Australia faces distinctive challenges in the management of shipping containers for import and export freight. In this context, Chris Hudson, Senior Associate at Prological, provides insights into the local container scene and proposes logistical solutions to address ongoing supply chain issues, according to an article published on the mhd supply chain website.
Container Imbalance, Imports Vs. Exports
There exists a significant disparity between incoming and outgoing shipping containers in Australia. While most containers arriving in the country are full, a considerable portion leaves empty. The Waterline report of the BITRE indicates that demand for full imports surpasses that for full exports by a ratio of about 1.5 to 1.
Dealing With Container Shortages
Imported goods primarily arrive in forty-foot equivalent units (FEU), whereas exports are commonly containerized in twenty-foot equivalent units (TEU). This creates challenges as the average tonnage of an import FEU is 11 tonnes, compared to the Australian export TEU average of 19 tonnes. The nature of imported consumable items with low density favours larger containers, while exports, primarily agricultural goods and raw materials, are better suited to TEUs.
Pandemic-Induced Disruptions
The shipping container challenges were exacerbated by supply chain disruptions during the pandemic. Cargo ships dropped off full containers but faced difficulties reloading, leading to a buildup of containers in ports and empty container parks (ECPs) globally.
Demand For TEUs And Container Shortages
Neil Chambers from the Container Transport Alliance Australia highlighted the impracticality of using FEUs for heavy cargoes typically assigned to TEUs. This resulted in a heightened demand for export-ready TEUs, complicating the issue of empty containers. With ECPs at capacity, the dehire period was reduced from 14-21 days to just seven days, impacting the overall logistics chain.
Utilizing Rail Freight
Rail freight, while seemingly a plausible solution, faces challenges in cost competitiveness. Most imported containers are delivered within a 50km radius of ports, making rail less cost-effective due to shorter distances. Urban rail networks in metropolitan areas compete with passenger services, impacting reliability.
Managing Increasing Freight
Efficient freight management requires addressing rail connectivity challenges and encouraging freight generators to migrate closer to IMEX terminals. Initiatives like the Moorebank precinct’s strategy in Sydney, integrating a domestic freight rail terminal with the IMEX terminal, could offer potential solutions.
Innovative Trends In Container Management
Recent trends include centralizing containerized freight, such as meat packers running frozen products by road freight and loading export containers close to ports. These innovations aim to streamline logistics processes and improve overall efficiency.
Looking Ahead, Forecast For Growth
Given the forecasted increase in containerized freight tasks, collaboration between industry and state transport authorities remains crucial. The Productivity Commission’s report underscores the need for innovative solutions to meet the growing demand, predicting significant growth at major Australian ports by 2050.
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Source: mhd supply chain
