BRIAN Hack, managing director of West Australian freight forwarder EES has thrown his weight behind the Australian Competition and Consumer Commission’s latest stevedoring monitoring report.
The report, released just before Christmas, highlighted the constraints faced by importers and exporters in being able to respond to continued landside price hikes.
Mr Hack quoted an example of one de-hire charge EES was paying that was $55 in 2021 and it’s now $130.
“That’s an increase of more than 130% in four years. How can that be justified? It’s unsustainable,” Mr Hack said.
He says Australia’s shipping industry – and consumers – can no longer afford for the Federal Government to ignore the fresh recommendations from the ACCC.
As well as the hikes in landside prices the report found there are likely market failures in the supply chain that may require a policy or regulatory response.
Mr Hack said the report is a frustrating but not surprising read and says action needs to be taken.
“We’ve been highlighting for some time now the ongoing impact of continued price hikes to landside fees and charges, including booking fees, de-hire charges and infrastructure levies.
“We’re not suggesting these shouldn’t be paid, but the concern is around the dramatic increase that occurs year on year.”
Mr Hack says the flow on impacts of continued fee hikes is that consumers will pay more.
“Freight forwarders and transport operators can’t absorb the increased costs, they get passed on to clients who in turn pass them down the line to the end consumer. Prices are going up on shelves because it’s simply costing more to get the goods off the ship.
“Heading into a federal election, we know cost-of-living is a key issue and there’s plenty of focus on the Reserve Bank and interest rates, but there needs to be a genuine focus on inflationary fee hikes across the shipping industry.”
Mr Hack says addressing the issue will have benefits beyond the supply chain.
For exporters the ACCC report highlights that addressing apparent market failures would likely improve efficiency of the container freight supply chain, which could potentially allow exporters to lower costs, and be more competitive.
For consumers significant increases in fees and charges are largely worn by the end consumer. Policy and/or regulatory measures to address the current issue could potentially stabilise the increases and reduce the impact on overall prices.
For SMEs the cost of doing business in Australia continues to rise, having a significant impact on SMEs. Measures which can assist in reducing operational costs and improve cash flow and profitability benefits business and the economy more broadly.
Mr Hack says he’s supportive of measures put forward by the International Freight and Customs Brokers Association of Australia (IFCBAA) for the establishment of a new body to monitor processes, charges and access conditions, or the development of a new mandatory code governed by the ACCC with noncompliance able to be prosecuted.
“Something needs to change. We cannot have the same conversation when the next ACCC report is handed down, and the same concerns are raised.”
“If not now, then when?”
