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Stakeholders Differ On New Shipping Line Outcomes

Is the Fijian market ready to cater for more shipping lines? Reactions? Yes and no. That’s the question Sun Shipping has posed to some industry stakeholders this week. Like all
18 Mar 2015 08:03
Stakeholders Differ On New Shipping Line Outcomes
Capitaine Tasman was the lone container vessel that arrived into Port of Suva on March 12. It discharged 322 metric tonnes of cargo and loaded 421 metric tonnes. Its last port was Port of Lautoka and it left for Apia, Samoa the next day. Agent for this service was Williams & Gosling Limited.

Is the Fijian market ready to cater for more shipping lines?

Reactions? Yes and no.

That’s the question Sun Shipping has posed to some industry stakeholders this week.

Like all aspects, there are two sides to the coin. On the one hand, it would augur well for the ‘hub concept’ which Fiji aspires to.

The introduction would eventually decrease the already low freight rates that’s being offered and provide more opportunities for trade with a wider market reach.

On the other hand, industry players may face increasing pressure from each other, forcing the shipping line leave the market as it would have be no longer viable.

As Fiji Ship Owners & Agency Association chairperson, Jeffrey Lin, puts it: “The Fiji market is already well catered for with the existing number of shipping lines.

“In fact, so much so that in July last year, a couple of the shipping lines consolidated their services and entered into a slot sharing agreement.

“It’s all about consolidating with the aim of reducing operational costs.”

This consolidation of services includes Neptune Pacific Line’s vessel-sharing arrangement with Maersk Line.

Maersk Line now operates what it calls the Fiji Express weekly fixed-day sailings from Fiji-New Zealand and vice versa on Neptune Pacific’s vessel.

Another service is the Southpac Consortium which comprises of Pacific Direct Line (PDL), Pacific Forum Line (PFL) and Sofrana Unilines, all under a vessel sharing agreement.

Mr Lin added: “We believe the existing capacity currently been offered by all shipping lines into and out of Fiji is sufficient enough to cater for current demand and that of the foreseeable future.

“Vessel sharing arrangements is something that was always looked into.

“This is more so now, especially with existing freight rates low as it is therefore consolidating services to reduce over operational costs is what most shipping lines are doing.”

Submission

The comments come as a submission is being put forth by industry stakeholders to the Fiji Commerce Commission.

This is on The Tariff Review Submission sent by Fiji Ports Corporation Limited and Fiji Ports Terminal Limited on container-handling charges.

It is anticipated increased rates can enable Fiji Ports Terminal to procure more equipment and improve its port efficiency and management effectively.

As operations manager Nabeel Ali said: “Agents should be promoting for new lines to call Fiji in order to create a larger export market and increasing the Imports market which will directly benefit the economy of the country.

“We have improved on our productivity and efficiency which is most of the lines priorities and we will continue to further increase up to international standards.”

Stance

Fiji Exports Council chief executive Jone Cavubati said: “Ideally we would like to see more competition which will drive the freight rates down.”

Customs Brokers and Forwarders Council of Fiji chairman Vinesh Chandra says Fiji was ready.

“With more competition it would open the door for cheaper freight rates and better services will be available as well,” Mr Chandra said.

“There will be more markets to trade and consumers will greatly benefit out of this.”

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