South Port backs sector changes as NZ slips into recession

<p>Bluff port operator South Port New Zealand has thrown its weight behind rationalisation of the sector as the country came to terms with its economy slipping into recession.</p> <p>Port companies have been leading the rationalisation debate, even as regional councils have tightened their port-ownership grip.</p> <p>&#8220To achieve rationalisation in the port sector, port company directors and shareholders need to take a wider view of the potential value and efficiencies that could be secured via combinations and mergers,&#8221 South Port chairman John Harrington said. </p> <p>&#8220It is almost certain that if and when rationalisation takes place, control of the land and infrastructure should remain in local ownership while the operating activity is transferred into new hands.&#8221</p> <p>His comments came as Bank of New Zealand economists said the housing slump and international credit crunch, along with high fuel prices had seen the economy shrink 0.2% in the previous quarter. </p> <p>Mr Harrington, speaking after South Port recorded a 12% higher net profit of NZ$2.51m, said there was also ongoing interest in the development of a viable coastal shipping option, as supported by the Government’s Sea Change report in March, and this had been heightened by port call volatility and with shipping companies having been adversely affected by the higher cost of fuel oil, an international economic weakening and demanding charter rates. </p> <p>&#8220New Zealand has a problem in relation to transport but, at the same time, we acknowledge there is no easy fix," he said. </p> <p>"There is, however, a need for future government infrastructure investment decisions to be based on the most efficient spend within the three transport modes &#8211 road, rail and sea. </p> <p>"To do this effectively, the government must have accurate information on the cost of providing these different modes and establish a more level playing field for the users of New Zealand’s transport systems. </p> <p>"Increases in coastal shipping will only be achieved as a result of economic efficiency and market drivers. South Port will continue to vigorously pursue all avenues available to it in an effort to reach the goal of gaining a coastal shipping linkage. </p> <p>&#8220There is presently a modest level of domestic freight movements conducted by shipping at just 15% of activity levels, compared with 66% by road transport."</p> <p>Meanwhile, South Port’s new 6,000 sq m warehouse for bulk stock food imports for the dairy sector, has been leased by Dynes Stockfood, an existing customer of South Port. </p> <p>A new bulk liquids storage facility will be built by Marstel Terminals on the Bluff Island Harbour and further dairy warehousing has been secured by Dairy Trust. </p> <br />