ACCC identifies reform priorities to support competition at Australia’s growing container ports

7 November 2013

In its 15th annual monitoring report, the Australian Competition and Consumer Commission has highlighted that further economic reforms are required if future benefits of continuing industry reforms and increasing competition in the container stevedoring industry are to be realised.

“The Australian stevedoring industry is healthier than ever before. Landmark reforms undertaken in 1998 have been instrumental in driving increased productivity on the Australian waterfront. The industry is now poised to benefit further; this time, competition from a third stevedore will spur the industry to become even more efficient,” ACCC Chairman Rod Sims said.

The 1998 waterfront reforms and strong growth in container throughput have led to lower unit costs and higher stevedoring profits. The stevedores have invested in new cranes and automation and today have more productive workforces. As a result, shipping lines today face lower costs and a better service from the stevedores. 

Since 1998, costs have fallen by 44 per cent in real terms as a result of the stevedores becoming more efficient. Most of this cost saving has been passed onto shipping lines, with average prices falling by 37 per cent in real terms over the same period.  Productivity has improved, with cranes moving 29.2 containers per hour in 2012-13 compared with 19.6 in 1998-99. Labour productivity has almost doubled, increasing from 22.4 containers per hour worked in 1998-99 to 41.1 containers per hour worked in 2012-13. 

Australian stevedoring will be subject to further competitive pressures as a new terminal operator enters the market. Hutchison Ports Australia opened a terminal in Brisbane earlier this year and is about to open another at Port Botany in Sydney. The Victorian Government is currently tendering out the rights for a new terminal in Melbourne, Australia’s largest container port.

“A new competitor is a welcome development in an industry in which the conditions have not until recently supported the entry of new competitors,” Mr Sims said. 

Continuing the trend observed in previous years, the stevedoring industry has again delivered strong returns. In more competitive industries, persistently high returns would typically attract new entrants, but this hasn't eventuated in Australian stevedoring until recently. This highlights the significance of the current addition of new terminal operators across several ports. New terminal operators and capacity expansion should increase competition which should drive investment and better service levels. However, an important reform task lies ahead.

Port expansions must be accompanied by targeted investments in road and rail connections to container terminals if Australia is to be ready to meet all of the challenges associated with an expected doubling in the freight task over the next twenty years. 

“The ACCC considers that further economic reform is required to ensure that related transport issues do not create bottlenecks in and around our growing container ports, and supports initiatives by various governments and other agencies to address these issues,” Mr Sims said.

The following reforms need to be considered:

  1. Reform to heavy vehicle road provision so that the right investments in the right roads can occur;
  2. Develop better signals for exporters and importers to enable them to make better, informed decisions about ‘modal choice’ i.e. whether to use road or rail services to move containers;
  3. Use pricing mechanisms to incentivise truck operators to better use landside facilities, such as through peak period pricing, which can encourage off-peak access to terminals.

“Without these reforms, Australia risks losing the benefits of investments in capacity expansion and competition at major container ports,” Mr Sims said.

The ACCC’s report will be available from its website at


The 1998 waterfront reforms centred on an end to over-manning and restrictive work practices in Australian stevedoring, boosting productivity, lowering costs and promoting more effective use of technology in the ship-to-shore task of handling containers.

The ACCC has monitored the container stevedoring industry since 1999 under a direction from the Australian government. Container stevedoring involves lifting containers on and off ships. The ACCC monitors prices, cost and profits of container stevedores at six Australian container ports. Patrick and DP World operate at the four largest ports—Brisbane, Fremantle, Melbourne and Sydney.  The newest stevedore—Hutchison Ports Australia—was included in the ACCC’s monitoring program for the first time in 2012–13, with its operations in Brisbane commencing and the terminal development in Sydney almost completed.

The ACCC also monitors Flinders Adelaide Container Terminal Pty Ltd, as the sole operator at the Port of Adelaide. At the remaining monitored Port of Burnie, no dedicated stevedoring service of international containers is currently provided since Patrick exited its operations in May 2011.

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