Ongoing disputes and industrial action at Australian ports spells bad long-term news for the agricultural sector, WAFarmers CEO Trevor Whittington says
Australian farmers should take note of the ongoing dispute at the ports, as sooner or later this is going to hit home and hold up imports needed for seeding.
Yet again the wharfies are on strike, with one of the two big stevedores, DP World – which has been owned by the Dubai royal family since 2015 – caught up in industrial action that has been going on for months.
Unfortunately for the owners, this is not the United Arab Emirates where there is a queue of cheap foreign workers standing at the gate ready to replace any worker that goes on strike.
This is Australia, a country that seems to prefer paralysis to productivity, with its pro-union government and complex industrial relations laws that gives vast powers to those that can hold Australia to ransom.
Unfortunately, some things never change. In the 1970s we had the Painters and Dockers running endless strikes, which in part led to the establishment of the National Farmers Federation when farmers had had enough.
Unfortunately, farmers cannot respond as we did back then by heading down to the wharf and taking over the job ourselves.
Nor do we have a Minister for Industrial Relations as tough as Peter Reith and a stevedore business owner like Chris Corrigan who has the courage to sack all the waterside workers and replace the crane drivers with farmers’ sons who actually want to work.
Since the last big fight, now a full quarter of a century ago, Patrick – now owned by Brookfield Asset Management and Qube – has worked out the solution to peace on the wharves – fewer people and more automation.
Patrick got there by agreeing to big pay rises in exchange for introducing new technology and removing clauses in its enterprise agreement that gave unions a say in the hopelessly inefficient rostering system that paid workers vast amounts to be on call.
This delivered a productivity offset which has left their rival DP World behind and allowed them to pay more. As a result, everyone is a winner except for the unions which see their membership numbers and income shrinking.
The fact that DP World’s workers are now being paid significantly less than Patrick’s workers is the basis for the latest round of industrial action.
The union’s want an eight per cent increase which would get them close to Patrick’s pay levels, but without any productivity trade-offs.
The problem is this would make the billion-dollar DP World business unprofitable and effectively worthless, not that the unions or the government seem to care.
According to an article in The Australian, the waterfront unions also appear to have a hidden agenda of wanting the Dubai owners to sign a two-year agreement.
That way, Patrick and DP World’s enterprise agreements will mature around the same time and open the possibility of massive disruption in 2026.
This will mark the opening for the unions to threaten to shut down the vast bulk of Australia’s stevedore operations at once and therefore threaten large chunks of the country including our agricultural exports and supply of essential imports.
This will be a disaster for the agricultural sector, as yet again Australia will be seen as an unreliable exporter and farmers will suffer massive delays in waiting for the essential imports needed to put in a crop.
Many farmers are already joining the dots of the risk posed by the wharves and now routinely pre-order and have their seasonal requirements delivered months before the first rains arrive.
But that does not help getting our containerised exports of grain, hay, meat and wine off the wharfs in a timely and cost-effective manner.
Without having the likes of Corrigan and Reith, there is no easy fix to the current dispute.
The problem is having a foreign investor who likes the profits but not the fights that come with dealing with Australian unions.
Unless DP World is prepared to stare down the unions and stump up millions of dollars in new capital upgrade, they are going to be forever at the mercy of the MUA.
Apparently, the Dubai royal family have worked out that dealing with Australian unions is all too hard and want out, but there are no buyers.
No investor wants to take on a business that has the backing of a government that hails from the hard left and see business through class war eyes.
The government’s only contribution to the dispute is via the Minister for Industrial Relations, whose solution is to simply lift Australian stevedoring prices and recoup the higher labour costs from importers and exporters that would flow from a large pay increase.
It’s the same solution they have to everything else, which is to throw other people’s money at the problem.
The fight on the wharves has a long way to go, but the unions are patient and they have time on their side.
The ultimate solution is to jump to fully automated ports, as has happened in many parts of the world where they have replaced all the crane drivers with automation.