Tasmanian Premier, Lara Giddings says Labor is close to clinching an international shipping service for the state.

The Premier said Swire Shipping is the front runner to operate a regular, competitive service between the Tasmanian container port at Bell Bay and Swire's base in Singapore.

Lara Giddings says the deal would involve a subsidy, but would cost less than a quarter of the Liberal Party's $33 million pledge to restart a shipping service.

"Cabinet has approved the negotiations to commence with Swire around a deal that would see international shipping for much less cost than what the Liberal party are putting forward.

"It's very likely that the freight will depart from Bell Bay.

"That's where the last international freight shipping company was based.

"This will also be driven by the demand of the exporters, so where the exporters are wanting to get their product, and how quickly we can work with Swire to deliver that service."

The Premier said Tasmania should have a direct international shipping service running out of Bell Bay in the second half of 2014.
Aluminium smelter's freight costs are crippling

One exporter, Bell Bay Aluminium has already pioneered a relationship with the Swire Shipping company.

Every five weeks it sends half its output of aluminium (about 150 containers) on a Swire ship direct to Singapore.

The other half is trans-shipped by Toll to Melbourne.
Rio Tinto's Bell Bay aluminium smelter, smoke stack in background. Fire closed part of the plant.

At a Productivity Commission inquiry into Tasmanian freight equalisation scheme and shipping, Bell Bay Aluminium general manager, Ray Mostogl gave evidence about the relative costs of international shipping and Tasmania's shipping and port costs.

Ray Mostogl said Bass Strait shipping costs are too high and the Productivity Commission needs to make recommendations that cut the rates by at least 25 per cent, to keep the Bell Bay smelter viable.

"So we're under that pressure, there's no doubt about it," he said.

"Anything that tips us the wrong way does bring the clouds of doubt back into our operation so that's why we're out fighting and making sure our voices are heard in this submission."
Fresh vegetable producer calls for shipping stability

One of Tasmania's premier vegetable companies, Harvest Moon says in comparison with the Bell Bay smelter, it's well serviced by the TT Line and the freight equalisation scheme.

But Harvest Moon managing director, Neil Armstrong told the Productivity Commission inquiry into Tasmanian freight equalisation scheme and shipping that he would welcome a reliable, competitive export service as well.

Neil Armstrong says only 10 per cent of Harvest Moon's produce is exported now, compared with 40 per cent a decade ago.

He says Labor's Freight Logistics Coordination Team is offering a solution that fits the needs of Tasmanian exporters and potential exporters like Harvest Moon.

"I've been part of the Labor review into shipping and on the committee," he said.

"I think the report that came out was very sound and I support all the findings.

"Whoever gets in government that report is pretty shound and should be looked at," he said.
ABS figures confirm Tasmania's export decline to 2005 figures.

Tasmania's Shadow Minister for Infrastructure, Rene Hidding says the latest data from the Australian Bureau of Statistics show Labor and the Greens have failed exporters.

Rene Hidding says 2013 export volumes are the lowest since 2005 show why we need the Libs' plan to restore international freight shipping is needed.

"A market-based approach is precisely what the Freight Logistics Coordination Team called for, and precisely what we were doing.

"All the while Lara Giddings is out there bagging our policy and now she's adopted it.

"But the kind of rotation she's talking about just isn't doable.

"It will be of little interest to the industry," Rene Hidding said.