Aurizon must carry on with intermodal business: ACCC

The Federal Court has ordered that Aurizon must continue operating its Queensland intermodal business while the ACCC’s case against Pacific National and Aurizon is heard and determined.
The ACCC instituted proceedings in July this year against Pacific National and Aurizon, and their related entities, for allegedly reaching an understanding about Aurizon’s intermodal business that had the purpose and/or would be likely to have the effect of substantially lessening competition in the supply of intermodal and steel rail linehaul services.
In addition, the ACCC alleges that Pacific National’s proposed acquisition of Aurizon’s Queensland intermodal business and the Acacia Ridge Terminal, as well as an agreement for Pacific National to operate the interstate side of the Acacia Ridge Terminal, would each separately have the likely effect of substantially lessening competition.
Following today’s hearing, the ACCC has been granted injunctions against Aurizon which require it to continue to operate its Queensland intermodal business.  The ACCC also sought orders for injunctions against Pacific National not to solicit employees and the top 10 customers of the business until the court proceedings are finalised, however those orders were not made.
“Given Aurizon’s previous announcements that it would close its Queensland intermodal business if the Pacific National acquisition was opposed by the ACCC, the ACCC sought an urgent interlocutory injunction to prevent Aurizon from closing its Queensland intermodal business until the ACCC’s proceedings involving that business are determined by the Court,” ACCC Chair Rod Sims said.
“It is part of the ACCC’s case that, at all times, Aurizon had alternatives to selling to Pacific National that would have been more competitive. The ACCC is aware of at least one alternative purchaser that is willing and able to acquire Aurizon’s entire remaining intermodal business.”
The final proceedings have been set down for a two week hearing starting on 19 November 2018.
“The ACCC will allege that it was more lucrative for Aurizon to agree to sell parts of the intermodal business to the closest competitor and close parts of that business than it was to sell the whole intermodal business to a new entrant,” Mr Sims said.

Australia Post launches Tech Academy

Australia Post has launched a dedicated Tech Academy, a two-year development program available to anyone with a keen interest in a career within the evolving tech sector.
Aimed at training emerging talent from a diverse background – including return to work parents and people with non-technical skills – Australia Post has teamed up with educator Coder Academy to provide 20 successful applicants on the job training and industry placements within the organisation’s tech and digital spaces.
Commencing February 2019, trainees will receive a 12-week tech boot camp, a two-week placement across Australia Post’s retail and operations sectors, and four five-month tech rotations, with opportunities for ongoing employment within a tech or digital team at the conclusion of the two-year period.
Australia Post chief information officer John Cox said the innovative program will nurture new talent and enable people to build their skills across emerging technologies.
“We know the tech industry is continuously growing and demand for talent is increasing. Meeting employment shortages within the sector has become increasingly challenging,” Mr Cox said.
“This program is open to anyone, regardless of technical background, including return to work parents, veterans, mid-career professionals, and graduates.”
Mr Cox said Australia Post is looking to grow its tech and digital capabilities, by developing talent in emerging technologies such as machine learning, the Internet of Things (IoT), and blockchain.
“Companies abroad have received high acclaim for their ability to deliver a workforce in line with future organisational needs and diversity, and we want to bring that to Australia Post.
“We are hoping this program will set the standard across the country, and will attract people who want to learn and have a strong sense of community, to help us improve the way we deliver our products and services for our customers.”
Applications for the Australia Post Tech Academy are closing on 2 September, with the first intake beginning in February 2019.
For more information and to apply visit

$6 billion penalty for Newcastle container port

Greg Cameron

The ACCC is currently investigating “concerns that contractual restrictions may prevent the expansion of container throughput at certain ports”. It is speculation that these unspecified “concerns” include the anti-competitive Port of Newcastle container fee.
It is fundamental that any ACCC investigation recognises the fee, its purpose and the date it became NSW government policy.
The Hon Adam Searle’s question without notice to The Hon Duncan Gay on October 17 2013 [see below] uncovered the fact that the government decided in 2011 or early 2012 to cap the number of containers that could be shipped through the Port of Newcastle without incurring a fee. The fee charged per container is equal to the average fee charged for a container shipped through Port Botany (currently $150). As Mr Gay revealed in his answer, the fee was an instruction the government gave its financial adviser, Morgan Stanley, for conducting a scoping study into leasing Port Botany and Port Kembla. The government appointed Morgan Stanley on December 14 2011.
Earlier, in 2009, the previous, Labor, NSW government decided to develop a container terminal at the Port of Newcastle by leasing the former Newcastle steelworks ‘Mayfield Site’ to the private sector. With the government acting as Newcastle Port Corporation (Corporation), a negotiation commenced, under contract, with Newcastle Stevedores Consortium (Consortium) in 2010. The Corporation changed its contractual requirements in 2013 to include the fee. This negotiation concluded on commercial terms in November 2013, without the site being leased.
The ACCC claims that the Corporation ceased carrying on a business for the purposes of the “Commonwealth Competition and Consumer Act 2010” in 2012 because the government decided not to develop a container terminal at the Port of Newcastle. As shown by Mr Gay’s answer, the government made no such decision. The ACCC is wrong to claim that the government decided in 2012 not to develop a container terminal, as proven by the Corporation’s ongoing negotiation with the Consortium and the “Port Commitment – Port Botany and Port Kembla”, which was publicly disclosed by The Newcastle Herald on 28 July 2016. Not even the government supports the ACCC’s claim. It defies reality that the Corporation complied with the Competition Act by requiring the Consortium to pay the fee.
The ACCC is obliged to acknowledge that the fee was an instruction the government gave Morgan Stanley for conducting a scoping study into leasing Port Botany and Port Kembla.
It is incontrovertibly in the public interest for the government’s liability to be determined because of the many billions of dollars of public money at risk if a container terminal is built at the Port of Newcastle and the fee proves to be unlawful or unenforceable. For example, a container terminal operating at a modest 1 million TEU a year between 2023 and 2063, will require the NSW government to pay NSW Ports $6 billion at the rate of $150 million a year.
Port Botany and Port Kembla were leased for $5.1 billion in 2013 for 99 years.
The Hon. ADAM SEARLE: My question is directed to the Minister for Roads and Ports. How much compensation will be paid to the private operator of Port Botany if a new container terminal is developed at Newcastle Port?
The Hon. DUNCAN GAY: The rules in the organisation that did the scoping study for Port Botany and Port Kembla and introduced guidelines there indicate that while general cargo is allowed there will not be an extension under the rules for the lease of Newcastle Port. So the short answer to the question is that we do not envisage that any compensation will need to be put in place. The Government has been clear on this all the way through the process, even before it indicated it would lease the port at the stage when Newcastle Port Corporation was in place. I have indicated in the House, as I have in Newcastle—indeed, I made a special visit to Newcastle to talk to the board, the chief executive officer and the local community—that part of the lease and the rationalisation was a cap on numbers there. I am not saying that there will be no containers into Newcastle. Certainly, a number of containers will come in under general cargo, but there will not be an extension. The only time an extension is allowed is when a specific number is reached and is tripped in Port Botany and Port Kembla.

Port of Melbourne container truck queue

Victoria establishes a state freight authority

The Victorian Government has created a one-stop shop for Victoria’s freight industry, joining other states in having a state-based freight authority.
The Victorian Freight Plan, Delivering the Goods, established Freight Victoria as a dedicated, specialist freight division of Transport for Victoria.
Delivering the Goods aims to increase Victoria’s gross product by $40 billion by 2040 and shift more freight onto rail, developing new inland freight terminals and a new freight precinct adjacent to the Port of Melbourne.
It includes plans to deliver the $7.6 million allocated in the 2018/19 Victorian Budget for development of a business case for the Western Interstate Freight Terminal, the extension of the Mode Shift Incentive Scheme, investigations into an integrated logistics hub at the Melbourne Markets and Dynon Road, and the review into heavy vehicle driver training and licensing.
The plan builds on the government’s claimed $40 billion investment in major infrastructure projects, including the Murray Basin Rail Project, the Freight-Passenger Rail Separation Project, West Gate Tunnel, Port Rail Shuttle Network, and bridge strengthening and regional freight route upgrades.
Minister for Public Transport Jacinta Allan said: “Industry has told us they want better coordination with government on the planning, management and delivery of Victoria’s freight and logistics network.”
“That’s why we have established Freight Victoria as a single point of contact, a one-stop-shop for primary producers, the freight and logistics industry and local government to contact for information and assistance.”

Supply chain management software up 13.9%: Gartner

The latest market share data from Gartner shows that adoption of supply chain management (SCM) software accelerated significantly in 2017. Total worldwide market revenue grew 13.9 per cent to reach a total of $12.2 billion in 2017.
“The SCM market’s revenue performed well in 2017, continuing the trend of accelerating growth from recent years. This is happening because SCM technologies are a key component of delivering digital business strategies,” said Balaji Abbabatulla, research director at Gartner (see Table 1.). “SCM technologies create digital value by optimising the flow of products, services and related information from source to customer and from customer to source.
“The top five vendors in the SCM market all increased revenue, but only JDA and Infor grew their market share by outperforming the total market growth,” said Mr Abbabatulla. “The ‘other vendors’ category is growing significantly faster than the top five market incumbents, but the top five rankings remained the same in 2017.”
Table 1. Worldwide SCM revenue market share, 2016-2017 (Millions of USD).

Company 2016 Revenue 2017 Revenue 2016-2017 Growth (%) 2017 Market Share (%)
SAP 2,930 3,257 11.2 26.6
Oracle 1,553 1,679 8.1 13.7
JDA 476 544 14.3 4.4
Infor 243 286 17.4 2.3
Manhattan Associates 219 225 2.8 1.8
Other Vendors 5,334 6,256 17.3 51.1
Total 10,755 12,246 13.9 100.0

Source: Gartner (July 2018)
Mr Abbabatulla continued: “Smaller cloud-native vendors enjoyed an average revenue growth of 41.4 per cent in 2017. The top five vendors are defending their market share by pivoting toward cloud-first strategies and quickly introducing new products through development, acquisition or partnerships on their cloud platform.”
Cloud offerings are driving growth in the market partly because more midsize organisations are adopting SCM software to drive digital business models. Midsize organisations help bolster revenue growth because they are net new customers of SCM products and are not bound by replacement and upgrade cycles from legacy investment.
“Cloud software typically have lower barriers to entry and are more easily scalable, and are therefore a better fit for midsize organisations looking at SCM for competitive advantage,” said Mr Abbabatulla. “We expect that vendors offering a well-defined, vertical-industry-oriented strategy for midsize organisations will grow rapidly over the next five years.”
Another source of competitive advantage for SCM vendors has been effective incorporation of artificial intelligence (AI) into their products. “While adoption levels of AI vary across sub market segments, we expect it to drive revenue growth as AI technologies and tools mature,” said Mr Abbabatulla. “This is because AI can bring productivity and user experience improvements by automating routine tasks and providing more effective support to complex decisions.”

Only 65% have a cybersecurity expert: survey

Despite 95 per cent of CIO expecting cyberthreats to increase over the next three years, only 65 per cent of their organisations currently have a cybersecurity expert, according to a survey from Gartner. The survey also reveals that skills challenges continue to plague organisations that undergo digitalisation, with digital security staffing shortages considered a top inhibitor to innovation.
Gartner’s 2018 CIO Agenda Survey gathered data from 3,160 CIO respondents in 98 countries and across major industries, representing approximately US$13 trillion in revenue/public sector budgets and US$277 billion in IT spending.
The survey indicates that cybersecurity remains a source of deep concern for organisations. Many cybercriminals not only operate in ways that organisations struggle to anticipate, but also demonstrate a readiness to adapt to changing environments, according to Rob McMillan, research director at Gartner.
“In a twisted way, many cybercriminals are digital pioneers, finding ways to leverage big data and web-scale techniques to stage attacks and steal data,” said Mr McMillan. “CIOs can’t protect their organisations from everything, so they need to create a sustainable set of controls that balances their need to protect their business with their need to run it.”
Thirty-five per cent of survey respondents indicate that their organisation has already invested in and deployed some aspect of digital security, while an additional 36 per cent are actively experimenting or planning to implement in the short term. Gartner predicts that 60 per cent of security budgets will be in support of detection and response capabilities by 2020.
“Taking a risk-based approach is imperative to set a target level of cybersecurity readiness,” Mr. McMillan said. “Raising budgets alone doesn’t create an improved risk posture. Security investments must be prioritised by business outcomes to ensure the right amount is spent on the right things.”
Business growth introduces new attack vectors
According to the survey, many CIO consider growth and market share as the top-ranked business priority for 2018. Growth often means more diverse supplier networks; different ways of working, funding models and patterns of technology investing; as well as different products, services and channels to support.
“The bad news is that cybersecurity threats will affect more enterprises in more diverse ways that are difficult to anticipate,” Mr McMillan said. “While the expectation of a more dangerous environment is hardly news to the informed CIO, these growth factors will introduce new attack vectors and new risks that they’re not accustomed to addressing.”
Continue to build bench strength
The survey revealed that 93 per cent of CIO at top-performing organisations say that digital business has enabled them to lead IT organisations that are adaptable and open to change. To the benefit of many security practices, this cultural openness broadens the organisation’s attitude toward new recruitment and training avenues.
“Cybersecurity is faced with a well-documented skills shortage, which is considered a top inhibitor to innovation,” Mr McMillan said. “Finding talented, driven people to handle the organisation’s cybersecurity responsibilities is an endless function.”
According to Gartner, while most organisations have a role dedicated to cybersecurity expertise, and therefore appreciate its needs, the cybersecurity skills shortage continues. Gartner recommends that chief information security officers (CISO) continue to build bench strength through innovative approaches to developing the security team’s capabilities.
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The hidden cost in trade: empty container management

The commercial practices of shipping lines and the performance of some empty container parks (ECP) in Sydney are causing significant cost increases in empty container management, according to transport advocacy group Container Transport Alliance Australia (CTAA).
CTAA director Neil Chambers has warned: “These additional costs are causing major difficulties for container transport operators in Sydney, and need to be remedied soon.”
Empty container park (ECP) capacity
A focus of immediate attention are delays and a lack of operational capacity at DP World Logistics Australia Parks 1 & 2 in Botany Road, Port Botany. Large volumes of empty container returns are being directed to this facility by shipping lines, including to meet rail demand for empty export containers.
“We are aware that DPW Logistics is recruiting, inducting and training more forklift and operational staff, but this will take several weeks to occur, Mr Chambers said. “A facility of its size should be achieving at least 30 container moves per half-hour truck arrival window. However, their current operational capacity constraints mean that they are only achieving around 10 to 15 moves regularly.”
Transport operators are having to stage more and more empty containers via their yards prior to being able to gain suitable slots for de-hire. This adds significant costs to the transport task through:

  • Added truck travel to/from yards, then separate later trips to/from the ECP.
  • Container lift off/on costs.
  • Added administration in managing time delays, fleet allocation, de-hire notification processing, and container detention avoidance management.

Mr Chambers observed: “Transport operators have become ‘satellite’ container logistics staging facilities, even for empties. Without this, the container logistics chain in Sydney would be dysfunctional. But, this comes at a cost with commercial consequences.”
Empty re-directions and limited alternatives
Building on the pressures applied by intense competition for available truck arrival slots are the number of empty container ‘redirections’ made by shipping lines and a lack of alternative return options.
Sydney is the ‘redirection capital’ of Australia, with an average of 85 redirection notices per month – double the number in Melbourne.
“This occurs because shipping lines want empties returned to specific places, including to railhead facilities for export use and direct return to the wharf. This saves the shipping lines their own costs of handling empties through traditional empty container parks and being responsible for the cost of repositioning the boxes themselves,” Mr Chambers said.
“The difficulties for transport operators arise because little notice of these redirections occurs, meaning that transport operational planning has become a lot harder, and futile truck trips can occur when containers are rejected from their original return location if the redirection notice is missed or is sent at the last minute.”
Some shipping lines also don’t allow any alternative returning options, which can restrict truck utilisation efficiencies, add to truck kilometres travelled, and contribute to facility congestion and truck queuing.
Lack of EDI flow of data
An increase in the flow of electronic data between shipping lines, their ECP service providers and technology platforms such as Containerchain would greatly assist with information visibility in the container logistics chain, and would help to reduce landside costs.
Unfortunately, only 61% of the empty container movements in Sydney have corresponding EDI data loaded into the technology platforms. This compares with over 90% in Fremantle and 80% in Melbourne, for example.
When EDI data is lacking, allocators must process container return electronic information manually, truck drivers must be supplied with paper or electronic versions of the delivery order (DO), and ECP gate staff must process trucks and drivers manually. All of these issues lead to delays and added costs.
“There are two major shipping lines that simply don’t provide any electronic information about empty containers – OOCL and Evergreen. Several others provide the information less than 40% of the time – COSCO (Five Star Shipping), Ocean Network Express (ONE), and Hyundai Merchant Marine.
“We’d like to see a commitment from these shipping lines, and the others, to try to increase the EDI exchange of data on empty container return instructions in Sydney towards 100%.”
Container detention liability
The current delays and inefficiencies in Sydney mean that there is more risk of the import container detention policies of the shipping lines being breached.
“Transport operators need to reinforce their business rules with customers about adequate notice of containers being ready for empty return (normally two working days), and should not accept any container detention claims caused by delays outside of their direct control.
“Also, importers and forwarders should be proactive in seeking an extension of time from shipping lines for the return of empty containers when delays threaten a breach.
“CTAA Alliance companies are seeking meetings with DPW Logistics, other ECP and with shipping lines through Shipping Australia Limited (SAL) to try to find sustainable solutions,” Mr Chambers said. “We also continue to liaise with NSW Ports and with the NSW Government about the current difficult situation.”

47% of employers plan to increase headcount

Transport Allocators, Warehouse Managers and Supervisors, and Import and Export Coordinators are areas of demand in logistics for employers who plan to increase permanent staff levels this financial year, according to recruiting company Hays.
In a survey of more than 3,000 organisations representing over 2.3 million employees for the annual Hays Salary Guide, the recruiter found that strategy and consulting will lead jobs growth, with 63 per cent of employers indicating they’ll add to their headcount in this area.
This is followed by general management (57 per cent), information technology (53 per cent) and project management (51 per cent). Fifty per cent expect to increase their human resources, operational management and sales permanent headcounts.
Twenty-two per cent of employers will also increase their use of temporary and contract staff. The trend of employing temporary and contract staff on a regular, ongoing basis will continue, with 24% of employers now doing so.
“The coming six months will see continued labour market strength, with permanent and temporary hiring intentions suggesting further employment gains,” said managing director of Hays in Australia & New Zealand Nick Deligiannis.
“However, employers say the shortage of highly-skilled professionals will impact the effective operation of their organisation or department.”
According to the Hays Jobs Report, covering the July to December half, skills in demand for the six months ahead in logistics and manufacturing include:
Logistics: Transport Allocators, Warehouse Managers and Supervisors and Import and Export Coordinators are areas of demand.
Manufacturing & Operations: Field Service Technicians, Engineering Drafters, Production Managers and Engineering Managers with technology and robotics experience are needed.
Procurement: Demand exists for Category Managers with end-to-end procurement skills, Procurement Officers and Senior Procurement Managers with a strategic focus.
Retail: Retail professionals with digital development and marketing expertise are required, as are Store Managers with experience implementing change and Merchandise Planners.

Renault opens Melbourne mega-warehouse

The shared parts and accessories warehouse is a first for Alliance member companies and is designed to maximise productivity, efficiency and accuracy in order fulfilment, allowing companies to enhance service to their national dealership networks.
The facility will become the new master warehouse for Renault, Nissan and Mitsubishi Motors’ national distribution network and will also service the INFINITI brand, which falls under the Alliance.
Based in the Melbourne suburb of Truganina, the purpose-built facility is strategically located between Melbourne’s sea container terminal and the airport. The facility has direct access to all interstate roads, is over 37,000 square metres in size, and is part of a CEVA super site that is the largest logistics facility in the southern hemisphere.
“Today’s opening is a significant milestone for the Alliance,” said Kent O’Hara, global senior vice president of aftersales for the Alliance.
“This shared facility is another example of how the Alliance continues to generate synergies to the benefit of our companies, customers and shareholders at a global level.”
Housing more than 90,000 different parts, the Alliance National Distribution Centre manages 11 inbound sea containers daily, as well as airfreight and other local shipments. It brings in 2,500 parts each day, while eight B-double transporters – as part of a same day service – deliver 8,500 parts direct to dealerships.
Operating 24 hours a day and transporting parts across the entire country, the warehouse has space for approximately 100,000 parts and accessories. It also includes a 677 sqm wet room with space for 700 pallets, and employs over 90 staff.
One of the first six star Green Star built and accredited buildings in Australia, it has a roof-mounted solar system to provide renewable energy, high bay LED lighting with daylight and motion sensors, early suppression fast response sprinkler systems and a rainwater system for bathroom and garden irrigation.
It also incorporates technologies and processes for the fast and efficient movement of automotive parts and accessories. These include a dedicated area for the storage of hazardous liquids such as oils, transmission and brake fluids, and the 10 container docks allow for high volume inbound and outbound shipments.
The Alliance National Distribution Centre is now fully operational.

Winter chill brings a little hope for retail: turnover rises 0.4%

Australian retail turnover rose 0.4 per cent in May 2018, seasonally adjusted, according to the latest Australian Bureau of Statistics (ABS) Retail Trade figures.
This follows a 0.5 per cent rise in April 2018.
“Department stores (3.9 per cent) led the rises,” said Ben James, director of quarterly economy wide surveys. “There was also a strong result in clothing, footwear and personal accessories, which rose 2.2 per cent. Both industries were able to rebound after unusually warm weather impacted April sales.”
There were also rises in food (0.3 per cent) and household goods (0.1 per cent). Cafes, restaurants and takeaways led the falls (-1.0 per cent), whilst other retailing also fell (-0.1 per cent).
In seasonally adjusted terms, there were rises in New South Wales (0.5 per cent), Queensland (0.4 per cent), South Australia (1.1 per cent), Victoria (0.2 per cent), Tasmania (1.5 per cent), and the Northern Territory (0.4 per cent). Western Australia, on the other hand fell (-0.5 per cent) in seasonally adjusted terms, whilst the Australian Capital Territory (0.0 per cent) was relatively unchanged.
The trend estimate for Australian retail turnover rose 0.3 per cent in May 2018 following a rise (0.3 per cent) in April 2018. Compared to May 2017, the trend estimate rose 2.8 per cent.
Online retail turnover contributed 5.6 per cent to total retail turnover in original terms in May 2018, a rise from 5.4 per cent in April 2018. In May 2017 online retail turnover contributed 3.9 per cent to total retail.
More detailed industry analysis and further information on the statistical methodology is available in Retail Trade, Australia (cat no. 8501.0).

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