KUALA LUMPUR: Shipping companies want to know Australia’s already expensive ports won’t get even pricier when Melbourne’s port is sold.
Malaysian ports are five times cheaper than Australia, while even New Zealand’s ports are significantly more expensive, Shipping Australia chief executive Rod Nairn says.
“My members have been burned by a few privatisations and would like to express our concerns,” Mr Nairn told a parliamentary inquiry into the sale of Melbourne’s Port on Tuesday.
He called for stronger price control mechanisms to make sure the 26 shipping companies competing in the Australian market were able to stay profitable.
The government plans to lease Melbourne’s port for 50 years, with an option to extend it to 70.
The new owners will get compensation if a second Melbourne port starts operations before the first port has reached an agreed capacity limit.
Dr Hermione Parsons, from the Supply Chain and Logistics Institute at Victoria University, predicts the port will reach its capacity of 5.5 million container units somewhere between 2026 and 2034.
But the government says the Port of Melbourne’s Webb Dock can be expanded to take the port’s total to eight million containers a year.
Dr Parsons said Melbourne will need a second port within 15 to 25 years, but she ruled out super-large container ships ever visiting the city.
“Melbourne is a very small market,” she said.
“The shallowest port in the national system largely determines size… Hence our belief the larger vessels will not come.”
Mr Nairn said his members had told him they would bring larger ships to Melbourne if they could get through the Port Phillip Heads efficiently.
Port of Melbourne Corporation CEO Nick Easy told the committee the heads wouldn’t have to be blasted to allow bigger ships through, as dredging to deepen the channel was a success.
“We think the system, and the configuration of the channels, is sufficient to accommodate the growth in vessels that will service this port in the time frame of the lease,” Mr Easy said.
The government plans to raise about $6 billion from the lease’s sale to pay for suburban level crossing removals.
Shipping activity at Port Qasim on February 11
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