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The Israeli government’s plan to reform its port sector is leading to huge challenges for forwarders operating in the country, as authorities and labour unions clash over the proposals.

Elinoar Pridan, managing director of WCA Family member Ordan-Cargo, told The Loadstar that wildcat strikes by members of the powerful Histadrut union at the country’s main ports of Haifa and Ashdod had led to heavy container congestion.

“It is a very difficult situation – the unions try to create every possible obstacle to the flow of cargo. Sometimes the congestion is in Ashdod, sometimes at Haifa,” she said.

Crane drivers in Israel are among the best-paid in the world, reportedly earning up to US$20,000 a month. The government is keen to liberalise the terminal sector and bring in private operators to manage its container facilities.

picture of elinoar march 2010 (2)

Mrs Pridan (pictured) said that, following a strike in the wake of the recent Passover holiday in Israel, around 1,000 containers due to be discharged at Ashdod had to be landed at Haifa instead, as the country’s box shipping line Zim Israel Navigation diverted its vessel call to the northern port.

“It took between a week and ten days to complete the transfer, and meant a lot of extra trucking and rail costs,” she added.

The situation has been compounded by worker action at Zim, where the staff are worried about the corporate restructuring taking place at the line. They are protesting that the government retains its “golden share” in the company as a way of maintaining positions that currently employ Israeli workers.

This was shown last week after seafarers aboard the 3,500teu Zim Iberia seized control of the vessel in Ashdod and refused to sail. According to Ashdod port, the vessel had arrived on 7 May from the Turkish port of Mersin, but since then no containers have been discharged from it.

There have also been reports that Zim has shut union members out of its headquarters in Haifa over the protests against the company’s plan that the Israeli government relinquishes the “golden share”. This forms part of Zim’s financial restructuring process, reported earlier by The Loadstar.

According to local reports, the line’s chief executive, Rafael Danieli, has refused to meet these demands and additionally ordered a reduction in employees’ work conditions.

As a result, the line has also been discharging cargo at Cypriot ports and feeding them to Israel, causing further delays for forwarders.

Nonetheless, Mrs Pridan said that trade in the country was in reasonably good health – Israel expects to post GDP growth of 4.5% this year – and new shipping services into the country had led to some modal shift from air freight. A service launched by MSC several months ago between New York and Haifa had led to a major air freight shipper switching from air to ocean.

“This Ordan customer used to do everything by air, but with the new service they are using one reefer container a month to do this freight – it is much cheaper, and the container cooling technology is much better than in the past,” she said.

At the same time, she added, competition between air freight operators was growing. Alongside flag-carrier El Al, Israeli all-cargo airline CAL operates a daily flight to Liege, while Mrs Pridan said Turkish Airlines had been increasing freighter capacity.

In addition, the integrators also serve the country with freighter capacity.

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