The Tasmanian Exporters Group (TEG) have confirmed that preliminary discussions are underway regarding the opening of a new Tasmania-China shipping service, which they are hopeful may begin this summer.
Tasmania has been without a direct export shipping service to the Asian market since the Bell Bay-Singapore route was ceased in August 2011, causing considerable upset to the local economy in the process.
However, TEG representatives have confirmed they have had some discussions with Swire Shipping, of the multinational Swire Group, over their own proposal to establish an 18-day route to Shanghai. The route would also incorporate stops at Townsville and Hong Kong. The talks have been confirmed by Swire Shipping, who stressed they were are an early stage.
Since ending direct exports to Singapore, which involved the shipping of some 60,000 containers annually, Tasmanian exports have had to be sent to Melbourne before being redirected to their Asian destinations.
But this has proven hugely expensive for local exporters, given that the Bass Strait is reputed to be the most expensive water crossing in the world.
The Tasmanian government responded to exporter hardships by granting $14.5 million to six exporters from the Tasmanian Shipping Transition Assistance Fund, while the Federal Government introduced the Tasmanian Freight Equalisation Scheme (TFES) to cover the costs of transporting by sea. But the need to revive a trade route has been the key priority.
News of discussions comes a little more than 4 months after the Tasmanian Premier, Lara Giddings, lead a 25-strong delegation on a 12-day trade mission to China, Vietnam and Hong Kong, in an effort to strengthen business associations.
For 6 days from September 10, the delegation met with a number of major businesses in Shanghai, including China’s largest food and beverage company, the Wahaha Group, which has expressed interest in the Tasmanian dairy sector, and with leading mining and forestry companies.
China is already one of Tasmania’s key trading partners, with total exports in 2012 amounting to more than $830 million – including $778 million in merchandise, $31 million in seafood, and $13 million in wool.
It has been intimated that as much as $30 million over 3 years would need to be secured from transitional government funding to kick start the project. But state Infrastructure Minister David O’Byrne has said that the proposal would be carefully examined by Tasmania’s freight logistics coordination team before any decision would be made.
“Any taxpayer contribution towards a freight carrier could only be short-term, and would need to benefit a wide range of Tasmanian businesses,” Mr O’Byrne said.
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