Direct over Indirect Container Transport for 'Remote' Areas: A Case for North Queensland?

Abstract

This paper investigates trade-offs between direct and indirect shipping of overseas containers from East Asia to North Queensland, Australia. Direct shipping is where fully consolidated containers are directly transported to a destination port near which end customers are located; indirect shipping uses hub ports where de-consolidation/consolidation of goods occurs, and then land bridging to end customers in more distant locations. Indirect shipping is common in Australia for coastal locations with less volume. However, recent demographic changes in Queensland make the option of direct shipping, especially for goods from East Asia, more viable. This paper compares the cost, lead time, inventory level and social benefits for these two options. A quantitative case is then presented to illustrate these differences for a typical home appliance commodity. The results indicate that once sufficient freight volume is accumulated direct shipping is beneficial. These changes have significant consequences for Australia's logistics landscape.