The country’s largest port by volume, the Port of Tauranga, delivered a record after tax profit of NZ$57.9 million in its fiscal to the end of June 2011 and that was up 17.2% on the previous year. Container traffic through Tauranga was up an impressive 15% to 590,506 TEU (20-foot equivalent units), while overall trade volumes jumped 12.4% to 15.4 million tonnes, compared to 13.7 mt a year earlier. Log exports rose to 4.4 mt from 3.8 mt a year earlier and impressive gains were also shown in fertiliser imports (530,000 tonnes), while grain and dairy food supplements rose to 1.1 mt. The news was also good for close rival Ports of Auckland in the country’s largest city to the northwest where an after tax profit of NZ$24.9 million was recorded, up 2.1% on the previous year’s NZ$24.4 million. The country’s leading container handler by volume saw box traffic climb 3.1% to a record 894,383 TEU, while non-containerised break bulk cargoes – cars, cement, machinery, construction equipment, tractors, sand, road metal, glass sand, wheat, grains and stock foods –were up 24% to 3.5 million tonnes. Ports of Auckland is the 109th ranked container port in the world and the only New Zealand port to make the Top 200. Those boxes contain 30% of the total value of New Zealand trade, compared to Tauranga’s 16%. Auckland’s total throughput, however, at 13.3 million tonnes, is behind Tauranga’s 15.4 mt. Port of Tauranga Chief Executive Mark Cairns is riding two major milestones into the new fiscal year – he’s at the helm of New Zealand’s largest tonnage port and the export leader by far, and his box movement efficiency crane ranking is well clear of any other New Zealand port and in the top 10% of the most productive ports in the world. No wonder shipping lines are starting to sit up and take notice of the North Island east coast port. Five new container services have been announced for Tauranga in the past few months as the port is seen more and more as an ideal hub port. Trans-shipment volumes – cargo moved ashore from one vessel then loaded onto another – increased by 52% over the year. The latest signing came from the world’s second largest shipping line, the Mediterranean Shipping Company (MSC) which will begin a new Oceania Express Service with the Port of Tauranga as its only New Zealand call on a Melbourne, Sydney, Brisbane, Tauranga, Balboa, Long Beach, Melbourne route. MSC Operations Director, Mark Godfrey, says the plan is to trans-ship cargoes from six other New Zealand ports using its three other services currently servicing New Zealand (Capricorn, Kiwi and Pacific Island services). It’s no surprise that Tauranga Port chief Cairns saw the announcement as “fantastic news.” In fact, the announcement also marks a significant move in New Zealand port consolidation, something it was thought the ports would have to compromise and negotiate themselves to ensure cash-strapped container lines didn’t abandon some of the smaller ports. “There’s been a lot of hot air about port rationalisation over the past 10 years,” Cairns told World Port Development. “A lot looked at it but it took the shippers council and the shipping lines themselves to start making the moves,” he says. The lines have opted to consolidate cargo movements into the two major ports in Auckland and Tauranga and bring in larger vessels for the Down Under trade. “The MSC announcement was really significant news,” says Cairns. “It was a tangible example rather than hot air.” For Tauranga, MSC’s new service will begin in October and along with five other new services recently announced will lead to a 20-25% boost in container volumes compared to the year ended June 2011. About 40% of this new box traffic will come from trans-shipped cargo. Meanwhile, the consolidation issue is part of a current inquiry into international freight transport services by the New Zealand Productivity Commission. Ports of Auckland Chief Executive, Tony Gibson, also notes a trend to greater hubbing and movement of trans-shipment cargoes through his port facilities with volumes up 7.7% over the previous fiscal year. “The consolidation of lines services into Vessel Sharing Agreements to enable greater inter-service connectivity was a key driver of the trend.” Surprisingly, Gibson says that because of recent shipping line changes, the port expects overall container volumes for the new financial year to be down on the record high of 2010-2011. He assured shareholders the port should still be able to maintain revenue levels, however, and says that container volumes for July and August finished ahead of expectations. Gibson was “particularly pleased” that his port has been able to cater for import growth while delivering record turn times for its customers and improvements in crane rates. Dwell times of less than 1.7 days underpin the attractiveness of Auckland’s port location for importers, says Gibson. And he’s confident of the port’s future in an improving New Zealand economy. “Over the next few months our focus is firmly on further enhancing productivity, lifting returns, and achieving improved labour flexibility and utilisation,” Gibson adds. “Longer term, we will continue to focus on achieving earnings growth in order to provide a platform for further investment and expansions.” And both New Zealand major terminals are amid expansion plans involving huge capital sums.
Capital investments
The Port of Tauranga is spending over NZ$150 million on capital projects over the next three years and expects to be able to handle 7,000 TEU capacity container vessels within five years. Work continues on extending its main container terminal at Sulphur Point by 170 meters while adding extra container storage land in a project that should be completed by the end of 2012. As well the port has ordered a sixth Liebherr gantry crane and Cairns says it may opt for a seventh. Four additional straddle carriers will also join the fleet. Dredging of the main shipping channel will ensure a depth of 13 meters, giving a draught of 43 feet at low water.
Ports of Auckland should complete an $8 million project to deepen and extend the northern berth at its Fergusson Container Terminal by the end of the year. The expansion will allow two ships between 3,500 and 5,000 TEU capacity to be worked simultaneously, providing greater berth flexibility and capacity. The port is also doing its own navel gazing with a comprehensive review of its operations and practices in the context of achieving its strategic objectives. The study will take four months, says Gibson, and will identify process improvements and highlight any under used and untapped revenue streams for the port. “This review is expected to result in increased revenues, reduced costs, and further productivity gains,” says Gibson. As well, the port is working closely with Waterfront Auckland on an exciting transformation of the public spaces on the waterfront. The first phase Wynyard Quarter revitalisation is now open allowing residents and visitors to “touch the water, smell the sea, and watch the action happening in the harbour.” The port is also keen on the redevelopment of Queens Wharf (sold to the Auckland Regional Council and the New Zealand Government in 2009) into the city’s premier cruise ship terminal. Cruise ship calls tallied 79 in the latest fiscal and are expected to climb to 97 in the current year with extra business expected to be generated by the Rugby World Cup in September-October. Gibson says the Princes Wharf cruise facilities were operating at near capacity with over 200,000 cruise passengers and nearly 65,000 crew members expected ashore over the next season which runs October through April.