Businesses and consumers are paying the ultimate price for the ongoing stalemate between DP World and the Maritime Union of Australia at Ports across Australia, and with no resolution in sight, I fear worse is to come.
Protected industrial action began at DP World container terminals across the country on October 1, with the MUA implementing stoppages and work bans in support of 300 bargaining claims.
Despite repeated requests from industry, the Federal Government is refusing to step in.
This is no longer just about DP World and the MUA, the ongoing delays and uncertainty are having a significant impact not only on Australia’s economy and international reputation, but Australian businesses are also being affected and taking a financial hit.
Our business has lost clients, and we’re having to wear thousands of dollars in extra container detention charges due to the backlog and delays, but we’re not the only ones dealing with this – the entire industry is copping the brunt of a situation we have no say in, and no control over.
The Freight & Trade Alliance has previously estimated the industrial action is costing Australian trade more than $20 million a day, with the backlog of containers sitting around 45,000.
To put that into perspective, even if this dispute were to be resolved today, it will still take weeks to clear the backlog and for operations to return to usual.
Added to this, the industrial action is also resulting in broader delays for shipping lines, blowing out schedules and causing some lines to skip ports altogether to either avoid congestion or make up time.
While it’s tough for businesses caught in the middle, ultimately it will be consumers who will be worse off.
We’re already seeing one transport provider adding a surcharge for picking up from the DP terminal, in direct recognition of the extra costs caused by the delays, and unfortunately, any extra charges will eventually flow through to consumers – at a time when they’re already dealing with cost-of-living increases.
I don’t want to scaremonger, but if we can’t get containers off the wharf, we could see shortages of products on shelves again. Maybe that’s when the Government will step in.
Without an immediate resolution, the impacts of ongoing action will be significant;
- Financial Impact to Business: Aside from losing clients who are frustrated by ongoing delays, businesses waiting on products to arrive are likely also losing out on sales. There may also be extra storage fees for businesses whose shipments sit idle while waiting to be unloaded, or may need to be stored after missing key deadlines – late Christmas shipments for example.
- Economic Impact: The FTA’s recent estimate of the loss to Australian trade being more than $20 million a day is likely to be conservative, with both importers and exporters affected.
- Reputational Damage: Delays are adding extra time to shipping lines schedules, which costs tens of thousands of dollars a day. Shipping lines are already skipping ports, and this will likely continue. It’s making Australia look unattractive for international trade, and unprofessional on a global level.
Latest information from both parties isn’t indicated a resolution will be reached any time soon, with industry anticipating disruptions will continue for some weeks to come, and potentially even months.
That simply can’t be allowed to happen. The potential impacts on the broader economy are too great.