Agriculture exports: Freight issues, strikes at ports puts Australian reputation at risk

Australia’s reputation as a reliable export market could be jeopardised by ongoing strike action and global freight issues.

Container and shipping issues continue to plague Australia’s agriculture industry. Picture: Ellen Smith

Stockpiles of agricultural produce could mount up on farms as an amalgamation of factors continue to plague the global shipping freight industry.

And Australia’s reputation as a reliable export market could be on the line if nationwide industrial action at ports continues, industry experts say.

Freight and Trade Alliance director Paul Zalai said the number one challenge facing the shipping industry was a lack of containerised shipping space to ports in the Indian subcontinent, the Middle Eastern gulf, and African ports.

“The congestion and difficulties we are facing don’t discriminate,” Mr Zalai said.

“Probably the biggest issue is that of target markets. We’ve got a situation where international vessels and equipment are in huge demand, and getting clogged up. To do trade to some of these other regions is less attractive to some shipping lines.

“Some of the feedback I’m now getting is farmers with bumper crops of grain and other products, they’re going to have to stockpile goods.”

Mr Zalai said much of the agricultural supply chain was reliant on container freight.

“That’s being caught up on this bigger mess of shipping congestion globally,” Mr Zalai said.

“In the Australian context, we’ve got our own complexity because of industrial relations, and Covid-19 as well. Melbourne and Sydney are opening up, we’re learning to live with Covid-19. But we haven’t been told how to work with it.”

“Something has got to give in that space.”

Australian Industry Group head of industry development and policy Louise McGrath said industrial action at the port of Fremantle – which has been ongoing for more than 10 weeks – was causing significant disruptions to supply chains.

” Business can’t absorb the cost of these delays forever and the impact is likely to extend economy wide,” Ms McGrath said.

“The inflationary pressure of these costs will hit us at some point. Companies can’t keep absorbing these rises in cost. Who is going to bear the cost? Either the exporter, or their customers. And in this case, the whole world is suffering from this. Other countries are having these issues, but they’re not having industrial action.

“You don’t have an ag sector without imports of fertiliser, packaging, and equipment.”