Industry News

Supply chain perfect storm threatens Christmas

The Victorian Transport Association (VTA) holds grave concerns for the integrity of state and national supply chains.

Planned industrial action and the potential for interstate linehaul driver shortages in response to the looming vaccine deadline have created a perfect storm ahead of Christmas.

Port of Melbourne stevedore Patrick has forecast delays of at least a week by mid-October because of 40 industrial actions planned by the Maritime Union of Australia at East Swanson dock.

The union plans rolling work stoppages totalling over 140 hours across 23 shifts in October, as well as bans on overtime work.

Industrial action is further exacerbated, according to the VTA, by limited capacity for stevedores VICT and DP World to offload containers from the inevitable backlog of ships because of positive COVID cases at those terminals.

Industrial action by the TWU in relation to sham contracting is also adding to the concern, with the knock-on effect of work stoppages by road and maritime freight operators causing likely shortages at supermarkets and other retail stores across Victoria.

On top of that, an industry that is already struggling with driver shortages may face additional pressures, with the October 7 deadline for Specified Worker Permit holders (Multiple Entry) just one week away.

This cohort was given only two weeks’ notice to get vaccinated, and while the extension of booking deadlines has helped, it is unclear how many haven’t had the first of two COVID-19 injections mandated by the State.

Like workers in other industry sectors, some drivers have exercised the personal choice to not get vaccinated, disqualifying them from interstate transport work.

“Victorians need to prepare themselves for a shortage of goods in the short and medium term as we head into Christmas because of the massive supply chain disruptions we anticipate from industrial action and labour shortages,” said VTA CEO Peter Anderson.

“The work stoppages at East Swanson Dock will double the time it takes to unload a ship from one to two days to two to four days, and there will be a knock-on effect to landside road transport operators collecting containers being offloaded from ships at a much slower pace,” he said.

Increasing clusters of ships in Port Phillip Bay will be another by-product resultant from a limited capacity by other Port of Melbourne stevedores to service the backlog of container ships.

Anderson expected around ten per cent reduction in heavy vehicle drivers able to service the interstate freight task because of the 7 October COVID vaccine mandate.

“Because of the skills and licencing requirements to operate a heavy vehicle, we can’t just take drivers from one part of the industry to another, so we do expect some delays in linehaul freight because of the additional anticipated driver shortages after 7 October,” he said.

“As we approach the busiest time of the year, this is not an ideal scenario, with consumers ultimately paying the price by not having reliable access to the goods they enjoy.”

In the United States, a record-breaking number of cargo ships are currently anchored off the coast at the ports of Los Angeles and Long Beach.

Labour shortages, holiday buying surges and other COVID-19 related issues were being blamed as consumers questioned how much of the crisis is being manufactured.

Surging demand for imports saw retailers and manufacturers rush to place orders and restock their inventories as the cost of shipping between China and the US plunged last week after hitting record highs in early September ahead of the off-season.

Multiple provinces across China have suspended factory production to ameliorate energy shortages or to meet the central government’s energy consumption control targets.

In response to this speculators have been quick to sell their hoarded shipping spots before the annual slowdown brought about by Chinese holidays.

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