Good Afternoon

We are being asked by Customers – Lines, Carriers and Cargo Owners when can we expect
to be back to normal operations?  Regrettably there is no single answer for this as it
depends  upon so many factors, a number beyond our control.

There are a number of reasons for the situation we find ourselves:

1.  We have restricted yard capacity as a consequence of building for automation to come on
stream in late 2019.  This is a project that we cannot defer due to the commitments we
have made to invest in this major capacity and technology project;
2.  We were already experiencing some yard congestion just before the accident due to a
number of the larger North Asia Services being delayed due to bad weather – something
out of everyone’s control;
3.  After 2 weeks of disruptive service during the accident period there has been no break
in the shipping or volume demand to allow us to recover and as a consequence of the
accident there is understandably greater caution in the yard with regard to straddle driving;
4.  As vessels get delayed, both at our Terminal but also at other Ports, efforts are made to
restore lost schedule time by omitting Ports and moving cargo between ships.  This is
adding  to our congestion challenges where we are now regularly seeing yard utilisation
sitting between 110-120+% on a daily basis;
5.  We are operating with a very tight labour supply, as I am aware that many other
industries are experiencing, and with the back to back nature of vessel schedules we
need to provide adequate rostered time off for staff to manage fatigue which limits
our ability to keep up with the demand on the ship side of the operations and road/
rail demand;
6.  We already see import volumes are remaining strong and with recent weather
events over the last weekend in North Asia, vessels yet to arrive will be delayed
seeking contingencies to regain lost schedule time.  This just puts us back into the
cycle of a heavily congested yard and much lower levels of productivity.

We do appreciate that this offers very little comfort to the wider supply chain and
our customers.  We are continuing to evaluate ways in which we can relieve the
pressures and help with increased flow of containers out of the Terminal yard but
there are limited opportunities.  We have explored more use of rail and have seen
some increase to services but for every container we have to move to/from the rail
grid is upwards of 2-3 moves for a straddle which are better serviced handling
containers direct to/from truck.

The road community has been doing a phenomenal job trying to manage the
various priorities and demands of importers and exporters requirements whilst
also fitting in with our own limitations.  Unfortunately we have to maintain a
limit to the VBS slots and continue to manage bookings manually against priorities
– specific export vessel cut offs, laden import active reefer and hazardous containers
and then any other imports where we can provide additional slots based on labour
resourcing each shift.

We are sorry but unfortunately there is no quick fix to this situation and realistically
we would expect to be in this mode of operation for the remainder of the import peak
period.

We will continue to provide these updates which we hope are at least keeping you
informed however we do appreciate offer little solutions for the short term.

Craig Sain
General Manager Commercial Relations

Operational update follows:

Today we would like to update you as follows:

Vessels:
Alongside and working:  Kota Lestari and Spirit of Canterbury;
Arriving today:  Kota Ekspres;
Arriving tomorrow:  Cape Marin and MSC Carla

Please continue to monitor Ports of Auckland website for changes in the vessel schedules.

VBS bookings continue to be managed based on the operational capacity throughout
the day and night.  Our Gate Ops team will continue to work with the trucking companies
and manage priority bookings based on the vessel schedule.  We ask that Carriers provide
container numbers for the booking required when sending requests through to the Driver
Assist Team.

Imports:
Trucking Companies will receive priority bookings for Hazardous and Reefer import
containers.  Please note that there will be no extra free time for DG containers and
reefer containers – including power charges.  Demurrage for all other units has been
extended for the meantime.

Exports:
For the next 24 hours priority will be given only to Export containers for:
ANL Emora;
Aglaia

We request rail users refrain from sending Export containers that are not for the above
mentioned vessels.  Containers that are booked to load later vessels will not be unloaded
from the train and will be returned.

Due to the space restrictions in the yard we will manage receival of Empty export containers
directly with the Shipping Lines. The On Dock Link facility remains open for de-hire of Empties.

We will update you again on Thursday afternoon