Listen to many managers at Australia’s frontline port organisations and the talk is about the financial impact of increasing security. And about the need to bring rational, cost-effective transport arrangements into play in the land-based movement of freight loads in and out of port facilities.

'Australia’s biggest waterfront operation is the Port of Melbourne, which handles $65 billion in trade a year and contributes an estimated $5.8 billion annually to the Victorian economy.

Melbourne’s containerised cargoes account for nearly 70 percent of total port business, with main commodities including dairy products, fruit and vegetables, cereal grains, meat and beverages. The main non-containerised commodity export was cereal grains (29.6 percent of the total).

Last year turned out to be a bumper year for food and beverage exports with the port making major gains in the export of fruit and vegetables, dairy products and beverages.

“We have just had our 11th consecutive year of growth,” said Alan White, national business logistics manager for the Melbourne Port Corporation. “That puts us well ahead of the pack.”

And Mr White believes the present, bullish conditions will continue for the coming 12 months – especially for many sectors of the food and beverage export industry.

Speaking to Global Food and Wine Magazine at Mildura during talks with local stone fruit and citrus producers, he said the drought was having an impact in many areas and some growers – in the rice industry, for instance – might think twice before planting.

“Our present trade is being pushed along by orders that are already in the pipeline – but the year ahead is still looking good, as long as growers are smart about using technology to protect their production. They tell me they’re worried about the increased value of the Aussie dollar – but, at the end of the day, it is better to export whole fruit than to turn it into juice.”

Mr White said the wine industry had just completed a year of 20 percent growth with Australians exporting more wine than they consume at home.

Beef is not a high – volume export item through Port Melbourne – but there has been trimming back in the normally major exports of regional sheep meat and pork, due to feed and water problems.

Sydney is Australia’s second biggest port, handling freight valued at $41 billion dollars a year. The port’s senior manager for Trade Development, Phil Rosser, is bullish about prospects for export sales of food and beverage-related products in the year ahead.
While accepting that the economic outlook in several major international markets is tenuous, Rosser is confident about prospects for food and beverage exporters using the Sydney ports.

Part of his optimism is driven by the fact that, of the 350,000 export product TEUs that are shipped out of Sydney each year, at least half come from Sydney’s own, less drought-affected metropolitan area. The other 50 percent originate in NSW regional areas and interstate.

A new report from NSW Agriculture reveals that farming on Sydney’s fringes accounts for up to 12 percent of the State’s entire agricultural output and is worth round $1 billion a year.
“We are certainly starting to see steady growth among manufactured food and beverage and food preparation exports from Sydney, with a lot of smaller companies dipping their toes in the export water – and that’s good news for Sydney ports,” he said.

Tim Blood, general manager for Ports Services at one of the nation’s biggest stevedoring firms, P&O Ports, surveys the portents for the year ahead and admits, frankly, that he doesn’t like everything he sees. But it isn’t just the drought, Australia’s more muscular dollar or economic recession overseas that concerns him.

Mr Blood believes that the key issue of anti-terrorism security might lead to problems involving port accessibility – and more expense for exporters. In addition, he said, the impact of drought and the higher-value dollar would start to take their toll in the second half of the year.

But there are some moves afoot to make life easier for Australian exporters. A recent initiative from P&O and its major stevedoring rival, Patricks, has been the adoption of a common, port-wide vehicle-booking communication system in Sydney called “One Stop”. The companies believe it will prove to be simpler and more effective, and will encourage the development of a more efficient transport chain.

Fremantle Port’s principal trade information officer, Rod Townsend, said most export business is locally produced with major food products being grain, animal feeds and sheep – mainly bound for Southeast Asia. He said Port Fremantle was working well and was handling plenty of business.

In Queensland, the Port of Brisbane admits that it is likely to be severely impacted by the Australian drought since its major food exports are frozen beef, cereals and other crop produce.
Brisbane handles well over 50 percent of Australia’s meat exports, totalling more than 500,000 tonnes in 2002. Total trade through the Port of Brisbane runs to more than 23 million tonnes and is worth around $20 billion a year.

According to Richard Tooher, general manager for Business Development with the Port of Brisbane Corporation, all Brisbane’s major food export lines are being severely impacted by the drought.

“We are forecasting that, even if there are drought-breaking rains later this year, the benefit will not be seen in exports until well into 2004,” he said. “Even though there may be enough rain this year for growers to plant summer crops, there will be little impact on the 2003 exports. But in 2004 we expect to see cereals and other food exports pick up.”

Horticultural lines such as Queensland’s tropical fruit crops will, in the future, benefit from plans for a major cold store development at Port Brisbane for perishable cargoes.

South Australia’s Flinders Ports Pty Ltd – the private company that took over the state’s Government Ports Corporation in 2000 – begins work this year on a $400 million, decade-long strategy to re-develop Adelaide's Outer Harbour into a globally competitive facility.

First priority in the re-development is the construction of a new deep-water grain berth and dredging of the main entrance channel, aimed at vastly improving service to South Australia's rapidly growing wine, grain, livestock and container shipments.
Flinders Ports reported an increased cargo tonnage in the last financial year, but new competition may come from the Port of Darwin. It’s currently a modest operation, but is set to boom with the opening of the Alice Springs to Darwin rail line early in the first quarter of 2004.

Wayne Webster, marketing manager of RailLink – the freight subsidiary of the development consortium APT – believes the line will eventually create opportunities for food and beverage exports from Australia to Asia. But it will take more than just the completion of a rail service capable of moving products from Adelaide to Darwin in 2 days to ensure this happens.

What still needs to be locked up to ensure a boom in exports is the establishment of shipping freight services out of Darwin to Asia. “There are two big issues that need to be addressed here,” he said. “The first is about attracting shipping to Darwin and the second revolves around establishing a supply chain solution that is cost effective for exporters.

“By 2010, one train approaching two kilometres in length will run daily in each direction along the track. Each train is expected to be carrying around 2,500 tonnes of freight destined for Darwin and beyond,” he said.

“Once the rail link is open, Darwin will suddenly become closer to the rest of Australia and Asia.”