Container stevedoring prices, costs and profits have been the focus of attention of the Australian Competition and Consumer Commission in a monitoring report on stevedoring issued today.
On 20 January 1999 the Treasurer directed the ACCC to monitor prices, costs and profits of container terminal operator companies at the ports of Adelaide, Brisbane, Burnie, Fremantle, Melbourne and Sydney.
Today's report is the first to be issued under the stevedore monitoring direction. The report sets out the methodology for the monitoring program that will be expected to be in place for a number of years. It provides some early findings drawn from the period of 1 February (the commencement of the levy) to June 1999.
The monitoring program aims to help provide information to the Government and wider community about the progress of waterfront reform. It is also to provide information about the absorption of the stevedoring levy by the stevedores.
As part of the Government's reform strategy funds were provided to ensure that all stevedoring employees made redundant as part of the reform process received full redundancy entitlements. A levy on the loading and unloading of containers and cars for export and import was to be applied to repay these funds. The stevedores agreed to absorb the full cost of the levy.
The ACCC monitoring report indicates that the container stevedoring companies have, overall, absorbed the cost of the levy during this initial monitoring period.
Patrick the Australian Stevedore shed a significant part of its workforce in 1998 and the cost structure analysed in the report is the result of this restructuring. As P&O Ports Ltd finalised its restructuring program after the monitoring period was complete (August 1999) the next monitoring report will show the effect of these changes.
The report indicates that there have not been significant reductions in container stevedoring rates during the monitoring period.
When information from the previous stevedore-monitoring program conducted by the Prices Surveillance Authority is combined with recent ACCC monitoring data, it is possible to draw out some longer-term trends.
The trend indicates that prices and costs in the monitored period are significantly below the levels they were in 1995 when the previous monitoring program ended. Most of the reductions in average revenue would seem to have occurred in the years 1996 and 1997. However no rate reductions have been detected in the current monitoring period.
Copies of the report are available from all ACCC offices in each State and Territory capital and also Townsville and Tamworth at a cost of $10.