ABP slammed over Humber ports monopoly

non descript
16th April 2010, 14:28
Ming Ming criticised....

Courtesy and Copyright of Lloyd's List - Dateline Friday 16 April 2010

A TOP Humberside businessman has attacked Associated British Ports’ “stranglehold” of the Humber ports of Hull, Goole, Immingham and Grimsby, alleging that it “kills off entrepreneurial spirit” and “handicaps” the region’s growth as a UK maritime hub.
Peter Aarosin, chief executive of RMS Group, said: “The Humber is successful but it could be far more successful. The Humber is handicapped by being owned by a single, infrastructure operator. This company owns the two main port complexes on the Humber: Hull and Goole on one side of the river and Immingham and Grimsby on the other side.
“The same single operator also owns the competent harbour authority and the pilotage service. There is no healthy competition at work here and since the company is only looking to achieve long term contracts, there is a spectacular shortage of speculative investments.”
Mr Aarosin, who declined to mention ABP by name, made his comments while giving the high profile shipping lecture to the Chartered Institute of Logistics and Transport in London.
Lloyd’s List was awaiting a response from ABP in London after sending a copy of the speech to its public relations department. It is not clear whether anyone from ABP was among the audience last night.
Mr Aarosin said: “I know for a fact that the Humber infrastructure operator is always aiming to make something like a 15% return on capital for any projects which it gets involved in – enough to kill off any entrepreneurial spirit very effectively.
“We have talked to the competition committee on a few occasions but this committee is of the opinion that there is no real competition issues which will affect the end customer.
He continued: “I always feel inferior when I show continental operators around our facilities, we seem to be somewhat behind our mainland European operators as far as port facilities are concerned, I am convinced that had we got more competition our facilities would be better equipped, be able to work more efficient, be more innovative and strangely also be more profitable both for berth operators and for the infrastructure owners.”
Citing a case study of port costs for a 18,000 tonnes consignment of steel from China to Europe, Mr Aarosin compared his calculation of the fees applied at Hamburg, Rotterdam, Antwerp and Immingham.
For Hamburg, the discharge costs were equivalent to £18,556 ($28,659), in Rotterdam to £25,743, in Antwerp to £26,342 and at Immingham “a whopping” £72,093 said Mr Aarosin.
He claimed that a total of £59,008 in dock dues is payable to the port authority for the “privilege of using the port”.
He continued: “I will leave you to draw your own conclusions, but spare a thought for the extra charges an importer importing cargo each month will pay in addition to his European competitors. What effect has this charge got on the Power Generators? What does the high port costs add to our electricity bill? Charges like these affect every area – pushing prices up.”
He added: “When you compare the costs in Immingham for the steel cargo and oilfield cargo with the three main European Ports, the difference is staggering. This extra UK-only cost is an important factor in making the UK manufacturing industry un-competitive, not only in the European Union but on the world market.
“Manufacturing is always king in my book, and as long as manufacturing is looked after, it will in turn look after the service industry; we have a duty to ensure that we provide the best and most competitive conditions for this important gross domestic product producer.
“The cost of using ports in the UK is prohibitive for a logistics chain. Britain is an island and our ports should be some of the most competitive in Europe in order to guarantee that we attract maximum seaborne traffic in and out of the UK.”
Mr Aarosin also criticised government policy on backdated UK port rates, estimated to place a £200m burden on port businesses. As the UK faces a general election on May 6, the opposition Conservative party has promised to freeze the rates backpayments and to launch an official inquiry into the rating system.
Mr Aarosin said: “Any new government must look long and hard at the ports industry. The Tories have promised us an industry review – and we need action if our ports are to be competitive in the European and global marketplace.
“Competition – both within the Humber and beyond it - is the key to survival. The stranglehold which exists on the Humber ports at the moment benefits no one but the landlord. Loosen it and we would rapidly see some entrepreneurship, more innovative investments and even that long awaited terminal.
“Hamburg, Rotterdam, Antwerp’s port facilities are very impressive; ours must be too. If we can make our port charges more realistic we should be able to see a flourishing coastal traffic round the UK. The water around the UK must be our cheapest infrastructure, it is also green infrastructure.”

Billieboy
16th April 2010, 14:42
He probably forgot to by shares in ABP when they were floated, long ago. Had he purchased some then, he would just sit at home counting his money!

Andrew Craig-Bennett
16th April 2010, 15:07
Interesting comment.

The Haven Ports (Harwich, Felixstowe, Ipswich, Mistley) are effectively dominated by Hutchison Ports, who have Felixstowe, Harwich, Harwich International and planning consent for Bathside Bay, whilst ABP have Ipswich and Mistley (small NAABSA port with one berth) is independent. The Haven Authority which is the conservancy body and pilotage operator is a trust port. There is really no doubt as to who dominates the place.

I suppose that everyone in British shipping (such as it is today) has looked at the Humber and said, "There is room for one more container port in Britain and the Humber is where it should be!"

I'm a director of a business in the port curtilage at Felixstowe which got clobbered by the rates, but we had accrued for them, on the very sound advice of Hutchisons. If we are about to get a windfall handout I'll of course be delighted but it isn't really necessary - I don't know of anyone who folded because of the rates.