Holcim says it will increase its use of road transport for cement distribution throughout New Zealand after the Government declined a request to approve a foreign-flagged vessel for its coastal shipping operations.
The decision has prompted criticism from the Maritime Union of New Zealand, which says the ruling supports domestic shipping capability and New Zealand-crewed vessels.
It follows associate transport minister James Meager’s decision to rejected NovaAlgoma Cement Carriers’ (NACC) application for an authorisation under section 198 of the Maritime Transport Act. Holcim had entered into a time charter with NovaAlgoma for the Panamanian-flagged, foreign-crewed NACC Vega as a temporary replacement for the New Zealand-flagged MV Buffalo, while a purpose-built vessel was planned.
Meager told RNZ the application did not meet the threshold for issuing an exemption, which is generally reserved for short-term situations where a New Zealand vessel is not immediately available.
“Generally, those authorisations are very short, if not one-off cargo movements to fill a gap or where a vessel is not immediately available. After careful consideration, we made the decision that the application did not meet that threshold,” Meager says.
“I appreciate that there has been a high degree of interest in the outcome of the application. The public should have confidence that all authorisations to carry coastal cargo align with the intent of section 198 of the Act, and that has been my priority throughout this process.”
Holcim preparing to move cement by road
Holcim says the minister’s decision prevents it from maintaining a coastal shipping option during the transition period and that no locally flagged vessel can meet its requirements.
The company says it has begun preparing to increase its use of road transport for cement distribution throughout New Zealand. Holcim estimates this will involve moving approximately 15,000 tonnes of cement a month, requiring more than 500 additional truck movements.
“This is an undesirable, but now necessary, decision,” a spokesperson says.
“We have to ensure the continuation of cement supply to our customers across both the North and South Islands.”
Holcim says the shift to a larger road-based supply chain will cost the business millions of dollars and could make a return to coastal shipping uneconomic in future.
The company also clarified that reports suggesting 32 seafaring jobs were preserved were incorrect. It says the MV Buffalo will leave New Zealand on December 28 and that “there are no seafaring jobs available at Holcim” following that departure.
Maritime Union supports minister’s decision
The Maritime Union of New Zealand (MUNZ) has welcomed the minister’s ruling, and says Holcim management should “stop digging itself into a bigger hole”.
“Holcim has a straightforward answer to their self-inflicted problem, which is to utilise a New Zealand-flagged and crewed vessel,” MUNZ national secretary Carl Findlay says.
“Holcim’s threat to jam hundreds of trucks onto New Zealand roads through spite has destroyed its social licence and public credibility.
“This is a company generating multi-billion dollar global profits threatening environmental harm and supply chain risk on New Zealand, simply because it failed to find a loophole in the system.”
Findlay says Holcim’s plan to replace the New Zealand-flagged MV Buffalo with the Panamanian-flagged NACC Vega crewed by foreign labour on inferior terms and conditions was a “blatant attempt to exploit foreign seafarers and circumvent the law through Flag of Convenience (FOC) shipping”.
“I wonder if the local management of Holcim has gone rogue, as it seems unlikely their corporate headquarters in Switzerland would be impressed by this type of behaviour.”
Findlay says Holcim needs to apologise to New Zealand, accept the decision of the Government to abide by the laws, and negotiate for a local crew for a coastal cement vessel.
