Ports of Auckland

New Zealanders are continuing to wait long periods for imported goods but delays at Auckland’s port are reducing, as the country’s biggest import port struggles to clear a massive backlog of freight.

Ships have been sitting in the harbour for over two weeks to unload their cargo, as Ports of Auckland grapples with a shortage of skilled operators and a global surge in demand for freight.

In late November, some shipping lines were waiting up to 17 days, but the port says the waiting time is now down to an average of eight days.

However, the delays are not helping retailers like Tony Gallagher, owner of Auckland flat pack furniture store Sofas and More, who was running out of stock.

‘’If I consolidated it all up, I could get it into six pallets and I can hold more than 70,’’ he said.

He said one shipment he was waiting on would arrive in the harbour next week but would not be unloaded for another 10 days.

Most customers were understanding, but it was embarrassing to tell people they might have to wait two to three months, Gallagher said.

‘’In the weekend customers are coming in, they are looking at the showroom and going we’ll have that, and I’m going, I’m sorry I can take your pre-order and you can get it in the New Year and they go, oh no, we need it now and walk it out.’’

The Ministry of Transport has committed to help Ports of Auckland recruit overseas workers, which needs over 50 staff to work as crane operators, straddle operators, lashers and other stevedoring roles.

‘’As many other employers have found, recruitment is proving difficult. The labour market is strong, there is not a large surplus of suitable people looking for work,’’ port spokesman Matt Ball said.

The port had found a crane operator and several skilled straddle drivers within the country.

‘’We hope to have another crane crew in place before Christmas and a second by February next year, but recruitment – and training – will be ongoing for some time.

Chris Edwards, president of the Customs Brokers and Freight Forwarders Federation, said the crux of the problem was the staff shortage, not the port’s current automation project.

Lack of staff meant only a few of the port’s cranes could run around the clock and he urged the Government to give the recruitment process priority.

“This is an urgent matter and, given the significant cost to the economy, it’s our view that the New Zealand Government should be assisting in this recruitment, much like the Australian Government is currently trying to do in its primary sector.”

As well as delays, importers were also grappling with much higher freight costs.

Edwards said costs were three to six times higher than a few months ago, and overlaid with surcharges for freight going through Auckland.

”A container from Shanghai to Auckland in January, a 20-foot container, would have cost US$500. That price now is around US$3000. And it’s going to be the same for exporters.”

To find ways around the backlog, ships have been diverted to other ports. Cargo has been diverted to Tauranga, Napier, Timaru and Lyttelton, much of it going back to Auckland by road or rail.

One shipping line announced this week it would divert a vessel to Whangarei, but Edwards said the cost and difficulty of getting 2500 containers back to Auckland in time for Christmas would be high.

Delays in shipping goods from Asia are expected to continue well into next year, complicated by a looming global shortage of shipping containers and severe congestion in Asian trans-shipping ports.

Demand for space has risen so much that some ships are bypassing New Zealand altogether, a practice known as ”blank sailings,” as they try to make up time.

Mondiale Freight Services has advised its importer customers to book space on ships up to three weeks before sailing, and plan for a six to eight week contingency delay in their supply chain.

Exporters are also struggling. Air freight capacity has nearly halved due to the drop in passenger flights and rates have risen by 35 per cent, forcing them to compete for sea freight.

Simon Beale, chairman of the Council of Cargo Owners, which represents major importers and exporters like Fonterra, said the bigger players who had locked-in contracts were managing, but those buying on the spot market were paying big money.

He said most ships were still visiting New Zealand. ‘’There are a couple of ones that have a couple of blank sailings just to help relieve the situation in Auckland. But things are moving.”

Cargo that missed New Zealand would go to Australia and then make its way back. ”Missing out on a week is better than missing out on six weeks.”

However, as the fruit and meat export season looms early next year, exporters were nervous about a potential mismatch and shortage of cargo containers around the world, Beale said.

”Getting boxes in the right place is the key thing between now and that period of time.”

Kiwirail has also been working to help alleviate the congestion in Auckland, putting on extra trains have between Tauranga and Auckland to help clear Tauranga’s wharves, increasing capacity on its South Island train and adding a train from Auckland to Christchurch each weekend.

Meanwhile, a Government scheme to subsidise carriers of high priority air freight has been extended until March.

Air New Zealand has been allocated an average of 55 flights per week under the scheme, providing it with a government contribution of between $100 million and $145m towards cargo revenue over the next four months.

Cargo flights are now providing about half Air New Zealand’s monthly revenue.

By: Nikki Preston

Herald reporter based in HamiltonNikki.Preston@nzme.co.nz

A photo has emerged showing the scale of the backlog of ships waiting to get into Ports of Auckland this morning as unprecedented and unexpected demand sees container ships stuck at sea with goods for an average of eight days.

Up to 11 container ships were anchored in the Hauraki Gulf waiting to be processed at Ports of Auckland at the weekend, but Ports of Auckland general manager of communications Matt Ball said that had now reduced to six.

The ships currently anchored are one bulk carrier, one car ship and four container ships carrying a wide range of goods which could likely include some Christmas presents.

All three upper North Island ports were busy and there were a further five ships at anchor waiting to go into Northport near Whangarei and five waiting to go into Tauranga, Ball said.

Yesterday the biggest container ship to ever berth at Northport, the 261m-long Constantinos P carrying 1340 containers, arrived. Up to 1000 trucks – travelling either at night or during off-peak traffic times – could be needed to move the cargo between Marsden Pt and Auckland from Thursday.

Ports of Auckland had already recruited an additional 15 people to help them process the containers more quickly and hoped to have one extra crane crew in place before Christmas.

“Our biggest problem is that we don’t have enough trained staff to handle the extra demand,” Ball said.

It was also ramping up the use of its robot straddle carriers help move more freight.

Prior to Covid, it was uncommon for Ports of Auckland to have any ships waiting to be unloaded and on the odd occasion when it did there would only be one or two at a time, he said.

“I think the largest queue previously has been when Brown Marmorated Stink Bugs were discovered on board car ships, which resulted in quite large delays to car imports. So this sort of thing only happens in exceptional circumstances, as we have this year with Covid.”

Ball said the delays were not unique just to New Zealand and were happening worldwide.

Demand between Asia and the US had also grown by more than 20 per cent, while New Zealand was facing “unprecedented and unexpected” demand.

The demand was expected to continue into 2021, with more than a month of back orders from manufacturers in China waiting to be shipped.

Last month, the Herald was contacted by a number of frustrated readers who told how they had been waiting for between four to six months for furniture to arrive from overseas as retailers including Freedom blamed impacts from Covid for delays at the ports.

Other retailers have also had to apologise to customers as the delays mean their pre-ordered stock won’t arrive before Christmas.

The spectre of empty shop shelves looms large over the Christmas season due to ongoing international shipping delays to New Zealand.

While people have largely resumed almost-normal life, the global pandemic has wreaked havoc on several manufacturing nations such as Bangladesh, India, China and Guatamala causing issues with product supply.

But fewer ships and choked ports are also preventing goods from being imported and delivered to retailers.

So what are the issues that could result be delaying the arrival of your new couch or appliance?

Industrial action in Australia

Port workers in Australia have taken periodic strike action across key ports over a pay dispute.

While some strikes have been put on hold, new industrial action has been launched in November by tug boat crew.

But the strikes have resulted in ships scrambling to remain on schedule and missing some port visits to make up for lost time.

The tyranny of distance

The disruption at Australian ports has flowed through to New Zealand because many of our shipping services route via Australia. As a result, ships that can’t get into Australia have also bypassed New Zealand.MORE FROM
DEBRIN FOXCROFT • BUSINESS REPORTER
debrin.foxcroft@stuff.co.nz

New Zealand Food and Grocery Council chief executive Katherine Rich described this as “the tyranny of distance” at a time when shipping companies are trying to maximise profits.

Backlog at NZ ports

Goods that do make it to New Zealand often become part of a huge backlog at ports, particularly in the North Island.

Congestion has become so bad that some shipping lines have introduced a surcharge on cargo passing through Ports of Auckland, on top of shipping rates that are sometimes several times higher than usual.

There are a number of reasons for the backlog, including a Covid-19 related delay in a major automation project at the Ports of Auckland and a struggle to get the right staff to man the port’s eight cranes.

Demand for consumer goods has also increased 20 to 25 per cent compared to last year.

As a result, Ports of Auckland has been accused of overloading the Port of Tauranga with vessels there during its peak export season.

Reduced shipping to New Zealand means there is also a shortage of empty shipping containers needed for exporters to get goods out of the country.

Mainfreight managing director Don Braid told RNZ that the domestic freight network was “finite”.

“There’s only a certain number of trucks, trains and coastal shipping containers that you can have. So, what we are asking our customers to do is to order earlier, and have less expectation on quick delivery,” he said.

Fewer flights

There are still significantly feweraircraft flying in and out of New Zealand than before the Covid-19 pandemic.

International flights out of New Zealand have dropped from about 600 a week to about 120, nearly halving air freight capacity.

This is particularly an issue for perishable goods like strawberries.

Limited production in some manufacturing countries

Production is ramping up in countries such as China, however, some are still struggling with controlling the Covid-19 virus.

Bangladesh, the world’s second largest garment manufacturer, is facing another wave of lockdowns this month.

This could cause a shortage of clothing around the world.

But it’s not all bad news. While Bangladesh and other manufacturing nations are still struggling with Covid-19, China has largely bounced back to pre-virus production levels.

Photo / File

New Zealand’s large ports are facing delays from a range factors, including some vessels just not arriving.

Shippers Council chairman Simon Beale says there needs to be good forecasting for shipping lines.

But he says some vessels have been delayed coming to New Zealand after port strikes in Sydney.

Beale told Mike Hosking operational changes following a recent death at Ports of Auckland, are also having an impact.

“Some vessels are going to Tauranga Port instead, which then impacts cargo movements on rail.”

Beale says it could take until Christmas to clear the backlog.

NZ Herald 31/8/20

Maritime authorities are now leading the investigation into the death of a worker at the Ports of Auckland over the weekend.

Emergency services were called to the Fergusson Container Terminal, in Parnell, about 2am yesterday.

WorkSafe was notified of the death, but has since released a statement saying Maritime New Zealand will be leading the investigation into the incident.

A spokesman for Maritime NZ confirmed it was looking after the investigation. Police are also involved.

The investigation comes as a workers’ union vows to fight for the health and safety of all people in the workplace – no matter what line of work they do.

First Union NZ took to social media site Twitter to express their views as well as pay tribute to yesterday’s victim.

“Everyone should be able to return home at the end of their shift, whatever work they do,” a post said today.

“Solidarity to the friends, whānau and workmates of the Ports of Auckland worker.

“Unions will continue to relentlessly champion health and safety in the workplace.”