Trade Supply Chain. Developing Rail and Sea Access. Peter Keyte PBPL

Transcription

1 Trade Supply Chain Developing Rail and Sea Access Peter Keyte PBPL

2 Port of Brisbane key economic enabler Queensland s largest port $50 billion worth of trade handled annually equivalent to c. 20% of Qld s GSP c. 50% of Qld s international trade > 95% Qld s containers > 95% Qld s motor vehicles 100% of Qld s meat exports c. 50% of Qld s agricultural exports Critical to support with freight corridors Economic performance of the country is interdependent on our ports ability to grow More than 40% of the ports freight volumes move through the Toowoomba region

3 Total Trade (tonnes) 45,000, % 40,000, % 35,000,000 30,000, % 25,000, % 20,000, % 15,000, % 10,000,000 5,000, % 0 Arr 2000/01 Arr 2005/06 Arr 2010/11-2.0% Total commodities Trade Growth FY14

4 Why are we focused on rail & coastal shipping Balanced and competitive modal outcome for supply chain all commodities Support forecast trade growth sustainably (organic) Grow trade and new markets induced Provide long term competitive market access for users Stimulate development of regional intermodal terminals and ports Attract freight onto rail & sea to help reduce congestion Reduce community impacts from truck movements Plan and deliver alternative as road reliance unsustainable in long term Assist Qld competitive trading position Strengthen and grow economy

5 Queensland s modal share scorecard Indicative freight movement in Queensland by primary mode, a. All commodities b. Excluding coal Rail share global average 30% Sydney & Melbourne 15% - policy target 30% Brisbane 5% and declining with no govt policy target Coastal shipping poor Source: QTMR Moving Freight Strategy

6 Supporting freight growth an economic imperative Economic drivers: QLD population set to be 10 million by 2050 National food production forecast to increase by 77% by % is exported Household imports increased by 68% in last 10 years Multi-modal transport needed: Freight growth is driven by: population growth consumption trends productivity performance export production (agriculture and mining) globalisation vs. reverse globalisation Global rail share average is 30% Sydney 15% Melbourne 22% Brisbane 4% and declining By 2025, road-based container traffic will = 7.2 million annual truck movements just to service Port trade

7 Consumer demand - container trade & truck movements * Every single container requires 0.92 trucks and three truck movements in the IMEX chain Current rail constraints means almost all forward container freight growth will move by road South-East Qld must develop a long term freight logistics system to match this world class port Inland Rail is not a regional project it is a truly national project congestion is everyone's issue

8 Demand drivers - agricultural exports Recent Qld Parliamentary Enquiry highlights the need for action 2012/13 export commodities from Darling Downs Cotton 672,181t (54,298 teus) 85% road 15% rail Cotton seed 411,610t (bulk 176,176t / Containers 18,894 TEU) 100% road Bulk grain 1,456,793Mt 60% via road & growing Containerised grain 22,640 teu >99% via road Meat 58,720 teu total approx 25% from Darling Downs region Shift of bulk grains into containers (27% in boxes now) Trend away from rail as it is too expensive Agricultural Industry Facts World population forecast to increase, 7 bil. today to 9 bil. by 2050 Australian food production could be 77% higher by 2050 Australian farmers export 60 percent of what they grow Farmers earned the country $32.5 billion in

9 Agriculture Golden Age Road Defining era New export opportunities Sea Rail Increased employment New industries Hub e.g. freight gas Property Improved liveability Freight out of city Air Development opportunities

10 Demand Driver and Funding Potential - Coal PBPL has validated market supply Firm demand >75mtpa Realistic 25mtpa to 50mtpa BFS would involve detailed coal demand process Difficult for general and intermodal cargoes to pay for rail infrastructure Multiple users Multiple buyers Volume spread across many different players Who can fund Stranded coal assets without DFRC Unrealistic for farmers to use SBR supply chain cost too high Does not compete with SBR when coal market recovers

11 Three way approach to increase rail 1) Infrastructure Deliver DFRC as Phase 1 Inland Rail, connect to Northern NSW ASAP Work with supply chains on interface infrastructure spur lines/intermodals etc Coastal shipping North versus expensive rail solution 2) Holistic Supply Chain Approach Coordinated investment strategies Entry & exit points last mile fixes Whole of supply chain review Intermodal hubs - critical 3) Policy & Regulatory settings Common user access Deregulation a must! Increase transparency and ease of access Increase competition for all modes User pays equity between road and rail and sea Access Regulations & Policy Settings Competitive Infrastructure Supply Chain Operations

12 Dedicated freight rail - the benefits Efficient market access for agricultural industries Decentralise industry hubs into regions intermodal terminals must have timely and efficient rail access Urban passenger network separated from freight provides growth & efficiencies for both Balanced modal share reduces urban road congestion and rural road dangers: Almost 4,000 trucks per day removed from the SEQ 186 mil km pa savings in Heavy Vehicle movements in 2045 Reduced road capital and maintenance spending Increased economic productivity Lower freight costs and more reliable export chain Improved road safety and reduced death tolls Improved air quality 460 tonnes of carbon removed annually Compressed commuter travel times (15mins saving Twba to Bne)

13 Plan for North Connection Develop New Range Crossing Port Study Area Remove rail freight from Toowoomba, Ipswich and Brisbane CBDs Develop SFRB Upgrade Western Line Priority Deliver of the missing connection between NSW & QLD

14 Priority National Connection Joining NSW & QLD will connect every port in Australia A logical priority to get Inland Rail started Essential for the Agriculture market

15 ARTC alignments for Inland Rail Why did PBPL adopt Rigorous process undertaken Advanced & backed by Federal government Underpinned by solid economic framework Final product extensively tested with customers and developed accordingly Can move into development & delivery stages now Ability to act while there is political will

16 Three levels of government support Cooperation Agreement between PBPL and ARTC signed Infrastructure Australia s No1 national freight priority for QLD Qld Governing for Growth Economic Strategy & Action Plan Feb 14 Letters of Support from Local Councils Commonwealth Implementation Group (State) Industry backing Appropriate MOU s with relevant parties Interested investors Under our plans, the standard gauge rail line that presently runs from Melbourne to Illabo will finish its almost 2,000 kilometre journey at the Port of Brisbane. The Hon Warren Truss MP Leader of the Nationals & Minister for Infrastructure & Transport, Scott Emerson Queensland Minister for Transport & Roads

17 Demand requirements how to fund? Commodity Agricultural produce Coal Intercapital freight Intermodal freight Business Requirements Provide a long term competitive market access for agricultural exporters as compared to the alternative, road-based option which impacts liveability of residents 60-70% rail share. Provide a solution for transport coal from mine to port at a unit rate that allows the coal to be competitively sold on the world market and will improve the viability of mines in the Clarence-Moreton and Surat coalfields (and thus allows the ultimate rail solution to be funded) mtpa Provide the final link to the Melbourne to Brisbane Inland Rail Corridor and ensure that the performance requirements of this corridor are achieved. Provide a link that will stimulate and encourage growth in rail intermodal freight between the port and freight terminals around SEQ= competitive option to road-based transport % rail share Coal and agricultural can have a symbiotic relationship

18 Inland Rail and Port Connection Status PBPL has successfully placed the DFRC on the agenda of government evolving it into three separate projects 1. Australian Govt has committed $300million for Inland Rail implementation. Blueprint to be delivered by December 2015 by John Anderson s Group (IRIG) 2. ARTC to undertake a detailed investigation to determine the most appropriate alignment and design of a new Port of Brisbane freight rail connection 3. ARTC and QR are negotiating for ARTC to take on the regional freight rail network in Queensland which includes the Western Line Port to Port changes business case from domestic to International

19 Inland Rail delivery solution Dedicated Freight Rail Corridor (DFRC) Toowoomba to the Port Build Southern Freight Rail Bypass (Rosewood to Kagaru) Complete study for rest of DFRC (Toowoomba range/bypass + Port Connection) Study to identify the best corridor to move freight from the urban network Build missing link NSW to Qld systems (dual gauge) DFRC supported by intermodal, agricultural and minerals traffic = strong commercial case This commerciality will support rest of Inland Rail and maximise private funding All users pay but fair and more affordable solution

20 Coastal Shipping Current sad state......but it is the northern solution to rail Minimal coastal shipping occurring due to restrictive government legislation and regulation (Fair Work, Coastal Trading legislation) Rail and road is being subsidised (200,000 teu on rail to North QLD) Port infrastructure upgrades required, but delayed by minority group action Port efficiency renewed focus on access for coastal traders Service reliability critical to ensuring success of any coastal service Must support new entrants to coastal trade to build confidence

21 In summary Port of Brisbane key strategic infrastructure asset for QLD Room to grow & diversify leadership capability Critical to sustainably connect the port to its markets to: Improve liveability for residents over time Ensure efficient, productive and competitive transport task Establishing modern road, rail, coastal shipping intermodal system for Queensland a priority PBPL is taking a lead role in supply chain management beyond port boundaries Business partnerships logistics hubs Established Cooperative Government Relationships