeant welcomed Mitsui as a key infrastructure<br />
provider and operator for the proposed facility. “We are proud to strengthen our longterm<br />
partnership with Mitsui in<br />
this way,” he said.<br />
Stevedore DP World Australia<br />
and the Maritime Union have<br />
confirmed recent meetings as part<br />
of negotiations for a new enterprise<br />
bargaining agreement.<br />
A DPWA spokesperson told DCN<br />
their representatives recently met<br />
with MUA national and state branch<br />
representatives and employee<br />
representatives to start negotiations.<br />
The EA covers about 1800<br />
employees at the four DPWA terminals.<br />
“The meetings were constructive,<br />
working through the log of claims<br />
and list of issues from all parties in<br />
considerable detail. While there are<br />
gaps between the different positions<br />
on claims and issues, this was a<br />
productive start,” the spokesperson<br />
said.<br />
“DP World Australia remains<br />
committed to a constructive dialogue<br />
with employees.”<br />
DPWA has described the EA<br />
negotiation as “a conversation” and<br />
a process of reaching an agreed<br />
collective outcome.<br />
“A key aim of the negotiation is to<br />
get a document that can be clearly<br />
understood by all parties,” the<br />
spokesperson said.<br />
“As an outcome of the EA<br />
negotiations, our employees may<br />
receive additional benefits. These<br />
benefits will need to be met by<br />
changes to flexibility and availability,<br />
so operating costs remain stable.<br />
“Together with the MUA, we<br />
are committed to finalising the EA<br />
negotiations by February 2019.”<br />
In a public statement, the MUA<br />
said the DPWA agreement was one<br />
of the largest in the stevedoring<br />
sector and criticised the company<br />
for “attacking workers’ rights and<br />
conditions”.<br />
“This may be a long negotiation<br />
on the basis of company claims but<br />
MUA members will hang in there to<br />
the end to secure an agreement that<br />
takes members forward,” the union<br />
stated.<br />
thedcn.com.au October 2018 11
NEWS IN BRIEF<br />
NSW releases its<br />
grand plan for freight<br />
The NSW Freight and Ports Plan 2018-2023 was released last<br />
month, outlining plans for the state government to invest more<br />
than $5bn to support the growing freight task and address growth<br />
and congestion on the state’s road and rail networks.<br />
The plan builds on the NSW government’s Freight and Ports<br />
Strategy, released in 2013, and lays out the state government’s longterm<br />
vision for freight transport. It includes 73 initiatives the state<br />
says it would deliver by 2023.<br />
Minister for roads, maritime and freight Melinda Pavey said<br />
more than 2m households and businesses across the state tap into<br />
the freight network every day, relying on the timely and efficient<br />
movement of goods to markets nationally and globally.<br />
“The amount of freight moved through NSW is set to grow by<br />
28% to more than 618m tonnes by 2036. To support this, the NSW<br />
Freight and Ports Plan 2018-2023 provides more than 70 initiatives<br />
for increasing capacity on the existing network, including building<br />
new infrastructure,” she said.<br />
The report clearly points to coastal shipping as an opportunity to<br />
improve freight efficiency.<br />
“Coastal shipping can be a viable alternative to road or rail for<br />
certain types of freight. The Glebe Island and White Bay precinct is<br />
uniquely placed to enable shipping of sand and aggregate to Sydney<br />
to service the needs of Greater Sydney’s construction boom,” the<br />
report states.<br />
“This removes the need for trucks to travel into central Sydney<br />
with sand and aggregate from outside the area. Coastal shipping is<br />
also increasingly being looked at as an attractive alternative to rail<br />
for moving less time sensitive freight from NSW to other states.”<br />
One goal of the report is to “simplify and harmonise regulation”,<br />
and, as part of this goal, the NSW government said it would<br />
advocate “for Australian legislative amendments to facilitate the<br />
greater use of coastal shipping”.<br />
The report also aims to increase the share of rail freight at Port<br />
Botany to 28% by 2021.<br />
Port of Newcastle is one of the three major<br />
ports in New South Wales<br />
Automated train derails at<br />
Devonport<br />
An automated freight train derailed at Devonport<br />
recently. At the time, the locomotive was hauling a cargo of<br />
cement in seven wagons.<br />
Tasrail contacted police around 9am indicating a train was<br />
likely to derail in the Devonport Wharf area, with police and<br />
emergency services immediately dispatched to the area.<br />
At 9.09am the train derailed on Formby Road, opposite<br />
the post office and near a local cafe.<br />
Two pedestrians received minor injuries and were transported<br />
by to the North West Regional Hospital by ambulance.<br />
A woman in her 20s sustained cuts and abrasions to her<br />
head after the train hit a fence near her.<br />
A man in his 40s sustained a suspected broken elbow and<br />
cuts and abrasions.<br />
They were later released from hospital.<br />
In a statement, TasRail said their network control centre<br />
was alerted at 8.48am and they contacted police soon after<br />
who took action to ensure public safety.<br />
TasRail’s network control manager remained on the<br />
telephone with Tasmania Police to provide live updates and<br />
advice on the operation of the train as it travelled toward<br />
Devonport.<br />
“As part of TasRail’s emergency response protocol, the<br />
train was diverted to a dead end siding track that has a<br />
permanent derailer, ensuring the train could be halted in the<br />
safest possible location,” a TasRail spokesperson said.<br />
TasRail confirm the train was being operated in a loading<br />
yard via on-site handheld remote control technology, which<br />
had been utilised for more than 15 years.<br />
In the statement, TasRail also extended its thoughts to<br />
those injured and their families.<br />
TasRail has confirmed that there was no hazardous<br />
material on board the train and that the Australian<br />
Transport Safety Bureau and other authorities have been<br />
notified.<br />
TasRail said it had launched “a detailed investigation” into<br />
the incident and would cooperate with authorities.<br />
Ben Jeayes ; VICT<br />
12 October 2018<br />
thedcn.com.au
NEWS IN BRIEF<br />
Bulker attacked by pirates<br />
Pirates have attacked Swiss bulker MV Glarus off Nigeria,<br />
taking 12 of its 19 crew hostage.<br />
In a statement sent to Daily Cargo News, ship managers<br />
Massoel Shipping said the vessel came under attack early on<br />
22 September about 45 nautical miles SSW of Bonny Island,<br />
Nigeria.<br />
At the time of the attack the vessel was sailing from Lagos<br />
to Port Harcourt with a cargo of bulk wheat.<br />
“It is understood the pirate gang boarded the Glarus by<br />
means of long ladders and cut the razor wire on deck to gain<br />
access to the vessel and eventually the bridge,” the Massoel<br />
statement read.<br />
“Having destroyed much of the vessel’s communications<br />
equipment the criminal gang departed taking 12 of the 19<br />
crew complement as hostage.<br />
“All the appropriate authorities have been notified and a<br />
pilot and naval officers are currently on-board the vessel at<br />
the Bonny inner anchorage.”<br />
Masssoel indicated it was working with the authorities to<br />
secure the crew members’ release and that “the safety and<br />
well-being of those taken hostage is the first and absolute<br />
priority of Massoel Shipping”.<br />
Families are said to be being kept “closely informed” of the<br />
situation.<br />
The waters off Nigeria are known as a hot spot for<br />
international piracy.<br />
Earlier this year, the International Maritime Bureau’s<br />
Piracy Reporting Centre noted Nigeria had recorded 22<br />
incidents for the first three months of the year.<br />
US Navy sailors conduct<br />
training with Nigerian<br />
special operations sailors<br />
Duncan Gay<br />
Ken Lay<br />
New leadership for<br />
heavy vehicle regulator<br />
Two new board members for the National Heavy Vehicle Regulator<br />
have been announced.<br />
Deputy Prime Minister and federal infrastructure minister<br />
Michael McCormack and Queensland transport minister Mark<br />
Bailey revealed the new members.<br />
Current NHVR Board chair Bruce Baird AM and board member<br />
Vincent Tremaine (the former Flinders Ports CEO) are to retire in<br />
October, opening the way for the new appointments.<br />
Mr McCormack said Duncan Gay and Ken Lay AO APM would<br />
replace Mr Baird and Mr Tremaine.<br />
“All state and territory ministers have unanimously agreed Mr<br />
Gay is ideally suited to provide leadership as chair of the NHVR<br />
Board, over the next three years,” Mr McCormack said.<br />
“I would like to thank Bruce Baird AM, for his service over<br />
six years, which included establishing the NHVR and setting its<br />
strategic direction.<br />
“I’d also thank Vincent Tremaine for his counsel and advice<br />
during his six-year term on the NHVR Board, providing continuity<br />
and stability to the board and the NHVR.”<br />
Mr Bailey welcomed the appointment of Mr Lay to the Board,<br />
highlighting his skill and experience as Lieutenant-Governor of<br />
Victoria and former Victoria Police Chief Commissioner.<br />
“Mr Lay served in Victoria Police for almost 40 years and is<br />
currently serving on several boards including as Chair of the<br />
Council of Australian Government’s Advisory Council on Family<br />
Violence,” Mr Bailey said.<br />
2018 INDUSTRY EVENTS<br />
DATE<br />
EVENT<br />
16 October MIAL national conference, Canberra mial.com.au<br />
17-18 October Brisbane Marine Pilots ISPO IUG Conference, Brisbane brisbanepilots.com.au<br />
23 October Shipping Industry Charity Golf Challenge, Sydney thedcn.com.au/category/shipping-industry-golf-day<br />
25 October<br />
Boulton Lecture, given by John Lines to the Company<br />
of Master Mariners Queensland Branch, Brisbane<br />
mastermariners.org.au/branches/queensland<br />
26 October SAL QLD Ball, Brisbane shippingaustralia.com.au/event/sal-qld-ball-2<br />
1-3 November CBFCA National Conference, Sydney cbfca.com.au/CBFCA/National_Conference_2018<br />
22 November Australian Shipping and Maritime Industry Awards, Sydney dcnawards.com.au<br />
23 November SCLAA Awards Gala Dinner, Sydney sclaa.com.au/awards<br />
7 December<br />
SAL New South Wales State Committee<br />
Christmas Luncheon, Sydney<br />
shippingaustralia.com.au/event/sal-nsw-christmas-luncheon<br />
Darryl Wood<br />
14 October 2018<br />
thedcn.com.au
- 7 ports owned and operated<br />
- Pilotage across South Australia<br />
- Mooring services<br />
- Draft surveys<br />
- Hydorsurvey & tide management<br />
- People safe & environment sound<br />
www..indersports.com.au | +61 8 8447 0611
INDUSTRY OPINION<br />
Proposed biosecurity levy will<br />
destroy trust in the system<br />
The new biosecurity levy on import cargo, announced in the last budget,<br />
is nothing but a tax grab, writes Llew Russell<br />
THE ROYAL COMMISSION INTO<br />
the Australian banking sector has highlighted<br />
the importance of consumer trust and<br />
how easily that trust can be destroyed.<br />
As far back as 1996, Professor Malcolm<br />
Nairn’s report on Australia’s quarantine<br />
system emphasised the importance of<br />
quarantine being a shared responsibility<br />
between industry and government and<br />
the importance of concentrating on areas<br />
of highest risk. Subsequent reviews have<br />
reached the same conclusions.<br />
In the last federal government budget,<br />
a new biosecurity levy was announced,<br />
effective July next year, without any<br />
prior industry consultation and not even<br />
hypothecated for use solely by biosecurity.<br />
THE CHARGES<br />
The levy was set at $10.02 per 20-foot<br />
equivalent container imported, when<br />
it is well known that almost all import<br />
containers are 40-foot containers which<br />
results in an effective charge $20.04<br />
per container whether full or empty. In<br />
addition, a charge of $1/tonne will be<br />
applied to non-containerised cargo. How<br />
risky would 25,000 tonnes of cement<br />
clinker be? What is the charge for a car or<br />
a bus? Many exporters rely on imported<br />
This non-discriminatory tax will not encourage<br />
better biosecurity outcomes for industry,<br />
the government or the nation.<br />
materials, for example fertilisers. The<br />
additional costs will impact many sectors.<br />
Vessels longer than 25 metres already pay<br />
a $920 arrival charge for biosecurity and<br />
additional charges apply if an inspection<br />
is required. In the future such vessels will<br />
have on-board ballast water treatment<br />
systems at great cost to the industry worldwide.<br />
A lot of attention is also being paid to<br />
treatments to avoid hull-fouling and vessels<br />
are subject to a prior arrival assessment<br />
of their possible biosecurity risk. The<br />
heavy lifting to contribute to the cost of<br />
protecting Australia’s biosecurity system is<br />
shared by many segments of industry.<br />
COSTS COULD PILE UP<br />
If the proposed levy was a cost-recovery<br />
charge, it would be more transparent and<br />
subject to discussion within the various<br />
industry and biosecurity consultative<br />
committees. Even though it will be<br />
administered by the Department of<br />
Agriculture and Water Resources, the funds<br />
may or may not be spent on biosecurity.<br />
This tax on trade will be larger by the<br />
time it reaches the end consumer. The levy<br />
of $20.04 per container imported is very<br />
likely to be more than that by the time it<br />
reaches the importer. It is proposed that<br />
the levy be collected by the stevedores. The<br />
costs of collecting the levy, remittance<br />
and reconciliation of levy payments<br />
will presumably be passed on down the<br />
chain. Taxing links in the supply chain<br />
usually has multiplier effects as far as the<br />
consumer is concerned.<br />
For non-containerised cargo it is even<br />
more complicated because the stevedores<br />
generally have no direct relationship with<br />
the receiver of the cargo, so they would be<br />
forced to charge the customs agent, the<br />
freight forwarder or the ship’s agent. This<br />
leaves the levy passing through multiple<br />
hands and potentially more handling fees<br />
to be added down the chain.<br />
NON-CONTAINERISED CARGO<br />
The container levy was a recommendation,<br />
among many others, of the 2017 report<br />
on priorities for Australia’s biosecurity<br />
system chaired by Dr Wendy Craik, and<br />
the recommendation was qualified. It did<br />
not include any recommendation on noncontainerised<br />
cargo. The panel believed<br />
that on equity grounds, the levy should be<br />
expanded to include non-containerised<br />
incoming trade in the future, as the<br />
vessels themselves also create biosecurity<br />
risks. No mention was made of the levy<br />
applying to the cargo that the vessels carry<br />
or the biosecurity costs already borne by<br />
vessels as mentioned above.<br />
In relation to the levy applying to<br />
non-containerised cargo, the panel<br />
noted the finding in the Cost Recovery<br />
Implementation Statement Biosecurity<br />
2015-16 that: “[The Australian<br />
government] did examine other options<br />
to apply a levy to all types of imported<br />
cargo, however, there are no other costeffective<br />
mechanisms available at this<br />
time”. Presumably this is why there was<br />
no specific recommendation on noncontainerised<br />
cargo.<br />
The panel acknowledged that the<br />
Australian government’s 2015 costrecovery<br />
review removed the previous<br />
charge on air and sea containers as part<br />
of the overall restructuring package. The<br />
charge covered the cost of the Department<br />
examining 100% of loaded or partly<br />
loaded sea containers imported, but not<br />
empty containers. With the move towards<br />
risk-based inspections, it was decided<br />
to switch to another mechanism. If the<br />
container charge is to be re-introduced,<br />
will that require a return to a 100%<br />
examination of all import containers plus<br />
empties by the Department?<br />
The panel stated in its report that if a<br />
container levy (air and sea) is considered<br />
unacceptable (given a levy was removed<br />
in the 2015 cost recovery review), an<br />
alternative would be to supplement the<br />
charge on full import declarations with<br />
a levy to collect a similar amount to the<br />
16 October 2018<br />
thedcn.com.au
proposed container charge, in the order of<br />
$10 per full import declaration.<br />
It also should be noted the panel<br />
recommended an increase in the passenger<br />
movement charge by $5 in July 2022<br />
with revenue generated hypothecated to<br />
the Australian government agriculture<br />
department for use nationally to enhance<br />
activities across Australia’s biosecurity system.<br />
This is an important recommendation, as it<br />
recognises that good biosecurity outcomes<br />
are in the national interest.<br />
AIR CONTAINER LEVY NOT ACCEPTED<br />
The panel also recommended a levy of $5<br />
per incoming air container, effective from<br />
1 July 2019 but the government did not<br />
accept that recommendation.<br />
The government needed more tax<br />
revenue from trade so added a levy of $1<br />
per tonne for non-containerised cargo. This<br />
levy alone will raise 125% more funds per<br />
annum than the panel estimated would<br />
arise from the application of the levy on air<br />
and sea containers which was their actual<br />
recommendation.<br />
Nationally, externally sourced funds<br />
in 2015-16 accounted for 57% and budget<br />
appropriations 43% of total investment.<br />
A marked change from 2013-14 when<br />
the corresponding figures were 32% and<br />
68% respectively. It was also noted in the<br />
report that while very difficult to quantify<br />
there are significant in-kind contributions<br />
from industry.<br />
The levy announced in the last budget<br />
is a tax grab. What will happen in future<br />
budgets? What control will be exercised<br />
over the incentive to increase this so-called<br />
levy in the future?<br />
This non-discriminatory tax will not<br />
encourage better biosecurity outcomes for<br />
industry, the government or the nation. It is<br />
not risk-based and undermines the concept<br />
of biosecurity being a shared responsibility<br />
between government and industry.<br />
Trust in the system will only be restored<br />
if there is an increase of $10 effective on 1<br />
July 2019 in the FID, being the alternative<br />
and in my view, realistic recommendation<br />
of the 2017 review. This increase in the<br />
FID will be subject to on-going scrutiny<br />
by industry in consultation with the<br />
Department. The tax revenue from the $1<br />
per tonne of non-containerised cargo (an<br />
additional $66m approximately per year for<br />
each of the next three years) will have to be<br />
foregone if trust is to be restored.<br />
Llew Russell, AM<br />
The threat of possible retaliation by<br />
our trading partners to this proposed new<br />
non-tariff barrier should absolutely not be<br />
summarily dismissed.<br />
Llew Russell was the inaugural CEO of Shipping<br />
Australia Ltd, retiring from that position in<br />
2013. He is currently a director and consultant<br />
and was the recipient of the 2013 Australian<br />
Biosecurity Lifetime Achievement Award<br />
BUILT SMART,<br />
BUILT TOUGH,<br />
BUILT HERE.<br />
SAL<br />
www.omega-heavy-trucks.com 1800 005 747<br />
thedcn.com.au October 2018 17
YOUNG SHIPPING AUSTRALIA<br />
Don’t fall afoul of the<br />
Australian Competition Act<br />
The Competition Act carries pitfalls for the unwary in the shipping industry writes<br />
Rebecca Niumeitolu and Adam Vrahnos<br />
A FOCAL POINT OF YOUNG<br />
Shipping Australia (NSW) and its parent<br />
body, Shipping Australia, is to educate<br />
and encourage members’ compliance with<br />
industry regulations. A topic of constant<br />
discussion is the application of the<br />
Australian Competition and Consumer Act<br />
2010 which, among other things, prohibits<br />
anti-competitive conduct.<br />
A difficulty with compliance under<br />
the Competition Act for members of the<br />
shipping industry is that they are often<br />
required to navigate this strait between<br />
permissible operational co-ordination and<br />
impermissible restrictive trade practices<br />
where the regulatory haze is thick.<br />
A review of current industry practices<br />
may well find that many participants are<br />
unclear on what and when conduct crosses<br />
the line. How can businesses assess risks of<br />
non-compliance and how can they identify<br />
risks as they arise?<br />
RISKY BUSINESS<br />
The Competition Act is regulated and<br />
enforced by the Australian Competition and<br />
Consumer Commission. As a rule of thumb,<br />
the ACCC’s methods of enforcement either<br />
go to the nature of regulatory breach by a<br />
business, or they tend to be commensurate<br />
to the degree of criminality.<br />
If the sentence imposed on Nippon Yusen<br />
Kabushiki Kaisha (NYK) on 3 August 2017 is<br />
any indication, long-standing cartel conduct<br />
may pose a significant risk for businesses.<br />
For NYK, the risk of non-compliance<br />
with the Competition Act resulted in a<br />
fine of $25m that had been reduced from<br />
$50m for NYK’s guilty plea, and past and<br />
future assistance, along with its contrition.<br />
That fine was imposed for a cartel which<br />
NYK engaged in between 2009 to 2012 in<br />
respect of transporting vehicles to Australia<br />
with other shipping lines.<br />
The list of ways a business can spot risks<br />
and avoid them is extensive and largely<br />
depends on each business’s circumstances.<br />
However, there are two that all businesses<br />
should keep in mind to ensure they are not<br />
in breach of the Competition Act.<br />
NUMBER ONE<br />
Think twice about prospective contracts,<br />
arrangements or understandings. The<br />
natural compulsion is to say “yes”<br />
to a contract that offers a business a<br />
commercial benefit with minimal costs.<br />
However, business need to think twice<br />
about contracts that:<br />
• have the purpose, or would have or be<br />
likely to have the effect of substantially<br />
lessening competition in the market;<br />
• offer services or goods on the condition<br />
of excluding a party from dealing with<br />
a competitor or only procuring services<br />
from a certain third party or other<br />
exclusively dealing with a party; and/or<br />
• contain cartel provisions, such as by<br />
fixing, controlling or maintaining prices<br />
of the supply of shipping services with<br />
the purpose of limiting the supply of<br />
services to persons of classes of persons.<br />
Sometimes it won’t be obvious that a<br />
contract term has a prohibited purpose or<br />
effect. Businesses need to look for, or obtain<br />
advice on, the implications of the terms of a<br />
contract, arrangement or understanding on<br />
the market. It may be a lot of effort, but it is<br />
better not to rely on inadvertence as a shield<br />
where the risks for non-compliance are costly.<br />
NUMBER TWO<br />
Register prospective conference agreements<br />
and review existing ones. Conference<br />
Rebecca Niumeitolu,<br />
lawyer, Holding<br />
Redlich and YSA<br />
committee member<br />
agreements are agreements between liner<br />
shipping providers relating to inward or<br />
outward cargo shipping services provided,<br />
or proposed to be provided, by those<br />
providers or members. Where appropriately<br />
registered, such agreements allow for liner<br />
service providers to agree to freight rates to<br />
be charged, the quantity and kinds of cargo<br />
to be carried and trade routes.<br />
Failing to register these agreements<br />
runs a risk of breaching prohibitions<br />
against price fixing, entering contracts that<br />
have the effect of substantially lessening<br />
competition and/or exclusive dealing.<br />
Parties contemplating entry into a<br />
conference agreement should register them.<br />
Parties that have failed to register a<br />
conference agreement or a variation to<br />
a conference agreement may consider<br />
contacting the ACCC with a strategy to<br />
rectify that error.<br />
WALKING A FINE LINE<br />
The Competition Act imposes various<br />
positive obligations on businesses to<br />
ensure that their coordinated efforts with<br />
other businesses in the shipping/logistics<br />
sector are permissible and do not restrict<br />
competition in the market.<br />
There is a fine line between permissible<br />
operational coordination and impermissible<br />
restrictive trade practices, as evidenced by<br />
various recent high profile prosecutions<br />
brought by the ACCC, and it is vital that all<br />
businesses in the shipping sector are aware<br />
of potential operational risks and respond<br />
promptly to ensure compliance.<br />
Adam Vrahnos,<br />
lawyer, Holding<br />
Redlich and YSA<br />
committee member<br />
Holding Redlich<br />
18 October 2018<br />
thedcn.com.au
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INDUSTRY OPINION<br />
The strategic fleet<br />
and the national interest<br />
MIAL chief executive Teresa Lloyd examines the implications of having<br />
a “strategic fleet”<br />
THE TERM “STRATEGIC FLEET”<br />
means different things to different people.<br />
Undoubtedly, Australia already has a<br />
considerable strategic fleet – vessels the<br />
government sees fit to own, operate or<br />
charter such as the defence and border<br />
protection fleets, the Antarctic Division<br />
ice breaker, the CSIRO research vessel and<br />
AMSA emergency response vessels.<br />
Internationally there are examples<br />
of broader concepts of strategic fleets –<br />
regimes adopted by the UK via the Royal<br />
Fleet Auxiliary and US via the Military<br />
Sealift Command. Of course, both these<br />
nations also have significant nationallyflagged<br />
fleets that could be requisitioned<br />
if required.<br />
THE AUSTRALIAN FLEET<br />
The Australian maritime industry is a<br />
dynamic and diverse sector that includes<br />
businesses already heavily invested in<br />
providing support services to Australian<br />
government fleets and has a proud history<br />
of working together and supporting our<br />
nation’s needs.<br />
The utilisation of merchant-marine<br />
capability by other nations’ defence forces<br />
across a much broader area of operation<br />
is instructive. Australia’s maritime<br />
circumstances necessitate the careful<br />
consideration of the types of vessels that<br />
may have a national interest, given the<br />
particular requirements of Australia. This<br />
could mean that an appropriate strategic<br />
fleet for Australia may be aligned not<br />
just with military and defence needs, but<br />
also with supply-chain security, trade<br />
facilitation and seafarer officer training,<br />
given our reliance on sea transport via our<br />
extensive network of commercial ports.<br />
Assuming this is the case, how would<br />
we go about determining what additions<br />
we might suggest to the existing strategic<br />
fleet? An appropriate test to apply at first<br />
instance might be to identify where there<br />
is sufficient cargo to warrant a stable and<br />
permanent presence for a ship.<br />
SETTING POLICY FOR A STRATEGIC FLEET<br />
The market has determined – and<br />
policy settings have allowed – that<br />
Australian ships with a full Australian<br />
crew component are uncompetitive and<br />
unwarranted in almost all Australian<br />
trades. If the objective of the strategic fleet<br />
is to have vessels of certain types available<br />
to secure Australian supply chains and be<br />
available for requisition, then these vessels<br />
need to be identified and incentives put in<br />
place to secure them.<br />
The idea floated in the 2016 green<br />
paper, A Maritime Transition, was that<br />
these vessels be supported by a redirection<br />
of funds currently paid by foreign ships<br />
participating in Australian coastal trade in<br />
the form of crew wage top-ups under the<br />
Seagoing Industry Award Part B.<br />
Unless and until Australia has a regime that supports<br />
a level of local content in our shipping task, we will not<br />
see certainty or stability in the sector, and industry<br />
will continue to be wary of investment.<br />
The strong sentiment at the time of<br />
the green paper’s preparation was that<br />
foreign shipping companies didn’t mind<br />
paying something, but they wanted to<br />
see it go to something of benefit to the<br />
Australian maritime sector. Importantly,<br />
they wanted to eliminate the red tape and<br />
administrative burden that accompanies<br />
the payment of the wages top-up. To<br />
achieve that end, a simple, fixed levy<br />
would sensibly form part of existing AMSA<br />
levy structures. Equally, there is a strong<br />
rationale for government support.<br />
FUND THE RIGHT THING<br />
In 2013-14 the public funding (from all<br />
governments) provided to road and rail was:<br />
• about $25bn (Commonwealth, state/<br />
territory and local) for road; and<br />
• about $8.3bn (Commonwealth and<br />
state/territory) for rail.<br />
Further, it is estimated that each 1%<br />
increase in freight efficiency saves the<br />
national economy $1.5bn. There is little<br />
doubt that with the right policy settings,<br />
shipping could deliver at least a 1%<br />
efficiency gain.<br />
A fraction of the expenditure provided<br />
to road and rail would greatly enhance the<br />
competitiveness of shipping versus those<br />
modes and increase the market share of this<br />
form of transport, with resultant economic<br />
and environmental benefits. Specifically,<br />
public investment in infrastructure to<br />
encourage dedicated coastal ro-ro services<br />
for containerised cargo and trucks was<br />
identified as being something that would<br />
likely have immediate impact and provide<br />
confidence to investors to provide that<br />
transport option.<br />
LOCAL CONTENT<br />
Unless and until Australia has a regime<br />
that supports a level of local content in our<br />
shipping task, we will not see certainty or<br />
stability in the sector, and industry will<br />
continue to be wary of investment. How<br />
long that change takes will determine<br />
whether the industry is in a position to<br />
rebuild at all. And, with the complete demise<br />
of the industry comes a loss of strategic<br />
skills that are essential for Australia.<br />
With appropriate forms of support<br />
in place, the commercial interests that<br />
would be expected to use the strategicfleet<br />
ships would be in the same position<br />
commercially as they are now – but the<br />
20 October 2018<br />
thedcn.com.au
Teresa Lloyd, CEO, MIAL<br />
nation will have secured assets that fill<br />
certain national interest requirements.<br />
Using round numbers, 20 vessels<br />
would result in about 850 permanent jobs<br />
(about 100 ashore and 750 at sea), provide<br />
training for about 100 seafarers each year<br />
and require $140m annually in support.<br />
That’s 1.6% of the rail funding, or 0.56% of<br />
the road funding allocation in 2013-14.<br />
Seems like a small price to pay to secure<br />
a reliable source of trained maritime<br />
professionals to run our nation’s ports,<br />
pilot our visiting ships in and ensure safety<br />
and environmental standards are upheld.<br />
Not to mention having a critical mass of<br />
assets available to look after the national<br />
interest should they be required.<br />
The objections to offering any industry<br />
support are obvious. Since governments<br />
already fund other forms of surface<br />
transport and provides aviation with a<br />
watertight cabotage regime, it seems fiscal<br />
and structural support for transport modes<br />
is alive and well in this country – just not if<br />
it happens on the sea.<br />
Marina Tatarenko; Jim Wilson<br />
ONE’S SUBSIDY IS ANOTHER’S<br />
INCENTIVE<br />
Philosophical objections aside, surely the<br />
pragmatist in us all can see that this avenue<br />
has potential to solve a great number of<br />
challenges facing the industry and in<br />
the process create jobs, solve our skilled<br />
seafarer shortage and create optimism<br />
and a future for an industry which other<br />
developed nations consider critical and<br />
carefully nurture. And they do this because<br />
it makes good sense and is in their national<br />
interest. Australia is no different.<br />
thedcn.com.au October 2018 21
INDUSTRY OPINION<br />
American investigation<br />
rings true in Australia<br />
Travis Brooks-Garrett examines some of the issues pertaining to detention<br />
and demurrage in the supply chain<br />
IN EARLY SEPTEMBER, THE US<br />
defined demurrage as charges relating to<br />
Federal Maritime Commission released<br />
the “extended use of terminal space”, while<br />
an interim report on its investigation<br />
detention was used by the investigators to<br />
into “conditions and practices relating to<br />
refer to charges for extended “use of carrier<br />
detention, demurrage, and free time in<br />
provided equipment”.<br />
international ocean-borne commerce”.<br />
Common issues identified by US shippers<br />
During the investigation, the FMC<br />
in their testimony included “delays involved<br />
served 23 ocean carriers and 44 marine<br />
with US government holds”, “labour issues”<br />
terminal operators with interview<br />
and “unclear demurrage and detention<br />
questions and document requests.<br />
billing and dispute resolution systems”.<br />
The investigation was a result of a<br />
petition by a coalition of 26 organisations,<br />
NOT JUST IN AMERICA<br />
including local shippers, freight forwarders<br />
Despite the peculiarities of the US port<br />
and customs agents, calling for the<br />
supply chain (chassis pooling, etc.),<br />
adoption of a formal position by the<br />
concerns regarding detention and<br />
regulator on what constitutes “just and<br />
demurrage practices are universal and<br />
reasonable rules and practices”.<br />
the FMC’s investigation into this area has<br />
The investigation comes at an important<br />
time, with critics claiming that shipping<br />
lines are using detention and demurrage<br />
practices as a revenue generator rather than<br />
caught the attention of the world.<br />
In Australia, detention charges caused<br />
by “border holds”, or containers being<br />
inspected at the Container Examination<br />
Travis Brooks-Garrett, secretariat, Australian<br />
Peak Shippers Association and director, Freight &<br />
Trade Alliance<br />
a fair and transparent penalty system.<br />
Facility (CEF), are a major and recurring<br />
If container detention and demurrage<br />
issue for our shippers. While the<br />
practices were “just and reasonable”,<br />
A DEFINITION OF TERMS<br />
Australian Border Force has arrangements<br />
the container detention clock would<br />
Firstly, it’s important to note that the<br />
with stevedores to offer free storage if the<br />
begin from the time the container<br />
FMC identified inconsistencies in how the<br />
terms “detention” and “demurrage” are<br />
defined and used, even among shipping<br />
lines. While we often, incorrectly, hear<br />
the terms used interchangeably, for the<br />
purposes of the investigation the FMC<br />
cargo report was lodged within statutory<br />
timeframes, shipping lines will still<br />
apply detention fees for late container<br />
de-hire, even though the shipper or<br />
freight forwarder has no control over the<br />
container during that time.<br />
becomes available after CEF processing,<br />
and not from the time the container is<br />
discharged from the vessel. This was a key<br />
recommendation in the Freight & Trade<br />
Alliance and Australian Peak Shippers<br />
Association joint submission to the Inquiry<br />
Jupeter; Image supplied<br />
22 October 2018<br />
thedcn.com.au
into National Freight & Supply Chain<br />
Priorities earlier this year.<br />
While shipping lines have every right to<br />
be recompensed for extended equipment<br />
use, shippers should not be forced to pay<br />
for events that are outside of their control.<br />
In Australia, this issue was particularly<br />
pronounced when reports were received<br />
that Australian shippers were slapped with<br />
detention invoices during the VICT-MUA<br />
industrial dispute. That is, even though<br />
it was impossible to collect containers<br />
during that period and even though, in<br />
consideration of the circumstances, the<br />
terminal itself had done the right thing and<br />
waived storage fees.<br />
While many shipping lines reported to<br />
the FMC that they “automatically extend<br />
free time when a container is unavailable<br />
for retrieval”, it is also noted that only a few<br />
“VOCCs [vessel operating common carrier]<br />
or MTOs [marine terminal operators]<br />
indicated that they affirmatively notify<br />
cargo interests that an event triggering such<br />
policies has occurred”. In other words, you’ll<br />
only get it if you ask for it!<br />
A NEED FOR CONSISTENCY AND CLARITY<br />
Another important issue in the investigation<br />
is the inconsistency and lack of clarity in<br />
how detention and demurrage policies are<br />
applied and how disputes are settled.<br />
Many of the shipping lines reported<br />
disputes were resolved on a case-by-case<br />
basis, with several VOCCs having no<br />
written policy on how to handle disputed<br />
invoices. Of those that did have written<br />
policies, “few provided guidance on how<br />
a disputed charge should be evaluated or<br />
what evidence should be considered”.<br />
Predictably, an informal case-by-case<br />
review process, with no written policy<br />
as guidance, can create more headaches<br />
than answers for a shipper. As a result,<br />
identical shippers with identical scenarios<br />
may receive very different outcomes in a<br />
detention charge dispute.<br />
Finding the appropriate contact seems<br />
to be another challenge entirely, with<br />
the FMC noting that “it was also not<br />
immediately clear who cargo interests are<br />
supposed to contact in the event that they<br />
wish to challenge demurrage or detention”.<br />
Again, this all plays very true to the<br />
Australian experience.<br />
In their initial findings, the FMC have<br />
identified the following focus areas:<br />
• transparent, standardised language for<br />
demurrage, detention, and free time<br />
practices;<br />
• clarity, simplification, and accessibility<br />
regarding demurrage and detention<br />
(a) billing practices and (b) dispute<br />
resolution processes;<br />
• explicit guidance regarding types of<br />
evidence relevant to resolving demurrage<br />
and detention disputes;<br />
• consistent notice to shippers of<br />
container availability;<br />
• an optional billing model wherein<br />
(a) MTOs bill shippers directly for<br />
demurrage; and (b) VOCCs bill shippers<br />
for detention; and<br />
• an FMC shipper advisory or innovation<br />
team.<br />
FTA and APSA, and other shipper bodies<br />
around the world, have applauded the FMC<br />
investigation. It is a brave exercise with<br />
While shipping lines have every right to be<br />
recompensed for extended equipment use,<br />
shippers should not be forced to pay for events<br />
that are outside of their control.<br />
a clear understanding of the real-time<br />
operational issues that affect US exporters,<br />
importers and maritime trade stakeholders.<br />
Hopefully, our own government agencies<br />
are taking note.<br />
We were proud to host Commissioner<br />
Dye of the FMC in Melbourne earlier this<br />
year as part of the Global Shippers Forum<br />
and look forward to further engagement.<br />
The final FMC Report is due on 2<br />
December 2018. The FMC Interim<br />
report is currently available to view on<br />
the FTA website.<br />
Proud to be sponsoring the<br />
2018 Freight Forwarder<br />
of the Year Award<br />
at the 2018 Australian Shipping<br />
& Maritime Industry Awards<br />
Australia’s first consolidator to financially guarantee its services<br />
thedcn.com.au October 2018 23
THE CUSTOMS BROKER<br />
How to survive trading risks in<br />
the international supply chain<br />
The risks of international trade are not the responsibility of services providers<br />
involved in the supply-chain management process, writes Paul Damkjaer<br />
SERVICE PROVIDERS IN INTER-<br />
national trade logistics and supply chain<br />
management face a challenging business<br />
continuum with the downturn of<br />
international trade. Of particular concern is<br />
deteriorating cash flow, facility for payment<br />
on behalf of clients of duty and GST, as<br />
well as the level of increased client failure<br />
through administration or receivership.<br />
The inherent risks of international<br />
trade, while clearly understood, are not the<br />
responsibility of service providers involved<br />
in the international trade logistics and<br />
supply chain management process.<br />
THE ROLE OF A SERVICE PROVIDER<br />
The international freight forwarder/customs<br />
broker is a service provider contracted to<br />
clients to ensure internationally traded<br />
goods move from the point of origin to the<br />
point of destination so as to arrive at the<br />
right place, time and at a cost appropriate<br />
with the service provided.<br />
To achieve these objectives requires<br />
expertise across a wide variety of processes,<br />
including:<br />
• international freight forwarding (import<br />
and export);<br />
• barrier clearance – border and<br />
biosecurity;<br />
• transportation and its security in all<br />
modes (sea, air, rail, road and post);<br />
warehouse/distribution; and<br />
• supply chain management.<br />
In many cases, contractual issues as to<br />
the supply and delivery of goods are done<br />
by the importer without consultation with<br />
service providers and the outcomes of these<br />
arrangements are, in the main, outside the<br />
control of service providers.<br />
Additional costs that may result from such<br />
arrangements are not as a result of, or indeed<br />
the responsibility of, the service provider,<br />
who may only be charged with the task of<br />
facilitating the import consignment through<br />
the barrier process on the client’s behalf.<br />
THE ROLE OF THE IMPORTER AND<br />
MITIGATION OF RISK<br />
It has become clear that while there is<br />
expertise within individual sectors of<br />
industry, there are very few experts and<br />
very little expertise covering the whole of<br />
supply chain.<br />
Operating in the international supply<br />
chain is a difficult and complex task that<br />
requires extensive knowledge of how the<br />
supply chain operates and parties interact.<br />
It is important for importers to partner<br />
with their service providers and work<br />
collectively to improve cost efficiency in the<br />
supply chain.<br />
The following points highlight some key<br />
issues for importers to consider:<br />
• Get legal advice before entering into<br />
international trade contracts.<br />
• Obtain advice from your service<br />
provider(s) involved in international<br />
trade facilitation.<br />
• Understand Australian regulatory (and<br />
documentary) requirements before<br />
importation (or exportation) of goods.<br />
• Obtain appropriate insurance cover to<br />
minimise international trading risks.<br />
• Note that just-in-time inventory has<br />
inherent risk, as unexpected delays can<br />
occur at any time in the international<br />
supply chain.<br />
• Your service provider should be provided<br />
with all necessary documentation early<br />
Operating in the international supply chain is a difficult<br />
and complex task that requires extensive knowledge<br />
of how the supply chain operates and parties interact.<br />
Paul Damkjaer, CEO, CBFCA<br />
to allow border clearance (and other<br />
requirements) before freight arrival.<br />
• Be flexible in the times for the receipt of<br />
containers, such as extending operating<br />
hours to align with those of stevedores<br />
and logistics service providers.<br />
• Unpack the container as quickly as<br />
possible (do not use it as a storage unit).<br />
• Notify your service provider or transport<br />
company when the container is empty<br />
and ready for collection. This should be<br />
at least two full working days prior to<br />
commencement of any detention fee<br />
period.<br />
• Ensure the timely payment of invoices<br />
to avoid cargo clearance delays as service<br />
providers are not required to provide<br />
financial accommodation.<br />
• Understand how the international<br />
supply chain partners interact.<br />
These issues are outside the control of<br />
the logistics service provider. The additional<br />
costs created from the compounding<br />
effects due to lack of awareness of the<br />
requirements in the complex supply<br />
chain are not as a result of, or indeed, the<br />
responsibility of the logistics provider.<br />
Ian Ackerman<br />
24 October 2018<br />
thedcn.com.au
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WOMEN IN MARITIME<br />
Amber Thomson<br />
in the<br />
wheelhouse<br />
A vision for<br />
Port Hedland tug crews<br />
Katherine Mahone relates the stories of women forging maritime careers<br />
in the tough working environment of Port Hedland<br />
AT THE BEGINNING OF JULY, A POST<br />
what was being done to promote maritime<br />
wasn’t until a colleague saw her potential<br />
appeared on an internet page for women<br />
careers for those who may not traditionally<br />
and suggested she consider working for<br />
who go to sea. The post was looking for a<br />
have sought such a career. How can<br />
AMSA that Clare became aware of the<br />
female engineer to join the tug crews in<br />
we learn from the experiences of other<br />
maritime industry. She has since worked for<br />
Port Hedland, with a view to having a fully<br />
industries that seek to promote diversity?<br />
offshore companies in marine logistics for<br />
female tug crew: master, engineer and<br />
I spoke with Clare Ellis (QHSE<br />
barge loading, landing craft and the supply<br />
trainee/mate.<br />
coordinator), Annette Prindiville (tug<br />
and support of offshore and blue water<br />
I was interested to know if they had<br />
master) and Amber Thomson and Bre Evans<br />
vessels. Clare is currently studying for her<br />
managed to achieve this goal and contacted<br />
(both trainee tug masters) to learn more<br />
Master Class 5 and Marine Engine Driver<br />
Clare Ellis, who posted the request, to find<br />
about how they came to work in maritime.<br />
qualifications.<br />
out more about the women working on the<br />
They, like many women and men, fall<br />
tugs in this area.<br />
into the two common paths to a career in<br />
ANNETTE AND AMBER<br />
the maritime industries – by accidently<br />
Both Annette and Amber had fishermen<br />
HEDLAND TUGS<br />
stumbling across it or because they knew<br />
in their families and spent a lot of time on<br />
Clare works for Rivtow Marine, which<br />
about the industry due to a family member<br />
the water while growing up, but still the<br />
provides tug services to Port Hedland.<br />
working in it, usually their father.<br />
knowledge of possible career opportunities<br />
Rivtow Marine has 18 tugs under<br />
in the industry was limited.<br />
management at Port Hedland, with three<br />
CLAIRE<br />
Annette started in the marine tourism<br />
crew per shift. The company has three<br />
Clare was never made aware of the job<br />
industry in Victoria and New South Wales<br />
women working on the tugs and three<br />
opportunities available in the maritime<br />
and completed short courses to move onto<br />
women working shore-side. There is hope<br />
industry when going through high school<br />
other areas within the industry. She worked<br />
that a woman engineer will be joining their<br />
and, even after she joined AMSA, it initially<br />
as a pilot-launch master and on patrol<br />
ranks shortly.<br />
Rivrtow’s post and my own experiences<br />
in the maritime industry led me to wonder<br />
wasn’t a consideration. Clare studied<br />
environmental science and worked in safety<br />
for several state and federal departments. It<br />
vessels around Australia and Papua New<br />
Guinea. After a few years of submitting<br />
her resume for a tug master position,<br />
Clare Ellis<br />
26 October 2018<br />
thedcn.com.au
Annette was offered a job as a trainee on<br />
Port Hedland tugs. When the management<br />
company changed, Annette was given a<br />
trainee tug master position and now holds<br />
Master Class 4 and Marine Engine Driver<br />
Grade 2 qualifications.<br />
Amber was initially encouraged to<br />
complete a trade before pursuing a career<br />
in the maritime industry. She completed<br />
a chef apprenticeship before travelling<br />
and working overseas. On her return to<br />
Australia, Amber worked on tourist vessels<br />
in Tasmania and the Kimberley. It was<br />
while working on a charter boat in the<br />
Kimberley that Amber decided to follow<br />
her dream of working as a master in the<br />
industry. Over the next 10 years, she<br />
obtained her Master Class 4 and Marine<br />
Engineer Driver Grade 2 qualifications and<br />
worked on a variety of vessels both inshore<br />
and offshore.<br />
Amber is a now a partner in a firm that<br />
sub-contracts to Rivtow Marine, where she<br />
is currently completing training on ASD tugs.<br />
BRE<br />
Bre Evans’ father was a scuba diving<br />
instructor and regularly took her on his<br />
dive trips, giving Bre a great love of the<br />
ocean and an interest in being involved<br />
in working either on or in the water. She<br />
studied marine biology and aquaculture<br />
and commenced working as a research<br />
officer in the pearling industry. This<br />
required Bre to operate small boats to<br />
be able to collect data, and led to her<br />
obtaining coxswain and Marine Engine<br />
Kirsty Timbury (BHP marine<br />
manager), Clare Ellis and<br />
Zoe Gill (BHP marine<br />
co-ordinator)<br />
Driver Grade 2 qualifications.<br />
While on holiday in the Caribbean,<br />
Bre discovered yachting. As she worked<br />
on luxury yachts around the world, Bre<br />
progressed her qualifications to Master<br />
Class 4 and a UK-issued Master (yachts<br />
that are less than 3000 GT). Bre has<br />
only been training on tugs for about<br />
three months but is enjoying learning all<br />
aspects of the job – maintaining a lookout,<br />
vessel maintenance, safety checks and<br />
administrative duties.<br />
All agree that working in the maritime<br />
industry has been rewarding and they enjoy<br />
being able to work at something they love.<br />
The schedules may vary – including day<br />
work with on-call duties; and 27 or 28 days<br />
on with the same number of days off.<br />
Like every job, there are ups and downs,<br />
good and bad days, but each of these<br />
maritime professionals believes the time<br />
and commitment taken to reach where they<br />
are today has been worthwhile.<br />
Unlike other jobs, though, information<br />
on opportunities to work in the maritime<br />
industry was not readily available. The<br />
challenge to us all is to promote the<br />
opportunities in the maritime industry.<br />
Katherine Mahone decided on a career at sea<br />
after enjoying a holiday on a square-rigged<br />
sailing ship at the age of 14. She has worked in<br />
the UK and Australia, and is currently a vesseltraffic<br />
officer at Port Kembla. Katherine is a<br />
single parent of a five-year-old who believes she<br />
is the boss of the ocean.<br />
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thedcn.com.au October 2018 27
PORTS AUSTRALIA BIENNIAL CONFERENCE<br />
Ports bosses<br />
confabulate in Darwin<br />
Ports honchos recently gathered in Darwin to<br />
attend Ports Australia’s 46th Biennial Conference,<br />
Ian Ackerman reports<br />
Euan Morton,<br />
Principal, Synergies<br />
Economics<br />
Synergies Economics principal Euan<br />
Morton took delegates through an in-depth<br />
Paul Weedon,<br />
CEO, TasPorts<br />
Day one of the conference kicked off with<br />
Ports Australia chairman and (now former)<br />
TasPorts CEO Paul Weedon giving a brief<br />
overview of the topics to be covered for the<br />
day, from a Tasmanian point of view.<br />
He said ports across the country were<br />
grappling with increasing vessel sizes, and<br />
“they have finally come to Tasmania; it is a<br />
big deal in our world,” he said.<br />
Mr Weedon also said people in Tasmania<br />
by and large have a good relationship with<br />
the ports in their towns.<br />
“Citizens in the towns of Burnie and<br />
Hobart love their ports and are hugely<br />
interested in what we do,” he said.<br />
Adam Handley,<br />
senior partner,<br />
MinterEllison<br />
Following Mr Weedon’s talk, Adam<br />
Handley, who is president of the WA<br />
Australia China Business Council and<br />
senior partner at MinterEllison, did a<br />
deep dive into the business and trade<br />
relationship that Australia has with China.<br />
He argued that there wasn’t a “binary<br />
choice” for Australia to align with either<br />
the US or China. He suggested Australia<br />
should focus on domestic stability, and<br />
spreading influence where it could – the<br />
Pacific region.<br />
“Our capacity to influence global<br />
situations is negligible, but we have some<br />
regional influence and we need to do more.”<br />
analysis of the economic and regulatory<br />
issues around Australian ports.<br />
During part of the presentation, he<br />
spoke about social licence and community<br />
engagement. Mr Morton drew comparisons<br />
between the ports industry and the gaspipeline<br />
industry. He said, among other<br />
similarities, that gas pipelines bring great<br />
good to consumers, but are largely invisible,<br />
and ports are similar.<br />
Also, Mr Morton spoke about ports’<br />
connections with communities in which<br />
they operate. He cited the Container exhibit<br />
at the Australian National Maritime<br />
Museum as a good example of the industry<br />
engaging with its community.<br />
“This industry has done a great job, but<br />
the public aren’t necessarily aware of it,<br />
and that’s going to be a big issue moving<br />
forward,” he said.<br />
Ian Ackerman<br />
28 October 2018<br />
thedcn.com.au
Anthony Albanese,<br />
member for<br />
Grayndler<br />
Labor MP Anthony Albanese gave a stirring<br />
talk during the second day of the conference,<br />
Daniela Constantinescu<br />
Mandy Newton ,<br />
Deputy<br />
Commissioner,<br />
Australian Border<br />
Force<br />
Speaking at the conference, Australian<br />
Border Force Deputy Commissioner<br />
Mandy Newton said government<br />
had been “extensively” exploring the<br />
implementation of the trade “single<br />
window”, a digital interface between<br />
government and industry.<br />
“Ultimately it’s a decision by the<br />
government, whether they wish to proceed<br />
in a particular financial year,” she said,<br />
noting that the scoping for the project had<br />
been extensive.<br />
Ms Newton said the ABF was keen to<br />
continue to engage with industry to refine<br />
its processes.<br />
calling for coastal shipping reform.<br />
“[Labor is] determined to not be a party<br />
in destroying a proud Australian industry,”<br />
he said during his address to the conference.<br />
Coastal shipping reform, he said, is<br />
essential for bringing back the maritime<br />
jobs that would feed into the upper levels of<br />
the profession.<br />
“You need a maritime sector and<br />
maritime skills, who’s going to run the<br />
ports if you don’t have a maritime sector?<br />
Who’s going to be the harbour masters?<br />
Vision!” he told Daily Cargo News on the<br />
sidelines of the conference.<br />
“It’s a matter of understanding that<br />
there’s a national interest,” he said.<br />
Mr Albanese also spoke about protecting<br />
transport corridors, the missing link in<br />
Inland Rail (Acacia Ridge to Port of Brisbane),<br />
and even quoted Adam Smith, who wrote<br />
about coastal shipping in 1700s Britain.<br />
Michael Gallacher,<br />
CEO, Ports Australia<br />
The conference concluded with Ports<br />
Australia CEO Michael Gallacher giving an<br />
impassioned speech about how the actors in<br />
the supply chain need to stick together<br />
“Coastal shipping is an issue that we<br />
won’t agree on. There are competitive issues<br />
there, I get that,” he said.<br />
“But that’s only a small part of it. When<br />
we go to government, they can’t pick us<br />
off, playing one against the other playing<br />
the game of the weakest link. We cannot<br />
have that. The supply chain if it’s going to<br />
be a chain, has to be a strong, unbreakable<br />
bond, and that means trust, and that<br />
means working together.”<br />
thedcn.com.au October 2018 29
LINDER TRADES TO NORTH AMERICA<br />
Conservation<br />
Trekandshoo<br />
30 October 2018<br />
thedcn.com.au
&<br />
Costs<br />
for shipping keep going up while freight rates<br />
remain stubbornly down. Carriers in the trade between<br />
Australia and North America are re-thinking their<br />
services to ensure survival, Dale Crisp reports<br />
Long Beach, California<br />
To dig below the surface of some of<br />
Australasia’s long distance direct<br />
services is to discover the fragility that<br />
lurks just out of sight.<br />
Shipping lines that have long<br />
defended the viability of such operations<br />
– even when all around them have, for 20<br />
years or more, been predicting their demise<br />
– sense the pressures building up.<br />
The volumes available do not support<br />
the deployment of larger ships on the<br />
frequency the market requires, yet the<br />
received wisdom is “bigger is better”, and<br />
so the pursuit of economies of scale have<br />
come at the expense of modern designs and<br />
newbuilding orders for route-appropriate<br />
lesser trades.<br />
Bunker and charter costs rise and fall,<br />
but the overall trend is for fixed system<br />
costs to keep increasing – while freight<br />
rates in some Oceania trades have not<br />
risen for years and in real terms have gone<br />
decidedly backwards.<br />
Reliable profits are harder to come by,<br />
resources deployed are out of kilter with<br />
returns available, and there’s always the<br />
(rightful) suspicion that customers don’t<br />
really appreciate what they’ve got, anyway.<br />
The trades between Australia and the<br />
East and West Coasts of North America<br />
had been stuck in a kind of benign neutral<br />
gear for year upon year.<br />
Then, in late 2017 came news of a<br />
significant shake-up of a major East Coast<br />
service and by the end of 2018 there’ll be<br />
a radical overhaul of West Coast links.<br />
Talk to carriers and you’ll find they’re busy<br />
throwing switches to try and ensure these<br />
direct services have a long-term future, to<br />
keep faith with shippers while still making<br />
a buck, to best fit supply to demand when<br />
these bi-coastal trades are – with the end<br />
of so much Australian manufacturing - so<br />
dependent on agricultural outputs that are<br />
seasonal, fluctuating and unpredictable.<br />
Let’s deal with the East Coast first.<br />
THE EAST COAST TRADE<br />
At the time of this review last year, the<br />
news was all about the forthcoming CMA<br />
CGM/Marfret/Seatrade vessel sharing<br />
agreement, combining the French carriers’<br />
long-standing PAD NASP fortnightly<br />
service to-from Europe via the east coast<br />
North America (ECNA) with the Dutch/<br />
Belgian reefer specialist’s early-2017<br />
launched Meridian service following a<br />
similar route every 10 days.<br />
However, as catalogued in Daily Cargo<br />
News’ recent review of ANZ-Europe liner<br />
trades, the VSA was stillborn, thanks to<br />
Seatrade’s financial difficulties. Instead,<br />
eventually, the market got what it desired<br />
when CMA CGM committed to taking PAD<br />
weekly, underpinned by a three-year contract<br />
with NZ kiwifruit exporter Zespri. The new,<br />
faster, 13-ship service took three months to<br />
roll out but was widely applauded by shippers.<br />
And trade figures appear to show CMA CGM,<br />
junior partner Marfret and slot-charterer<br />
(and CMA CGM Group member) ANL all<br />
liftings in the ECNA trade as a result of the<br />
improved product.<br />
BUMPS IN THE ROAD<br />
All wasn’t plain sailing. A 91-day round<br />
voyage offered unwelcome opportunities<br />
for delays without much schedule slack for<br />
recovery: ships skipped some Australian<br />
port calls to meet Zespri’s NZ export<br />
deadlines and stresses grew too great.<br />
Firstly, Nelson and London Gateway calls<br />
were stripped back to fortnightly, and<br />
then dropped altogether, and Napier was<br />
omitted. “Seasonal adjustments,” was the<br />
proffered explanation.<br />
thedcn.com.au October 2018 31
LINDER TRADES TO NORTH AMERICA<br />
FLEET MANOEUVRES<br />
In the past 12 months, changes to the West Coast fleets have<br />
been modest, as might be expected from the foregoing report,<br />
although there has been a general trend towards larger vessels<br />
– either as a portent of the service rationalisation or, more<br />
likely, a consequence of charter market availability.<br />
The OVSA PNW string has, until last month, operated with<br />
the same four ships: the Hamburg Süd-operated, 2741-TEU Cap<br />
Blanche and Cap Pasado, and the Hapag-Lloyd contributions<br />
2490-TEU BSL Limassol and 2546-TEU Balao. Ahead of the<br />
service consolidation, Cap Blanche was replaced in early<br />
September by the 2646-TEU Botany Bay.<br />
The PSW has seen some comings and goings, although<br />
constants remain: HLL’s 3534-TEU Northern Dexterity, HSD’s<br />
3868-TEU Cap Capricorn and PIL-branded Kota Ekspres, while<br />
a third sister, Cap Corrientes, was handed back to owners in<br />
February and replaced by the 4526-TEU Melina.<br />
All three ANL PSW ships have been changed: In October<br />
2017 the ANL-chartered Seaspan Loncomilla (4253 TEU) was<br />
replaced by a sister ship, ANL Warrnambool, while in April the<br />
long-serving 3586-TEU ANL Barega was replaced by the 4253-<br />
TEU ANL Tongala. More recently, in August, the 4253-TEU ANL<br />
Warragul (which has become something of a television star<br />
thanks to featuring in the series “The Pacific in the wake of<br />
Captain Cook”) was off-hired and replaced, temporarily, by the<br />
5040-TEU ANL Walwa.<br />
CONSOLIDATION<br />
As detailed earlier, with the consolidation of the two strings<br />
later this year the total OVSA fleet will initially stand at eight<br />
ships of average 4250 TEU, with Maersk providing four and<br />
ANL and HLL two each. Thus, as well as the four departing<br />
PNW ships, the current HSD and HLL contributions in the PSW<br />
service will be upsized. It is planned that each carrier will have<br />
representation in each alternating loop.<br />
Swire Shipping’s WCNA liner service has completed its<br />
transition to an almost entirely breakbulk operation, with<br />
the two 2082-TEU MPPs Siangtan and Shengking redeployed<br />
elsewhere in the company’s network and replaced by three<br />
B.Delta 39 handysize bulk carriers with limited container<br />
capacity. Eriskay, Pakhoi and Pekin are still offering scheduled<br />
southbound sailings from WCNA to ANZ but then backload logs<br />
for East Asia and where they join Swire’s trans-Pacific multibulk<br />
service to reposition to WCNA.<br />
On the two East Cost services, there has also been some<br />
fleet and capacity change, highlighted, logically, by the upgrade<br />
of PAD/NASP to weekly frequency that took effect from early<br />
this year. With 13 ships required to achieve that status – and<br />
round-voyage duration improved from 98 to 91 days – it took<br />
PAD/NASP several months to reach full deployment, using a<br />
combination of carryovers from the fortnightly service and<br />
tonnage “inherited” from the Seatrade Meridian service.<br />
Thus the fleet currently comprises: four Hyundai Mipo<br />
2800s – Santa Bettina, Harmony N, CMA CGM Pointe des Salines<br />
and Moen Island; three Samsung/Hyundai 2500s – Bomar Calais,<br />
AS Petronia and EM Corfu; two SDARI 2500s – Nordserena and<br />
Nordpacific; and four 2259-TEU colour class – Seatrade White,<br />
Seatrade Blue, Seatrade Red and Seatrade Orange.<br />
Forward schedules show that when the seasonal reversion<br />
to fortnightly frequency takes place – effective northbound/<br />
eastbound from early November until end-March – the service<br />
will be maintained by seven ships, presently listed (in sailing<br />
order) as Seatrade Orange, Nordpacific, Santa Bettina, Seatrade<br />
Red, Nordserena, EM Corfu and Seatrade Blue.<br />
TONNAGE SHUFFLE<br />
On the Maersk/HSD OC1/Trident service – now really a unified<br />
product given Maersk’s ownership of HSD – there has been a<br />
tonnage shuffle, driven by drydocking and other requirements<br />
and which has seen a marginal upsizing of vessels deployed.<br />
The 4256-TEU Bernhard-S, which was chartered last year to<br />
cover drydockings of the HSD-operated, 3630-TEU spirt class,<br />
was retained in the service in place of one of the latter, and last<br />
month was renamed ALS Jupiter following sale to new owners<br />
but remains in OC1/Trident. Early this month a sister ship,<br />
Elisabeth-S, replaced Spirit of Auckland, leaving four of the latter<br />
class remaining: Spirit of Singapore, Spirit of Shanghai, Spirit of<br />
Hamburg and Spirit of Sydney.<br />
From the Maersk pool, the 3364-TEU Maersk Izmir, Maersk<br />
Inverness and Maersk Innoshima are deployed (as of late<br />
September) along with the 3028-TEU Olga Maersk; the I class<br />
ships have progressively replaced the 3194-TEU B class, while<br />
also providing cover for drydocking of O-class vessels that have<br />
been swapped in and out of this service as well as Maersk’s<br />
YoYo and Northern Star. The 4255-TEU Harrier Hunter made one<br />
January/February voyage in Maersk Brani’s stead before<br />
being replaced by the returning Spirit of Shanghai.<br />
The total OC1/Trident service remains<br />
stable at eight ships.<br />
Sheila Fitzgerald<br />
32 October 2018<br />
thedcn.com.au
But then – just after the DCN feature<br />
lauding the weekly PAD/NASP was<br />
completed for publication – came an<br />
announcement of a more comprehensive<br />
“seasonal adjustment”. From mid-September<br />
ex-Europe (end-October in ANZ) PAD/<br />
NASP will revert to a fortnightly format “to<br />
maintain service continuity while adjusting<br />
capacity to the market demand”.<br />
So, for six months – effectively the<br />
NZ low season for fruit exports – PAD/<br />
NASP will operate on a rotation of<br />
London Gateway, Zeebrugge (until 06/11),<br />
Rotterdam, Dunkirk, Le Havre, New York,<br />
Savannah, Cartagena, Papeete, Noumea,<br />
Brisbane, Sydney, Melbourne, Tauranga,<br />
Manzanillo, Savannah, Philadelphia and<br />
back to London. The fleet will contract to<br />
seven ships of 2259-2824 TEU, all with a<br />
nominal 600 reefer plugs. Weekly service<br />
will resume mid-February from Europe and<br />
end-March from ANZ.<br />
“Hardly ideal,” was one affected party’s<br />
teeth-grinding assessment of the situation.<br />
“Finally we have the product the market was<br />
asking for, we make commitments to existing<br />
shippers and entice new ones, supply chains<br />
get modified accordingly, and then the whole<br />
thing goes into reverse. Very disappointing.”<br />
But some insiders are more<br />
understanding, if reluctantly. “When the<br />
PAD ships are full, seasonally, in either<br />
direction to or from ECNA (and/or Europe)<br />
the whole shebang looks justifiable as<br />
weekly,” one explains. “But the rest of the<br />
time it’s red ink. ECNA rates are always<br />
weaker than WCNA. It’s a long, thin<br />
service with high fixed costs for small<br />
ships, and bunkers.”<br />
A well-placed observer suggests that,<br />
alas, the weekly PAD was more “nice to<br />
have” than “need to have” for all but a few<br />
months of the year. “CMA always wanted<br />
to go weekly and heaven knows they’ve<br />
had a few half-pregnant attempts. Then<br />
Seatrade fell over, the Zespri opportunity<br />
opened up, and MSC was sniffing around.<br />
They had to do what they had to do – and<br />
now they’ve had to do it again, when<br />
volumes are down to unprofitable levels.”<br />
The insider again: “It’s all about<br />
survivability of the service. Fortnightly is<br />
better than nothing, and nothing is what<br />
it will end up being if it’s losing millions.<br />
And just around the corner is 2020 [when<br />
low-sulphur fuel regulations will massively<br />
increase ship-operating costs]. We’ve got to<br />
take pain now for long-term gain.”<br />
“EYE-WATERING”<br />
Meanwhile, CMA CGM is to revive a<br />
previous slot-charter arrangement – “at<br />
eye-watering cost” with Maersk on the<br />
competing OC1 service to ensure it keeps<br />
weekly faith with ECNA customers, via a<br />
reported 225 TEU southbound and 150 TEU<br />
northbound.<br />
Long-term survivability is what’s driving<br />
the somewhat radical shake-up of the ANZ-<br />
WCNA services, too.<br />
At the time of writing the plan was yet to<br />
be formally announced in Australia and New<br />
Zealand but from the end of November the<br />
Oceania Vessel Sharing Agreement (OVSA)<br />
will begin transitioning from the current<br />
set-up of two separate but interlocking<br />
strings to a single, twin-loop operation.<br />
Sources say OVSA members are cautious<br />
about revealing full details ahead of<br />
official approval from the US Federal<br />
Maritime Commission and the lockingdown<br />
of port and terminal windows in<br />
ANZ. It is understood the FMC has a<br />
mandatory 45-day review period following<br />
lodgement of any new or modified<br />
agreement and that took effect from 28<br />
August. If there are any challenges, that<br />
45-day clock is re-set.<br />
From the FMC documents, published<br />
on their website (and filed under the<br />
southbound trade designation US Pacific<br />
Coast-Oceania Agreement), the structure<br />
of the new service can be discerned. It can
LINDER TRADES TO NORTH AMERICA<br />
also be seen that ANL is now the sole CMA<br />
CGM Group entity in the agreement, while<br />
Hamburg Süd’s rights and membership has<br />
been novated to Maersk Line.<br />
Whereas the OVSA now operates two<br />
distinct services, fortnightly Pacific North<br />
West (PNW, using four 2500-2700 TEU<br />
vessels) and weekly Pacific South West<br />
(PSW, with seven 3500-4500 TEU vessels)<br />
the ‘new OVSA’ will utilise a total of<br />
eight average-4250 TEU ships, split evenly<br />
between a weekly loop and a fortnightly<br />
loop, and with each OVSA member having<br />
several vessels in each. Of the eight,<br />
Maersk will have four, ANL two and<br />
Hapag-Lloyd two.<br />
DCN understands that existing PSW<br />
slot-charterers MSC and PIL will retain<br />
their allocations on the new service; the<br />
FMC lists those current allocations as 200<br />
slots per week each way for what MSC<br />
designates its Oceania Express Loop 1,<br />
and 425 slots per week, southbound only,<br />
on PIL’s Americas Oceania Service. Both<br />
agreements date from 2014.<br />
The new format will see Auckland, Sydney,<br />
Melbourne, Tauranga, Long Beach and<br />
Oakland covered by the weekly loop, while<br />
Papeete, Auckland, Sydney, Melbourne,<br />
Adelaide, Tauranga, Vancouver, Seattle and<br />
Long Beach will be on the fortnightly roster<br />
(this subject to confirmation).<br />
To many observers this consolidation<br />
is no surprise, but OVSA members are<br />
nevertheless nervous about the change –<br />
especially since these services are effectively<br />
the only game in town for direct links<br />
between ANZ and WCNA.<br />
Sources say that this preys heavily on<br />
shippers’ minds, fearing that the revised<br />
service will be particularly vulnerable to<br />
disruption, space restrictions and – of<br />
course – rate gouging. OVSA members<br />
have been at pains to re-assure authorities<br />
and shipper representatives that their<br />
intentions are all good; there are absolutely<br />
no plans for voyage blanking (“just not<br />
practical in this trade”), voyage times will<br />
REGULAR ANZ DIRECT CONTAINERISED SERVICES TO/FROM NORTH AMERICA<br />
CARRIER/SERVICE PORT ROTATION FREQUENCY VESSELS<br />
PACIFIC COAST<br />
Oceania Vessel Sharing Agreement<br />
(ANL/Hamburg Süd/Hapag-Lloyd)<br />
Pacific South West [1][7]<br />
Oceania Vessel Sharing Agreement<br />
(ANL/Hamburg Süd/Hapag-Lloyd)<br />
Pacific North West [1][7]<br />
Mediterranean Shipping Co<br />
Oceania Express Loop 1<br />
Melbourne, Sydney, Tauranga, [Papeete], Oakland, Long Beach,<br />
Auckland, Melbourne<br />
Sydney, Melbourne, Adelaide, Auckland, [Suva/Honolulu],<br />
Vancouver, Seattle, Oakland, Tauranga, Sydney [2]<br />
Slot charter agreement with<br />
Oceania VSA PSW – see above<br />
Fixed-day<br />
Weekly<br />
Fixed-day<br />
Fortnightly<br />
Fixed-day<br />
Weekly<br />
1 x 5040 TEU<br />
1 x 4526 TEU<br />
2 x 4253 TEU<br />
2 x 3868 TEU<br />
1 x 3534 TEU<br />
1 x 2741 TEU<br />
1 x 2646 TEU<br />
1 x 2546 TEU<br />
1 x 2490 TEU<br />
See above<br />
Oceania Vessel Sharing Agreement [8]<br />
(ANL/Hapag-Lloyd/Maersk Line)<br />
Sydney, Melbourne, Adelaide*, Sydney, Tauranga, [Papeete*],<br />
Oakland, Vancouver*, Seattle*, Long Beach, Auckland, Sydney<br />
Fixed-day weekly<br />
*Fortnightly<br />
8 x c.4250 TEU<br />
Pacific International Lines<br />
America Oceania Service<br />
Slot charter agreement with<br />
Oceania VSA PSW – see above<br />
Fixed-day<br />
Weekly [3]<br />
See above<br />
Swire Shipping<br />
WCNA [4]<br />
Brisbane, Melbourne, Tauranga, [Dalian, Busan/Mokpo]<br />
Portland, Vancouver BC, Everett, Long Beach, Brisbane [5]<br />
Every 35 days 3 x B.Delta 39<br />
ATLANTIC COAST<br />
CMA CGM<br />
PAD2<br />
CMA CGM/Marfret/ANL^<br />
PAD/NASP/AUS1<br />
(^non vessel operating slot-charterer) [6]<br />
CMA CGM/Mafret/ANL^/<br />
Seatrade<br />
PAD/NASP/AUS1/Meridian<br />
(^non vessel operating slot-charterer) [6]<br />
Hamburg Süd/Maersk Line<br />
Trident/OC1<br />
Revived slot charter agreement with Maersk on OC1, effective<br />
November 2018<br />
Brisbane, Sydney, Melbourne, Tauranga, Manzanillo, Savannah,<br />
Philadelphia, (London Gateway, Rotterdam, Dunkirk, Le Havre),<br />
New York, Savannah, Cartagena, (Papeete, Noumea), Brisbane<br />
Brisbane, Sydney, Melbourne, Tauranga, Manzanillo, Savannah,<br />
Philadelphia, (Zeebrugge, London Gateway, Rotterdam,<br />
Dunkirk, Le Havre), New York, Savannah, Cartagena, (Papeete,<br />
Noumea) Brisbane<br />
Sydney, Melbourne, Timaru#, Port Chalmers, Napier, Tauranga,<br />
Auckland, (Cristobal, Manzanillo {Panama}, Cartagena),<br />
Philadelphia, Charleston (Cartagena, Balboa), Auckland, Sydney<br />
Fixed-day<br />
Weekly<br />
Fixed-day<br />
Fortnightly<br />
Fixed-day<br />
Weekly<br />
Fixed-day<br />
Weekly<br />
#temporary<br />
See below<br />
1 x 2824 TEU<br />
1 x 2556 TEU<br />
2 x 2506 TEU<br />
3 x 2259 TEU<br />
4 x 2824 TEU<br />
3 x 2556 TEU<br />
2 x 2506 TEU<br />
4 x 2259 TEU<br />
2 x 4243 TEU<br />
4 x 3630 TEU<br />
3 x 3364 TEU<br />
3 x 3028 TEU<br />
Hapag-Lloyd<br />
ANP<br />
Slot charter agreement with Maersk on OC1 – see above<br />
Fixed-day<br />
Weekly<br />
See above<br />
Mediterranean Shipping Co<br />
Oceania Express Loop 2<br />
Slot charter agreement with Hamburg Süd/Maersk Line on<br />
Trident/OC1<br />
Fixed-day<br />
Weekly<br />
See above<br />
KEY: The above itinerary only covers ports called between Australia and last discharge port in the region covered by this survey; those ports in italics are those called but not within<br />
the range of this analysis; square brackets indicates alternating or less-frequent calls. [1] The VSA lines involved in these loops share space on both, although allocations differ; MSC<br />
and PIL have no slots on PNW. [2] Seattle/Tacoma now jointly managed under NW Seaport Alliance [3] PIL AOS southbound/westbound only. [4] Principally breakbulk but operating<br />
a liner service schedule southbound [5] Northbound rotation now via Asia but southbound frequency maintained [6] From end October (northbound) until end March this service<br />
will revert to fortnightly frequency [7] From November OVSA will consolidate to a single string [8] Proposed single-string OVSA effective November 2018; full details to be confirmed.<br />
Tables compiled week ending September 20. © Dale Crisp 2018<br />
34 October 2018<br />
thedcn.com.au
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LINDER TRADES TO NORTH AMERICA<br />
STATS TELL THE STORY<br />
Carriers say the trade between Australasia and North<br />
America is “stagnant at worst and steady at best” and they’re<br />
not anticipating much change ahead, either in volumes or<br />
cargoes carried.<br />
EAST COAST<br />
PIERS/Journal of Commerce figures show total northbound<br />
trade from Oceania to ECNA in 2017 stood at just under 76,000<br />
TEU, with Hamburg Süd (HSD) the clear market leader (21,500<br />
TEU), followed by Maersk (15,500), CMA CGM (13,100), MSC<br />
(11,200), Hapag-Lloyd (HLL, 6500), ANL (3800), Marfret (2300)<br />
and then transhippers, led by OOCL (1000). Given MSC has only<br />
a modest weekly allocation on the Maersk/HSD OC1/Trident<br />
service, it can be assumed that the majority of its liftings are<br />
moving via transhipment.<br />
Until the end of July 2018, ECNA northbound had reached<br />
around 57,500 TEU, with HSD still dominating but Maersk<br />
and CMA CGM running neck-and-neck, doubtless the latter<br />
benefitting from the now-weekly PAD/NASP, which also<br />
boosted Marfret’s liftings.<br />
Southbound from the East Coast total 2017 volume to<br />
Oceania came close to doubling northbound, at 101,700 TEU.<br />
HSD again led the way amongst direct service providers with<br />
29,160 TEU, ahead of Maersk (24,700 TEU), CMA CGM (15,400),<br />
MSC (8700), HLL (7650), ANL (7400) and Marfret (which does<br />
not focus on this trade lane, 192 TEU).<br />
MSC’s direct service allocation is limited, so much of its<br />
share must be relay cargo; other leading transhippers for 2017<br />
were OOCL (4100 TEU), Mitsui OSK (1200) and COSCO Shipping<br />
Lines (1100).<br />
For the first seven months of 2018 carriers combined to<br />
ship a little over 47,000 TEU southbound from the East Coast.<br />
While HSD, Maersk and CMA CM remained at numbers 1, 2 and<br />
3, ANL overtook MSC and HLL; and amongst the transhippers,<br />
COSCO SL was hot on the heels of OOCL.<br />
WEST COAST<br />
Northbound to WCNA stood at almost 92,500 TEU in 2017.<br />
Again, HSD was a clear leader, followed by ANL, HLL and MSC.<br />
Relay service providers were also led by OOCL, followed by<br />
Maersk and Evergreen but again their volumes are modest<br />
although much greater than to the East Coast.<br />
As at end-July 2018, West Coast northbound had almost<br />
reached 63,000 TEU with no change in the pecking order<br />
amongst the direct service providers; however Maersk and<br />
Evergreen had swapped places amongst the relay operators<br />
and Matson has made a notable entry, registering 391 TEU for<br />
the seven months (and in so doing exceeding Maersk) against a<br />
2017 total of just a single TEU.<br />
Southbound from WCNA, carriers achieved total liftings of<br />
142,600 TEU in 2017. Strongest was HSD with around 48,500<br />
TEU followed by ANL with 37,500 TEU, HLL (18,100 TEU), MSC<br />
(8400) and PIL (6800). Swire Shipping carried almost 1900 TEU<br />
in 2017. Of the transhippers, OOCL was particularly strong at<br />
10,900 TEU, followed by Maersk at 4900, COSCO SL at 2850 and<br />
Yang Ming Line at 1350 TEU.<br />
At July 31, 2018 southbound WCNA liftings stood at 66,500<br />
TEU, with direct service market order unchanged at HSD, ANL,<br />
HLL, MSC, PIL and Swire, while Maersk had overtaken OOCL in<br />
the transhipper rankings.<br />
not change, reliability should improve and<br />
rates will surely be held in check by the<br />
ever-present fluctuating influence of relay<br />
operators.<br />
A LOSING TRADE<br />
The PNW service has been steadily losing<br />
money for a long time, sources say,<br />
and Adelaide calls in particular regular<br />
casualties of schedule delays.<br />
“We [OVSA member carriers] have had<br />
to look at what risk PNW has posed to the<br />
entire service structure,” a manager said.<br />
“The ships are too small to be efficient but<br />
we need to maintain coverage. We had<br />
to find a way to make the service viable<br />
and yet meet customer requirements. And<br />
although it might look as though we’re<br />
pulling a lot of capacity off the WCNA<br />
route, the larger ships that have gradually<br />
been swung in over the last 12 months or<br />
so have not been fully allocated out, so we<br />
don’t think space is going to be a problem.”<br />
Year-to-date utilisations on PNW are<br />
said to be running at just 70%, and on the<br />
(capped capacity) PSW at 85%.<br />
The provisional FMC agreement reveals<br />
the partners are providing for as many as 11<br />
ships, suggesting the new formula can/will<br />
be adjusted if dependable schedule-keeping<br />
proves challenging and/or space tightens.<br />
Will the new service structure open the<br />
way for interlopers? After all, the ANZ-<br />
WCNA route has played host to some<br />
famous outsiders, including ANZDL, Fesco<br />
Australia North America Line (FANAL),<br />
US Lines (the re-born ANZDL) and Pacific<br />
International Lines, which ran its own<br />
southbound service for some time in<br />
competition with OVSA. MSC threatened<br />
to do so, before striking a deal with OVSA.<br />
Carrier sources are confident they’re<br />
not opening up the trade to unwanted<br />
competition.<br />
“Growth has been nothing to write<br />
home about for many years now, despite the<br />
free-trade agreement. As others have found<br />
in the past, just putting in a new service or<br />
extra ships doesn’t magic up more cargo,”<br />
an executive said.<br />
“Rates are, in the main, pathetic. Apart<br />
from a spike here and there of a few<br />
dollars they haven’t really gone up and not<br />
noticeably down. Whenever we announce<br />
a GRI, southbound or northbound, east<br />
coast or west coast, you can pretty much<br />
guarantee we won’t get the full amount and<br />
what we might get fritters away.<br />
“MSC and PIL, through their slot deals,<br />
have unique insight into the composition<br />
and strengths and weaknesses of the trade,<br />
for example. Semi-regularly they’re not<br />
filling their own allocations, and they don’t<br />
appear to be rate-cutting to try to do so. So<br />
surely they’re not going to rock the boat.”<br />
Another said: “I know shipping lines<br />
are masters of finding new ways to lose<br />
money but I don’t see room for any new<br />
entrants on the west or east Coasts. I know<br />
Seatrade was more about Europe, and there<br />
were other issues at play, but there’s your<br />
perfect recent example of unnecessary and<br />
unsuccessful”.<br />
Asked about the prospects of a newcomer<br />
seizing the day after the OVSA revamp,<br />
another simply said. “It would not be an<br />
intelligent move”.<br />
So assuming all approvals, it’s heads<br />
down and bums up for the OVSA overhaul.<br />
“The immediate and ultimate priority<br />
is to bed the new service in,” the trade<br />
manger said.<br />
“We have to ensure customers don’t<br />
suffer – and we don’t either!”<br />
36 October 2018<br />
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REGIONAL PORTS<br />
Viking Destiny offloads<br />
mining equipment at Port<br />
of Mackay<br />
New trades & infrastructure<br />
Xxxxxxxxx Image supplied<br />
38 October 2018<br />
thedcn.com.au
Regional ports are<br />
upgrading and adding<br />
infrastructure to move<br />
more cargo and more<br />
different kinds of cargo,<br />
Ian Ackerman reports<br />
Change and diversification is the name<br />
of the game for many of Australia’s<br />
regional ports, with many investing<br />
in infrastructure to accommodate<br />
larger and more diverse ship types.<br />
North Queensland Bulk Ports has<br />
recently seen a program of refurbishment<br />
and upgrades paid off with the recent<br />
call of the first ro-ro vessel at the Port of<br />
Mackay with a shipment of Caterpillar<br />
794AC mining trucks.<br />
NQBP former acting CEO (and current<br />
general manager trade and operations)<br />
Brendan Webb told Daily Cargo News the<br />
upgrades that enabled the Höegh ro-ro<br />
vessel Viking Destiny to call at Mackay were<br />
part of a planned upgrade and maintenance<br />
investment.<br />
“The first major thing we needed were<br />
fender upgrades on berths 3 and 4,” he said.<br />
“And, rather than just replicate new for old,<br />
our engineering team looked at what we<br />
needed to do to create a roll-on, roll-off ramp.”<br />
Mr Webb said the complete works cost<br />
$9.8m, and of that, the cost of converting<br />
the wharf to accept ro-ro cargo was about<br />
$1m, backed by the idea of bolstering<br />
Mackay’s capacity to be a multi-user, multifunctional<br />
port.<br />
The engineering team signing off on<br />
the viability of the ro-ro upgrade was only<br />
the first step in bringing it to fruition, the<br />
second step involved the seafarers who<br />
would bring these ships into the port.<br />
Mr Webb said the pilots who work at the<br />
Port of Mackay spent many hours at the<br />
Smartship simulator in Brisbane to work<br />
out if it was actually possible to safely<br />
“In this case the influences in the<br />
supply chain would be shipowners, freight<br />
forwarders, stevedores, ship agents, the<br />
people buying the equipment, the people<br />
selling the equipment and the people that<br />
manufacture the equipment,” he said.<br />
The manufacturers, Mr Webb said,<br />
were a crucial last link in the chain, as the<br />
supply chain wasn’t yet proven or tested.<br />
“It’s quite a journey to change an<br />
existing supply chain or to create a new<br />
one,” he said.<br />
“We were looking for that early adopter,<br />
the first one to take the leap of faith. Once<br />
you get them going, the others get some<br />
trust in it and see that it can work.”<br />
“It’s a long way to send a ship with a<br />
cargo that may or may not have penalty<br />
rates on it. That to me was the magic<br />
ingredient, once we had the other physical<br />
things in place.”<br />
He said there was some “folklore” that<br />
ro-ro calls wouldn’t work at Mackay, “but<br />
that’s really just urban myth, to be honest”,<br />
he said.<br />
The first ro-ro call to Mackay, in late August<br />
went off without a hitch, Mr Webb said.<br />
“The weather was kind, and it went<br />
really well,” he said. “It had been a long<br />
time coming for our employee group, so<br />
there was a real sense of teamwork, and a<br />
lot of enthusiasm and joy afterwards, it was<br />
good to see.”<br />
DIVERSIFICATION<br />
Mr Webb said the ability for ro-ro vessels<br />
to call at Mackay would hopefully lead<br />
to increasing diversification of cargoes<br />
We were looking for that early adopter,<br />
the first one to take the leap of faith.<br />
Xxxxxxxxx NQBP Image supplied<br />
A great deal of<br />
preparation went into<br />
enabling the first ro-ro<br />
call to Mackay<br />
navigate ro-ro ships into the harbour.<br />
“These are all no-go gates,” Mr Webb<br />
said. “If you can’t do it engineering-wise,<br />
that’s the end of it. If you can’t do it<br />
pilotage-wise, that’s the end of it.”<br />
The third step was having the regional<br />
harbour master sign off on it, and the<br />
fourth step was freeing up berth-support<br />
infrastructure in the port area, making<br />
laydown area available.<br />
The fifth step in enabling Mackay to<br />
accept ro-ro calls was to look into the<br />
business-development side, identifying<br />
all the influences in the supply chain, Mr<br />
Webb explained.<br />
through the port, with agricultural<br />
equipment and more mining vehicles and<br />
mining equipment.<br />
“Tyres for mining vehicles are quite a<br />
large consumable item that goes through<br />
an established supply chain, and then<br />
they may be maybe light vehicles, or heavy<br />
on-road trucks,” he said, highlighting Port<br />
of Mackay’s proximity to the Bowen Basin.<br />
“If you’re talking about a piece of mining<br />
equipment that is 7-10 metres wide coming<br />
down a road from a major capital city –<br />
Sydney, Melbourne or Brisbane – the average<br />
road once you get out of the cities is eight<br />
metres wide, both lanes,” Mr Webb said.<br />
thedcn.com.au October 2018 39
REGIONAL PORTS<br />
“There are also police escorts, private<br />
escorts, there are three or four vehicles<br />
escorting that one truck; from a safety<br />
perspective, and an infrastructure integrity<br />
perspective, the fewer kilometres travelled<br />
the better.”<br />
WHERE DOES THE DEMAND COME FROM?<br />
While the demand for more ro-ro capacity at<br />
the Port of Mackay comes from an increase<br />
in mining activity, it is not just a ramping<br />
up of production that is the main driver.<br />
“There are many things that are driving<br />
this. Yes we’re putting out some good<br />
coal and we’ve hit a record as an overall<br />
business, but it isn’t what’s driving the<br />
equipment coming in,” Mr Webb said.<br />
He explained that after the big mining<br />
boom ended several years ago, the mining<br />
companies in the area pared back their<br />
maintenance and upkeep programs.<br />
“[Companies are now] catching up on<br />
replacing equipment that has worn out,<br />
A container ship calling at Port of Townsville<br />
and catching up on maintenance that has<br />
been really put off for the past five years,”<br />
he said.<br />
“A good mining machine averages 10<br />
years of life. They haven’t replaced many,<br />
if any, mining machines for five years,<br />
so some machines are well past their<br />
Blue highway the best highway<br />
Coastal shipping stands to benefit regional ports around<br />
Australia’s coast<br />
Coastal shipping is the hot topic of the day around industry circles. Arguments<br />
about how reform should be carried out, and what it should look like are manifold,<br />
but it is safe to say that industry agrees something needs to be done.<br />
Regional ports could see major benefits from a revitalisation of coastal shipping,<br />
with opportunities to grow bulk and container trades, moving freight from rail and<br />
road onto ships.<br />
Ports Australia CEO Michael Gallacher told DCN regional ports would benefit<br />
from increased coastal shipping, as it would provide a way for them to expand<br />
throughput, and also boost jobs in the towns where the ports are located.<br />
“If you start to expand the things that ports are doing around the country, you’re<br />
going to need more people to do it, these ports won’t be relying on automation<br />
because they won’t have the critical mass of throughput to justify the introduction<br />
of automated processes in the main,” he said.<br />
“Therefore, it’s going to rely on people to move freight around the country,<br />
around the ports, around the regional communities where they reside.”<br />
Brendan Webb of NQBP pointed out that moving freight by sea was logical.<br />
“You don’t have to maintain the ocean,” he said.<br />
“The country is struggling with congestion in major metropolitan areas, and it’s<br />
struggling with the cost of infrastructure needing maintenance and upkeep.<br />
“There’s a logical sense to use the blue highway, as Ports Australia call it, and you<br />
can bring your bigger vessels in from overseas and tranship out of Brisbane, or any<br />
of the major ports, and bring it into Gladstone, Mackay, Townsville or Cairns in the<br />
Queensland language.”<br />
Mr Webb also said more coastal shipping would be a boon when bad weather<br />
knocks out land-transport routes.<br />
“When the Bruce Highway gets cut, the shipping can keep going,” he said. “You<br />
can get in and out of Mackay, or Townsville or Cairns, but you can’t get from one to<br />
the other by road.<br />
“With a regular shipping service, or even an irregular one, you can get your basic<br />
goods up there.”<br />
replacement date. It’s not a boom, it’s just a<br />
lot of catch up.”<br />
THE VIEW FROM TOWNSVILLE<br />
In North Queensland, agricultural<br />
industries including beef, dairy,<br />
aquaculture, fisheries and a variety of<br />
tropical and subtropical horticultural<br />
enterprises, produce an abundance of<br />
perishable commodities.<br />
This agricultural production shows no<br />
sign of decreasing, as there are emerging<br />
agricultural precincts include the Hells Gate<br />
Dam project on the Upper Burdekin River<br />
which wll provide up to 100,000 hectares of<br />
additional irrigated agricultural land.<br />
With good intermodal connectivity<br />
via triple road-train access and rail, the<br />
Port of Townsville acts as a supply hub<br />
for the import and export of more than<br />
30 different commodities, including dry<br />
bulk agriculture and mining products,<br />
liquids, containerised cargo, project cargo,<br />
refrigerated cargo, vehicles and live cattle<br />
exports. The region’s high value growth<br />
corridor is connected to world demand;<br />
75% of the port’s trade is with Asia.<br />
The Port of Townsville’s containerised<br />
cargo capabilities and proximity to highly<br />
productive agricultural regions make it<br />
ideally positioned as a centralised export<br />
distribution hub for North Queensland.<br />
Key capabilities include: regular container<br />
line services; access for type 2 road trains<br />
direct to the port; designated container<br />
berths and terminals; biosecurity services;<br />
and reefer points on three berths.<br />
Additional cold chain supply chain<br />
capabilities at the port are provided by<br />
Harbourside Coldstores, a 4000-pallet<br />
international export accredited cold storage<br />
facility. Harbourside is located within two<br />
kilometres of the Port of Townsville.<br />
Port of Townsville<br />
40 October 2018<br />
thedcn.com.au
Pictured: Tunnel boring<br />
machinery imported via the<br />
Port’s Mayfield 4 berth.<br />
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trade@portofnewcastle.com.au<br />
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SOUTH AUSTRALIA & THE NORTHERN TERRITORY<br />
A guide into Darwin’s<br />
Just where does Darwin fit into the jigsaw puzzle that is Australian<br />
maritime trade? David Sexton investigates<br />
When providing insights into the<br />
future of Darwin Port, chief<br />
executive Terry O’Connor is<br />
unafraid to look to the past.<br />
“Around Darwin, the Larapinta<br />
people were trading with the Makassans [a<br />
people from what is now part of Indonesia]<br />
before Europeans arrived. Why were [the<br />
Larapinta] trading? Because [Indonesia]<br />
was the natural trading partner,” he said.<br />
“Two hundred years on, we’ve continued<br />
to focus on developing those trading links.<br />
The free-trade agreement with Indonesia –<br />
we need to think what that might mean<br />
for Darwin.”<br />
The CEO was speaking in answer to a<br />
question about the role of Darwin.<br />
Some Australians have dreamed this<br />
tropical city could one day be a flourishing<br />
gateway to the wealth of Asia to our north.<br />
Sceptics have countered that it is simply too<br />
far away from major Australian cities to be<br />
of much use, while also grumbling about<br />
cyclones, heat, flies and crocodiles.<br />
Mr O’Connor is, of course, an optimist<br />
when it comes to talking about Asia, but<br />
also calls for some perspective.<br />
“I think we would be foolish to say<br />
the [Alice Springs – Darwin] railway<br />
is suddenly going to change its usage<br />
overnight. But I think that the reality is,<br />
as a service centre for north Australia, we<br />
have an opportunity to also service the<br />
bottom half of Indonesia.<br />
“That service may be connectivity by<br />
shipping.”<br />
WHAT’S GOING ON?<br />
Activity at Darwin Port is closely<br />
intertwined with the economy of the<br />
Northern Territory and for some insights<br />
on recent developments, Daily Cargo News<br />
approached Professor Rolf Gerritsen, a<br />
professorial research fellow at the Northern<br />
Institute, part of Charles Darwin University.<br />
“Technically, in recession as the ABS<br />
national account figures show,” Professor<br />
Gerritsen said, when asked about the state<br />
of the NT economy.<br />
“It is the wind-down of INPEX [LNG<br />
project]. The INPEX project … had a huge<br />
distortionary effect on the NT. Now it’s<br />
winding down and so all the people are<br />
going and consumption is falling.”<br />
Professor Gerritsen notes a few projects<br />
“in the pipeline” that could aid a recovery.<br />
“It depends partially on whether the<br />
Commonwealth continues the special GST<br />
deal it has with the Territory,” he said.<br />
As well as the special GST revenue<br />
deal, Professor Gerritsen noted the North<br />
Australia Infrastructure Facility was<br />
promised $300m in concessionary loans for<br />
the airport upgrades at Darwin, Katherine<br />
and Alice Springs.<br />
“The most important element of that<br />
NAIF [Northern Australia Infrastructure<br />
Facility] concessional loan is the export<br />
hub that they’re building at the airport in<br />
Darwin,” he says.<br />
“If that gets going, the horticulture<br />
product of the Darwin region is greater<br />
than the horticulture product of the Ord<br />
River region [in north-west WA].<br />
“So if you can provide better access to<br />
markets in South East Asia, then there’s<br />
potential for that to grow.”<br />
A VIEW FROM THE PORT<br />
Professor Gerittsen’s views are reflected by<br />
Terry O’Connor when summing up trade<br />
James Christian<br />
42 October 2018<br />
thedcn.com.au
trading future<br />
Charles Darwin University; Ian Ackerman<br />
trends, albeit the CEO is confident longer<br />
term and notes improvement during the<br />
past 12 months.<br />
He corrects this writer in suggesting<br />
Darwin is primarily a container port.<br />
While it is true Darwin has a respectable<br />
container trade, its largest export is<br />
manganese and there is a significant trade<br />
in such commodities as mineral sands and<br />
rare earths.<br />
Professor Rolf Gerritsen, Charles Darwin<br />
University<br />
“We would call ourselves anything but a<br />
container port. While we have containers<br />
the numbers are relatively small,” Mr<br />
O’Connor said.<br />
LIVE EXPORTS<br />
Darwin is a hub for the live export of cattle,<br />
particularly to places such as Indonesia.<br />
The live animal export trade has been<br />
under a cloud this year, but that was more<br />
focused on sheep from southern ports than<br />
cattle from the north.<br />
A political row erupted seven years ago<br />
when the federal government banned live<br />
cattle exports following cases of extreme<br />
cruelty in overseas destination markets.<br />
The NT does well out of the live cattle<br />
trade – some 260,000 or 270,000 head<br />
were exported last year – so any disruption<br />
would be quite a blow.<br />
“Certainly from our perspective live<br />
cattle have been good,” Mr O’Connor said.<br />
PROJECT CARGO<br />
So-called project cargo is also reported to<br />
have increased during the past 12 months,<br />
with second-hand mine equipment arriving<br />
and then being transferred to mines in<br />
Western Australia.<br />
Another example of specialist cargo is<br />
pipe shipments for the Tenant Creek to Mt<br />
Terry O’Connor, chief executive officer,<br />
Darwin Port<br />
Isa pipeline and more recently the Alice<br />
Springs to Tanami Desert pipeline.<br />
LOOKING FORWARD<br />
Mr O’Connor says the mantra of<br />
“developing the north” remains relevant<br />
even if it is getting less traction than it did<br />
12 to 18 months ago.<br />
“I don’t think that push to develop<br />
northern Australia has gone away. Almost<br />
on a daily basis we have conversations with<br />
people who have all types of operations,”<br />
he said.<br />
“We have lots of space to grow …<br />
modern technology means that the labour<br />
costs aren’t necessarily [such a big factor].<br />
“I still think that our footprint is going<br />
to be in Asia – possibly in the southern<br />
part of the continent rather than Darwin<br />
being some magical entry point for<br />
Australian products going into Asia or<br />
coming into Australia.”<br />
thedcn.com.au October 2018 43
SOUTH AUSTRALIA & THE NORTHERN TERRITORY<br />
Bigger ships to help define Flinders Ports’ future<br />
Large infrastructure projects are setting up South Australia for bigger ships<br />
and bigger freight volumes<br />
A substantial capital expenditure<br />
program is setting up Port Adelaide and<br />
Flinders Ports for the future. Front of<br />
mind is a situation where increasingly<br />
large ships are appearing on the horizon.<br />
Flinders Ports general manager<br />
Captain Carl Kavina says they have<br />
invested more than $320m in capital<br />
expenditure during the past 15 years<br />
to “enhance efficiencies and grow the<br />
business”.<br />
“Longer and wider vessels are<br />
coming into the trade more frequently<br />
which is forcing ports to constantly<br />
upgrade infrastructure, our waterways,<br />
fixed infrastructure and plant and<br />
equipment,” Captain Kavina says.<br />
To address this ongoing operational<br />
challenge, FPH is focusing on several<br />
capital expenditure projects this<br />
year including widening the outer<br />
harbour channel and building a new<br />
wharf access structure for the Port<br />
of Thevenard, an isolated port on the<br />
Great Australian Bight with a focus on<br />
dry bulk exports.<br />
The port operator is also expected<br />
to focus on refurbishing Osborne 1 and<br />
berth 20 in Port Adelaide Inner Harbour.<br />
“The business has successfully and<br />
sustainably grown over the years,”<br />
Captain Kavina says. “The success has<br />
been built around a clear strategy, a<br />
culture that values working with and<br />
respecting all our stakeholders …<br />
and most importantly the quality and<br />
dedication of our employees.”<br />
Flinders Port Holdings (FPH) is<br />
made up of three major businesses:<br />
Flinders Ports, Flinders Adelaide<br />
Container Terminal and<br />
Flinders Logistics.<br />
The Port Adelaide Outer Harbor<br />
channel widening project received<br />
government approvals in June this year<br />
and it is now seeking native vegetation<br />
and dredging licenses.<br />
“Tenders for the project works have<br />
been tendered out and are currently<br />
being evaluated, we would expect to<br />
commence physical dredging towards<br />
the end of the first quarter 2019 with a<br />
completion date towards the end of the<br />
third quarter 2019,” Captain Kavina says,<br />
adding that removal and replacement of<br />
navigational aids would start soon.<br />
He noted that in 2017, the Flinders<br />
Adelaide Container Terminal had 322,690<br />
full TEU cross the wharf.<br />
FPH says there will be “natural growth<br />
in trade, particularly in the containerised<br />
sector which experienced close to 4%<br />
growth last year”.<br />
“The agriculture and mining sector<br />
in SA continues to expand and the FPH<br />
business will continue to look across the<br />
supply chain to provide an additional<br />
range of services,” Captain Kavina says.<br />
CHANNEL WIDENING<br />
By widening the channel, FPH argues<br />
South Australia will remain a competitive<br />
port for cruise ships and large container<br />
and bulk vessels.<br />
The project involves removing<br />
1.55m cubic meters of material from<br />
the shipping channel and placing it 30<br />
kilometres offshore. That volume is about<br />
half the amount of material removed<br />
from outer harbour in the 2005<br />
channel deepening project.<br />
“This is essential to safeguard the<br />
South Australian economy by providing<br />
importers and exporters access to<br />
world markets,” Captain Kavina says.<br />
“Without widening the channel, these<br />
larger vessels, which are becoming<br />
increasingly common, may omit South<br />
Australia from their calls,” he says.<br />
“This could result in increased costs<br />
for our South Australian businesses<br />
to export products by other means<br />
and locations, and also could result in<br />
increased prices for products that are<br />
imported.”<br />
Currently, Adelaide is the only capital<br />
city in Australia without a port able<br />
to accommodate such larger ships. In<br />
2014, the port saw 37 ships exceed the<br />
design width of the channel. In 2017,<br />
the number jumped to 312 as ships<br />
continue to increase in size.<br />
FPH has also been involved in recent<br />
years in discussions regarding a new<br />
deepwater port in South Australia,<br />
although it continues to be debated<br />
according to Captain Kavina.<br />
“Flinders Ports is continually discussing<br />
the needs of the market with all stakeholders,<br />
including government,” he says.<br />
“Flinders Ports still believes that Port<br />
Bonython is a logical location that suits<br />
the needs of the state, providing port<br />
access to all mines. This was the reason<br />
Port Bonython was originally selected<br />
as the preferred location.”<br />
Captain<br />
Carl Kavina<br />
Adelaide Container Terminal<br />
FACT; FPH<br />
44 October 2018<br />
thedcn.com.au
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EDUCATION & TRAINING<br />
Training<br />
Port Ash provides training on scale models<br />
of various types of vessels<br />
46 October 2018<br />
thedcn.com.au
for the tech age<br />
The pace of technological change is asking for new and improved skills for everyone<br />
in the industry, including engineers and pilots, writes Paula Wallace.<br />
The age of automation is now upon<br />
us, but there will be debate until the<br />
cows come home as to when, if ever,<br />
entirely autonomous ships will see<br />
widespread adoption.<br />
Nonetheless, it would seem reasonable<br />
to assume many maritime tasks currently<br />
performed by humans will be taken over<br />
by machines.<br />
At the forefront of this debate is lecturer<br />
and engineer Gamini Lokuketagoda, who<br />
is helping train engineers in the use of<br />
remotely operated ships.<br />
Mr Lokuketagoda is particularly interested<br />
in how theoretical studies can be better<br />
intermeshed with practice.<br />
“The practice in the past by trainers and<br />
students has separated theory from practice,”<br />
he said.<br />
“If you take the example of a diesel<br />
engine … if you have only learnt the<br />
practical part, then you are just a<br />
technician, but to become an engineer you<br />
should have problem solving skills and<br />
creative thinking that can only come from<br />
an understanding of the theory.<br />
“The simulator is the best tool that is in<br />
existence today to teach onshore operators<br />
of autonomous vessels because it combines<br />
theory with practice.”<br />
The simulator features virtual-reality<br />
screens for a life-like training experience<br />
on a range of diesel and electric propulsion<br />
engines.<br />
Mr Lokuketagoda stressed the human<br />
intervention or the presence of the remote<br />
operator could not be underestimated.<br />
“Irrespective of the degree of automation<br />
installed on the vessel, it is yet important to<br />
enable human intervention if all else fails,”<br />
he said.<br />
Mr Lokuketagoda said he believed the<br />
future role of the marine engineer would<br />
essentially be confined to a shore-based<br />
operating station, making decisions based<br />
on the telemetry from the machinery.<br />
“I had to do an apprenticeship and<br />
work on board ships to become a qualified<br />
marine engineer,” he said. “I did a<br />
four-year apprenticeship which included<br />
fitting, welding, machining, running and<br />
operating machinery. It’s not necessary<br />
anymore, as you’re not going to be doing<br />
… hands-on work onboard an autonomous<br />
ship, so we need people trained in colleges<br />
like AMC where they can get the right<br />
knowledge and experience mainly through<br />
engine simulators.”<br />
The IMO convention on STCW<br />
1978 effectively supports the hands-on<br />
criterion by prescribing various workshop<br />
competencies towards certification.<br />
Defence Image Gallery<br />
VIRTUAL ENGINE ROOM<br />
Regular DCN readers will know about<br />
the use of the engine-room simulator at<br />
AMC, an advanced piece of technology<br />
designed and manufactured by Kongsberg.<br />
It is typically used by students to<br />
prepare for routine and emergency<br />
engine room operations, troubleshooting,<br />
optimal operation, fuel economy and<br />
energy conservation.<br />
Gamini Lokuketagoda,<br />
lecturer, Australian Maritime College<br />
So much electronic stuff is terrific but when things are<br />
going pear shaped you need to rely on grassroots skills<br />
like those gained through manned models.<br />
thedcn.com.au October 2018 47
EDUCATION & TRAINING<br />
Subsequently, the STCW 1995<br />
convention further enhanced the workshop<br />
requirement.<br />
“However, the code does not adequately<br />
focus MET [Maritime Education and<br />
Training] institutions towards the required<br />
theoretical concepts essential to prepare<br />
engineers with the required knowledge and<br />
skills to deal with future trends and advanced<br />
technology,” Mr Lokuketagoda said.<br />
This led to a situation where many<br />
training and education institutions were<br />
not gearing up to face the transition to<br />
autonomous shipping.<br />
“We need to be training engineers for<br />
the jobs of the future and these jobs will be<br />
centred around autonomous technologies,”<br />
Mr Lokuketagoda said. “We’re anticipating<br />
that unmanned or remote-operated vessels<br />
will be the industry standard within the<br />
next 20 to 25 years.”<br />
THE ROLE OF SIMULATION<br />
Simulation as a training tool is also in<br />
evidence in New South Wales where the<br />
Australasian Marine Pilots Institute (AMPI)<br />
has teamed up with the Port Ash training<br />
facility near Newcastle to develop a program<br />
for those seeking to increase their skills and<br />
gain accreditation in the process.<br />
AMPI president Neil Farmer told DCN,<br />
“pilots are extremely well trained but<br />
we wanted to create a standard and an<br />
achievable benchmark in further training”.<br />
The AMPI web-based program includes<br />
focus areas such as manned models,<br />
Port Ash is the only manned model training facility in Australia<br />
simulator training, tug workshops and<br />
human factors.<br />
“There’s a whole range of components<br />
… manned models is one of the integral<br />
parts,” Mr Farmer said.<br />
Pilots that complete the CPD program<br />
can gain points and certification<br />
demonstrating their credentials to<br />
regulators and port authorities.<br />
A course was designed this year by Port<br />
Ash to meet the requirements of AMPI’s<br />
program. The manned ship-model facility<br />
specialises in the practical aspects of ship<br />
handling and the control of ships at low<br />
speeds in confined and shallow waters with<br />
and without tug assistance.<br />
“This gives trainees some grassroots<br />
ship handling experience without the<br />
distraction of electronics,” Mr Farmer said.<br />
“So much electronic stuff is terrific but<br />
when things are going pear shaped you<br />
need to rely on grassroots skills like those<br />
gained through manned models.<br />
“When people come into pilotage, many<br />
ship captains haven’t handled their ships<br />
or received those foundation skills,” Mr<br />
Farmer said. “The manned model brings<br />
them up to the level where they really<br />
see and feel the complex hydrodynamics<br />
involved.”<br />
Located 35 minutes north of Newcastle,<br />
Port Ash provides training in ship handling<br />
for masters, ship’s officers and pilots, using<br />
experienced pilots as instructors.<br />
“I think it’s terrific, it’s a first class<br />
facility,” Mr Farmer said, referring to Port<br />
Ash. “It’s the only facility of its kind in<br />
Australia. The models are to scale and the<br />
remote control tugs are some of the best<br />
I’ve seen anywhere.”<br />
Mr Farmer said the benefit of diversified<br />
forms of training was they could address<br />
several learning styles.<br />
“The simulators play a specific role …<br />
where people can sit in a boat and see what<br />
is happening all around them without<br />
distractions,” he said.<br />
Port Ash managing director of Port Ash<br />
Captain Cliff Beazley said it was gratifying<br />
to see that state regulator Maritime<br />
Safety Queensland had approved AMPI’s<br />
continuous development program.<br />
“It’s a start for introducing some form<br />
of commonality in Australia,” Captain<br />
Beazley said.<br />
“Our general manager, Captain Andrew<br />
Beazley, has spent much of this year<br />
developing and delivering a three-day<br />
program tailored to each port.”<br />
Its emphasis is to select likely points of<br />
incident in each port and blend them into<br />
general principles that manned models<br />
The simulator is the best tool that is in existence today<br />
to teach onshore operators of autonomous vessels<br />
because it combines theory with practice.<br />
show uniquely. A course is then delivered<br />
using the relevant ship-models and tugmodels<br />
over two or three days depending<br />
on the complexity of the port.<br />
“There is much failing of main engines,<br />
wrong-way wheels, the occasional accidental<br />
dropping of anchors, breaking of tug lines –<br />
all at inconvenient and unexpected times of<br />
course,” Captain Cliff Beazley said.<br />
“The aim is to practice the unexpected,<br />
mitigating the consequences while<br />
preferably avoiding damage altogether. It<br />
really is relevant training at the pointy<br />
end,” he said.<br />
“As the models work in accelerated time,<br />
a tremendous amount of ground and<br />
scenarios can be covered in the three days.”<br />
Port Ash<br />
48 October 2018<br />
thedcn.com.au
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EDUCATION & TRAINING<br />
Meeting naval shipbuilding capacity needs<br />
A sustainable sovereign workforce is a key enabler to deliver the<br />
Commonwealth’s naval shipbuilding program<br />
The federal government is working<br />
with several industry partners to develop<br />
naval shipbuilding endorsed programs<br />
to deliver a skilled and capable<br />
workforce to meet industry’s needs.<br />
The Commonwealth has announced<br />
a nationwide shipbuilding enterprise<br />
that includes the investment of $90bn<br />
over the next 30 years, of which $54m is<br />
to go to the Naval Shipbuilding College.<br />
Its aim is to ensure a co-ordinated,<br />
national approach to workforce<br />
development and skilling across the<br />
naval shipbuilding enterprise.<br />
“A sustainable sovereign workforce<br />
is a key enabler to deliver the<br />
Commonwealth’s continuous Naval<br />
Shipbuilding Program,” program<br />
director Bill Docalovich said.<br />
He told DCN the college is working<br />
with the Defence Industry Education<br />
and Skilling Consortium, the Australian<br />
Maritime College, as well as VET industry<br />
and the education and training sector.<br />
While the college is based at<br />
Osborne, South Australia, it has a<br />
nationwide hub and spoke model<br />
working with ship and submarine<br />
designers, shipbuilders and suppliers<br />
across the country.<br />
“Later this year the college will open<br />
a Western Australian satellite office in<br />
or near the Henderson shipbuilding<br />
precinct near Fremantle,” Mr Docalovich<br />
said.<br />
With the recent announcements<br />
about building 12 offshore patrol<br />
vessels, nine future frigates and<br />
12 future submarines, there is a<br />
requirement to deliver 5000 direct<br />
shipbuilding jobs and another 10,000<br />
jobs in supporting industries.<br />
“The Commonwealth’s commitment<br />
to a continuous ship and submarine<br />
program means that shipbuilding will<br />
become one of the careers of choice<br />
for the Australian workforce,” Mr<br />
Docalovich said. “Thousands of South<br />
Australians will have the opportunity<br />
for long-term careers working with<br />
cutting edge technology to support<br />
Australia’s national security.”<br />
A key role of the college is to work with<br />
industry to determine the appropriate<br />
training required to meet the rigors and<br />
demands of naval shipbuilding in their<br />
specific areas of expertise: trades, semiprofessional<br />
or professional.<br />
The college, through its national<br />
network of education and training<br />
providers, will assist in ensuring sufficient<br />
capacity is available within the training<br />
and education systems to meet the<br />
future specialised workforce skilling<br />
requirements.<br />
“This will be achieved by working<br />
across industries to identify personnel<br />
numbers by trades and professions and<br />
analysing this data against throughput<br />
capacity of training and education<br />
providers,” Mr Docalovich said.<br />
The college has developed a workforce<br />
register to manage the talent pool of<br />
interested candidates enabling the<br />
growth of a sovereign workforce for the<br />
Naval Shipbuilding Enterprise. It links<br />
potential candidates to employment<br />
or training opportunities in naval<br />
shipbuilding, supply-chain or associated<br />
industries.<br />
“Our candidate-managers<br />
work with these interested<br />
individuals to fully understand<br />
their background, skills, past<br />
training and education to<br />
discuss and support their<br />
desired career path and<br />
potential role type,” Mr<br />
Docalovich said.<br />
“These individuals<br />
are then matched<br />
with training and/<br />
or open positions<br />
in the naval<br />
shipbuilding<br />
enterprise.”<br />
The college has received expressions<br />
of interest in shipbuilding careers<br />
from more than 250 people to date.<br />
It is continuing to establish working<br />
relationships with the ship and<br />
submarine-building firms, including<br />
Naval Group, Lürssen, CIVMEC, BAE<br />
Systems and ASC.<br />
AMC is a foundation preferred<br />
education provider within the college<br />
network, owing to its role as a national<br />
specialist maritime education and<br />
training institute, especially as the<br />
major provider of maritime engineer,<br />
naval architect and maritime logistics<br />
graduates.<br />
“AMC graduates are widely employed<br />
in shipbuilding industries, domestically<br />
and internationally, and are highly<br />
sought after,” Mr Docalovich said.<br />
Naval Shipbuilding College has a<br />
commitment to encouraging diversity in<br />
candidates with a strong focus towards<br />
attracting women, Aboriginal or Torres<br />
Strait Islander people and those from<br />
culturally or linguistically diverse<br />
backgrounds.<br />
“We’ll also look at developing workers<br />
in any stage of career development<br />
whether they’re a school-leaver,<br />
transitioning from another industry,<br />
former shipbuilding employee, or<br />
unskilled/seeking new opportunities,”<br />
Mr Docalovich said.<br />
The Naval Shipbuilding College<br />
recently marked its first official<br />
endorsed program in welding in<br />
partnership with TAFE SA.<br />
“This is not only a tremendous<br />
milestone for both educational<br />
institutions, but it’s a critical<br />
development to the success<br />
of the continuous naval<br />
shipbuilding program in<br />
Australia,” Mr Docalovich<br />
said.<br />
Building new defence vessels in<br />
Australia is increasing demand for skilled workers<br />
Defence Image Gallery<br />
50 October 2018<br />
thedcn.com.au
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MARITIME ENGINEERING & SALVAGE<br />
The case of the<br />
Kea Trader<br />
DCN’s David Sexton spoke with Roger King, who<br />
is involved in the complex salvage operation off<br />
the coast of New Caledonia<br />
In July last year, the container ship Kea<br />
Trader grounded on Durand Reef, New<br />
Caledonia. Daily Cargo News editor<br />
David Sexton sat down with Roger King,<br />
master mariner and director of TMC<br />
Marine, Australasia, about the case. TMC is<br />
a London-based, international marine<br />
consultancy which also worked for four<br />
years on the Rena wreck in New Zealand.<br />
What were some challenges?<br />
The main challenge that we encountered<br />
in the Kea Trader salvage, which has<br />
progressed to wreck removal, has been the<br />
wreck site and its location in the South<br />
Pacific. The Durand reef is a shallow, flat<br />
topped, hard rock reef 40 nautical miles<br />
south east from the nearest land, Mare<br />
Island and 130 nautical miles from the<br />
nearest port, Noumea. Salvage operations<br />
have been hampered by a swell that<br />
often breaks across the whole reef and<br />
unrelenting winter trade winds supplanted<br />
in summer by passing cyclones. This<br />
pounding on the Kea Trader has resulted<br />
in hull failure and ongoing degradation.<br />
The isolated location means personnel,<br />
equipment and specialist vessels have to<br />
be brought in from Singapore, China or<br />
Australia. Safety is the primary concern<br />
followed by environmental protection and<br />
mitigation of effects caused by the wreck.<br />
Initially, oil was removed (1009 cubic<br />
metres of heavy fuel oils, diesel and other<br />
lube oils) and then 697 containers were<br />
salvaged from the vessel.<br />
What have been some of the big lessons?<br />
TMC Marine was appointed as special<br />
casualty representatives (SCR) by Lomar<br />
Shipping given its technical knowledge and<br />
experience in major casualty management,<br />
including the Rena. Much of the Renaobtained<br />
experience has been equally<br />
applicable in this jurisdiction. From the<br />
outset, a project control group (owners,<br />
insurers and TMC) set out to work<br />
52 October 2018<br />
thedcn.com.au
Kea Trader with SSC vessel HUA AO on the Durand Reef, July 2018<br />
Kea Trader, September 2018 March 2018<br />
TMC<br />
alongside the authorities and to ensure that<br />
at every step of the way, the works program<br />
was understood, approved and accurately<br />
reported. Good communication has helped<br />
build co-operation with the authorities<br />
and those affected locally. This has helped<br />
to deliver timely and effective decisionmaking,<br />
a co-ordinated approach and the<br />
approval to get on with work at sea and<br />
on land. From the outset we took the joint<br />
decision with the owners and insurers to<br />
engage the best expertise to help resolve<br />
this problem.<br />
Initially, Ardent was appointed as<br />
salvors under a LOF contract and then, as<br />
the challenge turned to a complex wreck<br />
removal, Shanghai Salvage Company took<br />
over after an exhaustive tender process.<br />
From the authorities side of the project, the<br />
benefits of having responsible ship owners<br />
insured with the International Group<br />
plying your waters make all the difference<br />
when there is a major incident and in<br />
dealing with its aftermath.<br />
What were some of the unique<br />
characteristics of this case?<br />
The remote location combined with the<br />
surprisingly poor weather and often<br />
difficult sea conditions combined to<br />
add a unique complexity to this project.<br />
The exposed location has also had a<br />
major impact on the vessel, given she<br />
was grounded in an elevated position<br />
on an exposed rock in the middle of a<br />
vast ocean. Initially, the Kea Trader’s hull<br />
failed, fracturing her into two halves<br />
and thus eliminating any expectation of<br />
salvage. The mid-section of the vessel has<br />
degraded further and now lies as a debris<br />
field between the forward and aft sections.<br />
Marine operations on both major sections<br />
are further complicated by the shallowness,<br />
the angle of list and the debris field. This<br />
has required the completion of a new and<br />
very comprehensive bathymetric survey to<br />
ensure safe operations on site.<br />
Opportunities to board and undertake<br />
work have decreased as time has passed<br />
and the condition of the vessel has become<br />
more hazardous. When safe boarding has<br />
been possible, the SSC team has removed<br />
all accessible and potential flotsam, whilst<br />
monitoring for any pockets of pollutants.<br />
The vessel continues to be clear of both.<br />
Currently, an area of the reef adjacent<br />
to the wreck is being cleared of debris<br />
thedcn.com.au October 2018 53
MARITIME ENGINEERING & SALVAGE<br />
OFFSHORE PIPE HAUL MANAGED BY AAL<br />
Specialist shipping company<br />
AAL says it recently transferred<br />
subsea pipes and other equipment<br />
to the Greater Enfield Project, a<br />
development of subsea oil production<br />
and water injection wells 60<br />
kilometres north-west of Exmouth.<br />
The 90-day project was done on<br />
behalf of TechnipFMC, a subsea and<br />
offshore specialist.<br />
The cargo was loaded onto the<br />
AAL Nanjing in Kuantan, Malaysia and<br />
Tanjung Langsat, Malaysia.<br />
An accommodation block had<br />
already been installed on the ship<br />
in Singapore, able to host a group<br />
of specialist offshore marine<br />
construction workers, TechnipFMC’s<br />
own team and additional AAL<br />
superintendents and personnel – all of<br />
whom remained onboard throughout<br />
the entire operation.<br />
The operation took three<br />
months to plan and, according<br />
to AAL’s statement, “met the<br />
strictest standards of safety and<br />
environmental compliance”.<br />
It involved the AAL Nanjing<br />
operating offshore in the Exmouth<br />
Gulf for 71 days, transferring cargo<br />
ship-to-ship to two platform supply<br />
vessels and itself initially interacting<br />
with Technip’s pipe layer/installation<br />
vessel Global 1201 at the start of the<br />
offshore campaign.<br />
AAL chartering and operations<br />
director Namir Khanbabi described the<br />
project as “a major offshore operation<br />
and key scope in one of Australia’s<br />
most important offshore oil production<br />
projects”.<br />
“It was very challenging in terms of<br />
quality control and the environmental,<br />
health and safety compliance associated<br />
with operating offshore in the Exmouth<br />
gulf for so many days, transferring<br />
cargo s-t-s and accommodating not just<br />
our crew, but 12 extra passengers,” Mr<br />
Khanbabi said.<br />
“This included strict ballast and<br />
waste management regulations and the<br />
constant well-being of all the personnel<br />
onboard.”<br />
Mr Khanbabi said the sourcing and<br />
management of the offshore marine<br />
construction crew was key to their<br />
scope of work and testament to AAL’s<br />
expanded capabilities for taking on<br />
similar operations on a full project basis<br />
in the future.<br />
“The dedication of our land and seabased<br />
teams and flexibility of the AAL<br />
Nanjing herself – a perfect vessel for<br />
such a demanding job,” he said.<br />
Namir Khanbabi, chartering and operations<br />
director, AAL<br />
TechnipFMC project director<br />
Archie Walker said the company<br />
worked closely with AAL to develop<br />
the procedures for loading and the<br />
working of the vessel in Australian<br />
waters to the installation vessel the<br />
Global 1201.<br />
“The project was completed<br />
successfully without any recorded HSE<br />
incidents or schedule delays,”<br />
Mr Walker said.<br />
AAL Nanjing at Exmouth<br />
AAL, TMC<br />
54 October 2018<br />
thedcn.com.au
Kea Trader oil removal via<br />
lifting drums July 2017<br />
by divers using a variety of lifting aids,<br />
including airbags, before scrap steel is<br />
transferred ashore in New Caledonia for<br />
recycling. Around 180 hull pieces together<br />
amounting to more than 92 tonnes of<br />
steel have been recovered to date. On<br />
land in New Caledonia, TMC is providing<br />
expertise and technical support as project<br />
managers, distressed cargo specialists<br />
and community liaison and shoreline<br />
response co-ordinators. Offsite, TMC’s<br />
specialists in naval architecture, the marine<br />
environment, pollution safeguards and<br />
other expertise has been involved as needed.<br />
What work is still to be done?<br />
The remaining large task is the removal<br />
of the two hull parts and the structural<br />
debris field. Plans are well advanced,<br />
with the intention to mobilise new heavy<br />
resources with heavy lift capabilities – the<br />
design of which is subject to complex<br />
engineering studies and final approval<br />
by the authorities. It forms part of a<br />
revised methodology for removing the<br />
vessel, which has been required given its<br />
changing condition and is being designed<br />
to continue to provide safeguards to the<br />
local environment. In the interim, SSC will<br />
continue to monitor the wreck and ensure<br />
the reef environment remains protected.<br />
SSC will also continue to remove further<br />
smaller-sized debris from the reef, as and<br />
when sea conditions make this possible.<br />
How is technology changing the way<br />
salvage is conducted?<br />
The salvage industry has been seeing<br />
increasingly complex and expensive wreck<br />
removals. This is due to larger vessels;<br />
isolated, environmentally sensitive or<br />
difficult wreck sites; politically complex<br />
locations; and increasing public and<br />
cultural awareness that ensure the<br />
authorities demand full or substantial<br />
wreck removal. The Kea Trader encapsulates<br />
the hardest of all these elements. To<br />
meet these demands, salvage and<br />
marine consultancy experts both have<br />
to constantly adapt and innovate. While<br />
primary salvage objectives such as the<br />
protection of the environment from oil<br />
or cargo pollution are constant, others<br />
such as the removal of wrecks from<br />
difficult locations are not. The variability<br />
between wrecks dictates that any operating<br />
Kea Trader containers removed<br />
onto Hibiscus barge August 2017<br />
platform must be adaptable to the specific<br />
challenges of a project like this. The<br />
Kea Trader project was always going to<br />
present a very tough challenge, one that<br />
would require innovative thinking and<br />
considerable investment.<br />
TMC Marine - providing expert advice and support<br />
internationally to the marine industry since 1979<br />
WRECK REMOVAL<br />
SALVAGE<br />
TECHNICAL ANALYSIS<br />
CLAIMS AND ACCIDENT<br />
INVESTIGATION<br />
TMC provides expert advice to clients on a wide range of marine issues, whether it<br />
is attendance at a casualty, technical investigation and support during court<br />
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thedcn.com.au October 2018 55
INDUSTRY ANALYTICS<br />
Aussie ag exports buffeted<br />
by weather and trade<br />
Farm exports may suffer because of trade tensions Ian Ackerman reports<br />
AUSTRALIAN AGRICULTURAL<br />
production and exports are expected to<br />
decline slightly over this financial year, on<br />
the back of drought, and trade tensions<br />
are casting a shadow over future export<br />
figures, according to a recent report from<br />
the Australian Bureau of Agricultural and<br />
Resource Economics.<br />
The report, Agricultural commodities<br />
forecasts and outlook for September quarter<br />
2018 (authored by Matthew Howden and<br />
Kirk Zammit), shows that total Australian<br />
agricultural commodity production is set to<br />
total $60bn for the current financial year,<br />
which is 3% less than the previous year, but<br />
above the 10-year average of $56bn.<br />
The authors of the report point to a<br />
decline in area planted in the eastern states<br />
and the effect of drought conditions in late<br />
autumn and early winter as a driver of this<br />
decrease.<br />
ABARES predicts that 2018-19<br />
production of livestock and livestock<br />
products will increase. Droughts can result<br />
in more meat processing and more live<br />
exports as livestock farmers shrink the size<br />
of their herds.<br />
Earnings from exports of agricultural<br />
commodities are expected to decrease by<br />
5% to $47bn. Lower exportable supplies of<br />
canola, coarse grains, pulses and wheat are<br />
the expected drivers of this decrease. The<br />
report again points to the recent drought<br />
conditions as an underlying cause of this,<br />
as well as an increase in the use of these<br />
exportable grains as feed for livestock.<br />
VALUE OF AUSTRALIA’S AGRICULTURAL EXPORTS<br />
Livestock Crops<br />
50<br />
40<br />
30<br />
20<br />
10<br />
0<br />
A$bn 2013-14 2014-15 2015-16 2016-17* 2017-18* 2018-19**<br />
CHINESE IMPORT TARIFFS, AUSTRALIA AND THE US, AUGUST 2018<br />
COMMODITY AUSTRALIA (%) US (%)<br />
UNDER CHAFTA<br />
Beef 7.2–15 37–50<br />
Dairy 12-3 33–40<br />
Fresh or dried fruit 2.4–9 47–70<br />
Pork and pork products 2–4.8 63–70<br />
Tree nuts 1.4–2.6 45–65<br />
Vegetables and legumes 2.8–13 25–38<br />
Wine 2.8–13 29–35<br />
NOT INCLUDED IN CHAFTA<br />
Cotton 1 26<br />
Durum wheat 1 26<br />
Grain sorghum 0 27<br />
Soybeans 3 28<br />
Alf Manciagli<br />
56 October 2018<br />
thedcn.com.au
While ABARES predicts an increase in<br />
meat exports, total exports of livestock and<br />
livestock products is expected to remain<br />
flat, due to a decrease in exports of live<br />
sheep, skim milk powder and wool.<br />
The burgeoning trade disputes between<br />
the US and China could be problematic for<br />
Australian agricultural exports, with the<br />
Chinese government having imposed tariffs<br />
on the majority of agricultural imports<br />
from the States. With ChAFTA in place,<br />
and Australia able to export many of the<br />
same products to China, this dispute gives<br />
Australian exporters an advantage, the<br />
report points out.<br />
Burgeoning trade<br />
disputes between the<br />
US and China could<br />
be problematic for<br />
Australian agricultural<br />
exports.<br />
However, US exports will find their way<br />
to other markets, and new subsidies in the<br />
US may have an effect on competitiveness<br />
vis-à-vis Australian exports.<br />
Additionally, the report points out that<br />
the trade dispute puts economic growth in<br />
Asia at risk, thereby negatively impacting<br />
economic growth and thereby future<br />
demand for Australian agricultural produce.<br />
With 66% of total agricultural exports<br />
going to Asia in 2017-18, the continent is<br />
Australia’s largest market.<br />
LIVE SHEEP EXPORTS<br />
2000<br />
1500<br />
1000<br />
500<br />
0<br />
‘000 sheep 2016-17 2017-18* 2018-19**<br />
WHEAT EXPORTS<br />
25,000<br />
20,000<br />
15,000<br />
10,000<br />
5000<br />
0<br />
Kilotonnes 2016-17 2017-18* 2018-19**<br />
SUGAR EXPORTS<br />
5000<br />
4000<br />
3000<br />
2000<br />
1000<br />
0<br />
Kilotonnes 2016-17 2017-18* 2018-19**<br />
BEEF AND VEAL EXPORTS<br />
1200<br />
1000<br />
800<br />
600<br />
400<br />
200<br />
0<br />
Kilotonnes 2016-17 2016-17* 2016-17**<br />
* ABARES estimate ** ABARES forecast<br />
THE FALL OF TARIFFS<br />
UNDER CHAFTA<br />
As China is the biggest destination<br />
for Australian agricultural produce,<br />
the China-Australia Free Trade<br />
Agreement is an important pact for<br />
Aussie producers and exporters<br />
of farm products. According to<br />
statistics from the Department<br />
of Foreign Affairs and Trade, the<br />
Chinese market was worth about<br />
$13.5bn in 2017 for Australian<br />
agriculture, forestry and fisheries<br />
exporters – an increase of 105% over<br />
2011 numbers.<br />
Since ChAFTA came into force in<br />
December 2015 tariffs on several<br />
agricultural commodities have<br />
fallen, with many more scheduled to<br />
decrease or be eliminated next year<br />
and beyond.<br />
Tariffs on Australian beef in the<br />
Chinese market (which are currently<br />
set between 12% and 25%) are set<br />
to be eliminated by the beginning of<br />
2024, and a 12% tariff on beef offal<br />
is due to be eliminated by 2022. In<br />
2017, Australia exported 116,603<br />
tonnes of beef to China, worth<br />
$832.5m.<br />
Tariffs on live exports to China<br />
(including all animals) are set to<br />
be eliminated by 1 January 2019,<br />
including a 10% tariff on live cattle.<br />
Tariffs on pork are also set to be<br />
eliminated by the beginning of next<br />
year, with tariffs on sheep and goat<br />
meat to be eliminated by 2023.<br />
Wine is another Australian<br />
agricultural commodity set to receive<br />
tariff-free entry to China starting<br />
next year. Tariffs of up to 20% are set<br />
to be eliminated by 1 January 2019,<br />
giving Australian wine exporters<br />
better access to the Chinese wine<br />
market, which doubled in size since<br />
2010, according to DFAT.<br />
Horticultural products are also set<br />
to see tariff reductions in January.<br />
Macadamia nuts will no longer have<br />
tariffs of 10 to 25% entering the<br />
Chinese market next year, and fresh<br />
vegetables and fruits (except for<br />
citrus) will enter China tariff free as<br />
well. Tariffs on citrus are set to be<br />
eliminated in 2023.<br />
Also on the chopping block for<br />
2019 are tariffs of up to 15% on<br />
seafood including abalone, rock<br />
lobster, salmon, trout, southern<br />
bluefin tuna, salmon, crabs, oysters,<br />
mussels and prawns.<br />
thedcn.com.au October 2018 57
MARITIME LAW<br />
HMB Endeavour replica, berthed<br />
at the Australian National<br />
Maritime Museum in Sydney<br />
Managing risk on Australia’s<br />
blue highway<br />
Maritime lawyer Ambrose Rajadurai examines some trends in terms<br />
of international management of shipping safety<br />
A COMPREHENSIVE REGIME EXISTS<br />
manage additional risk and complement<br />
managing this risk have been shaped by<br />
to manage the safety of shipping, including<br />
the resources already on board.<br />
historical considerations. Systems in place<br />
International Maritime Organisation<br />
Such sensitive waters include port waters<br />
in Australia are largely the product of<br />
conventions, national laws, classification<br />
and special sea areas such as the Great<br />
incremental change over the past hundred<br />
society regulations, flag-state control,<br />
Barrier Reef. The risks are not just those<br />
years or so, very much similar to the<br />
port-state control and private vetting<br />
relating to protection of the environment,<br />
Commonwealth Navigation Act 1912. Just<br />
compliance required by charterers and<br />
avoiding injury or damage to property.<br />
as that Act underwent a complete review<br />
terminal operators. This all ensures most<br />
A major accident in a critical waterway,<br />
and replacement recently, it is suggested<br />
vessels are operated safely for general<br />
resulting in closure of a port, could have<br />
that the management of safe and efficient<br />
trading on the high seas.<br />
devastating consequences for the broader<br />
transit of vessels through sensitive waters<br />
community and the economy, the cost of<br />
merits review from the ground up to ensure<br />
NAVIGATION IN SENSITIVE WATERS<br />
which would most likely not be recoverable<br />
that systems in place effectively address<br />
However, in sensitive waters, whether<br />
from those accountable. Imagine the<br />
contemporary expectations and standards,<br />
because of increased hazards to navigation<br />
Westgate Bridge being brought down and<br />
utilising all available modern resources in<br />
or because the consequences of an accident<br />
closing the port of Melbourne for weeks,<br />
an integrated and effective manner.<br />
present unacceptable risk, local authorities<br />
or a ship sinking in the entrance to Botany<br />
impose additional requirements to better<br />
Bay, blocking access to the port.<br />
TRADITION<br />
manage risk. These include additional<br />
August 2018 marked 250 years since Captain<br />
local rules, reporting requirements for<br />
RISK MANAGEMENT<br />
James Cook started the first of his three<br />
ships in the area, vessel traffic services<br />
and compulsory pilotage. These additional<br />
requirements are tailored specifically to<br />
The risk that needs to be managed here<br />
is one of low probability but of very<br />
high consequence. Attitudes towards<br />
voyages of discovery. On 26 August, 1768<br />
Cook set sail from Plymouth on HMB<br />
Endeavour. Cook’s voyages seeded what is<br />
Victor Wong<br />
58 October 2018<br />
thedcn.com.au
Image supplied<br />
commonly referred to as globalisation, and<br />
had a big influence on shaping this part of the<br />
world. The maritime industry has a long and<br />
romantic history compared with most other<br />
industries in the modern era. The industry<br />
is steeped in rich tradition, and practitioners<br />
and others in society delight in recalling the<br />
past. Many, like Tevye the milkman in the<br />
famous musical, still believe that without<br />
its many traditions, the maritime industry<br />
would be “as shaky as … a fiddler on the roof”<br />
and cling to models of risk management<br />
based on historical traditions, especially<br />
with regard to risk posed by and to shipping<br />
in port and sensitive coastal waters. It is<br />
posited that many maritime traditions no<br />
longer have practical relevance because of a<br />
paradigm shift in operational practices and<br />
societal expectations.<br />
DEVELOPMENTS IN THE PAST 50 YEARS<br />
Ships and the industry today are radically<br />
different from those barely 40 years ago,<br />
let alone from the days of Cook or the<br />
period narrated about in Homer’s Iliad and<br />
Odyssey. Containerisation, the increase in<br />
the size of ships, specialisation of ships in<br />
the bulk liquid trade and commensurate<br />
changes in port infrastructure, cargohandling<br />
systems and technological<br />
innovation across the board has<br />
transformed the industry radically.<br />
It is arguable that there has been more<br />
fundamental change in the maritime<br />
industry in the past 50 years than there<br />
was in the previous 500, a rate of change<br />
that continues to accelerate exponentially.<br />
An example is automated cargo-handling<br />
systems in container terminals. Today, the<br />
volume of cargo loaded or discharged in<br />
an hour by a handful of operators would<br />
exceed that handled by perhaps hundreds<br />
of dockers over 24 hours just a few decades<br />
ago. Practices considered world’s best only a<br />
few years ago would be considered criminal<br />
today. An example is in the tanker industry,<br />
where ballast water was loaded into cargo<br />
tanks after discharge of the cargo. When<br />
this was pumped out prior to loading,<br />
hundreds of tonnes of oil would also be<br />
simultaneously discharged into the sea.<br />
Similarly, cargo ships would, as a matter<br />
of course, throw all rubbish overboard<br />
and there was usually a stream of rubbish<br />
trailing in their wake when ships departed<br />
port. Today, discharge of just a few litres<br />
of pollutant into the environment would<br />
invite severe penalties.<br />
MARGINS FOR ERROR<br />
Large modern ships have a deadweight several<br />
thousand times that of the Endeavour, have<br />
physical dimensions many times hers, crews<br />
about a fifth in number of hers (in case of<br />
cargo ships) and carry a range of modern<br />
cargoes that, if released uncontrolled into<br />
the environment, would have unimaginably<br />
negative consequences. Passenger ships carry<br />
thousands of persons on board, posing wholly<br />
different risk scenarios.<br />
Conversely, technological advances<br />
have improved precision in, position<br />
fixing capability, charting of underwater<br />
topography, measurement and prediction of<br />
relevant external forces (wind, tide, current),<br />
measurement of speed, etc. The continuously<br />
improving ability to more accurately measure<br />
relevant parameters has resulted in permitted<br />
margins for error in managing the transit<br />
of vessels through sensitive waters, being<br />
progressively narrowed.<br />
The spotlight today is being turned on the regulators<br />
as much as on the perpetrators<br />
While the probability of marine accident<br />
may have been reduced, the consequences<br />
when an accident does occur have been<br />
much magnified. The challenge has<br />
changed dramatically.<br />
CHANGING EXPECTATIONS AND<br />
TOLERANCE<br />
On 28 November 1903, the tanker Petriana<br />
ran aground at Portsea, Victoria an hour<br />
after the pilot boarded. After attempts<br />
to free her failed, she was lightened by<br />
dumping her cargo of bulk oil into the sea.<br />
The spill was described as “a film of great<br />
beauty, radiating all the colours of the<br />
rainbow, spread from Sorrento Back Beach<br />
to Point Nepean”. The pilot had his license<br />
suspended for 12 months for carelessly<br />
causing the stranding.<br />
On 5 January 1975, the ANL bulk carrier<br />
Lake Illawarra collided with the Tasman<br />
Ambrose Rajadurai, principal, Ambrose<br />
Rajadurai and Associates in Melbourne<br />
Bridge in Hobart and brought down several<br />
sections. Four cars drove off the collapsing<br />
bridge into the water below killing five<br />
occupants. Seven crewmen on the ship also<br />
perished. The master was found to have<br />
not handled the carrier in “a proper and<br />
seaman like manner” and had his master’s<br />
certificate suspended for six months.<br />
TIMES HAVE CHANGED<br />
In the case of abuse of children and<br />
customers of banks brought into the<br />
light by recent royal commissions, the<br />
spotlight today is being turned on the<br />
regulators as much as on the perpetrators.<br />
Practices once swept under the carpet are<br />
no longer tolerated. Similarly, legislators<br />
are reacting to public and media outcry<br />
in the case of maritime casualties. Those<br />
directly responsible and others, higher<br />
up the management tree, vested with<br />
authority to manage safety, are being held<br />
accountable and being served with severe<br />
penalties. In some instances, political and<br />
judicial overreaction may have resulted<br />
in unjust sanctions being meted out and<br />
counterproductive legislative changes<br />
enacted.<br />
A following article in next month’s<br />
edition of this magazine will illustrate this<br />
trend with specific examples. It will discuss<br />
the implications for safety regulators,<br />
harbour masters, pilots, VTS operators,<br />
ship masters and all others who have a<br />
shared responsibility to manage safety<br />
on Australia’s blue highway and a duty<br />
to promote the safety of life at sea, safe<br />
navigation and to prevent pollution of the<br />
marine environment.<br />
thedcn.com.au October 2018 59
WORKPLACE RELATIONS<br />
Technology and HVNL<br />
Gina Capasso examines the legal impact of advancing technology<br />
use in transport and logistics<br />
THE EFFECT OF FATIGUE ON<br />
road safety is a critical issue for the<br />
transport industry, as well as the broader<br />
community. Self-monitoring and selfreporting<br />
in the industry have historically<br />
been ineffective ways of reducing serious<br />
or fatal fatigue-related road accidents.<br />
However, technology can be used as a tool<br />
with the capacity to reduce safety incidents<br />
in the transport industry.<br />
TWO EXAMPLES<br />
In two recent cases, the Fair Work<br />
Commission considered disputes arising<br />
under the applicable Enterprise Agreement<br />
(EA) and determined the employer in each<br />
case had the right under the EA to:<br />
• further implement anti-fatigue<br />
monitoring technology in trucks in<br />
the form of infrared driver fatigue/<br />
distraction monitoring system (guardian<br />
technology) and inward and outward<br />
facing camera monitoring systems (DVR<br />
Cameras) – Toll Transport Pty Ltd T/A<br />
Toll Shipping v Transport Workers Union<br />
of Australia [2018] FWC 3573 (20 June<br />
2018); and<br />
• install GPS tracking devices on<br />
technician employees mobile phones –<br />
Australian Municipal, Administrative,<br />
Clerical and Services Union v Canon<br />
Australia Pty Ltd T/A Canon [2018] FWC<br />
2695 (18 May 2018).<br />
ADVANCES BEYOND GPS TRACKING<br />
Recently one of the big four banks built<br />
a blockchain for its logistics clients to<br />
monitor a shipment of 17 tonnes of<br />
almonds from Victoria to Germany. In<br />
this experiment the almonds and their<br />
transportation path was monitored using<br />
sensors. This provided all parties in the<br />
global supply chain with full transparency<br />
of the location and condition of the<br />
almonds and assisted the parties in the<br />
supply chain to identify and deliver<br />
efficiencies in their business.<br />
Logistics has traditionally involved<br />
extensive paperwork but emerging<br />
technologies mean more efficient<br />
and transparent supply chains will<br />
become prevalent. Technology that<br />
records transactions and tracks product<br />
movements from supplier to customer is<br />
likely to provide efficiencies, visibility and<br />
interconnectivity between parties in the<br />
supply chain.<br />
Operators and others in the supply<br />
chain will need to adapt to technology<br />
advancements particularly where such<br />
advancements are implemented by<br />
competitors and demanded by customers to<br />
remain competitive.<br />
Can blockchain and other technology<br />
advancements assist duty holders with legal<br />
compliance obligations?<br />
HVNL AND COR LAWS<br />
The new chain of responsibility laws<br />
(which have just arrived) provide that<br />
parties who control or have influence over<br />
the transport task (employers of drivers,<br />
loaders, unloaders, packers, loading<br />
managers, operators of heavy vehicles,<br />
schedulers, consignors and consignees)<br />
Technology may play a part in assisting with legal<br />
compliance where it incorporates mechanisms for<br />
identifying safety issues in transport activities<br />
will be responsible for ensuring breaches<br />
of the Heavy Vehicle National Law do not<br />
occur. These laws prevent heavy-vehicle<br />
driver breaches of fatigue management<br />
requirements, speed limits, mass,<br />
dimension, and loading requirements.<br />
If there is an alleged breach of these<br />
laws, the actions of each party in the<br />
Gina Capasso, special counsel, KHQ<br />
supply chain may be called into question<br />
and they parties may become the subject<br />
of an investigation, with the potential<br />
for prosecution. This investigation would<br />
include looking at what measures those<br />
parties in the chain have in place to prevent<br />
breaches of the HVNL occurring.<br />
HOW TECH CAN HELP, LEGALLY<br />
Technology may play a part in assisting<br />
with legal compliance where it<br />
incorporates mechanisms for identifying<br />
safety issues in transport activities (such<br />
as delays which impact delivery times and<br />
may have speed or fatigue considerations)<br />
that can then be eliminated or controlled.<br />
However, parties that have legal<br />
responsibilities in the supply chain need<br />
to ensure that the implementation of<br />
any technology to assist with compliance<br />
actually achieves this outcome. It will not<br />
be sufficient for a party that exercises (or<br />
has the capability of exercising) control or<br />
influence over any transport task to satisfy<br />
its legal obligations by simply relying on<br />
technology that is stated to achieve this<br />
objective. The user of the technology must<br />
be satisfied that the technology provides<br />
reliable information that can be used in<br />
demonstrating legal compliance.<br />
KHQ<br />
60 October 2018<br />
thedcn.com.au
CURRENCIES, GEO-POLITICS & TRADE<br />
The global economy<br />
and its risks<br />
The US economy is powering up, but political instability and<br />
potential trade wars threaten the global recovery<br />
THE GLOBAL ECONOMY IS<br />
killed middle-class jobs in the US, while<br />
travelling well, led by the US, which is<br />
enriching global corporations. The political<br />
firing on all cylinders. The Federal Reserve<br />
fallout has been immense.<br />
System has been rapidly returning to a<br />
The North American Free-Trade<br />
normalised monetary policy, reflecting the<br />
Agreement between the US, Mexico and<br />
strong growth and inflationary pressures.<br />
Canada has been a major casualty. The<br />
Europe has also been improving, with<br />
Mexicans have seized the opportunity<br />
steadily improving economic numbers.<br />
and negotiated a bilateral agreement with<br />
The Australian economy has been<br />
the US, while Canada has been seemingly<br />
a beneficiary of the global economic<br />
left isolated.<br />
environment as a heavily trade-exposed<br />
The US remains the biggest economy<br />
nation. The macro risk to global markets<br />
in the world and the primary destination<br />
has been the realignment of global trade<br />
for exporters. Any nation wishing to trade<br />
and the emergence of so-called trade wars.<br />
with the US must now establish new trade<br />
President Trump has decided to<br />
agreements. The US has used tariffs as<br />
renegotiate the US trade agreements and<br />
leverage, and the pressure seems to be<br />
re-establish the US supply chain. China<br />
working. In July the EU avoided a trade war<br />
has had a major advantage and, despite<br />
being the second largest economy in the<br />
world, receives advantage as an emerging<br />
by agreeing to buy more American goods,<br />
but China is still holding out.<br />
Paul Bettany, foreign exchange partner,<br />
Collinson & Co<br />
trading nation, complements of the<br />
POLITICAL UPHEAVAL<br />
WTO. Trump has sought to address this<br />
The Australian dollar was resilient during<br />
surrounding emerging markets, attempting<br />
apparent inequity.<br />
the political crises that enveloped the<br />
to end extremely stimulative monetary<br />
government in recent months. Yet another<br />
policy and return to normal monetary<br />
TRADE WARS<br />
internal coup deposed a serving Australian<br />
conditions. The Bank of England and<br />
The Trump administration in mid-<br />
prime minister. Australia has undergone<br />
European Central Bank remain prone with<br />
September announced tariffs on<br />
political insecurity, with seven prime<br />
Brexit negotiations building to a crescendo.<br />
US$200bn worth of Chinese imports. The<br />
ministers in the past eleven years. This is<br />
US equities continue to hit record<br />
US has launched a realignment of trade<br />
evidence of the political tumult that has<br />
highs as confidence and investment surge,<br />
agreements. Trump has discarded multi-<br />
engulfed the world.<br />
providing the platform for further economic<br />
lateral free trade agreements which he<br />
The Australian economy is trade<br />
gains. Business investment translates into<br />
sees as inequitable. The US has seen the<br />
exposed and has thus suffered from<br />
growth in profitability and incomes, thus<br />
supply chain shift to lower-cost economies,<br />
instability generated by the Trump trade<br />
supporting the consumer society.<br />
bringing with it the loss of manufacturing<br />
wars. Australia is heavily dependent on<br />
It is hard to foresee any interruption<br />
and the associated high-paying jobs.<br />
providing Asian supply chains and thus<br />
in this bull-run, save black swan events.<br />
This was thought to be the irreversible<br />
impacted by the volatility surround the<br />
Growth and inflation will mean further<br />
consequence of globalisation.<br />
US-China trade negotiations. The Reserve<br />
upward pressure on interest rates driving<br />
As manufacturing was shipped offshore,<br />
Bank of Australia has warned of the high<br />
currencies. The US is way ahead in the<br />
the consumer was the beneficiary through<br />
levels of consumer debt, exasperated by<br />
monetary cycle, which should lead to a<br />
cheaper consumables. Primary export<br />
stagnant wage growth, which gets the<br />
strong dollar.<br />
nations supply the energy and resources,<br />
canary in the mine-shaft quieting down.<br />
The risks to the Australian dollar<br />
thus benefiting the trade exposed nations,<br />
The past month again has been<br />
remain the global trade situation<br />
such as Australia, Argentina, Brazil, etc.<br />
dominated over the impact of global trade<br />
and consumer debt. A solution in the<br />
Collinson & Co<br />
The low-cost labour nations were set up<br />
as the global factories, which has seen the<br />
supply chain shift to parts of Asia, Mexico<br />
etc. This reduced costs and prices, but also<br />
wars and speculation over central bank<br />
activity and rhetoric. Central banks have<br />
recognised the healthy state of global<br />
economies, with the obvious exceptions<br />
China-US trade negotiations could see a<br />
significant upward boost to the currency,<br />
while continued uncertainty, brings with<br />
it vulnerability.<br />
thedcn.com.au October 2018 61
MISSION TO SEAFARERS<br />
MtS staff assisting cruise ship workers<br />
Cruise season is almost upon us,<br />
and MtS is at OPT to help seafarers out<br />
Operation Cruise Terminal<br />
With cruise season starting this month, Mission to Seafarers Sydney<br />
is launching Operation Cruise Terminal, writes Wendy King of MtS<br />
SEAFARERS HAVE MANY AND<br />
varied needs because of their long<br />
contracts, which typically require them to<br />
work from six to 12 months at a stretch. Due<br />
to the quick turnaround of cruise vessels at<br />
Sydney’s Overseas Passenger Terminal (they<br />
arrive at about 6am and depart at around<br />
6pm), few of the crew have shore leave.<br />
For the minority who do venture ashore,<br />
they prioritise carefully how they spend<br />
that brief time. Operation Cruise Terminal<br />
at OPT focuses on their needs, and, in<br />
partnership with the Port Authority of NSW,<br />
we are setting up a gazebo or marquee at the<br />
crew exit gangway at the OPT.<br />
This facility will enable us to serve the<br />
seafarers, assisting and caring for them<br />
in whatever way possible and within our<br />
means. Our friendly MtS staff at the gazebo<br />
will be selling discounted, pre-paid SIM<br />
cards with good plans; distributing our<br />
newsletters, magazines and information<br />
sheets regarding the MtS; and directing<br />
them to our Mission Centre which is only a<br />
10-minute walk from OPT.<br />
AT THE MISSION<br />
At our Mission, we provide facilities such<br />
as free internet and Wi-Fi and seafarers<br />
can get connected with family and friends<br />
back home. Seafarers can also listen to<br />
news updates in their own language in our<br />
Apple TV lounge, while enjoying a free tea<br />
or coffee. They can also change foreign<br />
currencies to local currency and remit<br />
their wages to family members back home<br />
through our Western Union facility.<br />
Our shop is stocked with toiletries,<br />
groceries and health supplements such<br />
as Omega-3 fish oil, as well as popular<br />
snack foods. The shop also sells souvenirs<br />
such as soft toy kangaroos and koalas,<br />
fridge magnets, T-shirts and caps, as<br />
well as mobile phones and accessories.<br />
We also sell discounted tickets to places<br />
of interest. Alternatively, seafarers can<br />
just relax in our centre on Hickson Road,<br />
Millers Point, playing pool and table tennis.<br />
Reading materials such as novels, booklets,<br />
magazines and newspapers are available<br />
free of charge.<br />
SEAFARERS IN THE FESTIVE SEASON<br />
Due to their work commitments, many<br />
seafarers labour through the festive<br />
seasons, especially Christmas and New<br />
Year. During these seasons, many of them<br />
would like to order gifts online, but where<br />
can their order be delivered? We allow<br />
them to use our Mission’s address to deliver<br />
orders, which they pick up from us when<br />
they call in at our port. This is another way<br />
to meet the needs of the seafarers. We have<br />
had much positive feedback from them<br />
about this service.<br />
The friendly, competent staff and chaplains<br />
at the Mission are available seven days a<br />
week, 363 days a year, providing listening<br />
ears to seafarers needing to share private and<br />
confidential matters without being judged<br />
This facility will enable us to serve the seafarers,<br />
assisting and caring for them in whatever way<br />
possible and within our means<br />
or criticised. The Mission provides a home<br />
away from home for all seafarers. We provide<br />
pastoral and personal care as well as hospital<br />
visitation when needed.<br />
We want to express our heartfelt<br />
gratitude to Port Authority of NSW senior<br />
manager, cruise and terminal operations<br />
Robert Rybanic and his team for endorsing<br />
our Operation Cruise Terminal at OPT<br />
and for granting permission to set up the<br />
gazebo at the terminal to serve and assist<br />
the seafarers calling at our port. We look<br />
forward to partnering with other agencies<br />
to assist us to serve the seafarers with<br />
greater efficiency.<br />
Mission to Seafarers<br />
62 October 2018<br />
thedcn.com.au
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thedcn.com.au
OUT & ABOUT<br />
Svitzer port manager Ben Hart and Tim Crakanthorp,<br />
state member for Newcastle<br />
A Newcastle<br />
welcome<br />
for Svitzer<br />
Glenrock<br />
Svitzer hosted a ceremony<br />
and celebration at the<br />
Port of Newcastle,<br />
christening its new tugboat<br />
THE SECURITY GUARD AT THE PORT<br />
entrance was looking forward with<br />
trepidation at the crowds of people she had<br />
to let through the boom gate. “I’ve got my<br />
work cut out for me tonight, darl.”<br />
The crowds were gathering at the Port<br />
of Newcastle’s Dyke Point to attend the<br />
naming ceremony for the new tugboat,<br />
Svitzer Glenrock.<br />
Guests were greeted with a string trio<br />
making its way through the standard light<br />
classical repertoire, with a smattering of<br />
Bach, Dvorák, Vivaldi and others.<br />
The Glenrock itself was open for guests to<br />
clamber around in and explore the innards<br />
of the Damen ASD 2312 tug. While guests<br />
were chatting and admiring the vessel, a<br />
few dolphins swam by and two other tugs<br />
spun around in circles.<br />
Ray Kelly Jr gave the Welcome to<br />
Country and spoke about his family’s<br />
connection to the area. He said he<br />
appreciated the tug’s name and the<br />
connection to the area it represented.<br />
Then, it was time for the main event. The<br />
“naming mother”, Emma Fensom (who is<br />
also the chief operating officer for the Port<br />
Authority of New South Wales) boarded the<br />
tug, donned safety glasses and smashed a<br />
bottle of champagne on the vessel.<br />
“Let it be known, that on this day,<br />
Thursday the 13th of September, and forever<br />
more, this fine vessel is named Svitzer<br />
Glenrock,” she said.<br />
“May God bless her and all who sail in<br />
her.”<br />
Then, Svitzer east coast general manager<br />
James Mather took the stage and said<br />
the vessel was named by the company’s<br />
Newcastle employees.<br />
“We gave the employees a chance to<br />
choose the tug’s name, and they chose<br />
Glenrock through a vote,” he said.<br />
“Glenrock is a well-used wilderness<br />
precinct just south of Newcastle city. It was<br />
made a State Recreation Area in the 1980s<br />
Ian Ackerman; Svitzer<br />
64 October 2018<br />
thedcn.com.au
Nuatali Nelmes,<br />
Lord Mayor of Newcastle<br />
Gordon Lasker, Teresa Lloyd and Andrew Cumming<br />
Tug master Gavin Herbert, Svitzer CEO<br />
Henriette H. Thygesen, and deckhand Shane Suska<br />
Tom Charter and Sjoerd de Bruin<br />
and is popular with families because of its<br />
beaches, bush, wildlife and famous lagoon.”<br />
Mr Mather also said Glenrock was a place<br />
of regular habitation for the Awabakal people.<br />
Next, Svitzer managing director Nicolaj<br />
Noes was up.<br />
“The Glenrock, she’s a special lady,” he<br />
said.<br />
“If you have a cape-size coming through<br />
the channel and it loses power, you want<br />
someone like the Glenrock there,” he said.<br />
Svitzer global CEO Henriette Thygesen<br />
spoke about the importance of a naming<br />
ceremony, which is known as a christening<br />
in Denmark.<br />
“A ship has a soul – this is not mere oldfashioned<br />
superstition, but it is commonly<br />
believed, even in modern times, that a ship<br />
is almost like a living being,” she said.<br />
“There are many parallels between<br />
naming ships and naming newborn babies.<br />
Ms Fensom said she was honoured<br />
to be the naming mother for the Svitzer<br />
Glenrock, and she explained that the new<br />
tug would be instrumental in allowing<br />
more, larger ships – particularly fuel<br />
tankers – to call at Port of Newcastle.<br />
Emma Fenson and Keith Wilks<br />
Aaron Henshaw, Tiffany Adams, Lauren Rogers and Mark Whipp<br />
thedcn.com.au October 2018 65
OPINION<br />
Australia needs<br />
to go nuclear<br />
Captain Harry Mansson argues for nuclear power as an energy source<br />
and the spillover for the maritime sector<br />
NUCLEAR POWER USE HAS BEEN<br />
discussed in Australia since the 1950s,<br />
with policy proposals made and rejected<br />
like a revolving door. Prime Minister John<br />
Howard banned it before re-opening it for<br />
discussion in 2007. But nothing came of it.<br />
It is, therefore, refreshing to see some<br />
stirring, most recently by the former<br />
head of Australia’s Nuclear Science and<br />
Technology Organisation, and current<br />
chair of NBN, Dr Ziggy Switkowski. Dr<br />
Switkowski was quoted in The Australian<br />
as stating: “it was sensible to clear the<br />
regulatory pathway for the next generation<br />
of small nuclear reactors”. Opposition<br />
energy spokesman Mark Butler has held out<br />
the prospect of Labor removing the obstacle<br />
if and when they win government.<br />
REDUCED EMISSIONS<br />
The advantages would be enormous.<br />
Australia is the world’s third-largest supplier<br />
of uranium and thorium, it provides for<br />
safe dumping of nuclear waste. The fuel<br />
costs compared with coal-powered plants<br />
would see reductions of up to 80% and there<br />
would be zero emissions. A reduction in coal<br />
emissions would have obvious benefits for<br />
public health as well as for the environment,<br />
if there was the government’s will and<br />
strength to back it up.<br />
Our country is about the only developed<br />
nation not using nuclear power. When<br />
I left my native Sweden in the 1960s for<br />
good to become a proud and loving Aussie,<br />
that country had six reactors working for<br />
it and that has been increased to seven at<br />
times. Never any problems. And, Australia<br />
already has a small nuclear facility at Lucas<br />
Heights, NSW for medical purposes.<br />
The areas that need such power in<br />
Australia change with the weather, floods<br />
and fires. Ideally the reactors would be<br />
movable. Which brings us, accepting Dr<br />
Switkowski’s views, to the concept of<br />
building new reactors each of about 100<br />
MW capacity, each able to supply energy<br />
for up to 100,000 people. These could be<br />
installed inside second-hand converted<br />
cargo ships to be towed to wherever needed<br />
and tied up near the existing power feed.<br />
NUCLEAR POWER IN SHIPPING<br />
Meanwhile, 15 countries have signed<br />
with Russia as users of non-self-propelled<br />
nuclear power supply ships. These include<br />
China, Indonesia, Malaysia, Algeria,<br />
Namibia, Cape Verde and Argentina. The<br />
New York Times reported that proponents<br />
argue such power stations could be<br />
“assembled more quickly, be put in a wider<br />
range of locations and respond more<br />
nimbly to fluctuating supply on power grids<br />
that increasingly rely on wind and solar”.<br />
The general use of nuclear propelled<br />
vessels also has been around for some time.<br />
The US built the cargo ship Savannah in<br />
the 1950s (it was a pet project of President<br />
Eisenhower) and could circle the globe 14<br />
times at 20 knots without refuelling its 20<br />
kilograms of uranium. A similar 14,000 kW<br />
of installed power would cost up to $50m<br />
for bunker fuel alone.<br />
Our country is about the only developed nation<br />
not using nuclear power<br />
The seaborne nuclear supply concept<br />
is not new; the Russians have several<br />
non-self-propelled ships operating already<br />
and more on mass production order.<br />
The supplier is the Baltic shipyard in St<br />
Petersburg. Each vessel can produce up to<br />
70 MW of electricity (300 MW of heat),<br />
enough for a city of 200,000. They can be<br />
towed almost anywhere around Russia.<br />
Refuelling of 20 kilograms of uranium<br />
is required every three years. The reactors<br />
Captain Harry Mansson, former shipping<br />
executive, sea captain and sailor<br />
have a life span of about 40 years, and<br />
service is only required every 12 years. And,<br />
nuclear propulsion is also nothing new to<br />
Russia, where nuclear icebreakers have been<br />
operated for 50 years, as well as a large<br />
number of Navy and tourist ships.<br />
NEED FOR LEADERSHIP<br />
What next? Nothing will happen without a<br />
Federal Government initiative. So it should<br />
set up a qualified working group consisting<br />
of industry leaders, including health and<br />
environment, and a minimum of politicians,<br />
coming up with the results of a study<br />
showing the proposed geographical target<br />
areas, required capacity of a typical nuclear<br />
energy supply ship, cost/benefits, inclusion of<br />
desalination needs, etc. Then come up with<br />
design ideas to suit the particular ships.<br />
The group would then come up with designs<br />
for the ships, and then call for global tenders,<br />
which should be independently assessed.<br />
The target deadline for the completion<br />
of this work should be six months, because<br />
this issue is far too important to leave it to<br />
languish on the back burner.<br />
Image supplied<br />
66 October 2018<br />
thedcn.com.au
The grill<br />
began on this dirty little garbage barge on<br />
Pittwater due to a lack of education.<br />
When I look back on it now, that was<br />
the best job I ever had. It was absolutely<br />
amazing and, as a young bloke, I thought<br />
I was the captain of the biggest ship in the<br />
world. At the end of the day, it was just a<br />
7-metre garbage barge.<br />
What is your favourite thing to eat?<br />
I’m a bit of a lefty when it comes to food<br />
and have a pretty heavily plant-based vegan<br />
diet these days – it’s probably a bit more<br />
sustainable as well.<br />
Favourite thing to eat would probably be<br />
– well, I’m lucky enough to have a fiancée<br />
who really knows how to cook, so anything<br />
she puts on my plate is great.<br />
Ian Ackerman<br />
Cameron Butchart, port officer at the Port Authority<br />
of New South Wales, talks garbage barges, cycling<br />
and a healthy diet<br />
What does a typical day at work look<br />
like for you?<br />
My current role at the Port Authority<br />
entails developing better work practices and<br />
procedures for our operational staff and<br />
our customers. Some of our customers are<br />
cruise ships, tankers and container vessels.<br />
I’m just trying to accommodate their needs<br />
so we can progress as world-class port and<br />
not hinder their port stays.<br />
What is the best part of working at the<br />
Port Authority?<br />
The best part of working at the Port<br />
Authority is that no two days are the same,<br />
we have so many different customers.<br />
One day I could be chatting with cruise<br />
ship captains, and the next day I could be<br />
helping assist a tanker with discharge or<br />
loading. There’s no day that’s the same.<br />
After spending a life at sea, I still get to be<br />
present on board ships but I don’t have to<br />
actually go away to sea.<br />
What did you do before you took up<br />
your current role?<br />
I had spent my entire life at sea. I<br />
completed a cadetship with Shell<br />
Tankers when I was younger, and I slowly<br />
progressed my way through the different<br />
deck officer ranks at sea.<br />
Later, I moved across to the Australian<br />
offshore oil and gas industry, working<br />
primarily on anchor handlers and support<br />
vessels.<br />
What was you first-ever job?<br />
The first job I got was a garbage man on a<br />
garbage barge on Pittwater. I always wanted<br />
to work at sea, but I had no qualifications –<br />
I hadn’t finished school. So, skippering this<br />
garbage barge around Pittwater collecting<br />
rubbish was the only job I could do without<br />
a qualification. I quickly realised I could<br />
clock up sea time on the garbage barge. One<br />
thing led to another and I accrued enough<br />
sea time to obtain a cadetship with Shell.<br />
I went from a small garbage barge to some<br />
of the biggest tankers in the world. It all<br />
What does an ideal holiday look like?<br />
It would be anywhere as far away as<br />
possible from the hustle and bustle of<br />
city life. I used to love getting away to sea<br />
because I could get away from the city. But<br />
now an ideal holiday would probably be<br />
on a nice, quiet island, somewhere in the<br />
tropics, or South East Asia. Somewhere with<br />
no technology, no devices.<br />
Got any hobbies?<br />
Cycling. Most mornings I’m out well before<br />
the sun comes up riding somewhere around<br />
Sydney. I’m an avid cyclist. I recently<br />
qualified for the World Fondo Series in<br />
Italy, I’m hoping to try and get there this<br />
year. I’m also getting married around the<br />
same time as the series, so I’m not too sure<br />
that the wife will let me travel.<br />
Are there any social issues you feel<br />
strongly about?<br />
Live export – I like to eat an ethical diet;<br />
I think more could be done with the live<br />
export trade. Is it a barbaric trade, and we<br />
could develop more humane ways to ship<br />
these animals overseas.<br />
I went from a small garbage barge to some of<br />
the biggest tankers in the world. It all began on<br />
this dirty little garbage barge on Pittwater due<br />
to a lack of education.<br />
thedcn.com.au October 2018 67
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