A PORT NELSON BLOG
The complex operations of forestry were rushed into lockdown at the commencement of alert level 4 in New Zealand. With little time to adapt, the industry faced cargo jams and logs were having to be left at the site of harvest in many instances. With log export operations restricted during Level 4 Nelson saw only two vessels call at the port.
The move to alert level 3 is welcome relief to the industry and log ports across the country. Over the past week Port Nelson has seen significant volumes of logs arriving through port gates.
At the end of alert level 4, the Nelson log yard was nearly empty with only 8,500 JAS in storage, but this has since ramped up over the first week of alert level 3, with cart-ins peaking on Thursday at 6500 JAS. These volumes are expected to remain strong as log export customers continue to move stock that had been stored at harvest sites.
Stevedoring staff in Picton have since part loaded two log vessels that are calling at forestry ports across New Zealand before heading to market destinations. Nelson exporters are eagerly awaiting the return of log vessels, with the first due this weekend and another two calls during early May.
The strengthening New Zealand Dollar and high log sale price combined with lowered freights rates are also positive news for exporters who hope to make gains after a month of next to no earnings. Log rates are expected to remain favourable and return to pre-COVID pricing over the course of the month.
With a further easing of restrictions under alert level 2 and the opening of the Chinese market there is a sense hope in the forestry industry for continued favourable conditions and recovery of the levels of trade, though stricter hygiene and safety measures are expected to be maintained for the foreseeable future.
The last month has been one that the world is going to be talking about for a long time to come. Six months ago, we had never heard the word “COVID” and now it features in almost every conversation or article we read. But that is not the only reason we will remember the past four weeks at Port Nelson. While we have been navigating the restrictions of COVID-19 our highly skilled team have managed to kick some serious goals and achieve some new records against the odds.
With lockdown starting in peak pip fruit season, the team were prepared for a busy few months ahead, and the season has not disappointed. Demand for the New Zealand’s apples has remained strong and in April alone we have exported 51357 Revenue Tonne or 1938 TEU of the region’s apples to the world.
The Port also welcomed the first breakbulk vessel for apple export since 2016. The Baltic Spring, a breakbulk reefer vessel was chartered by T&G Global to export 5400 pallets or about 31 million apples to Antwerp from both Nelson-Tasman and the Hawkes Bay. Breakbulk vessels were once a common sight during apple season, but with reefer containers now more common, it was first for this type of loading for many of the SSA Nelson stevedores who loaded the vessel over the ANZAC weekend.
The team at QuayConnect have also been hitting new targets as wine drinkers around the world demand New Zealand’s fine wine during times of crisis. Despite an ongoing harvest and what would normally be a quieter time for the team to prepare for the 2020 vintage, QuayConnect saw a 53% growth in volumes during March, from last year, a welcome record for the month that saw our first week of lockdown and nervousness in global markets already hit by COVID-19 shut downs. Throughout lockdown the volumes have kept rolling in. During the week starting 14 April, QuayConnect staff packed 76 containers of export wine. That's 93,632 cases or 1,123,584 bottles of wine in a week. Thirsty work.
The nature of the port means that what comes through our gates must go straight back out and these impressive numbers have seen growing volumes of cargo departing on vessels. On the last day of alert level 4, Port Nelson stevedores loaded the regions’ export containers on to the Moana Chief as they do week on week as part of Pacifica’s weekly coastal service. This week however, the 1740 TEU vessel left Port Nelson at its fullest capacity to date, 1030 TEU. A massive effort from port stevedores and exporters across the region, who continue to meet demand in these testing times.
As we launch into the new realm of alert level 3 and the port restarts log and processed wood operations, the team in Nelson and Picton are pulling out all the stops to get the forestry industry moving again and hopefully breaking some volume records.
edBy now the majority of New Zealand's grapes have been harvested for Vintage 2020. A feat that at the end of March seemed more daunting than usual. Often faced with the impacts of tough weather conditions, the wine industry is not new to a challenging harvest, and the stories from this memorable season have highlighted that.
The challenges came thick and fast, firstly with the announcement of lockdown almost bang on the start of the wine harvest in Nelson-Tasman and Marlborough. Once it had been confirmed that the grape and wine industry was essential, then came the task of a quick adoption of social distancing practices in the vineyards.
Under normal circumstances, harvest is a labour intensive and delicate process usually carried out in teams working closely together, row by row. Much of this seasonal workforce are recruited from overseas, which created additional hurdles of two weeks quarantine, causing a massive risk to the time sensitive crop. Winegrowers were now faced with the demanding task of picking this year’s bumper harvest with smaller crews, working further apart in the field, and separated in isolation in their cells in worker accommodation. Challenge accepted.
Four weeks in and growers are beginning to see the fruits of their labour. Teams of pickers made up of some seasonal workers and vineyard staff from across departments pulled out all the stops to successfully pick their fruit off all the vines. Latest intel from the Marlborough and Nelson region promise a high-quality crop and premium wines from vintage 2020, thanks to the optimum growing conditions over the season, and tireless work of their staff.
There are still on going in-market challenges for the wine industry to face as the world navigates the economic impact of a global lockdown. But, while the shutdown of hospitality outlets across the world will have negative impacts, retail global consumption seems to be booming.
March is typically a slower month for QuayConnect as the industry focuses on harvest, however this March, the first month of lockdown, the team packed 345 containers of export wine, which was an impressive 53% more than March 2019. The trend appears to be continuing with 244 containers packed in April so far. Essential imports of glass bottles are also continuing to flow into Port Nelson, to meet the bottling demands of our top of the south wine producers.
Wine is New Zealand’s 9th largest export by value and its premium quality collects a premium price in market. These booming industries will be essential to keeping the New Zealand economy on track on the rough road ahead. So, while the port and QuayConnect continue to support the export of our fine wines, domestically we encourage all of you to support local, and have a glass of your favourite Kiwi drop to celebrate how well we have done as country to control the spread of COVID-19 during lockdown.
Whether you are spending extended days in your home or safely socially distancing at work, the impact of COVID-19 has seen most of us looking in our own backyard for new ways to make it through these uncertain times.
While it took some adjustment and learning on the go, the team at Port Nelson have found our new rhythm of working. Whether it’s people, infrastructure or operating protocols we are adapting and working together (from at least 2metres apart) to maximize the port’s potential with the great facilities, team and resources we have.
With growing trade comes a growing need for space within the port. With empty containers stacked six high in the container yard and fulls stacked four high in the terminal, the port has optimised its storage, yet often nears capacity during peak seasons like the current fruit and busier than usual wine harvest season. Demand for this valuable on port real estate has further intensified with the unloading of containers and used cars that are unable to be cleared during alert level 4.
The arrival of two log vessels over the past week has allowed a large section of the log yard to be cleared which has created space for the port’s new temporary ‘car park’ housing imported used cars.
The stevedoring team has worked tirelessly over the last few days, loading logs over the Easter weekend and moving import vehicles to swiftly release precious storage and wharf space.
With most empty containers now filled and awaiting export or already on the way to consumers, the port must fully utilise new container stocks arriving. To help meet the high demand for reefer containers, Port Nelson is working closely with on port reefer technicians, Independent Reefer Services International (IRS) and Specialised Container Services (SCS) service providers to ramp up the number of Pre-Trip Inspections (PTI) and repairs carried out on reefers for a quick turnaround of suitable containers to fresh produce customers.
Since the COVID-19 restrictions the port has also begun to receive imports of fertiliser in bulk rather than individually packaged in containers. The new breakbulk cargo has been speedier to discharge and reduced the pressure of container and warehouse storage space. This along with reduced volumes of unessential cargo to store has enabled warehouse space to be made available for busier port businesses like QuayConnect to utilise as overflow storage when needed.
Port Nelson staff have responded remarkably to the new workplace protocols ensuring the port can continue operations and support the region uninterrupted.
Essential workers on port haven’t let the new ways of working slow productivity despite the additional cleaning steps required before, during and after their shifts and they have adapted their daily duties to the 2meter social distance rules. The introduction of separate cells has safeguarded staff from unnecessary exposure during lockdown and has worked well for stevedoring gangs and for AM and PM shifts.
The condition of the heavy machinery used for daily operations is crucial to port productivity. Our skilled workshop staff have continued their essential work to keep equipment such as cranes, forklifts, container handlers and onsite infrastructure and utilities in safe working order to allow the ports vital work to continue.
Seasonality and COVID-19 has meant some departments are busier than others and this has allowed underutilised staff in some areas to help carry out the heavier workload of other departments to keep the supply chain moving.
Teams working from home have fully embraced the technology that allows them to do so. The use of software like Microsoft Teams has allowed staff to carry out their daily tasks almost as if it were business as usual and has encouraged greater collaboration as a unit while working from our own bubbles. Daily morning video meetings are now the norm as we debrief on the day that was and plan for what’s ahead. The power of the internet has also allowed teams to navigate more complex systems like Master Terminal, coordinating truck deliveries and container relocations from afar.
The constant changing scenarios around COVID-19 has also meant ongoing communication is a must and we’ve increasingly been picking up the phone rather than simply emailing each other. A friendly voice on the other end of the line has been both productive and a welcome respite from the isolation we find ourselves in.
As we hopefully edge closer to alert level 3, Port Nelson stands prepared and flexible to the next set of inevitable changes and will continue to innovate within the new normal to best serve our customers, the community and play our key part in the global logistics network.
The current global situation has truly highlighted the importance of the supply chain and the intricacies that need to work together to ensure the uninterrupted flow of goods and cargo across the world.
While cargo continues to move through Port Nelson thanks to essential work operating business as usual with the required COVID19 adjustments, there are a number of global forces that impact certain aspects of our business.
The current COVID-19 situation has seen the supply chain challenged and the knock-on effects are inevitable. The dramatic drop in consumption of non-essential goods has increased capacity on shipping trades, resulting in reduced returns to carriers. The situation is exacerbated by the restricted work practices and full containers of unclaimed cargo unable to be discharged, while others remain empty on port awaiting loading. The global repositioning of containers full and empty has become increasingly difficult due to this congestion of ports and interrupted supply chain.
The current peak pipfruit season in the Nelson Tasman region has heightened the need for containers particularly reefers. Port Nelson is working closely with the shipping lines to make sure that containers are made available as and when required. The seasonal call of Maersk during this peak time is also hoped to expediate the export of fruit from our region.
These challenges have also seen exporters adapting to the new supply chain by utilising chartered breakbulk vessels to move their produce to the market. While this is not a new method of moving fresh produce, and is still used by kiwi exporters, it is the first for apples out of Port Nelson since 2016.
Port Nelson remains flexible to our customers’ needs and will continue to collaborate across the supply chain to ensure all needs are met.
Since the season commencement in early March, Port Nelson has seen a steady increase in the arrival of apple containers ready for export to global consumers. Year to date, 1398 containers have been exported, of which 518 were received last week, week 14 in the growing calendar or week one of COVID-19 lock down.
According to Container Operations Manager, Jonny Cook “this is the busiest week for export apple containers so far this season, and it is on a par with week 14 exports in 2018, the strongest season on record for Port Nelson”. The slightly higher export volumes during the same week in 2019 was a direct result of the early harvest caused by the drought faced last season. “The 2020 season is showing good container movements, and continued discussions with our customers show promising steady volumes in the weeks to come” added Cook.
The stable weather patterns in the region over this summer and the cooler autumn evenings have proved optimum growing conditions for apples in the Nelson-Tasman region, with high quality fruit of all varietals ripe for the picking. This harvest is expected to yield a 6% increase in volumes from the region and 10 -11% increase nationally.
Retail demand from all international consumers remains positive with a majority of containers departing Port Nelson for ports in South China, South East Asia, the Middle East and Europe. Retail demand is said to be bouyed by Europe’s high dependence on imported fresh produce, increased supermarket expenditure and the growth in popularity of fresh produce delivery services, both of which have been driven by the increased appeal of a healthy diet and the downturn in businesses supplying foodservice.
Like all industries, the port and orchards are impacted by adjusted COVID-19 workplace protocols. For the port this has meant on going communication with remaining on port service providers to ensure the steady supply of export ready reefer containers to exporters. For orchadists it has meant adapting harvest practices to new prootocols and fewer migrant pickers to pluck fruit off the trees in time to meet demand and strict shipping deadlines.
Jonny Cook commented that “the container operations and cargo reception team have now settled in to their new working environments and it is business as usual with the help of a little Kiwi-ingenuity and innovation to allow the smooth flow of cargo in to the port while working in isolation. Truck drivers delivering to the port have also been exceptionally patient and adaptable to the new way of working during alert level 4” .