The Shipper's Council has unsurprisingly found little favour with Port Otago's 100% owner, the Otago Regional Council, nor Port Otago's chairman, John Gilks.
With 13 commercial ports around the country, the industry and analysts believe there has to be rationalisation of the number of ports.
The shipping lines, presently using ships carrying 4100-5000 containers, want to bring larger ships with a 7000-unit capacity to visit less ports, less often.
The Shippers' Council's 96-page report, The Question of Bigger Ships: Securing New Zealand's International Supply Chain, was released yesterday and considered myriad shipping, land-freight and transport options around the country.
The overall finding warns that New Zealand would "seriously damage" its trade performance if it failed to welcome bigger ships to its shores, sooner rather than later, New Zealand Shippers Council chairman Greg Steed said at the Ports and Shipping summit in Auckland yesterday.
"If New Zealand loses its current level and quality of shipping services to South-east Asia alone, exporters face increased costs of $194 million a year to send product via Australia.
With the additional threat of increased travel times to market, exporters of chilled product are seriously concerned.
"In contrast, by accommodating bigger ships, New Zealand stands to benefit to the value of $338 million per year from 2015-16," Mr Steed said.
Both Lyttelton Port of Christchurch and Port Otago have applied for resource consents to widen or deepen their respective shipping channels to accommodate larger ships in the near future.
The council report said it would initially be "logical" for just one port each in the North Island and South Island to invest in accommodating the bigger ships carrying 7000 containers; with Tauranga chosen over Auckland and Lyttelton over Port Chalmers.
Auckland and Otago should in the meantime "prepare" for capital growth plans and secure resource consents for future growth in trade.
"Analysis and research points to Lyttelton Port becoming the logical South Island port to make this investment first," the report said.
Lyttelton handled more containers and bulk cargoes, including coal, than Otago and its costs to accommodate larger ships was up to $80 million, compared to $100 million at Port Otago, the report said.
Otago Regional Council chairman Stephen Cairns was contacted and said while he had not seen the report, he was "surprised" the council was promoting Lyttelton over Port Chalmers, based on size.
"Bigger doesn't mean better.
Economies of scale are not always the point," Mr Cairns said.
On the question raised by the council that LPC is able to potentially expand using an inland port near Christchurch, Mr Cairns countered the same opportunity was available to Port Otago to potentially establish an inland port on the Taieri Plains.
Port Otago chairman John Gilks, who had not seen the report, was similarly "surprised at the judgement call" of the council, and defended Port Otago in that it carried similar levels of containers to LPC and that estimates of $100 million dredging costs were incorrect.
"We are likely to cost less than Lyttelton for deepening," Mr Gilks said.
He said the 2-3-year-old issue of bigger ships arriving in New Zealand had supposed they would be here in three to five years, but Mr Gilks believes that is "at least eight to 10 years away" now.
"There's no suggestion bigger ships will be here in the foreseeable future. [However] we will continue to apply for resource consents in the meantime, but not do the work until there is a clear vision of when the ships are coming, and what size," Mr Gilks said.
In a separate report published by New Zealand Institute of Economic Research last week, local government ownership of ports was criticised as parochial and should be scrapped in favour of more competitive management.
Mr Cairns said yesterday "Local government ownership is not an impairment.
Port Otago is run as a business; there is no political involvement and we are not represented on its board."
There was no highlighting of the 22-month-old, proposed merger between Port Otago and Lyttelton in the council report - a suggestion poised to become a parochial issue in its own right.
"Philosophically, the ORC is supportive of the merger, but we would have liked it finalised by now, either way," Mr Cairns said.
Mr Steed said that under a scenario where a North Island and a South Island port become bigger-ships capable, Auckland and Otago "would continue to play a vital role in servicing" New Zealand exports and imports.
