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Australian consumers set to pay more due to port bottlenecks

Australians can expect to pay more for imported goods this Christmas as shipping container backlogs cause delays at major ports, resulting in many empty shipping containers not being returned to Asia.

Exports of goods from Australia have reduced due to COVID-19 restrictions and not enough containers are heading offshore. Empty containers usually used for two-way trade are lying idle at Empty Container Parks (ECP).

This bottleneck is impacting the import of goods at a time when Australians, particularly Victorians, are buying more in lockdown.

One of the world’s largest third-party logistics providers C.H. Robinson has seen first-hand a shift in importing trends during the pandemic. Andrew Coldrey, Vice President Oceania, said that as Australians spend more time at home, there has been a greater need for household items such as vacuums, chainsaws and bulk grocery products.

“At the same time, there has been a decrease in Australian exports due to COVID-19 staff restrictions, which combined with the congestion at our ports, have caused chaos for transport operators, with costs set to trickle down the supply chain to Australian consumers,” Andrew said.

Importing from Asia is currently at risk due to the inability to export full and empty containers back to Asia. Research from NSW Ports has shown an imbalance of 30,000 Twenty-Foot equivalent units (TEU’s) between full and empty imports and full and empty exports between April-June 2020.

Severe congestion at the Port of Botany can be attributed to weather disruptions, industrial disputes and overcrowding at overwhelmed ECP’s, reducing operational efficiency, placing a heavy strain on the port and causing ships to redirect to the Port of Melbourne.

These issues have placed greater pressure on Melbourne’s already struggling ECPs, culminating in further strain on trucking and additional supply chain costs.

“This issue has been slowly mounting and has reached a stage where Australian consumers are most likely going to suffer at the checkout,” Andrew said.

“At the beginning of the year, planning by freight forwarders couldn’t have accounted for the differing consequences of a world pandemic. Our current import allocations are committed, and we are seeking more, but spare shipping allocation is now being sold at a premium, adding additional costs throughout the supply chain,

“With the busiest quarter almost upon us, we must address the bottlenecks at key Australian ports,” Mr Coldrey said.

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