Pressing need to ease restrictions on port: MP

Substantial shipping costs for growers could be saved if the NSW government eases operations restrictions on the Port of Newcastle.

That is according to North West MP, and former NSW cabinet member Adam Marshall.

The state Member for Northern Tablelands said there is a pressing need to change the port commitment deed which Mr Marshall described as an outdated concept that restricts the current operations of the port.

“I refer specifically to the unfair and outdated embargo that continues to stymie regional development and drains the back pockets of our hardworking farmers and manufacturers in the North West of New South Wales,” Mr Marshall told parliament.

“The North West of the state, including a large section of the Northern Tablelands, boasts the very best grain-growing areas in this country, if not the world.”

Mr Marshall’s speech to the parliament came as the Member for Lake Macquarie, Greg Piper, gave notice to introduce the ‘Port of Newcastle Extinguishment of Liability Bill 2022’.

Port commitment deeds signed during the privatisation of Port Botany and Port Kembla in 2013 require the state to compensate the operators of the two ports if container traffic at Newcastle exceeds 50,000 containers a year.

Mr Marshall said a bumper harvest would easily breach that container cap.

“To double down on that party pooper, when the Port of Newcastle was privatised in 2014, another port commitment deed required that port’s operators to reimburse the state government for any compensation paid to the operators of Kembla and Botany that exceeded the cap—a double whammy,” he said.

“The provisions have not only created an artificial monopoly, which we are against, but have also made establishing a container terminal and increasing capacity at the Port of Newcastle financially unviable for the operators of that port, and our grain growers and regional manufacturers cop it in the neck. We are the ones who pay the price.

“The Productivity Commission recently released a report blaming the government’s embargo on container shipments through Newcastle for ‘raising import and export costs across the container logistics chain’.”

Mr Marshall told the NSW parliament this had led to congestion at Port Botany and a lack of competition.

“Meanwhile, the Port of Newcastle, a shining regional jewel, is a natural gateway to many parts of New South Wales. It is ideally placed to open up the state’s container trade but it is blocked by state government decisions made a decade ago, before COVID-19 and the war in Ukraine.

“Legislators in this place must relook at the port commitment deeds and create an environment which at least removes the reimbursement provisions so the Port of Newcastle can operate in a freer market. This would allow the port to pursue expansion plans without being burdened by the ridiculous compensation requirements. Establishing a container terminal at the Port of Newcastle has the potential of cutting the costs of grain rail freight from my region by $16 to $22 a tonne, putting huge dollars back into the pockets of growers and ultimately our local bush communities and economies.”