Maritime Union of New Zealand

The Maritime Union of New Zealand is hosting a public meeting on the future of the Port of Timaru. The meeting will be held at the conference room at “Robbies” (Hibernian Hotel), Latter Street, Timaru on Thursday 17 September starting at 7.30pm sharp.

All concerned local people are invited to the meeting, including port workers, unions, business, industry, farmers, and all those concerned with the future of the port.

For more information see the Port of Timaru campaign website.

The Maritime Union is asking where the Government and the Minister of Transport stands on the future of regional ports after Fonterra announced it was withdrawing from some regional ports in favour of transporting goods by long distance rail last month.

Jobs are under threat, casualization is hitting workers hard, and the viability of regional ports is under a cloud after the decision, which has created intense debate in the regions and the transport industry.

Maritime Union General Secretary Trevor Hanson says the union’s national executive met with a Fonterra representative earlier this week.

He says the meeting was a useful initial step but none of the issues had been resolved.

“We want to see Fonterra registering the fact they have a social responsibility to the communities they work with, not just a narrow focus on short term benefits for their shareholders.”

However he says the Government seems to have “turned on the auto pilot and left the bridge.”

Mr Hanson says that no satisfactory response has been forthcoming about the impact of Government investment in rail and how this could influence pricing, but questions were continuing to be asked throughout the industry.

“The Maritime Union supports public investment in rail, but if ports and coastal shipping are not receiving the same public investment, then this cannot lead to the most effective solution.”

Mr Hanson says there has to be a co-ordinated national strategy for ports and transport where Fonterra had a role but was not able to dominate for their own benefit.

He says the lack of response from the Transport Minister is a concern as it appears the Government had “gone to sleep” on a major issue in the regions and the heartland New Zealand communities it electioneered on.

“This is bigger than Fonterra. We are talking about the future of transport in New Zealand and if we leave it up to the biggest player to call the shots, then the result will not be a good one.”

The Maritime Union is pressing for “social responsibility” from Fonterra and a national transport strategy that works for the regions following the meeting between the union and the dairy giant.

Mr Hanson says that appears some progress has been made in Port Taranaki with extra work being found for the port by Fonterra, which would lessen the impact of its sudden switch to a long distance rail option.

He says that it is imperative that similar arrangements be made with the Port of Timaru, where job losses and the casualization of the workforce are occurring, with the port reeling from the loss of more than half of its container traffic.

The following resolution was passed this week at the national executive meeting of the Maritime Union of New Zealand in Wellington:

“The Maritime Union national executive registers its concerns at the actions of Fonterra in its arbitrary decision to stop shipments through Timaru and Taranaki and also the effect this will have on all the other ports”

“The Union will continue to campaign for a full and proper discussion among all stakeholders including ports, maritime workers, farmers, regional business, local government and national government to ensure that regional ports are not disadvantaged by Fonterra’s decisions.”

“Further more the unilateral move to bypass the environmental and commercially viable option of coastal shipping, is of further concern especially when New Zealand’s carbon footprint is of real concern in the future of NZ exports.”

The Maritime Union of New Zealand was formed in 2003 and represents waterfront workers, seafarers and related workers throughout New Zealand.

Cartoon courtesy of the Shipping Gazette

The Maritime Union has stepped up its demand for answers as fallout continues from Fonterra’s dumping of regional ports in favour of long distance rail – and the influence that state subsidies to KiwiRail may have had on any deal.

KiwiRail has waded into the growing debate over the fate of regional ports, as the implications of Fonterra’s withdrawal from ports in New Plymouth and Timaru becomes apparent.

KiwiRail chief executive Jim Quinn was reported in the Taranaki Daily News (29 August 2009) saying any Government subsidy was irrelevant to the Fonterra deal but that KiwiRail did need the subsidy.

Maritime Union General Secretary Trevor Hanson says that the situation has obviously blown up in Fonterra’s face and it needed to be held to account.

He was not satisfied with KiwiRail’s answers and said “either they are being subsidized or not, and we believe there is more to this situation than regional communities are being told.”

Now the Maritime Union for public meetings to begin “active resistance” to the actions of Fonterra.

Mr Hanson says there should be immediate public meetings organized to bring together those affected by the decisions – ports, local councils, farmers, maritime workers, local businesses and all affected citizens, to demand some input into such decisions.

He says locals need to fight back against the destruction of these ports, and ultimately the damage to their regional communities.

The Union is also demanding answers from the Government as to how taxpayer funding of KiwiRail is being allowed to threaten the future of regional ports.

“The Government has the end responsibility here to step in for the national interest. To stand aside and let these heartland communities have their infrastructure and transport systems effectively demolished by a five hundred pound gorilla called Fonterra is showing that it either has no idea or the wrong idea.”

Mr Hanson says the both of these ports are capable of handling their local cargoes – without subsidies.

He says the money these ports have invested in infrastructure to handle Fonterra’s trade has effectively been flushed down the drain.

“The question needs to be answered – is the Government aware of any influence of subsidies on the price of the movement of cargo on rail hundreds of kilometres away from its regional catchment?”

“Both ports need to ask the Government to put Fonterra’s activities on hold until a true cost of their decision has been investigated.”

Mr Hanson says for some time there has been strong advocacy for the use of coastal vessels to move cargo out of the secondary regional “feeder” ports to major exporting “hub” ports.

He says this strategy has now been “blown out the water” without explanation or discussion in the industry.

Mr Hanson says Fonterra shipper Maersk needs to state its position as one of the largest shipping operators in the world.

“Maersk has described itself as a socially responsible company and will be very aware of the damage caused to regions and communities from Fonterra’s actions.”

“We have to wonder if Fonterra has other shipping options under study, and what effect this could have.”

The Maritime Union has hit back at “socially irresponsible” Fonterra pulling out of regional ports and says the dairy giant’s profits are being subsidized by the taxpayer.

Maritime Union of New Zealand General Secretary Trevor Hanson says Fonterra has come out with “weak excuses” for its decision to pull out of some regional ports in favour of transporting products by long distance rail.

Mr Hanson says the future of the New Zealand transport industry seems to be in the hands of one man, Fonterra General Manager of Supply Chain Strategy Nigel Jones.

“Fonterra holds the fate of whole regional economies in their hands because of their size and influence, but seem to have no accountability to anyone but themselves.”

He says recent comments by Mr Jones to rural sector media confirmed Fonterra had no interest in working for a stable and secure regional economy.

“Mr Jones says his goal is to put more money in farmers pockets. Yet he has admitted the large public investment in rail has been behind the decision to dump ports. There has been no debate as to whether this vision is correct or dangerously wrong. Regional communities have been ignored.”

Mr Hanson says he does not believe the rates being paid by Fonterra to rail their goods are sustainable and are basically being propped up by the public.

He says there is a real danger if the rail plan fails, there would be a huge increase in container trucks on the road and regional ports would have disappeared.

Mr Hanson says the decision by Fonterra affects all the other producers who send goods through regional ports like Timaru and New Plymouth.

He says public investment in rail is a good thing, but only as part of an integrated transport system, and publicly owned rail should not be used to play off regions and transport modes against each other.

“It is common knowledge that ports such as Timaru and New Plymouth had planned and invested heavily in upgrading infrastructure to cater for Fonterra. Now they are left high and dry because of overnight decisions. There has been no consultation, no social responsibility and no recognition from Fonterra about the wider implications of their actions.”

“People in the regions are paying three times to subsidize Fonterra profits – they are paying for their regional ports to invest in infrastructure that is then made worthless, they are paying to upgrade rail infrastructure to carry Fonterra goods, and they are paying with their jobs and livelihoods when Fonterra makes overnight decisions to abandon regional ports.”

Mr Hanson says the “hands off” approach by Government to ports has led to a dysfunctional situation which was harming regional economies.

“We cannot have a company like this able to dictate terms to regional New Zealand and cause havoc in regional economies through arbitrary and irresponsible decisions.”

He says that the profits made by Fonterra and primary industries are not just created on the farm, they are created by an entire production and logistics chain that includes transport workers, ports and shipping.

“The actions of Fonterra have a massive impact on regional economies, and if they continue to make harmful decisions based entirely on their own short term interests, then regulation is the only answer.”

The Maritime Union says regional ports have been hit hard because of a decision by Fonterra to rail goods to distant ports.

Maritime Union General Secretary Trevor Hanson says the moves have already led to notices of major redundancies in the port of Timaru, greater casualization of the workforce, and was threatening the viability of some ports.

“This issue cannot be dealt with by ports continuing to compete each other into the ground. It must be addressed by national co-ordination of our transport system, not the wasteful, insecure and chaotic mess we have at the moment.”

He says that Fonterra is running for cover on the issue and their explanations have not satisfied people in the regional ports affected by their recent decisions.

Mr Hanson says there are industry concerns that Fonterra may be getting extremely low rates to transport goods by rail.

He says while such a situation might suit Fonterra, regional ports and coastal shipping were being disadvantaged.

As rail was publicly owned, this could mean people and businesses in those communities would be effectively paying for work to be taken away from them.

Mr Hanson says it’s not a case of rail versus sea.

“The Maritime Union is a big supporter of rail being in public ownership, and public investment in rail, but it has to be part of an integrated transport system, not just another way for the big operators to play off ports and transport modes against each other.”

He says the Maritime Union supports the use of coastal shipping and rail working together, rather than the Government’s emphasis on “unsustainable, polluting and inefficient” heavy trucking.

The Maritime Union’s comments on the effect on ports of decisions by Fonterra and shipping companies have featured widely in the news.

TVNZ reports that “the Maritime Union of New Zealand is calling for national co-ordination of port strategy, arguing that Fonterra is exerting such power as a customer it is effectively rationalising the port industry.”

The Taranaki Daily News writes that “Zealand’s waterfront workers and seafarers have savaged Fonterra’s decision to drop Port Taranaki, warning it has the potential to ‘rip the guts out’ of the port” following a “a bombshell decision last week, the dairy giant said it would be railing Whareroa product to Auckland and Tauranga instead.”