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Shipping container shortage sends cotton industry ‘back to the future’

Shipping container shortage sends cotton industry ‘back to the future’

Australia’s cotton industry is about to experience a blast from its past, with more than 100,000 bales being exported next month to Turkey via break bulk shipping.  

Like most of the world’s goods that are exported by sea, cotton normally gets put inside shipping containers

But a global shortage of containers and general issues around sea freight logistics have caused exporters to seek alternatives.

“We’ve got a record cotton crop, we’ve got the market crying out for our high-quality cotton, so Australian cotton shippers have been looking at other ways of getting our crop to the market,” Cotton Australia chief executive Adam Kay said.

“One of the options that will be implemented is the use of break bulk, so the bales loaded off the dock, straight into the hold of a ship — which is how cotton use to be exported.”

A truck carrying a shipping containers waits to be unloaded at a container terminal

Like the vast majority of commodities, Australian cotton is usually exported via sea in shipping containers.(Reuters: Amir Cohen)

Back to the future

Australia’s first shipment of ginned cotton occurred more than 100 years ago.

The bales from Queensland were loaded onto the SS Westmorland, bound for England in July 1921.

“So the company doing this [shipment to Turkey] is using a hospital-grade ship, which has been used in the past for wood pulp.

“It’s a ship with a gantry-type crane system on it that can lift these cotton bales off the dock and into the hold in an efficient way and a way that doesn’t damage the cotton.”

Mr Kay said the industry could not recall the last time the shipping method was used for cotton.

a black and white photo of a cart carrying loads of cotton.

Cotton being offloaded at a new gin in Brisbane in 1921.(Supplied: Cotton Australia)

Expanding markets

A couple of years ago, China was buying about 70 per cent of Australia’s cotton crop.

Then in October 2020, the Chinese government started to tell mills to stop buying Australian cotton or risk their quotas being slashed.

Mr Kay said the industry had been working hard to find new markets and expand existing markets such as Turkey.

“I think they were finding it difficult to get ships and containers up to the Mediterranean and so that’s why this [break bulk] option is now being explored.”

Australia is on track to produce a record 5.5 million bales this year.

Like most commodities, the price of cotton has eased in recent weeks and is currently valued at around $770 a bale.

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