Swire Shipping pulling out of Tasmania

The operator of southern Tasmania’s only direct freight service has announced it is pulling out of the state in two weeks, forcing customers to transport goods to northern ports by road or rail. Singapore-based company Swire Shipping has been operating out of Hobart every nine days since 2015, but are stopping the service due to charter and bunker costs making the service “commercially unviable”.

The end of the service is expected to seriously affect the forestry sector, with one industry leader saying “a number of communities would be holding their collective breath knowing this will have a significant impact”.

Chief executive of the Tasmanian Chamber of Commerce and Industry, Michael Bailey said the biggest loser from the move was the southern Tasmanian forest industry, which had been using Swire’s service to export to international markets.

“We know that for our Southern forest industries, this is a really important way of getting their residues into a profitable market, so this is a problem,” he said. “There’s really no other option but for the southern industries to freight their products now north. We know the impact that has on their bottom line, and that’s going to be a problem for them.”

Forest Industries Association of Tasmania chief executive Craig Jones said the decision would be “a problem for the Swire’s customers who are using that and then also the customers for the wood overseas”. Mr Jones said the Tasmanian timber industry was sustainable into the future, but was in need of proper coordination. “It’s another illustration of the issue around residues in the southern forestry estate. Unless we find a manageable solution for that, it’s always going to be difficult,” he said.

A State Government spokesperson said logs could still be exported from Hobart through bulk shipments, and the loss of Swire would only affect containerised shipping. She said the Government would work with Swire customers to discuss the impact and alternative freight solutions and had engaged Evan Rolley to examine all forest residue options as a priority.

But Labor’s shadow minister David O’Byrne said forestry companies that relied on the Swire service to ship their product to Melbourne would be significantly affected. “It will mean they have significant extra costs to get their product to the northern ports or they’ll need to seek another exporter to move their products,” he said.

Source: ABC News

Photo: Chief executive of the Tasmanian Chamber of Commerce and Industry, Michael Bailey