Freight rates on the up as a downer to end 2017


Port operators are now charging for the collection of containers through their yards.

Well that was 2017….did you blink?

It seems like just yesterday I was writing about how exciting 2017 was shaping up to be with all of our ducks lined neatly in a row!

Good exchange rate, CHAFTA, Tasmanian Freight Equalisation extension for export cargo, new Searoad vessel, three international lines all calling direct to Tasmania as well as a plethora of other lines servicing via Bass Strait feeders as well as an extended air runway in Hobart – all excellent things.

We didn’t have any floods or broken moorings this year and whilst our power bills were huge (mine was anyway), we turned the lights on with confidence (as opposed to 2016).

With tourists everywhere, new hotels going up, promised new ships from Toll as well as potential investment into our ports from DP World, our cup was running over, and it was a big cup!

Feel a sense of foreboding? Of course you do, it is only natural.

There are some thorns on the roses I am afraid and we would be wise to consider these going forward into the next year.

Infrastructure surcharges are a new cost impost from our northern cousins and it would appear that they are going up – there has already been one increase from the initial advice this year.

The likes of port operators (think DP World, Patricks) are issuing invoices for the collection of containers through their yards to transport companies – these costs were traditionally borne by the shipping lines and passed on to the customer as the terminal fee.

The costs of power, rent etc are being used as a mechanism for these additional charges.

Freight rates are going up – there is no getting away from this (particularly if you are an importer). There is less capacity than demand, particularly at this time of year –  freight rates have nearly doubled and securing space ex-North of South East Asia is like a bar room brawl at the moment – not many winners and very messy.

Export conditions are dependent on crops in the first part of the year, but be aware that there is little patience for not coming though with your commitments – there are charges for missed or cancelled bookings for exporters in place now.

What will 2018 bring?

There are some significant projects that will add to shipping volumes in 2018 and this is positive to the volume story of Tasmania.

We are positioned in a good place for another successful year ahead.

By Brett Charlton, Agility Logistics Tasmania General Manager

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