Ro-Ro, fuels for the future
WITH the days when Australians mostly drove cars built in Geelong or Elizabeth largely gone, motorists are now reliant on imports, predominantly from Asia and Europe, with the United States an important source of utes and farming machinery.
According to TrendEconomy, the value of the Australian motor car import trade (cars and motor vehicles principally designed for the transport of people) rose to US$25 billion in 2023, well up from around US$20 billion in 2022.
The Observatory of Economic Complexity (OEC), points out that Australian cars are mostly from Japan, South Korea, China, Thailand and Germany.
Australia’s lucrative agricultural sector is also heavily reliant upon imported machinery for sowing and harvesting crops.
The office of the US International Trade Administration says about 95% of all agricultural machinery and equipment including tractors used in Australia are imported with demand for agricultural equipment predicted to rise.
“This makes Australia a strong prospect for American companies which supply products and services to the agricultural sector,” the US ITA said.
According to the Australian Department of Agriculture, Fisheries and Forestry, between 2019-20 and 2021-22, Australia imported an average of $1.7 billion of agricultural machinery each year.
Harvesters and threshers ($493 million) and machinery to prepare soil ($200 million) were the largest import categories.
These trends ensure that there is plenty of work for roll on, roll off (ro-ro) vessels visiting ports around the Australian coast.
As noted by car carrier Wallenius Wilhelmsen earlier this year, “capacity constraints in the car carrier markets and general increased demand for cars and heavy equipment has led to solid earnings and renewal of multi-year contracts at rates reflecting the current market.”
Ro-ro terminals are found at or near the major Australian capital cities, as well as smaller ports such as Gladstone and Devonport.
It is a constantly evolving space, with terminal operators and shipping companies moving to stay ahead of the game in terms of business productivity and environmental sustainability.
Red Sea crisis
The automotive trades have not been spared from geopolitics, with Houthi rebels in Yemen attacking shipping aligned with Western interests.
As noted by S&P Global, attacks in the Red Sea and Gulf of Aden have exposed “the vulnerability of global trade to regional conflicts, leading to detours, delivery delays and other repercussions for the auto industry.
“Strikes on radar systems, storage facilities and launch sites in the critical Red Sea conduit for global maritime trade were initiated in the initial weeks of 2024,” S&P reported.
Pilbara Ports is working collaboratively with Yara in the Pilbara to fast-track ammonia
Samuel McSkimming, Pilbara Ports Authority
Several car companies were impacted by rerouting around the Cape of Good Hope, with Tesla and Volvo reportedly suspending some production operations in Europe due to a lack of components.
Car carriers NYK, K-Line, MOL and Wallenius Wilhelmsen were among the lines to reroute ships due to the risk of Houthi attacks.
“While there may be budgetary headroom in the short term, any prolongation in the crisis could impact future capital expenditure projects and could be detrimental to an automaker’s outlook at any stage,” S&P reported.
“Right now, the industry is going through a particularly capital-intensive phase of its development: Electrification, batteries, autonomous vehicles and software-defined vehicles are all competing for any spare automaker dollars.”
Back in January Wallenius Wilhelmsen said it was prioritising safety in deciding to sail around the Cape, albeit adding two weeks of sailing time from Europe to Asia.
“As a result of the ongoing security situation in the southern parts of the Red Sea, Wallenius Wilhelmsen has until further notice decided to reroute all vessels to avoid the area,” it said.
“We continue to monitor the situation closely and remain in direct consultation with authorities, industry bodies and all relevant counterparts.”
MIRRAT goes under the hammer
One of Australia’s most important facilities for the import of cars and machinery is the Melbourne International Ro-Ro and Automotive Terminal (MIRRAT).
Features of the terminal include 187,000 square metre footprint, three berths, 14,500 car slots, 8000 square metres of undercover storage and a 120-tonne gantry crane.
The terminal has been around for almost a decade under the ultimate ownership of Wallenius Wilhelmsen.
Earlier this year, it was announced that Qube Holdings, through subsidiary AAT, had entered into a “binding agreement” to acquire MIRRAT from WW for around $332.5 million.
In a statement back in May, Qube managing director Paul Digney said MIRRAT played “a critical role in the Victorian and national economy” and “Qube is delighted to acquire this high-quality asset, which plays a critical role in efficient import and export automotive supply chains.
“This is a business Qube knows well, recognising that MIRRAT shares a common underlying customer base with AAT,” Mr Digney said.
Wallenius Wilhelmsen chief executive and president Lasse Kristoffersen said MIRRAT had been incredibly successful, “both commercially and financially.
“As we continue to develop our integrated offering to customers, we believe the terminal’s independence and open access can be even better developed under a new and independent ownership,” Mr Kristoffersen said.
“We will continue to be a happy customer of MIRRAT and work with the strong team there.”
Qube is set to rebrand MIRRAT with the Australian Amalgamated Terminals identity upon purchase completion.
The deal requires the approval of the Australian Competition and Consumer Commission (ACCC).
At the time of publication, the ACCC was yet to announce a final decision.
Qube has been advised on its acquisition of MIRRAT by law firm Gilbert + Tobin, with consumer and market regulation partner Simon Muys advising in relation to the competition and regulation aspects.
“We’re very pleased to have been able to work with Qube on this important transaction,” Mr Muys said mid-year.
“G+T has worked with the Qube team for many years across a number of deals and MIRRAT certainly is another high-quality asset. We now look forward to working through the ACCC process over the coming weeks.”
A special milestone
Across the border in New South Wales, the Port Authority of New South Wales recently acknowledged the important role of Port Kembla Car Terminal for the automotive trade and the economy more generally.
PANSW chief executive Captain Philip Holliday said during the last 10 years, Port Kembla had “seen 2.4 million motor vehicles through our port, almost 100% of NSW’s motor vehicle imports.
“In the decade to come, we will continue our focus on fostering trade and economic growth in the Illawarra and investing in state-of-the-art technology to keep our port future fit for all opportunities,” Captain Holliday said.
“This includes standing ready for innovation in the port including supporting the new LNG import facility under development and training our highly skilled operations team to accommodate shipping advancements.”
Cleaner, greener ships
The ro-ro trade is being influenced by global efforts for cleaner transport and ensuring environmental sustainability.
One example is Oslo-based Höegh Autoliners which recently had its first Aurora class vessel, Höegh Aurora, delivered from the shipyards of China Merchants Heavy Industry.
Each of the 12 Aurora vessels on order will be able to operate using ammonia as fuel, as well as liquefied natural gas (LNG), part of a commitment by the company to a net-zero emissions goal by 2040.
Höegh expects the delivery of two Aurora vessels every six months until 2027, with the option of ordering another four ships.
The Aurora Class vessels will be operating globally, connecting the world from east to west and north to south.
“Together, we are making sustainable shipping doable, accelerating the green transition within our industry and setting a whole new standard for sustainable solutions and services in shipping,” said Höegh board chair, Leif O. Høegh earlier in the year.
In the decade to come, we will continue our focus on fostering trade and economic growth in the Illawarra and investing in state-of-the-art technology to keep our port future fit for all opportunities
Philip Holliday, Port Authority of New South Wales
After bunkering liquefied natural gas fuel in Shanghai, the first Aurora class vessel, Höegh Aurora called at ports in Japan, South Korea and China before heading to Europe with full decks. The plan is for Höegh Aurora to visit Australian ports for the first time this December, calling at Fremantle, Melbourne, Port Kembla and Brisbane before Christmas.
“Australia is an important market for us and our Auroras will therefore also serve this part of the world,” a Höegh spokesperson said.
Aurora class vessels are expected to begin using ammonia from 2027. The first eight Aurora class vessels are to run on LNG but will be designed to be converted to run on ammonia.
The ammonia engine technology is set to be ready in 2026, allowing for the last four ships to be built to run on ammonia from the start.
“These vessels will be delivered in 2027 and will be groundbreaking, becoming the world’s first emission-free vessels in our segment,” a company spokesperson said.
“At Höegh Autoliners, we take leadership by actively collaborating with a wide range of highly qualified and dedicated suppliers to make clean ammonia viable as a zero-emission shipping fuel.
“We believe it is important for shipping companies to send a clear signal to the rest of the value chain that the technology can be realised in a short time and that there will be demand for carbon-neutral fuel.”
According to Höegh, with a capacity of up to 9100 cars, the Aurora class vessels “will be the world’s largest and most environmentally-friendly car carriers ever built.
“Already now, the Aurora Class will be cutting carbon emissions per car transported by up to 58% from the current industry average,” the spokesperson said.
“In 2027, when the first Auroras are powered entirely by clean ammonia, they will eliminate nearly all carbon emissions.
“With our Auroras, we are sailing for sustainability setting new standards for sustainable deep-sea transportation and making a significant stride towards our 2040 net zero emissions goal.”
Höegh Autoliners has already formed several partnerships with ammonia producers for the supply and use of clean ammonia.
Ammonia is already being produced at strategic locations globally and the company is expecting that the infrastructure for bunkering will follow suit.
Höegh Autoliners is only expected to need two to three key bunkering ports to operate globally.
The Aurora class is equipped with the newest and most modern maritime technology, including advanced safety and digitalisation solutions.
The Auroras are to be the first to be ready to operate zero-carbon ammonia propulsion with the main engine designed by MAN and the bridge system supplied by Kongsberg Maritime.
“Through partnerships with world-leading ammonia distributors, we are driving the industry towards a net zero future and creating demand for sustainable fuels to accelerate the transition.
Ambitious targets
Wallenius Wilhelmsen is also on a journey towards a greener future by way of cleaner fuel and has set a target of reaching net zero by 2040.
The company has talked of contracts “focusing on integrating offerings across ocean and land-based services, combined with decarbonisation initiatives such as the use of biofuel.
“This year we made a significant leap towards net zero emission by partnering with our customers on buying reduced carbon freight. Another key milestone was the ordering of our Shaper class vessels capable of running on green methanol upon delivery,” Mr Kristoffersen said.
“We also introduced zero-emission battery electric trucks in the US and opened the Orcelle terminal in Belgium. All these initiatives are vital parts of our strategic goal to deliver the world’s first end-to-end net zero service to our customers in 2027.
“This is a very ambitious target, and we need to break many barriers to get there. But together with our customers, we are confident that it is both possible and needed.”
Commitment to Australian trade
The Italian company Grimaldi Group has Fremantle ro-ro and over-dimensional cargo, enhancing port capabilities in Australia.
According to Grimaldi, this demonstrates the company’s “commitment to the Australian trade and recognition of trade needs on the West Coast of Australia.”
Grimaldi is also taking what it says is “a proactive approach” when it comes to addressing the challenges of climate change and the need for shipping to decarbonise.
Ships calling in Australia are equipped with advanced technologies designed to reduce emissions and improve fuel efficiency.
The company currently has 17 ammonia-ready pure car, truck carrier ships, each with a capacity of 9000 cars, scheduled for delivery between 2025 and 2028.
The ammonia-ready class notation received from RINA (an Italian class society) certifies that these new car carriers can be converted to use zero-carbon ammonia fuel in the future.
These ships are also designed for ‘cold ironing’ with shoreside supply or electricity – a green alternative to the consumption of fossil fuels. These new car carriers will also be equipped with systems to collect ocean plastics and potentially a carbon capture system.
Grimaldi has recently concentrated its investments in newbuilding vehicle carriers. In addition to the 17 ammonia-ready ships, Grimaldi has ordered six multipurpose ro-ro units belonging to the innovative G5 class, four of which have already been delivered.
The design of these G5 vessels is, according to Grimaldi, “the result of careful study of the needs of the group and feature an innovative and completely customised internal configuration”.
These ships are able to transport 4700 linear metres of rolling freight, 2500 CEU and 2000TEU.
As well as increased loading capacity, these vessels also have numerous cutting-edge technological solutions aimed at increasing energy efficiency and reducing environmental impact, resulting in a significant reduction in CO2 emissions per tonne transported up to 43% less compared with other Grimaldi ro-ro, container ship hybrids (ConRo).
Spirit of Tasmania
An important development for the Australia market has been new ships for the Spirit of Tasmania services on Bass Strait.
TT-Line/Spirit of Tasmania services have operated passenger and freight (ROPAX) services for many years, an important connection between Tasmania and the mainland.
The second of the new Bass Strait passenger, passenger vehicle and freight vessels, Spirit of Tasmania V, was officially named and launched at a traditional ceremony at shipbuilder Rauma Marine Constructions’ (RMC) yards in Finland back in July.
Governor of Tasmania, Her Excellency the Honourable Barbara Baker AC, formally named the ship Spirit of Tasmania V and broke a bottle of Tasmanian sparkling wine on her bow.
Spirit of Tasmania V is the second of two new vessels ordered by Spirit of Tasmania to replace the existing ships.
The new vessels will have an overall length of 212-metres and a beam of 31-metres, compared to the current ships that are 194.33-metres-long overall with a beam of 25 metres.
Australia is an important market for us and our Auroras will therefore also serve this part of the world
Höegh
Spirit of Tasmania managing director and chief executive Bernard Dwyer said he was delighted to witness the launch of the second new Spirit of Tasmania ships.
“The new vessels are the first purpose-built for Spirit of Tasmania for operation on Bass Strait,” he said.
“While they look very similar to the current vessels, they are much bigger and have substantially larger capacity for passengers, passenger vehicles and freight.”
It has been documented that these new ships will have a 60% increase in vehicle lanes for passenger and freight vehicles.
While the ships are in the process of being delivered, port upgrades at Devonport are required to allow them to operate to full capacity.
These upgrades are not expected to be ready until 2026, with a temporary berth having been put in place, the matter having become a political hot potato.
Premier of Tasmania Jeremy Rockliff said there were important benefits from having the new Spirits, even with the temporary berth.
“Spirit IV is much more efficient when it comes to freight and a new freight loading system,” Premier Rockliff told parliament.
“It’s safer for caravans and camper vans and vehicles with the wider lanes. It provides a much better customer experience and is more fuel efficient.”
Freight always has been an important component of the Spirit of Tasmania/TT-Line services on Bass Strait.
According to management, moving the Spirits’ Victorian terminus from Station Pier in Melbourne to Geelong provided space for a main freight yard, allowing clients with access to collect and deliver freight units at all times.
“It is a major benefit for freight clients that no longer must deal with the constraints at the former Station Pier site which required freight to be collected immediately on discharge,” management said in its annual report for 2022-2023.
“Importantly, following the move to Geelong, the company has retained more than 90% of our TEU volumes, and believes, in line with pre-move expectations, that the industry is adapting to the change in Victorian ports after 37 years of freight arriving from Tasmania into Station Pier.”
Spirit of Tasmania has indicated “future initiatives” to support and encourage freight clients in the Geelong yard.
This article appeared in the October | November edition of DCN Magazine
