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The Forum > Article Comments > Coastal shipping > Comments

Coastal shipping : Comments

By David Leyonhjelm, published 16/12/2014

There are now 2 million tonnes less freight being moved by foreign vessels and the number of major Australian registered ships with coastal licences fell from 30 in 2006/07 to just 13 in 2012/13.

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I looked at the Coastal Trading Act, which is at...
http://www.comlaw.gov.au/Details/C2014C00575
...and while it's arguably unnecessarily bureaucratic it doesn't seem to do any of the things that it's being accused of. Although it does give coastal shipping operators the opportunity to object to direct competition from cabotage and negotiate with the foreign ship operators, ultimate control rests with the minister. And if there are only 13 coastal ships left, is it really that much of a problem?

Where is this alleged regulation that requires a vessel to sit in port for a day before it can start loading?
Posted by Aidan, Tuesday, 16 December 2014 1:13:11 PM
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Aidan,

The long and short of it is that any ship transporting goods between two Aus ports has to pay its workers the same as Aus Maritime workers. As MUA workers get paid more than just about anyone else in the world this has nearly doubled the price of shipping freight within Aus ports. This has added huge costs to local manufacturing, and shifted much transport back onto the roads.

Unfortunately for the MUA, the cost of running ships is not just wages, and foreign owned ships are still cheaper, so in spite of the protectionism, the No of Aus owned ships has halved in 6 years.

All in all a terrible law.
Posted by Shadow Minister, Wednesday, 17 December 2014 1:48:36 AM
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Shadow,

That's due to the Rudd government's regulations, which predate the Coastal Trading Act (which was brought in by the Gillard government). That did initially result in fewer ships between Australian ports, but a few years later it was clear it had barely dented the upward trend, at least for the Port of Adelaide, so on what do you base the claim that it shifted much transport back onto the roads? If, despite the apparent lack of evidence, a shift had occurred, I'd expect it to have been onto the railways!

Wage regulation is hardly protectionism (compare it with the USA where they ban cabotage and restrict what vessels can be used). And is there any real evidence that it's nearly doubled the cost of freight between Australian ports?
Posted by Aidan, Wednesday, 17 December 2014 1:40:55 PM
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There's a lot of angst going on this forum, so at the risk of getting blasted myself, let me just say that I hope that all the matters get sorted out. I really don't see why we should be charging other Australian ships or vessels the same as any other's countries' vessels for using our own ports honestly. Whether for storage or for clean up or whatever, we should get a certain discount for using our own native wharves right? I mean that's how we'll maitain our internal competitive advantage. We really shouldn't be fighting about independence and whatever, it's more important to stand united!
Posted by UdyRegan, Thursday, 18 December 2014 12:45:28 PM
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Aidan,

I work in a large manufacturing business, and we ship product from Sydney to Perth, Melbourne etc to smaller converting factories. What I do know is that the shipping costs suddenly jumped by 60-70%, and that we changed some shipping to road and rail especially to closer cities, and that the converter in Perth closed down.

Wage increases imposed only on foreign ships is the definition of protectionism as is the banning of cabotage.
Posted by Shadow Minister, Friday, 19 December 2014 8:27:21 AM
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Shadow,

When did the shipping costs suddenly jump by 60-70%?

The wage regulation is imposed on all ships between Australian ports, regardless of whether they're domestic or foreign. Therefore it is not protectionism.
Posted by Aidan, Friday, 19 December 2014 10:11:24 AM
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