No need of panic about Upper North Island ports, PwC report says

Tuesday 4th December 2012

A report on ports in the upper North Island kills the idea that Northland's natural deep water port may one day be a hub for container ships and doesn't see New Zealand becoming a branch of an Australian hub port either.

The report by PwC commissioned by the Upper North Island Strategic Alliance also sees no need for a new port in the upper North Island or any need for existing ports to rush to invest in infrastructure to cater for larger container ships. The alliance is made up of representatives from the Northland, Auckland, Waikato and Bay of Plenty councils.

"Shipping lines expect to continue to serve New Zealand with smaller ships in the interim," the report says.

There is no significant risk for exporters and importers associated with the timing of ports' investment with respect to larger container ships. The report's solution to a forecast increase in trade over the next 30 years is for ports to become more efficient.

It says New Zealand ports are inefficient and have poor technology. If they improve they can handle projected demand for many decades. For years there has been debate about how long Auckland can have a commercial port on the waterfront of its central business district and development of Whangarei's port has been seen as a long-term alternative.

But PWC said there would have to be a significant reduction in New Zealand's high land transport costs before a container port at Whangarei "would make sense".

The report says Ports of Auckland is below the New Zealand average on the efficiency measure of containers moved per crane per hour and Port of Tauranga is more efficient.

It says all ports need to improve technology, particularly by adopting automated container stacking systems to increase capacity in container yards.

Port capacity can be created by operational efficiencies, particularly in container handling and storage.

But the report did acknowledge that if Ports of Auckland could not expand its footprint growth would need to be accommodated at other upper North Island ports.

New Zealand ports were moving to a "hub and spoke" model and regional ports such as Timaru and Wellington were losing out, it said.

But New Zealand was not likely to become a spoke to an Australian hub port because Australian ports also lacked capacity to handle larger ships.

Each council will formally receive and consider the report at their appropriate December 2012 council or committee meetings.

BusinessDesk.co.nz

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