Some stevedoring charges at the Port of Melbourne are on track to skyrocket more than 2000 per cent in 20 months, prompting Australia's pricing watchdog to call for government intervention.
With increased competition causing profits to narrow for stevedoring services across Australia, the users of most terminals have been subject to an "infrastructure charge" with fee escalation most noticeable in Melbourne, the ACCC reports.
"The likely impact of these charges on supply chain costs, not just for the land transport operators, but also for importers and exporters who may ultimately be paying for the infrastructure charge through their land transport costs, is worthy of consideration by policy makers," it says.
The report cites one instance where the fee went from $3.45 per container in April 2017 to $85.30 from January 2019.
Left unconstrained charges could increase to a point where they would exceed what the stevedores need to recover costs and earn an adequate return, it said.
"Australia's importers and exporters would then face higher charges to ship their goods than otherwise, and not significantly benefit from the additional competition between stevedores at the east coast port."
Stevedores told the ACCC pressures including property-related cost, the need to recover investments in terminal facilities and falling prices charged to shipping lines led to the increased fees.
The Victorian Farmers Federation has urged the state government to act.
"Victorian farmers are already battling to maintain access to valuable export markets in the face of the high production costs and competition from cheaper supply chains in other exporting countries," the federation's grains group president Ross Johns said.
Stevedores may be within their rights to increase charges but they owed it to operators to use proceeds to deliver improvements to the landside facilities, the Victorian Transport Association said.
"Ending these indiscriminate cost increases would be good for all Victorians, and we look forward to playing a leading role in a review that will hopefully give landside operators a fair go at the port," chief executive Peter Anderson said.
A Freight Victoria review into regulating pricing and charges for the port is already underway.
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