Regulating efficiency into port-oriented chain systems: export coal through the Dalrymple Bay Terminal, Australia

Abstract

Supply chains generally, and port-oriented chains more particularly, are not easily integrated for operational efficiency. This is not especially surprising given their complexity and the underlying power relationships by which they are structured. Nonetheless, integration that does occur may reflect efforts to re-engineer the chain; or, not unusually, it may be the result of substantial, market-based rationalization and consolidation of the industry through corporate restructuring by merger, acquisition or joint venture. Much less common, at least in a ports/shipping context, is the attempt to induce supply-chain integration and operational efficiency by direct application of regulatory power and through the intervention of a regulator into the marketplace. In April 2005 the Australian Competition and Consumer Commission (ACCC), the Australian competition regulator, intervened in the export coal chain which is oriented on the large coal handling terminal at Dalrymple Bay in Queensland. The Commission, through its authorization powers, allowed the terminal operator to introduce a queue management system designed, inter alia, to reduce ship queuing at the terminal and in so doing reduce the costs of ship demurrage and its negative impacts on exports. This paper focuses particularly, but not only, on the conceptual relationships between regulation and supply chain efficiency; and it examines the mechanisms, processes and outcomes in the Dalrymple Bay case.

Acknowledgements

The author wishes to acknowledge with much gratitude the interest, effort and expertise of talented coal and rail industry managers who were involved in the University's Graduate Program in Bulk Freight Systems Management over the last year or so. Some contributed research papers, which are listed in the references; all deserve mention. I acknowledge also, with appreciation, the co-operation of the management of the Dalrymple Bay Coal Terminal; and the exceptional contribution of Martin Oldfield, General Manager Coal in QR National and of my research and teaching colleague Associate Professor Sophia Everett.