Tuesday, August 10, 2010

Problems For Port Botany Despite Container Terminal Approval

Rail Strike Suspended but Rates Threaten Harmony
Shipping News Feature

AUSTRALIA – Port Botany, set fair for a massive expansion after it’s half built A$1 billion container terminal development received another vote of approval from auditors this week, even on ecological grounds, was the subject of controversy as force majeure was declared on container rail traffic shipping through the Sydney facility because of planned industrial action over the next few days by rail freight staff.

Strikes called for 12th and 18th August had been notified by RailCorp and the declaration is intended to effectively protect the carriers from liability for claims arising from the situation. Today the action planned for Thursday was suspended by unions in a goodwill gesture but next weeks action is still on the cards.

Perhaps more damaging for the port’s long term future rates set by the Patrick Corporation, an Asciano subsidiary, have been widely criticised and the company threatened with sanctions by the Sydney Ports Corporation. Port operator Patrick intends to introduce the higher rail window rates from 1st September and opponents claim it will effectively derail the New South Wales Government’s sworn strategy to shift more than 40% of Port Botany traffic to rail carriage.

It has been a good week for fans of force majeure, one of those shady, indistinct clauses born of Civil Law parents and much misunderstood and wrongly imposed over the years. The Russian Government banned grain exports a few days ago to the apparent relief of agricultural traders, many of whom now believe they are able to hide behind the clause to allow them to escape from uneconomic deals. As a challenge through the Russian Courts is singularly unappealing to any party feeling wronged, just jumping behind the clause may be the cause of some controversy.

Photo: Patrick Container Handling Facility – Port Botany