Media release – POAL and NRC 14/11/19
Auckland’s supply chain complications
National Road Carriers Association and the Ports of Auckland are combining forces to promote change in the supply chain to improve delivery times and prevent delays.
This initiative has come about because of supply chain capacity issues which were highlighted following an accident at Ports of Auckland in August. Imported freight has taken longer to deliver and exporters have encountered delays getting their goods away, leading to frustration all round.
“The supply chain is running at capacity, so unexpected problems can have a domino effect,” says David Aitken, National Road Carriers CEO.
“At its heart, the problem is Auckland’s growth. The supply chain needs to evolve and we’re all going to have to change the way we work to prevent future problems. Better planning and coordination are the key.”
“We’re letting stakeholders know what causes hold-ups and we’re working with partners to improve our end-to-end processes,” he added.
Situations contributing to delays can arise at any stage in the supply chain, sometimes occurring thousands of kilometres away from New Zealand.
“In the last 12 months over half of all container ships arrived at Auckland late (often as a result of bad weather), causing congestion,” says Craig Sain, Ports of Auckland’s General Manager Commercial Relationships. “This makes it hard for us to staff the terminal properly, causing delays.”
Labour scheduling issues at the port are made worse by a shortage of labour in Auckland, which also affects the trucking industry.
The port is currently installing an automated container handling system to address this problem, but the work required to install the system has reduced terminal capacity by about 20%, adding to congestion. This situation will remain until late 2019 when the project will be completed.
“With reduced space in the terminal and more containers coming in due to growing Auckland demand for freight, it is taking us longer to service trucks visiting the port,” says Mr Sain.
Another problem is that getting containers off the port can be delayed because there is nowhere for the containers to go. The port works 24/7 and has capacity at nights and weekends, but often distribution centres, importers warehouses and empty container depots are closed at these times.
“In the past working 9-5, Monday to Friday was fine, but now Auckland has over 1.5 million people it is no longer feasible,” says Mr Sain. “The whole industry needs to be able to work 24/7, not just the port and carriers, and this means distribution centres and importers need to be open nights and weekends to receive imports.”
The road freight transport industry is caught in the middle says David Aitken. “Importers don’t want to pay for weekend or afterhours work but they also don’t want to pay to hold containers at the port or container depots as a result of their limited business hours.”
“We are storing containers at freight hubs longer, which adds costs for double handling, or are delivering goods later than originally expected because of holdups. We’re also facing higher costs because of Auckland’s congestion, costs which could be avoided by working 24/7,” he added.
The solution is going to come through a combination of technology, greater co-ordination and a move to 24/7 working throughout the supply chain.
As well as investing in automated container handling, Ports of Auckland is working with National Road Carriers Association to update its processes and business rules to minimise manual intervention and incentivise off-peak container movements. Last minute freight moves will become a thing of the past, with all movements having to be planned in advance.
“As a port we have a key role to play and we are trying to educate other players in the supply chain so that they understand the need for change and what they can do to make the process more efficient,” said Craig Sain. “Ultimately, these changes will benefit New Zealand through the fast, efficient and cost-effective delivery of freight.”
A double dose of good news has Northland’s deepwater port Northport buzzing, with expanded coastal shipping services locked in and a trial kiwifruit export service now operating year-round and taking other export products.
Northport chief executive Jon Moore said a seasonal trial of a port call at Northport by a global shipping giant has become a permanent, year-round service.
MSC (Mediterranean Shipping Company) has announced it is making the fortnightly port call at Northport by its Kiwi Express service a fixed part of its international schedule. The move will improve access to international markets for Northland’s exporters and importers.
A trial, which started in May and was planned to run until the end of the kiwifruit season in late August, has brought a ship to Northport every two weeks to load Zespri kiwifruit and other locally grown produce.
But the year-round service means other Northland exports can use it. The kiwifruit service alone was expected to take more than 500 truck and trailer trips off the road south of Marsden Pt.
Moore said that as well Pacifica Shipping had also confirmed it was expanding its coastal shipping service between Northport and ports further south, including into the South Island.
He said this opened up new opportunities for Northland businesses to get their products to elsewhere in the country without the need for them to be transported by road south of Marsden Pt, which would save costs and also mean less trucks on the roads.
”A port is a facilitator and we don’t drive any of this, but we can facilitate it well and if we didn’t have a port we wouldn’t be able to do any of this,” he said.
”The two announcements) have the potential to really help business grow in Northland and it’s now up to the business community to help grow this service by using it.”
General manager of MSC New Zealand Steve Wright said the company was delighted to add Northport as a year-round call on the Kiwi Express.
“It is a noticeable and important inclusion for all exporters and importers in the Northland region, as they now have direct access to all international markets for their cargo.”
Northland Inc chief executive officer David Wilson said the move was a really good sign.
“It’s showing confidence in the Northland economy.”
He said the move “just makes complete sense” and makes it a lot easier for Northland businesses to directly reach international markets.
“The cost of freight and logistics is an important component in any exporter’s product offering.”
Kerikeri-based grower, coolstore and packhouse operator Alan Thompson thought the move from a trial service to a permanent one was good and he hoped others would make use of it year-round.
Before the trial, kiwifruit was trucked from Kerikeri to Auckland before being loaded on to rail and taken to the Port of Tauranga for export.
Thompson said the cost to get one pallet of kiwifruit from Kerikeri to the Bay of Plenty is about $102. To load that same pallet at Marsden Point cost about $36, a saving of $66.
Moore was thrilled the service had been extended.
“The move is the result of months of hard work and relationship building by many people and organisations around our region. It reinforces what those of us who call Northland home already know, there is significant potential for economic growth here.
“We encourage any and all Northland importers and exporters, regardless of what sector they operate in, to use this service. We are hopeful that, given sufficient support, it could potentially become a weekly call.”
Wellington, New Zealand — New Zealand’s transport minister said Monday he will pay a small fine for violating aviation rules by making a cellphone call from a plane.
The Civil Aviation Authority fined Phil Twyford 500 New Zealand dollars ($340) for breaching rules it says were intended to prevent electromagnetic interference with aircraft instruments.
The authority said that because Twyford ended his call before takeoff, it didn’t pose a significant risk to the safety of the flight.
Twyford had earlier stepped down from his role overseeing aviation safety after making the call to a staffer in May.
Acting Prime Minister Winston Peters said the breach was a low-level offense and that Twyford was contrite and would be reinstated to his aviation oversight role now the investigation was complete.
“A slight irony, of course, is that we have noticed that a great number of other people are guilty of that offense,” Peters said. “It should be a great deal of education value to us all to know how serious it is.”
Twyford said Monday he can’t recall the exact chronology of the call, but that his phone records and airline records indicated he’d been on the phone for about three minutes while the plane was taxiing but before takeoff.
Cellphone calls are banned after the doors are closed in preparation for takeoff. While some rules around mobile devices have been relaxed in recent years, passengers are still banned from making cellphone calls or sending text messages during flight.
“I’ll be paying the bill very shortly,” Twyford said. “It was a breach, and particularly inappropriate given that I’m the transport minister.”
He said he wanted to reiterate his earlier “unreserved apology” for his mistake.
The breach was brought to light by an opposition lawmaker.
Regional Economic Development Minister Shane Jones gives the thumbs-up to the reopening of the Wairoa–Napier railway line – Photos courtesy of KiwiRail
Trains are moving again on the Napier to Wairoa line for the first time in six years following the reopening of the railway line in early June.
The first train travelled along the Napier to Wairoa railway line between Napier and Eskdale to deliver ballast as part of the project to reopen the line. Hawke’s Bay Regional Council, KiwiRail and Napier Port have been discussing the reinstatement of the mothballed line for several years.
Repairs to the line to enable it to be reopened were made possible through the provision of $5 million from the NZ government’s Provincial Growth Fund, which will eventually allow a low-speed forestry service to operate between Wairoa and Napier, delivering logs from forestry blocks to the port.
At the official reopening event, KiwiRail chief executive Peter Reidy said, “Today sees a work train travelling up to Eskdale from Napier, the first time there has been a train on the line since 2012. The reopening of the Wairoa–Napier line is one of the first to be funded from the Provincial Growth Fund, and would not have happened without it. It is a significant event for KiwiRail on a number of levels, and recognition of the tremendous value that rail delivers to New Zealand.”
Hawke’s Bay Regional Council group manager strategic development Tom Skerman says that while credit should go to KiwiRail for achieving this important milestone, he wants to acknowledge Councillor Alan Dick, chairman of the council’s regional transport committee, for his vision, perseverance and advocacy for the reinstatement of the service.
“With central government behind the project, our focus now is to support the establishment of a commercial operation on the line. We expect this to deliver many regional benefits, such as resilience of the transport network, effective management of the anticipated growth in demand for log transport, and reducing the carbon footprint associated with the logistics of harvest,” says Mr Skerman.
Mr Reidy says KiwiRail has given the government a list of ‘shovel ready projects’ that will enhance the company’s role, particularly in the regions, of which the Wairoa–Napier line is the first to get underway. “Having work trains running is an important part of getting the line open to shift logs by rail and take trucks off the road,” he notes.
CUTTING CARBON EMISSIONS
Regional Economic Development Minister Shane Jones, who attended the official event, says the government is making safety a higher priority when it invests in transport, and taking logging trucks off challenging roads contributes to that.
“We’re strongly committed to making significant investment in regional rail and I look forward to being able to make more announcements with KiwiRail in the coming months,” he says. “KiwiRail is experiencing growth in its overall forestry business – a result being driven by an increase in the volume of logs – and the government sees substantial benefits in using rail to decrease the number of logging trucks on our roads.”
Mr Reidy says the reopening of the Wairoa–Napier line is an important project for the region, for New Zealand and for KiwiRail. “It lifts the regional economy, makes the roads safer, and helps the environment by cutting carbon emissions – every tonne of freight carried by rail is a 66% emissions saving over heavy road freight.”
KiwiRail estimates that using the Wairoa–Napier line to move the logs could take more than 5500 trucks a year off the road, and cut carbon emissions by 1292 tonnes. The line is expected to be ready for logging trains by the end of the year.
The seawall at Ohau Point was completed in May
The last of more than 7500 seawall blocks just north of Ohau Point along the Kaikoura coast have been installed along State Highway 1.
NZ Transport Agency earthquake recovery manager Tim Crow says this is a significant milestone for the recovery work in what was one of the most damaged areas following the November 2016 earthquake.
“We’re pleased work has progressed so much on these structures, and it’s down to the efforts of the crew who have been working hard to get the job done. All the seawalls have now been completed just in time for winter,” he says. “Seawalls offer long-term sustainable protection to the road and rail transport corridor from the coastal elements and seismic activity.”
In order to reopen the road for last Christmas, the seawalls had temporarily been built at a lower height. Since then, work has been underway to build them up for long-term resilience.
To prevent significant traffic interruptions, some activities could only be done at night. This involved importing large volumes of construction material, along with the removal of slip material.
When SH1 was opened to traffic by day, the seawalls could only be backfilled at night. Night crews have raised the height of the road at Ohau Point by 5 m since Christmas, and around 150,000 cu m of backfill has been placed behind the seawalls.
Tim Crow says completing the seawalls was a momentous occasion for the crew, particularly as some team members who had laid the very first foundations also helped place the final blocks.
Women’s International Shipping and Trading Association (WISTA) is proud to announce the re-launch of WISTA Japan.
“We are delighted to welcome Japan back to our WISTA family. Japan plays an important role in the maritime industry, being the second ship owing nation in the world and we are positive that WISTA Japan will contribute greatly to the aims and mission of WISTA International,” said Despina Panayiotou Theodosiou, president of WISTA International.
“I am very gland to re-launch WISTA Japan and to be registered as the official member of WISTA International. In the shipping industry in Japan, it is both socially and politically meaningful to create a women’s association. We are looking forward to growing with WISTA International,” said Shoko Kamimori, president of WISTA Japan.
WISTA Japan was re-founded by: Shoko Kamimori, Fukada Salvage & Marine Works Co., Ltd., President WISTA Japan; Yoriko Ishida, National Institute of Technology, Oshima College; Akiko Matsumoto, Tokyo Century Corporation; Reiko Yoshida, Atsumi & Sakai; Atsuko Kissho, Atsumi & Sakai; Aya Osawa, The Japan Ship Owners Protection & Indemnity Association; Maki Yoshida, Star Marine Public Relations Corporation; Masayo Wakamori, Lloyd’s Register of Shipping; Yuka Narita, Atsumi & Sakai; Yukako Mori, Atsumi & Sakai; Yukari Aoto, Sonpo Japan Nipponkoa Insurance Inc..
WISTA International is comprised of 40 National WISTA (NWA) around the world and nearly 3,000 members. To launch a national WISTA association, the association must file appropriate paperwork in the home country, have at least 10 members in management positions and pay annual fees to WISTA International. WISTA International and its NWAs facilitate the exchange of contacts, information and experiences among its members, promote and facilitate the education of its members and provide liaison with other related institutions and organizations worldwide.
Transport Minister Phil Twyford today announced the appointment of Michael Stiassny as Chair of the New Zealand Transport Agency Board.
Michael Stiassny has been appointed for a term of three years commencing on 19 April 2018.
“Michael Stiassny has a wealth of governance, leadership and financial knowledge having been involved in governance and corporate positions for the past three decades,” Phil Twyford says.
The NZ Transport Agency’s core functions are to plan and invest in New Zealand’s land transport networks through the National Land Transport Programme.
“This Government has a transformative agenda to rebalance the transport system toward better safety, access and value for money, along with more investment in regional and local roads and rail.
“The NZ Transport Agency has a crucial role to play in creating a modern and sustainable transport network across land transport modes. Michael Stiassny brings strong and decisive leadership to the Board.
“I’d like to thank Dame Fran Wilde who’s been acting chair over the past three months and acknowledge the contribution of Chris Moller who stood down in January,” Phil Twyford says.
Statement from LPC
Lyttelton Port has today received a further notice of strike action for 26 April to 29 April by the Rail and Maritime Transport Union (RMTU) for approximately 11 Marine staff. Strike action by this small group will close the Port.
LPC will therefore pay none of RMTU’s 191 members for the days – or any other day(s) the Company receives a strike notice for.
LPC Chief Executive Peter Davie says the Company has no option but to take this course of action.
“What is particularly disruptive about the strike notice served today is that it is for only a very small number of RMTU members – just approximately 11 of its 191 members at the Port. The approximate 11 striking RMTU members operate the launch which delivers our pilots to vessels when they arrive at the head of the harbour and must have pilot guidance to reach our Port.
When the RMTU members who operate the launch go on strike, the Pilots can’t reach the vessels so ships cannot get in or out of the Port. That means there is no shipping. The approximate 180 RMTU members not striking know that. They intend to come to work, do nothing and get paid.
“This tactic will not work.
“I want to make this very clear. The RMTU strike notice may be for only approximately 11 of its members but none of its 191 members will be paid for any day for which we receive a strike notice.
“We are taking this step as a direct response to the Union’s tactic of causing maximum disruption to customers and businesses in the region while trying to ensure its members don’t lose money.
“The Union has refused our very generous offer which is well above inflation.
This offer is well above recent RMTU settlements with other New Zealand Ports.
“The dispute is about only one thing – the RMTU wants a better settlement than the other major Union at our Port – the Maritime Union of New Zealand (MUNZ).
“The RMTU claims it wants the same offer we made MUNZ – but it has rejected it. The RMTU members want the same salary increases as MUNZ but they will not make the roster changes MUNZ agreed to as part of their offer.
“RMTU members have already lost more pay than their negotiators can possibly recover for them – and the longer the Union refuses our offer the more its members will lose.
“Meanwhile the Union’s tactics are causing significant disruption to shipping lines, importers, exporters and our region.
“We remain committed to resolving the dispute but do not see any justification for amending our very generous offer.”
Rail and Maritime Transport Union organiser John Kerr said the sticking point was the port company’s refusal to pay full wages for about 70 cargo handlers over last Thursday and Friday.
LPC Operations Manager Paul Monk said 54 union staff were affected between Thursday and Saturday, “days for which the union gave late notice of withdrawing its strike action”.
“These staff lost pay for between one and three shifts depending on when they had been rostered to work.”
The union gave notice of strike action for the two days, then withdrew it. The port company said it had to divert ships meaning there was no ship loading work on those days.
Kerr claimed a rough estimate of the cost to Lyttelton Port of paying the wages would be about $33,000.
Kerr said this meant that for a relatively small sum the port company was prepared to lose much more in revenue, with a knock-on effect to freight companies and Canterbury importers and exporters.
Monk said staff who lost work were “in a wide range of roles at the port with varying responsibilities and wages. This makes it challenging to provide an average cost”.
“Due to the wide variety of shipping and ancillary services it is also difficult to give the complete range of costs for ship diversions,” Monk said.
Kerr said the union put forward two options as a framework for settlement early on Monday.
“We’re ready to talk again at any time but there’s an excess of testosterone at the bargaining table.
“We’ll be holding peaceful pickets outside freight firms to give people information.”
A Lyttelton Port spokeswoman said recent industrial disruption had cost shipping lines and Canterbury freight firms.
The Canterbury Employers Chamber of Commerce chief executive Leanne Watson said none of her members reported being affected yet, but they would be if two weeks of strike action took place.
The port company said it had to reorganise the arrival of more than eight vessels between Sunday night and Monday.
“International shipping does not usually allow for vessel diversion with less than seven days notice.
“Managing the return of vessels to our port over the weekend has come at a significant cost and disruption to the shipping lines and Canterbury shippers, who had already diverted cargo to other ports or cancelled export bookings.”
The company reiterated its “generous” offer of a 3 per cent salary increase each year for three years while asking for no changes in their conditions of work.
“This means we are no longer asking them to make the roster changes, agreed to a year ago by their Maritime Union of New Zealand colleagues, which would allow us to offer customers more flexible servicing of their vessels.
“Because of Maritime Union members’ flexibility in accepting the new roster they received a salary increase of 4 per cent this year and 3 per cent for the next two years.
“Rail and Maritime Transport Union want the same salary increases as their Maritime Union colleagues while refusing to make the same roster changes,” the port company said.