Fonterra switches freight allegiance away from Toll

Fonterra has moved much of its freight from Toll's rail business to shipping line Maersk over the past 11 months.

Container shipping line AP Moller-Maersk took over its main rival P&O Nedlloyd last August, increasing its share of global trade by 30 per cent.

In New Zealand, the Danish shipping line said it had focused on merging the two business models while looking after key customers such as Fonterra.

Fonterra now carries 75 per cent of its export volume - 600,000 tonnes annually - on Maersk.

As a result of the merger, Maersk added New Plymouth and Timaru to its weekly Singapore-Auckland-Napier-Port Chalmers service.

Before Maersk bought P&O Nedlloyd, Fonterra put some of its cargo from the North Island's west on rail to the Ports of Auckland, and in the lower South Island by rail to Port Chalmers.

"Toll has lost large volumes of dairy long-haul trade to Maersk, particularly on the route between Port Taranaki and Tauranga port," said Maersk managing director Tony Gibson.

"But Toll could retrieve the volume if it manages to draw up a good long-term plan which shows that it could work with Maersk and Fonterra."

Maersk and Fonterra are embarking on a major strategic review of the New Zealand supply chain.

Gibson said the ports sector in New Zealand was over-capitalised and under-utilised and needed rationalising.

Fonterra and Maersk also said that Toll needed to finalise its negotiations on a commercial rail access deal with the Government soon.

Toll chief executive David Jackson said: "We are aware of the dynamics are changing and we are committed to working through that."