Soaring International Freight Costs & Coffee Supply

We have recently received an industry update from the industry body, Freight & Trade Alliance (FTA), in regards to the rapidly increasing international freight costs.  

Paul Zalai, Director of the FTA and Secretariat of the Australian Peak Shippers Association (APSA) says that according to the Freight & Trade Alliance (FTA), owners and shareholders of container stevedore operations have been handed a licence to print money with the National Transport Commission (NTC).  

He says they are instead recovering costs from transport operators that have
no influence on service or price.

“Foreign-owned shipping lines servicing our container trade are in such a dominant position,”
Paul says.

“Not only are they cashing in on importers and exporters with high freight rates, a spate of surcharges and unfair container detention penalties, they are also putting to squeeze on their contracted stevedores who have resorted to Terminal Access Charges to remain commercially viable,” he adds.

Despite witnessing the failings of the Voluntary Port Performance Model (VPPM), the NTC has embraced the hopelessly flawed model adopted by the Victorian Government setting a new standard for adoption by state governments nationally.  

Paul goes on to say “The bottom line is that Australian supply chain participants are currently paying an additional $500 million per year direct to stevedores and empty container parks with these rapidly increasing costs having devastating impacts on exporters and importers with downstream crippling financial impacts on manufacturers, farmers, and regional communities.”    

What does this mean for coffee supply?  

We at Minas Hill are under immense pressure getting our coffee to you.

We, as importers, are at the mercy of third parties and without reliable shipping ETA’s, we are constantly depleting our stock on hand.   The price hikes inevitably result in importers and roasters paying even more for coffee per kilo.  

Our valued customers can be rest assured that we DO have coffee! May is a huge month for arrivals, as we see a back log of containers finally arriving, which will see our stock, replenished!

What’s being done about it?

On April 1, the FTA and APSA say that further to the testimonials and extensive evidence raised in its formal submission to the review of the Australian Maritime Logistics System, the peak industry alliance will escalate its call on the Productivity Commission to lead a way for regulation to end the scourge of Terminal Access Charges.

We will keep you updated in due course with these outcomes.

Article Information courtesy of Joseph Misuraca – MHD Supply Chain
& Connor Anderson International