Warning NZ ports may start to seize up this week if non-essential freight can’t be moved

Allowing only essential freight to be transported to businesses by road, not that simple, haulage organisation warns.
JOHN KIRK-ANDERSON/STUFFAllowing only essential freight to be transported to businesses by road, not that simple, haulage organisation warns.

A “pile-up” is looming at the country’s ports that will restrict the movement of food and medical supplies if non-essential freight destined for closed businesses can’t be cleared, Road Transport Forum chief executive Nick Leggett has warned.

“All manner” of freight could arrive at the same time on cargo ships, he said.

“We now have a situation where many businesses that receive some of that freight are closed and there is nowhere for it to go,” he said.

“The issue with non-essential goods is you can remove them from the port, but if there’s nobody at the receiving end at work, where do you put them?’

The Government needed to recognise that “all freight must move” during New Zealand’s coronavirus lockdown, and not just essential items, Leggett said.

He forecast “constipation” at the ports and massive problems, if the issue wasn’t addressed.

“This an absolute real live thing.”

Containers need to be cleared and emptied to ensure essential supplies can get in and exports can get out, Road Transport Forum chief executive Nick Leggett says.
SUPPLIEDContainers need to be cleared and emptied to ensure essential supplies can get in and exports can get out, Road Transport Forum chief executive Nick Leggett says.

​Mainfreight chief executive Don Braid said it wasn’t seeing congestion yet, but the forum was “making good points”.

“Under the lockdown rules, it is not possible to deliver non-essential freight.”

A successful outcome would require “innovative thinking and action”, he said.

“We are attempting to assist the government agencies through this where we can.” 

Leggett said officials at the Transport Ministry had “definitely listened” to the forum’s concerns, but had said the rules stood at this point.

“If it is deemed by the Government to not be essential, it cannot be moved.

“We absolutely appreciate the reasons for that but if we don’t have an ‘all-of supply’ chain solution to this we believe there will be issues in a couple of weeks,” he said.

Transport Ministry supply chain manager Harriet Shelton responded to the forum’s concerns with an update that said its lockdown rules did allow the movement of non-essential goods “if necessary to move or create space for essential goods”.

Leggett said the forum would not have put out its warning lightly at this time.

Reopening closed businesses to accept non-essential freight would “fly in the face” of the reasons for the lockdown, which were to keep as many people home as possible, he said.

“We do appreciate that, but we need a solution.”

Leggett said another problem was that if containers in which non-essential goods were imported were not emptied, there would be a shortage of containers for exported goods going out.

“All freight needs to move during this time to enable the valuable exports that are going out, such as kiwi fruit, access to ports.”

Port of Tauranga says non-essential freight can be stacked next to its terminals but will then take time to retrieve, so it is important essential goods are identified first.
MATT SHAND/STUFFPort of Tauranga says non-essential freight can be stacked next to its terminals but will then take time to retrieve, so it is important essential goods are identified first.

Customs Brokers and Freight Forwarders Association chief executive Rosemary Dawson agreed that the delivery of non-essential cargo remained an issue that would need to be dealt with to avoid congestion. 

“Sea freight was operating fairly normally now,” she said.

But Dawson said she “absolutely” shared some of the concerns expressed by the Road Transport Forum, including with regard to the availability of empty shipping containers.

Port of Tauranga chief executive Mark Cairns said it had put in place new measures to allow importers to identify imported cargo required for essential services before it arrived in New Zealand “so that it can be handled and transported first”.

It needed the support and co-operation of importers and exporters to help it manage the flow of cargo “and avoid blocking the path of essential food, medicine, equipment and other supplies”, he said.

Mainfreight chief executive Don Braid says the Road Transformation Forum is making good points and innovative thinking will be needed.
CHRIS HUTCHING/STUFFMainfreight chief executive Don Braid says the Road Transformation Forum is making good points and innovative thinking will be needed.

Non-essential imported cargo could be temporarily stored on or off-site until it could be collected by truck or transferred by rail to MetroPort Auckland, he said.

Spokeswoman Rochelle Lockely said non-essential freight could be stored near its terminals in Auckland and Tauranga, but once freight went into that “locked stack” it would not be fast to retrieve, so it was important essential items were identified first.

There was a worldwide shortage of shipping containers because of the disruptions caused to supply chains globally by the coronavirus, but that was not something the port had detailed information on, she said.

The port would not charge extra fees for storing non-essential cargo until April 26, apart from one-off handling charges and for power charges needed to keep refrigerated containers cool, Cairns said.

The Road Transport Forum has suggested that some goods that can’t be delivered to closed businesses could be stored on land owned by Kiwirail, but Leggett believed that could only be part of any remedy.

“Closing down the country to the scale we have now hasn’t been done before and it does reveal some issues that need to be addressed pragmatically,” he said.

To illustrate the problem, Leggett said 14,000 cars were expected to arrive from Asia over the next month.

“Those cars cannot stay on the port; they have to go somewhere. The dealers that would normally take them are closed.

“We appreciate cars are not an essential service, however, they are holding space that is needed for essential goods.

“Our industry is looking at how we could find storage for the freight with nowhere to go, but we need the Government to allow that freight to move,” he said.

Leggett said some truck drivers had been stopped by police and asked what they were doing on the roads.

“Well, they are doing a job and it is one that is essential at a time like this.

“They cannot be forced by the Government to be arbiters of what is essential and non-essential on the back of their truck,” he said.

Stuff

Ports of Auckland interim results

Monday, 2 March, 2020 – 10:48

Ports of Auckland Chief Executive, Tony Gibson has today announced the company’s half-year results.

“Our company is in the midst of delivering our 30-year master plan, a major investment programme which will increase capacity, efficiency and returns, as well as lay the foundation for us to meet our 2040 zero emission goal.

Delivering such a large investment programme whilst keeping the port working well has not been without challenges, however the last six months have seen significant progress and the next six months will see the completion of two major master plan elements: container terminal automation and the new car handling building. We have also made significant progress on a third element, channel deepening.

We largely completed infrastructure work for terminal automation this period, enabling some capacity to be returned to terminal operations. There is still some work to do in the second half of the financial year, but the worst of the disruption from this work is behind us. The 2019 import peak did not see the same level of congestion or delay that was seen in 2018.

Even so, we have felt the effect of the automation work this period. Container volumes were down two percent on the year prior as a result of the loss of two service calls, a service change and a high number of vessels arriving out of schedule.

The ability to find staff in a tight labour market has also affected volumes. At times we haven’t had the resources to handle as many containers as customers have wanted. This situation is expected to ease once automation is fully delivered.

Automation will go live in two phases: the northern part of our terminal late March and the southern area two-three months later. In early January we decided to put the go-live date for Phase 1 back a month to the end of March 2020 so that we could handle unexpectedly high January volumes.

Automation testing and preparation is going well. We are now testing the new terminal operating software using live terminal data. Staff training is ongoing and truck drivers are also being trained in the new processes.

Once automation is fully live around the middle of the year, we will gain a significant amount of terminal capacity, from around 900,000 TEU a year to around 1.7 million TEU. That is enough capacity to handle the freight needs of a million more people in Auckland and should last us until the middle of the century. If necessary, beyond this date further changes to the port layout and greater levels of automation could deliver enough capacity for an Auckland population of around 5 million people.

Work on our new car handling building has progressed very well and the building is expected to be finished on time and on budget around the middle of 2020.

It will deliver new capacity in time for the Auckland fishing fleet to be relocated to Marsden wharf for the America’s Cup and to handle an expected upturn in vehicle imports as New Zealand switches to an electric vehicle fleet.

We have started engagement for a new public space on the building’s roof which will be an exciting addition to the downtown waterfront. We aim to have the park open no later than 2023.

We have applied for consent to deepen our channel and asked for the application to be publicly notified. Notification was not required under the Auckland Unitary Plan for dredging inside the channel precinct, but we feel it is important for all our major projects to be carried out in an open and transparent manner. We also undertook a great deal of public engagement prior to lodging consent. Council has now received public submissions and we expect a consent hearing to be held later this year.

Work at our Waikato Freight Hub has progressed well, with the completion this period of the new access road and bridge which will be vested with Waikato District Council. Construction of the first stage of heavy-duty pavement for the inland port part of the development is underway.

Financial performance

As expected, revenue was flat while costs for the last six months were up, due to the investment programme, higher interest costs, and higher labour costs. As a result, net profit after tax was $17.2 million, compared to $24.4 million in the pcp.

This situation will remain much the same for the full year. The company will not pay an interim dividend and will pay a lower full-year dividend as forecast. The second half of the year will be impacted by the new coronavirus. While we expect the impact to be temporary, we can’t estimate the quantity of it yet.

Looking forward to the 2020/21 financial year, while there is still uncertainty in the global trade environment, the completion of the automation project will mean more capacity at the terminal and the ability to handle greater volumes. With new capacity in hand and a third berth in operation, we will look to win back both volumes and services over the coming year.

Our people

One of the biggest issues for our people is the impact of automation on jobs. We expected around 50-60 roles to be affected, but as we get closer to go-live we can see several factors which may lead to a lesser impact.

First, our container terminal operations are under-staffed due to a tight labour market. Second, some jobs may change but not disappear and some new roles are being created. Third, when automation goes live we will also open our third container berth and we expect volume to increase.

This is a potentially positive situation. If we win back services and increase volume, we may have a situation where no roles are lost, so once automation is fully operational, we will be targeting volume that has moved to other ports in the last few years. Given our position on Auckland’s doorstep, with a faster, lower carbon supply chain than other ports, we expect to be successful in winning back business.

Because we will not know the exact impact on jobs until after automation is fully operational, we have given a commitment that there will be no staff changes until after implementation is complete. We are ensuring staff are kept well informed.

Zero-emission by 2040

We intend to be a zero-emission port by 2040.

As a member of the Climate Leaders Coalition we have made a public commitment to set an emissions reduction target. We have also committed to the Science Based Targets initiative (SBTi) because of the scheme’s ability to help with verifying that our emission reduction roadmap is consistent with an approach grounded in science. The SBTi requires emissions reductions roadmaps to be aligned to a target consistent with keeping global warming well below 2OC or 1.5OC of pre-industrial levels.

We have developed an emissions reduction roadmap in line with the ‘well below 2OC’ target and it was approved by the Board in December. In the short to medium term the roadmap involves using fuel switching (to bio diesel or renewable diesel) and the purchase of renewable energy certificates for our electricity to achieve emissions reductions. This will be followed by the adoption of zero emission technology in the mid to late 2030s. We are now submitting our roadmap to the SBTi for verification.

We are also looking to reduce emissions in the supply chain. Our great advantage as a port is that we are in the market we serve. Other ports, like Tauranga or Northport, lie a great distance away so goods imported to Auckland through these ports have a higher carbon footprint.

We have created a carbon calculator so that cargo owners can see the difference using a local port makes. For example, a 15 tonne, 20-foot container imported via Ports of Auckland and delivered to South Auckland will only emit 18 kilogrammes (kgs) of carbon. Through Tauranga it will emit 130 kgs – seven times as much – and through Northport ten times as much: 184 kgs.

At a time when climate change seems to be accelerating, every gram of carbon counts. Currently around 300,000 TEU of Auckland freight is handled through Tauranga. Auckland could potentially save over 30,000 tonnes of CO2 a year by importing through its local port. By helping customers see the benefit, we can make a significant contribution to Auckland’s effort to fight climate change.

We continue to make a positive economic and social contribution to Auckland and New Zealand. Our recent investments will ensure we can continue to play that role in the future, and we will see the results of that investment delivered from 2020 onwards.

I would like to thank our staff, management and directors for the work they have been doing to prepare our port for a new era and to keep it operating at a high standard.”

New Zealand ports see growth amid potential cargo shift

in Port News 18/02/2020

New Zealand’s ports have generally continued to experience growth in container volumes amid potential that all freight operations at the Ports of Auckland could eventually get dispersed amongst other nearby ports.

Ports of Auckland plays a huge role in New Zealand’s trade with other countries, being that it handles the second highest amount of container volumes in New Zealand, with the Port of Tauranga taking first place. However, the Ports of Auckland did experience year-over-year declines in net profit and container volumes for fiscal year 2019, which ended June 30, 2019 for New Zealand’s ports.

From port to port. New Zealand’s ports collectively handled 3.43 million TEUs in FY 2019, up 1.3% from FY 2018 and up 7.4% from two years prior, as illustrated in the chart below, which was built using data from the relevant port authorities across the country.

Six of the ports saw container volumes increase year-over-year in FY 2019, while three experienced a decline, as illustrated in the chart below, which was also built using port authority data.

The chart below, built using data from BlueWater Reporting’s Port Dashboard tool, shows the Port of Tauranga is called by the most liner services that connect New Zealand to regions beyond Oceania at 13, nine of which are container services, followed by the Ports of Auckland with 11 liner services, six of which are container services.

The Ports of Auckland and the Port of Tauranga have the strongest global ties of New Zealand’s ports. While the vast majority of the liner services that call New Zealand don’t sail beyond Oceania or Asia, there are four liner services that call New Zealand that sail beyond these two regions.

The chart below, built using data from BlueWater Reporting’s Port Dashboard tool, shows the three container services calling New Zealand that also sail beyond just Oceania and Asia. All three call the Port of Tauranga, while two of the three call the Ports of Auckland.

Not included in this chart is a roll-on/roll-off service operated by Wallenius Wilhelmsen. Although the ro-ro service’s rotation changes slightly with each voyage, it tends to sail between North Europe, the East Coast of North America, Central America, Oceania, Asia, West Coast North America, Mexico, Central America, East Coast North America and back to North Europe. The ro-ro service tends to only call Auckland in New Zealand.

Shift proposal. A final report by The Upper North Island Supply Chain Strategy (UNISCS) Working Group, an independent working group that reported to New Zealand’s Ministers of Finance, Transport and Regional Development, found that the Ports of Auckland is unviable long term.

The final report, titled, “Transforming Auckland; Transforming Northland – Final Report of the Upper North Island Supply Chain Strategy (UNISCS) Working Group,” was released in November.

The UNISCS Working Group recommended that Northport, which operates a multi-purpose port in Marsden Point, should be developed to take over much or all of Auckland’s existing and projected freight business, while the Port of Tauranga’s existing expansion plans should proceed to accommodate growth.

“The new two-port configuration should be supported by a rejuvenated North Auckland rail line and spur to Northport, and a new inland freight hub in northwest Auckland to complement and be connected to Metroport (Auckland) in the south,” the UNISCS said.

MetroPort Auckland is an intermodal cargo hub that connects to the Port of Tauranga via rail.

The working group recommended the government give the ports until Dec. 1 of this year to reach a commercial agreement on how the strategy should be implemented. Additionally, the working group recommended the transition begin immediately and be fully implemented by no later than 2034.

The working group said it “argues for Tauranga to continue with its growth plans but for Northport to be the major site to cater for freight growth over the next 15 years and beyond.”

In response to the finding’s, New Zealand’s Ministry of Transport said in December that the working group’s recommendations raise a range of economic, social and environmental questions for the government to consider. Consequently, the government instructed the Ministry of Transport to undertake further analysis and report back to the Cabinet in May.

Time for a shift? There appears to be numerous reasons to shift freight operations from the Ports of Auckland, with one of the largest being the amount of money that would have to be invested into the site for it to remain viable.

The UNISCS Working Group noted how the Ports of Auckland’s freight operations are already constrained, particularly on the landside, adding how it would require an estimated NZ$4 billion in investment over the next 30 years and the dredging of a further two million metric tons from Auckland’s Waitemata Harbor for the port to effectively handle New Zealand’s expected freight growth.

Additionally, existing port operations in Auckland remain highly industrial, and include the importation and storage of containers, vehicles, coal and cement. “These uses produce very poor returns for its owner, Auckland Council, with dividends dropping as low as NZ$8.7 million for the privilege of occupying land with probable value of NZ$6 billion,” the working group added.

Business at the port was not exactly booming in FY 2019. The Ports of Auckland’s annual report for the fiscal year showed that compared to the prior fiscal year, breakbulk cargo volumes (including cars) fell 3.3%, container volumes fell 3.5% and car volumes fell 14.3%.

Ports of Auckland CEO Tony Gibson said container volumes were down because infrastructure work needed to automate the terminal reduced the terminal’s capacity and made operating more difficult. Additionally, he said car volumes were hindered by a drop in car sales, as well as new treatment rules for imported vehicles, which are designed to prevent the brown marmorated stink bug from entering the country.
However, data from Ports of Auckland shows that container volumes for FY 2019 were the lowest they had been since FY 2016, as illustrated in the chart below.

Additionally, Auckland’s economy is no longer based on manufacturing, let alone agricultural commodities, but is overwhelmingly dominated by services, according to the UNISCS Working Group, which added how Auckland generates export revenues from tourism, education and IT, which don’t require a port.

It also appears most Aucklanders don’t necessarily want a port in the area. A June 2019 Colmar Brunton study, dubbed, “Aucklanders’ Sentiment Towards Moving the Auckland Port,” which was prepared for the Ministry of Transport on behalf of the UNISCS Working Group, asked respondents, “How do you think moving the cargo port would affect Auckland’s attractiveness as a place to live, work or visit?” Sixty-two percent of respondents said they thought that moving the cargo port to a new location (possibly outside Auckland) would make Auckland much/slightly better.

Potential prospects. Auckland, Tauranga and Northport make up the Upper North Island’s three ports. While Northport is New Zealand’s newest port with a massive amount of potential, the Port of Tauranga is the country’s biggest port and continues to see rampant growth.

“The progressive and managed closure of Auckland’s freight operations, the development of Northport and the continuation of Tauranga’s existing expansion plans is in the best interests of Auckland, the rest of the Upper North Island and New Zealand as a whole,” according to the UNISCS Working Group.
In regards to Northport, the working group noted how there is a vast supply of flat, industrial-zoned land adjacent to the port with no higher alternative uses. “The storage of imported vehicles, empty containers and bulk goods can take place around Northport at a fraction of the cost possible in Auckland,” the working group said.

Additionally, the working group pointed out how New Zealand relies mostly on agriculture and forestry to supply exports to provide income for the country. “Of the Upper North Island’s three ports, Tauranga is close to producers of export commodities and is known best as a successful export port, but is also taking an increasing share of Auckland’s import business. Like Tauranga, Northport is also close to producers of export products and also handles the importation of all of New Zealand’s fuel, but its expansion is hampered by the absence of a rail connection.”

Northport features a three-berth facility at Marsden Point with a total wharf length of 570 meters, according to Northport’s website. For berths one and two, there is 13 meters of water available at chart datum and 14.5 meters at berth three.

The port’s terminal primarily focuses on the export of forest products, although it can cater to large, multi-purpose vessels. The port features 58 hectares of land, 30 hectares of which are currently paved and being used for cargo operations, while there is over 180 hectares of land outside the port that is available for port-related ventures to set up and operate from.

Meanwhile, container volumes over at the Port of Tauranga are booming, as well as substantial upgrades at the port.

“International experts have told us that Port of Tauranga can easily accommodate up to 2.8 million TEUs on our current footprint. We already have the next stage of capacity expansion under way,” Port of Tauranga CEO Mark Cairns said in December. “We still have plenty of capacity on the rail connection between Tauranga and Auckland, with the ability to double the current number of trains per day.”

A Port of Tauranga spokesperson told BlueWater Reporting in January that the port owns 190 hectares of land on both sides of Tauranga Harbor, with about 40 hectares still available for development.

“Our next significant capital expenditure will be extending the container terminal quay to the south. Port-owned land adjacent to the existing berths will be converted from cargo storage to a fourth container vessel berth, adding up to 385 meters to the overall quay length. We hope to have this completed in about two years,” the spokesperson added.

The port’s ninth ship-to-shore crane is being delivered in early 2020 as well as seven straddle carriers.

“Future stages of expansion will be driven by cargo volume growth and will primarily involve rail-mounted stacking cranes and additional ship-to-shore cranes,” the spokesperson said.

Ports of Auckland’s perks. Although business at the Ports of Auckland did decline in FY 2019, it still plays a huge role in New Zealand trade, and upgrades at the key port remain underway.

Current projects in the works include automation at the container terminal, as well as a car handling facility.

Beginning in 2020, the container terminal will become the first in New Zealand to use automated straddle carriers to load and unload trucks and operate the container yard, according to a Ports of Auckland FAQ pamphlet updated in January. There will be a total of 27 automated straddles, although the terminal will retain 24 manual straddles for servicing the vessel cranes and the out of gauge, oversized cargo truck lanes. The northern berth will be automated first in late March 2020, while the launch of phase two is expected to occur in May, in which automated straddles will work the southern half of the terminal.

Meanwhile, the Ports of Auckland reiterated in its December 2019 quarterly newsletter that its car handling facility will be complete by August 2020. The facility will allow the port to handle more cars in less space and will be capable of holding up to 1,700 vehicles.

Additionally, the Ports of Auckland does still appear to economically benefit Auckland and New Zealand as a whole. The consulting firm New Zealand Institute of Economic Research (NZIER) released a report in October 2019, dubbed, “Location, location, location – The value of having a port in the neighbourhood,” which found that the national economy, measured by GDP, would be well over NZ$1 billion smaller per year if goods moved through another port.

NZIER noted how the value of cargo crossing the wharfs at the port has grown faster than the volume, especially on the import side, as well as how the downtown port serves the country’s largest and fastest growing center of economic activity.

The port “gives firms in Auckland a competitive advantage: the final leg of an import journey is a short one, as is the first leg of an export journey,” NZIER said.

Additionally, data from BlueWater Reporting’s Country to Country Transit Analysis by Service tool shows how the Ports of Auckland plays a key role in liner shipping operations from China, New Zealand’s top trading partner, in terms of imports and exports.

The first chart below shows that four of the five fastest liner shipping transits from China to New Zealand involve Auckland. However, the second chart below shows that from New Zealand to China, the fastest transits involve the Port of Tauranga, followed by the ports of Napier and Lyttelton.

Source: Bluewater Reporting

Nation ‘$1b poorer’ if port leaves Auckland

With a working group’s third report on Port of Auckland’s future not available to the public, others are pushing ahead with their own analysis, Dileepa Fonseka reports.

A third port study will go before a Cabinet committee on Wednesday but on Tuesday Finance Minister Grant Robertson gave a clear indication it wouldn’t be enough on its own to persuade him to support moving Auckland’s port to Northland.

“The report’s a useful contribution, but as I’ve said to you previously, I’ve got further questions I want answered.”

“This is a massive, massive move we’re talking about here. So you know, we’ll go through the process, but we haven’t made a decision to do it.”

Meanwhile another report into the future of Auckland’s port has been released. 

The NZEIR report calculates New Zealand would be $1b poorer if the Port of Auckland’s functions were taken up by either Northport or Tauranga. 

“Auckland is both the largest source of import demand in New Zealand, and the largest concentration of commercial activity,” says the report.

“An equally profitable port elsewhere, employing the same number of people, would have a similar direct effect on its local economy, but its wider economic effect would depend on how efficiently their customers’ exports and imports moved from the port to their doors.”

The use of diesel trains to transport goods from Northport to Auckland would emit 121,461 tonnes of carbon dioxide into the atmosphere every year. 

“Longer and more frequent road or rail trips would be required to bring imports to their ultimate destination or to the port for exporting.”

Most of the costs of relocating the port would be borne by Auckland in terms of reduced consumption, higher prices, and longer wait times for freight. 

People and businesses in New Zealand’s largest city would see the cost of their imports go up by $549m if port operations moved to Northland or $626m if port operations moved to Tauranga, the report says. 

But the rest of the country would see the cost of their imports go down if the port’s business was taken up by Port of Tauranga or Northport.

Economist Laurence Kubiak, who authored the report, said this was because other ports, like Centreport in Wellington for example, would import more and goods would have to travel a shorter distance to get to consumers in those areas. 

Anticipating the report’s release 

Both Infrastructure Minister Shane Jones and Upper North Island Supply working group chair Wayne Brown told Newsroom last week they were looking forward to a possible release of the full report this week after Cabinet deliberations.

After details of the report leaked, Auckland’s Mayor Phil Goff has bristled at its reported suggestion POAL could be taken off Auckland Council with only waterfront space as compensation, and Jones has called POAL CEO Tony Gibson a “recreant” – cowardly renegade – after details emerged that Jones warned Gibson not to put his head in a “political noose” by going up against NZ First on the port issue. 

Others have expressed concern at the mode shift that would be required from shippers of freight – who have been favouring trucks in greater numbers – in order to make a Northport option work. 

Supporters have lined up behind moving the port from its current location in Central Auckland too. 

RNZ reported former Prime Ministers John Key and Helen Clark were backing a “Waterfront 2029” to get rid of POAL and The New Zealand Herald reported National MP Nikki Kaye had expressed a preference for moving the port but wanted to explore a number of options including the Firth of Thames.

Vehicle import rules getting even tougher ahead of stink bug season

Biosecurity rules are being tightened to prevent the arrival of a pest which could devastate New Zealand’s horticultural industry.

The brown marmorated stink bug feeds on more than 300 plants and has already cut a swathe through Europe and the United States.

If it gained a foothold in New Zealand, it could cost the horticulture and arable industries an estimated $4 billion.

In an effort to keep the bug at bay, Biosecurity New Zealand is tightening the rules for imports during this year’s stink bug season, which runs from September to April.

Under the new rules, the list of countries required to fumigate imported vehicles, machinery, and parts before their arrival in New Zealand would rise from 17 to 33.

These countries have all been identified as having stink bug populations.

In another change, imported vehicle cargo would need to be treated offshore, including cargo in shipping containers.

In the past only non-containerised vehicle cargo has required offshore treatment, Biosecurity New Zealand spokesman Paul Hallett said.

Offshore treatment requirements would also apply to all containers from Italy.

The brown marmorated stink bug feeds on more than 300 plants could cost the horticulture and arable industries an estimated $4 billion if it became established in New Zealand.
SUPPLIEDThe brown marmorated stink bug feeds on more than 300 plants could cost the horticulture and arable industries an estimated $4 billion if it became established in New Zealand.

“The new rules are intended to reduce the biosecurity risk to New Zealand, by ensuring potentially contaminated cargo arrives as clean as possible,” Hallett said.

Biosecurity NZ planned to have officers based in Europe this season to educate manufacturers, treatment providers and exporters about the new requirements and to audit facilities.

“If our checks find any issues, New Zealand will not accept any cargo from that facility until the problem has been fixed.”

Hallett said New Zealand’s treatment requirements were now closer to Australia’s, which would make compliance easier for importers bringing cargo to both countries.

“A key difference is that the Australian Department of Agriculture and Water Resources will continue to allow treatment on-arrival for containerised goods,” he said.

The new rules would be provisional until July 15 and could be contested during that time.

The changes come after a spate of stink bug discoveries last year.

In November, Biosecurity NZ ordered a vehicle carrier to leave New Zealand waters after the discovery of stink bugs.

Three live and 39 dead brown marmorated stink bugs were found aboard the Carmen when it arrived in Auckland from Europe. Another 69 regulated stink bugs were also found.

A week later, more than two dozen live stink bugs were found in a box of shoes imported into New Zealand from EBay.

Stuff

West Auckland ‘inland port’ among new transport options

NorthPort today. Photo / File.
NorthPort today. Photo / File.

BusinessDesk By: Gavin Evans

An inland port in west Auckland and a vehicle importing and servicing centre at Northport are among a dozen potential transport investments a working group is considering to improve freight handling in the upper North Island.

The group, formed last year, has spent the past eight months talking with users and imagining how the existing ports at Auckland, Marsden Point and Tauranga – and the road and rail links between them – could be reconfigured to provide the best options for long-term growth.

It plans to report back to the government in June with options and complete more detailed costings and recommendations in September.

“There are a large number of infrastructure options that may have a part or full place to play in changes to the upper North Island supply chain which will be considered,” chair Wayne Brown says in a progress report filed with Cabinet’s Economic Development Committee earlier this month.

“For example, in evaluating one of our options that involves moving some of Ports of Auckland’s freight task to Northport, we will consider potential infrastructure that may be required to support this,” the group says.

They include: “a spur to Northport, which we understand the current government is investigating; upgrades to the existing North Auckland Line; potential short-term operational changes, such as moving freight through Auckland on the commuter network at night; potential long-term new infrastructure requirements such as a new rail line out west of Auckland to avoid congestion in the Auckland public transport rail network and connect through to the current inland freight terminals; and the potential establishment of new inland freight terminals.”

The Upper North Island Supply Chain study was the result of a pre-election pledge by NZ First to move container operation from Ports of Auckland to Northport by 2027.

While there is broad consensus that Auckland’s port will be increasingly constrained by the city’s development around it, there is no agreement as to how soon change is needed, how much freight could be redirected through Tauranga or Northport, and how that would be achieved.

As recently as 2016 a study group recommended work start assessing Manukau Harbour or the Firth of Thames as long-term replacement options for Auckland. Last August, Port of Tauranga chief executive Mark Cairns said there wasn’t yet sufficient freight volume in Northland to warrant the relocation north. Port of Tauranga owns half of Northport.

Auckland and Tauranga are the country’s two largest container ports. With Northport, they handle about half the country’s exports and two-thirds of its import volumes.

Tauranga and Auckland, controlled by Bay of Plenty Regional Council and Auckland Council respectively, compete for freight. They considered a merger in 2006 but talks collapsed the following year. Ports of Auckland has a 20 percent stake in Northland Regional Council-controlled Marsden Maritime Holdings, Tauranga’s partner in Northport.

The working group noted submitters’ views that the “interwoven” nature of the three ports’ ownership had prevented them being developed in New Zealand’s best interests and had resulted in some inefficiencies and “duplication” of resources.

“We will be considering the current ownership structure of ports and whether a change may be needed to ensure interests are aligned to deliver the best outcome for New Zealand,” the group says.

“Councils were somewhat open to a change in port ownership as long as they preserved their income and value of the port to their community.”

Ports are long-term businesses. The working group is canvassing issues in 10-, 25- and 50-year timeframes.

Scope is also important. Freight operators argue Northport, west of the Marsden Point oil refinery, could meet growth on Auckland’s North Shore, rather than replacing Ports of Auckland entirely.

Short-term options could include establishing a distribution centre at Silverdale or Orewa; imports and Northland products could be trucked there overnight – avoiding congestion on SH1 – for day-time delivery into Auckland.

Northport already plays a similar role. Structural components for some major Auckland building projects are stored there for just-in-time delivery to avoid congestion in the CBD.

Car imports have already been identified as a potential early change. Ten hectares of new space at Northport could provide storage for 10,000 cars. Auckland currently receives about 300,000 cars annually, each of which spends close to three days on its wharves.

Northport started operating in 2002 and is largely a blank canvas. Its 49-hectare footprint can be expanded to 75 ha, while its berth length can be more than doubled to 1,390 metres. The port lies next to 180 ha of commercial and industrial land controlled by shareholder Marsden Maritime.

But it has limited capital for development and no rail link. KiwiRail and the Ministry of Transport are investigating a $200 million, 20-kilometre spur line, but that is probably more than six years away even if there was a prompt decision to proceed.

The existing line from Swanson to Fonterra’s Kauri dairy plant north of Whangarei also needs upgrading at a cost of another $500 million to carry larger and heavier container traffic. KiwiRail has previously estimated the total bill – including upgrading rail capacity from South Auckland – at about $2 billion.

The working group noted its “fundamental” belief that there is “no point making further investment in Northport without investment in, and development of, the train line to Auckland.”

Ports of Auckland could become a make-or-break issue for the Coalition

An artist’s impression of a port-less Auckland. Graphic/Stop Stealing Our Harbour

An artist’s impression of a port-less Auckland. Graphic/Stop Stealing Our Harbour

New Zealand First appears as closed-minded on the Ports of Auckland as the other vested interests, who are either opposing change or advocating for alternatives.However dysfunctional those charged with providing vital transport infrastructure can be, they somehow always manage an instant massed-wagon-circling at the very mention of reform.

The Government is about to receive reports on both the future location of the Ports of Auckland and the feasibility of upgrading Northland’s rail. Labour’s support partner, New Zealand First, is fervently committed to moving some of Auckland’s port business to Northland, saying it will relieve our biggest city of congestion and bring much-needed growth to the north. For the coalition, this could become a make-or-break issue.

Unfortunately, NZ First appears as closed-minded on the issues as the other vested interests, who are either opposing change or advocating for alternatives, such as Tauranga, the Firth of Thames or Manukau Harbour.

Because of the complex governance and ownership issues of Ports of Auckland and other potentially affected ports and public entities, any Government changes will be extremely hard to negotiate. The choices available will also be sandbagged by the virtual impossibility of getting any case for new or restored rail to stack up financially.

However, the biggest hurdle will be patch protection – not just from commercial interests, but also from public agencies who too quickly forget the wider obligation that their state-conferred monopoly status puts on them.

Chief interested party is Auckland Council, which owns 100% of the Ports of Auckland. It has consistently defended its right to the port’s undiminished annual dividend of more than $50 million – to the point of vowing to build a multistorey waterfront car park for more revenue.

Mayor Phil Goff is adamant the port is essential to Auckland’s future. However, this assertion is debatable, given that a city such as Sydney survives very well with its harbour reserved for cruise ships and cargo sent to Port Botany, Wollongong or Newcastle.

Loss of port revenue would, however, doubtless force Aucklanders to pay for the loss with even higher rates, for benefits mostly accruing outside its boundaries. This would be unfair, especially to those on low incomes, and so politically dangerous that no sane administration would cause it to happen.

Perhaps a better starting point would be to regularise, even centralise, the haphazard patchwork of ports ownership. This would inevitably land the Government with a fat compensation bill, but the existing potpourri of local body, port-specific and private shareholders is a barrier to efficiency. Intra-agency competition and multiple interests – Auckland part-owns Tauranga’s and Northland’s port as well – further occlude the picture.

The National Party’s policy of treating the ports as discrete commercial entities immune from state interference is recklessly hands-off. But, by the same token, Aucklanders may be incensed at seeing their port asset commandeered, especially with NZ First so blatantly using Northland as its electoral base.

Yet, Auckland’s port must somehow be restored to being part of the national ports network. Aucklanders, used to the city’s infamous congestion, would be the first to agree it remains an international embarrassment that a prime waterfront site is used to store second-hand cars. Moving the port would unlock 77ha of superb shore land.

Northland’s Marsden Point tempts as an existing deep-water port, which, with a suitable rail spur from the Auckland line, could handle the business. Tourist and even commuter growth could ensue. Yet, there are other considerations, including the likelihood that moving the port to Northland would hugely increase congestion in Auckland, since most goods exported out of it are produced south of the city and would have to pass through it. Even if some of the goods went by train – and the expense of building rail tracks could itself prove prohibitive – the trains would be more frequent and longer, causing frustrating delays at level crossings. There are also the climate-change considerations, with increased emissions from transporting freight over longer distances.

In New Zealand, 99.7% of all imports and exports travel by sea, so the ports issue is not trivial. Any changes to these assets will affect, for better or worse, numerous other sectors and projects, not least the still-uncosted light rail to Auckland Airport. The sheer complexity and political risk may simply end in inertia. But everyone concerned has a duty to approach this debate with the country’s best interests at heart.

Shareholders would solve Ports of Auckland’s problems

New cranes at Ports of Auckland. Photo / Jason Oxenham
New cranes at Ports of Auckland. Photo / Jason Oxenham

NZ Herald Editorial

COMMENT:

Of all the policies the NZ First Party brought into this coalition Government, the wildest and wackiest was to move the entire port of Auckland to Marsden Pt. The Labour Party agreed only to commission a feasibility study the idea of moving the port and left open the choice of alternative sites. Winston Peters, hoping to hold the Northland seat, promised to move the whole operation to Northport, but the coalition agreement merely directed Northport be given “serious consideration”.

The feasibility study led by former Far North District mayor Wayne Brown is reported to have produced an interim report for the Government and its tentative suggestions ought to be interesting. The fact that ministers will receive at the same time a report on upgrading the railway from Auckland the Marsden Pt suggests Northport is the preferred alternative for at least some of Auckland’s imports.

Doubtless there are countless ways that goods shipped to or from New Zealand could be better shared between various ports, not only for more efficient handling and distribution but also to stop the Auckland port encroaching ever further on the Waitematā harbour.

Doubtless too, the companies running ports would quickly find a more efficient use of them — within the constraints on Auckland — if Ports of Auckland Ltd had commercial shareholders.

Its nearest rivals, Port of Tauranga and Northport, are majority owned by their local bodies but also have tradeable shares which has resulted in a degree of cross-ownership. Tauranga has a stake in Northport, as does Ports of Auckland Ltd. But PoAL is entirely owned by the Auckland Council which has been averse to any of its business going to other ports.

Total public ownership has been a mixed blessing for Auckland citizens. While the council collects all the port’s dividends it suffers a conflict of interest when Aucklanders oppose the port’s further expansion. Despite a long campaign to stop the port company extending wharves for the latest cruise ships, the council is allowing moored “dolphins” and walkways to extend Queens Wharf.

Mayor Phil Goff did not exactly welcome news this week that an interim report of the feasibility study has arrived on ministers’ desks. “Any decisions on the future of Ports of Auckland should have the agreement of the council,” he said. “We accept that at some point the growth of freight into Auckland will outgrow the land available…..” Citizens opposed to further harbour reclamation would say that point was reached some time ago. Goff said the same when he stood for election.

“However, the port is also a critical lifeline of freight into our city,” he says now. No it is not. Freight from any other port could reach Auckland, making room for cruise ships within Auckland port’s existing harbour footprint.

Most of Auckland’s port is unlikely to be going anywhere. The feasibility study should be looking at rationalising the use of all New Zealand Ports but it should not suppose politicians can best decide where freight goes. The Hawke’s Bay Regional Council is planning to partially float its port at Napier. If the Auckland Council did likewise it would see the city’s interests more clearly.

Infrastructure Minister Shane Jones launches the New Zealand Infrastructure Commission

The Government has launched a new independent Crown entity tasked with addressing New Zealand’s “unprecedented infrastructure deficit”.

The New Zealand Infrastructure Commission – Te Waihanga – would look at ways of fixing and further funding areas where infrastructure investment is needed.

Transport projects and urban infrastructure issues would likely be the focus of the new commission.

Infrastructure Minister Shane Jones said New Zealand has an “unprecedented infrastructure deficit” and the commission was tasked with addressing that.

He said New Zealand’s transport and urban infrastructure was struggling to keep up with population growth.

“This infrastructure deficit is manifesting in housing unaffordability, congestion, poor-quality drinking water and lost productivity.”

“That’s simply not good enough,” he said.

The Treasury has estimated the total infrastructure spend over the next five years would be $42 billion – more than double that of the past five years.

Jones said this showed why the establishment of the Infrastructure Commission was needed.

Overall strategy and planning would be the focus of the new body.

In a Cabinet paper, Jones said the Infrastructure Commission would also act as a “shop front” for private companies looking to invest in New Zealand.

He pointed the finger at the previous Government, accusing National of focusing on short-term projects and under-investing in infrastructure projects.

Local Government New Zealand president Dave Cull said unprecedented population growth and the need to adapt for climate change, as well as a low-emissions economy, means that New Zealand was “behind the eight ball in terms of infrastructure investment”.

“Having a central agency to act as a shop front that the private sector can interact with, and having an ability to buy goods and services in bulk will be a massive benefit to regional development projects,” he said.

The Cabinet has approved just over $4 million to establish the commission and legislation establishing the body would go before Parliament in April.

The creation of the Infrastructure Commission has been well flagged – in August last year Jones announced work had begun on establishing the body.

He said Treasury had been unable to properly quantify the value of the infrastructure deficit New Zealand was facing which he said “was not good enough”.

The new body would work to quantify the level of the deficit, as well as figuring out how to fix it.

The Government received 130 submissions on what the body should look like.

“We have heard that message, and we have delivered.”

Ministers will retain final decisions on infrastructure investments, but the Commission will have an independent board and the autonomy it needs to provide robust, impartial advice.

“It will help hold this Government, and future governments, to account and we welcome that,” Jones said.

CargoChain – NZ’s blockchain solution for global logistics

18 December 2018 – Jade Logistics Group, New Zealand’s leading port software company today announced a new business called CargoChain that it believes will revolutionise the way that cargo information is shared across the global supply chain.

The CargoChain platform was borne out of witnessing first-hand an inability to share supply chain information amongst multiple interested parties. David Lindsay, CargoChain CEO said “we observed this first with ports and then looked across the entire supply chain, and the problems were the same. Siloed, important information that supply-chain actors didn’t have, but needed, to make better decisions”.

Lindsay adds that following five years of R&D, CargoChain has created a cargo information sharing and innovation platform that supports the distribution of previously unavailable cargo information, as well as the development of third-party applications. “We believe that the collaborative and independent nature of the CargoChain platform is a first for the global industry.”

“The proposition is made even more powerful as today’s consumers are demanding trust while those involved in the supply chain require full transparency and visibility. We saw the need for a digital platform that provides this by sharing trusted information amongst all supply chain actors.

“CargoChain is one of the few supply chain solutions in the world that has blockchain as an integral working part of its platform to provide this trust.”

“Blockchain is currently right at the top of the technology hype cycle and most companies understand its importance but are really struggling to understand how they might use it in their business. CargoChain takes this pain away, as it already delivers a working blockchain solution for our customers”.

While blockchain is an important part of CargoChain, Lindsay notes that the platform itself provides significantly more to supply chain actors.

CargoChain’s ultimate vision is to empower the supply chain by providing its platform to application developer communities globally.

“We want to allow developers to solve the world’s supply chain problems for all logistics players, large or small.”

Initial CargoChain applications are already in development for a number of Australian and New Zealand customers, along with pilots for other significant supply chain projects. In New Zealand there is also significant interest from major food exporters, driven by the need to prove complete provenance with an emphasis on food trust and safety.