SYDNEY, Nov 4 (NNN-AGENCIES) – A report from Australia Competition and Consumer Commission (ACCC) today, revealed, a perfect storm of the post-lockdown surge in demand and congestion at Australia’s international container ports could lead to supply shortages.
“International shipping line movements normally run lean and just-in-time, but a surge in demand and COVID-19 outbreaks that have forced numerous port operations to temporarily shut down, have caused congestion and delays with a cascading effect across the globe,” said ACCC Chair, Rod Sims.
This confluence of factors has seen large retailers in Australia buying their own shipping containers and renting shipment vessels, to ensure shelves are full leading up to Christmas.
Policy and Communications Manager from shipping industry body, Shipping Australia, Jim Wilson, said, current delays have been growing in Australia over the course of the pandemic.
“There has been a surge in trade, as people came out of lockdown, they basically went into retail therapy, buying lots of goods,” said Wilson.
“Australia being an island nation, containerised trade is about 35-36 percent of our total trade, so it’s enormously important.”
Wilson said that, long wait times in Australian ports have driven up shipping costs and led many ships to cut their routes to Australia. “Congestion is the root cause of all supply issues we are having in Australia…Ports must up their game.”
The ACCC’s report cited data from the United Nations Conference on Trade and Development, which showed that wait times for container ships docking in Australia were three times longer than Japan, twice as long as China and 50 percent longer than Singapore or New Zealand.
“We were told that some shipping lines were already withdrawing services from Australia before COVID-19 hit. Australia needs to take decisive action to remain an attractive destination for global shipping lines,” said Sims.
Wilson said that, while consumers and retailers may feel the crunch on specific goods leading up to Christmas, the larger issue of supply shortages would continue well into the future.
“If you’ve got an enormous surge in demand, if you’re trying to cater that demand through physical infrastructure, such as big metal objects like ships, it takes a while to build new ships and put them in service and get them to the right place, about two to three years.”– NNN-AGENCIES
