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Concerns over new shipping solution

climate shipping

Freighting CEO Jackson Meyer says Anthony Albanese’s shipping proposal of securing an emergency fleet of ships for Australian waters won’t be feasible with current restrictions.

If elected, Albanese has proposed a strategic fleet of 12 ships to ensure stable access to fuel and essential supplies.

Global shipping fleets have reached record demand with stock across the globe stretched thin at international ports as countries meet fleet capacity and industry players face the hardest conditions ever seen.

Although matching the proposal currently being put forward by the Labour government, the sale saw the Australian coastal shipping line, which was originally established in 1956, sold to French shipping company CMA CGM.

Jackson Meyer, CEO of Australian freight forwarding company Verus Global, who has been working on the frontline amid these supply chain disruptions due to the Omicron variant, says the ALP’s proposal won’t work.

“What we’re seeing in the market at the moment is that shipping lines around the globe are maximising the more lucrative trade lanes over Australia, leaving surging demand increasing with no release of supply for much needed goods into Australia. Shipping lines over the years have formed alliances across the globe which has created a monopoly market with incredibly high barriers to enter the market due to fierce competition,” he says.

“If ships can be secured for to create a fleet, the government will then need to consider how long it will take to prepare the ships for service, what ports the ships will call, how they plan on calling areas with political instability (China) and additional costs including the rising prices of fuel and docking in international countries as an unrecognised carrier.”

Consistent shipping disruptions and the impact of the latest COVID outbreak has triggered current supply chain delays through factory shutdowns, port congestion and container shortages in conjunction with ongoing labour shortages and temporary workforce closures.

“The effects of the Omicron variant on the industry have added further strain on the supply chain and we aren’t likely to see the disruptions ease until at least November 2022, with levels of stock diminishing and a lack of workforce to replenish shelves the effects are ongoing,” Jackson says. “2022 will ultimately be a repeat of 2021 with the shipping lines continuing to dictate the market and profiteer.”

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