RDA Priorities

Transcription

1 RDA Priorities RDA name Regional Development Australia Mid North Coast Project Name Mid North Coast Freight and Distribution Study RDA Project Priority 1 Document Title: Mid North Coast Freight and Distribution Study Prepared For: NSW Department of Industry Regional Development Prepared By: Regional Development Australia Mid North Coast This document is the joint intellectual property of RDA Mid North Coast & NSW Department of Industry, allowing dissemination to other organisations as appropriate. The project methodology used to develop the document remains the Intellectual Property of RDA Mid North Coast. You may reproduce and publish this document in whole or in part for you and your organisation s own personal, educational or non-commercial purposes. You must not reproduce or publish this document for commercial gain without the prior written consent of RDA Mid North Coast or NSW Department of Industry. Regional Development Australia Mid North Coast

2 Mid North Coast Freight and Distribution Study Contents Executive Summary Introduction Study purpose and objectives The Study Area Structure of this report... 7 Section 2 Definitions and Sustainability Criteria Intermodal Terminal Road Freight Hubs Highway Service Centres Section 3 The Current and Forecast Freight Task Overview of the Freight Task on the Mid North Coast Outbound Freight Inbound Freight Forecast Freight Growth Forecast Outbound Freight (2031) Forecast Inbound Freight (2031) Section 4 Road or Rail? Identification of Contestable Rail Freight Intermodal Freight Hub Summary Section 5 - The Road Network The Existing Road Network Proposed Freight Transport Infrastructure Viability of a Regional Freight Transport Hub Section 6: The Rail Network The Existing Rail Network Regional Development Australia Mid North Coast

3 6.2 Proposed Rail Freight Transport Infrastructure The viability of a regional intermodal Terminal in the study area Section 7 - How a Freight Transport Hub Aligns with Government Strategies Conclusion List of Tables Table 1: Population by Local Government Area... 6 Table 2: The top 5 commodities making up the outbound freight task - Mid North Coast (2011) Table 3: The top 5 commodities making up the inbound freight task - Mid North Coast (2011) Table 4: Forecast Outbound Freight Volumes by Commodity Category, Mid North Coast, Table 5: Forecast Inbound Freight Volumes by Commodity Category, Mid North Coast, Table 6: Outbound Freight Volumes by Local Government Area (LGA) Table 7: Inbound Freight Volumes by Local Government Area (LGA) Table 8: Rail Freight Mode Share by Commodity Category in NSW excluding coal Table 9: Inbound and Outbound Commodities Suitable for Transport by Rail, NSW Mid North Coast.. 22 Table 10: Evaluating Contestability Mid North Coast Table 11: Distance to Major Centres Table 12: Proposed Transport Infrastructure on the Mid North Coast Table 13: Mid North Coast Population Forecast Table 14: Existing Rail Infrastructure, NSW Mid North Coast Table 15: Intermodal Terminals in Northern NSW Table 16: Evaluating Contestability - Summary List of Figures Figure 1: The Study Area: Mid North Coast of NSW... 6 Figure 2: Transport Logistics Options... 8 Figure 3: Intermodal Terminal Viability Checklist... 9 Figure 4: Freight Hub Requirements for Geographical Advantage Figure 5: National Rail and Highway Network Figure 6: Australian Rail Track Corporation: North South Corridor Network Diagram, Rev 7 Jun Figure 7: Intermodal Terminals in NSW Figure 8: Melbourne - Brisbane Inland Rail Alignment Regional Development Australia Mid North Coast

4 Executive Summary The purpose of this study was to identify the current and forecast freight task on the Mid North Coast of NSW and determine if there are sufficient volumes of freight to establish viable freight transport infrastructure, such as intermodal terminal(s) or road freight hub(s) in the study area. The study area is located on the Mid North Coast of NSW and comprises the local government areas of Coffs Harbour, Bellingen, Nambucca, Kempsey, Port Macquarie-Hastings and Greater Taree. An intermodal terminal is a strategic location between a freight service user or exporter / importer and a destination. It offers a customer road and rail transport access, and short-term storage. A freight hub is a place where cargo is exchanged between vehicles or transport modes and may be a cluster of logistics operators and light manufacturing industries. Data obtained from the Bureau of Freight Statistics, Strategic Freight Model (2011) reported that the study area generated 1,972,000 tonnes of outbound freight and 2,518,000 of inbound freight in The highest volumes of outbound freight were generated by: 1. Forest products 2. Dairy Products 3. Meat 4. Containers and General Freight 5. Food Products The highest volumes of inbound freight were generated by: 1. Fuel and Lubricants 2. Consumer Goods 3. Food Products 4. Building Products 5. Containers and General Freight The Mid North Coast freight task was characterised by a dispersed market. Both inbound and outbound freight had dispersed origins and destinations. The outbound freight task produced few commodities with a significant volume of direct, single origin destination freight. Regional Development Australia Mid North Coast 1

5 Outbound Freight The biggest outbound freight volume was generated by forest products, with Newcastle Port the key destination for this commodity. Significant volumes of outbound freight were generated by Containers and General Freight, with Queensland being the key destination. Significant volumes of outbound freight were generated by Food Products, with Victoria being the key destination. Inbound Freight The biggest inbound freight task was generated by Fuel and Lubricants with Newcastle being the key origin. Significant volumes of inbound freight were generated by Consumer goods, with Newcastle being the key origin. Significant volumes of inbound freight were generated by Food Products with QLD being the key origin. Significant volumes of inbound freight were generated by Containers and General Freight with Queensland being the key origin. Transport for NSW reported a forecast annualised growth rate of 2.44% for outbound freight and 2.99% for inbound freight. This equates to a 58% increase in outbound freight and a 75% increase in inbound freight between 2011 and The forecast annualised population growth rate was much lower at 0.75% or 15% between 2011 and 2031; thus it can be assumed the forecast growth of outbound freight will need to be largely driven by inter-regional and international trade servicing demand. Intermodal Freight Hub Viability Assessment The intermodal freight hub viability assessment concludes that: The volumes of 2011 inbound and outbound freight did not meet the minimum 10,000 Twenty- Foot Equivalent Unit (TEU s) for a sustainable intermodal terminal when a 5% and 10% mode share was tested. The volumes of 2011 inbound and outbound freight met the minimum 10,000 TEU s for a sustainable terminal when a 15% mode share was tested. Forecast data for 2031 illustrated the overall volume of both inbound and outbound freight did not meet the minimum 10,000 TEU s for a sustainable intermodal terminal when a 5% mode share was tested. Regional Development Australia Mid North Coast 2

6 Forecast data for 2031 illustrated the overall volume of both inbound and outbound freight does meet the minimum 10,000 TEU s for a sustainable intermodal terminal when a 10% and 15% mode share was tested. The outbound freight task on the Mid North Coast comprised 50% Forest products (2011 data). Transport for NSW (2015) advised that Forest Products can be considered highly variable as production can stop, start or shift in focus quickly. Given the uncertainty of production, shippers were often reluctant to fund long term investments in their supply chain. The variable nature of such a large portion of the Mid North Coast outbound freight task represented a significant risk to the development of an intermodal freight terminal, based on this commodity. It was considered this represented a significant limiting factor to the establishment of an intermodal terminal in the study area. Road Freight Hub Viability Assessment The road freight hub viability assessment concluded that: Three industrial land developments are proposed on the Pacific Highway in the Nambucca, Port Macquarie - Hastings and Taree LGA s. These locations were identified as suitable for development as road freight hubs and were well placed to proceed in a timely fashion. Existing investment ready industrial land adjacent to the Highway Service Centre in Kempsey was identified as suitable for development as a road freight hub. Proposed industrial land in the North Boambee Valley, adjacent to the Pacific Highway bypass of Coffs Harbour (2018/19 commencement), was identified as suitable for development as a road freight hub. Lots in the abovementioned developments were of sufficient size, at all locations, to accommodate road transport firms. Services are currently at differing stages of provision, however all services would be available upon occupation of the abovementioned developments. Existing businesses adjacent to the Port Macquarie-Hastings LGA proposal (manufacturing) and the Kempsey LGA development (Highway Service Centre) may assist in attracting future tenants. Commercial expressions of interest have been received for the proposal in the Taree LGA and the Nambucca LGA. A local transport and logistics company has purchased land adjacent to the Taree LGA proposal. Anchor tenants may assist in attracting future tenants and thus create demand for road freight services. Regional Development Australia Mid North Coast 3

7 No prohibitive regulations were identified. Transport for NSW identified strong growth in the volume of both inbound and outbound road freight to 2031 on the Mid North Coast. The freight task on the Mid North Coast consisted of multiple commodities, destined for dispersed locations - a scenario better suited to road transport than rail transport. Development of an intermodal rail terminal in the region was determined as unlikely to be viable and unlikely to attract private investment due to low volumes, seasonal commodities and insufficient distance to destination for a competitive advantage over road transport. Despite this rail transport may be a viable option for specific commodities, for example forest products, manufactured goods or mining products, and should be considered on a case by case basis. Road freight was established as the dominant and most suitable transport mode for the Mid North Coast freight task. Investment in road freight infrastructure could see improved efficiencies for the industry and was more likely to attract private investment than rail infrastructure. Five suitable locations for the development of road freight hubs were identified in this study in Greater Taree, Port Macquarie- Hastings, Kempsey, Nambucca and Coffs Harbour LGA s and additional sites may be identified in the future. Regional Development Australia Mid North Coast 4

8 Section 1: Introduction 1.1 Study purpose and objectives The purpose of this study was to identify the current and forecast freight task on the Mid North Coast of NSW. This study was to establish if sufficient freight volumes exist to establish viable freight transport infrastructure such as intermodal hub(s) or freight hub(s) in the study area. The objectives of this study were: To define freight facilities including intermodal transport hubs, freight transport hubs and service centres; To define the current and forecast freight task on the Mid North Coast; To identify existing commodities contestable for a mode shift to rail transport; To identify existing and proposed freight transport facilities in the region; To determine the viability of developing road or rail freight transport hubs in the region. The deliverables (methodology) were defined in the scope of works for this project as: Consultation between stakeholders from RMS and relevant Councils, industry and investors to map out existing and potential opportunities; Consultation with the transport industry to identify needs and existing gaps in infrastructure; Economic data collection and analysis in support of transport infrastructure and the potential flow on of jobs, investment and other economic outcomes; Identification of suitable locations for freight transport hubs; Freight volume estimates and minimum freight volumes required for a hub to be successful; Document what level of participation local councils are willing to provide. Regional Development Australia Mid North Coast 5

9 1.2 The Study Area The study area was the Mid North Coast of NSW, comprising the Local Government Areas of Coffs Harbour, Bellingen, Nambucca, Kempsey, Port Macquarie-Hastings and Greater Taree. The region is linear from north to south and stretches from the Great Divide to the east coast. Figure 1: The Study Area: Mid North Coast of NSW Port Macquarie-Hastings and Coffs Harbour are the most populated centres, followed by Greater Taree, Kempsey, Nambucca and Bellingen. Table 1: Population by Local Government Area Local Government Area Population Count Population Change (%) Annualised Growth Rate (%) Coffs Harbour 70,950 88, % 1.15% Bellingen 12,900 12, % -0.04% Nambucca 19,250 20, % 0.37% Kempsey 29,150 30, % 0.24% Port Macquarie Hastings 75,250 90, % 0.99% Greater Taree 48,100 51, % 0.40% Total 255, , % 0.75% Regional Development Australia Mid North Coast 6

10 Local Councils are very supportive of freight transport hubs whereby industry capacity can be realised. Data used in this report has been collected at the regional level (incorporating all LGA s) and at Local Government Level. 1.3 Structure of this report Section 1: Introduction Section 2: Defines an intermodal freight hub, road freight hub and highway service centre; and provides sustainability criteria for the development of a regional intermodal terminal and road freight hub. Section 3: Describes the current and forecast freight task in the study area Section 4: Identifies commodities contestable for a mode shift to rail transport Section 5: Describes the existing road network, proposed road transport network; and assesses the viability of a road freight transport hub Section 6: Describes the existing rail network, proposed rail transport infrastructure; and assesses the viability of a regional intermodal terminal Section 7: Describes how freight infrastructure aligns with Government strategy Conclusion Regional Development Australia Mid North Coast 7

11 Section 2 Definitions and Sustainability Criteria This section of the report defines an intermodal terminal, road freight hub and highway service centre; and provides sustainability criteria for the development of a regional intermodal terminal and road freight hub. 2.1 Intermodal Terminal An intermodal terminal is a strategic location between a freight service user or exporter / importer and a destination. It offers a customer road and rail transport access, and short-term storage 1. A place within a regional community; A business entity that generates a commercially sustainable outcome; An element within a land-based supply chain. Intermodal terminals may be located within various supply chains operating in NSW. Regional-based exporters and importers may choose from a range of transport options to meet their freight needs as illustrated in Figure 2. Figure 2: Transport Logistics Options Source: Sea Freight Council of NSW, nd, Developing Freight Hubs, A Guide to Sustainable Intermodal Terminals for Regional Communities, available online 1 Sea Freight Council of NSW, nd, Developing Freight Hubs, A Guide to Sustainable Intermodal Terminals for Regional Communities Regional Development Australia Mid North Coast 8

12 The Sea Freight Council of NSW have developed a framework to assess the viability of establishing a regional intermodal terminal. Figure 3: Intermodal Terminal Viability Checklist Intermodal Terminal 1. Volume Is the aggregated volume in the catchment area sufficient to meet the minimum of 10,000 TEU s per annum? (15,000 to 20,000 TEU s per year is likely to make a significant profit) Is the market expected to grow significantly? 2. Distance Is the location sufficiently distant (ie kilometres) from port? This distance is required for a rail-based service to compete successfully with a direct road service. Are the customers physically dispersed so that moving goods via the terminal is an attractive option? 3. Initial Investment and terminal capacity Does the terminal site have access to the rail network? Can existing infrastructure be leveraged? (e.g. does the site incorporate former shunting yards, freight depots, rail sidings, etc?) Is the quality of the connecting rail network (track condition) adequate to carry the volumes expected? 4. Seasonality If volumes are seasonal, will the terminal generate sufficient revenue to cover capital and operating costs during periods when volume throughput is low? Does the terminal have sufficient capacity to accommodate volume throughput at seasonal peaks? Can the intermodal service accommodate time or temperature-sensitive freight? 5. Competing Channels Is the terminal part of an integrated supply chain that can offer a unique service to the customers in the catchment area? Will the terminal be the only intermodal terminal in the catchment area? Can the terminal / supply chain compete effectively with alternative supply chains vying for business in the same market? 6. Economic and social impact Do the local and regional community objectives align with the development objectives for the terminal? Does the new site enhance the economic performance of the NSW transport network and contribute to the State s competitiveness? Regional Development Australia Mid North Coast 9

13 2.2 Road Freight Hubs A road freight hub is defined as a place where cargo is exchanged between vehicles or transport modes. Road Freight Transport Hubs may be a cluster of logistics operators and light manufacturing industries. Facilities may include distribution centres (warehousing, storage, light transformations); transportation (freight forwarders, skippers, transport operators); and supporting services (maintenance and repair) 2. Freight Transport hubs that are serviced only by road do not require significant planning; often simply a change in zoning and some basic amenities (e.g. road access to a lot and utilities). They also tend to appear "spontaneously" at locations where there are good accessibility levels and where there is sufficient market demand. Figure 4: Freight Hub Requirements for Geographical Advantage Freight Transport Hub Labour: Does the site have proximity to a large pool of labour? Accessibility: Does the location have access to a major transport route ie. Highway, Rail, Port? Accessibility: Does the region itself have an important production and consumption market? Accessibility: Can the location be open 24/7, enabling flexibility of supply chain management? Land: Is suitably zoned land available in the region? Is land available to rezone? Land: Is the land of sufficient size to accommodate a freight hub? (Min 2 ha for smaller operators, up to 12-20ha for national companies) Land: Is the land competitively priced? Infrastructure: Are utilities available (electricity, water, sewage, etc.) Infrastructure: Roads, dedicated highway ramp? Anchor tenants: Is there a potential anchor tenant for this location? (large logistics firm? Big Box Retailer?) Regulation: Are there prohibitive regulations in place? Growth: Is there sufficient current demand or predicted growth to ensure the facility will be in demand. 2 Jean Paul Rodrigue (2013), The Geography of Transport Systems Third Edition, Routledge, New York. Regional Development Australia Mid North Coast 10

14 2.3 Highway Service Centres A Highway Service Centre is defined in the NSW Governments Standard Instrument Local Environmental Plan as: a building or place used to provide refreshments and vehicle services to highway users. It may include any one or more of the following: A restaurant or café; Take away food and drink premises; Service stations and facilities for emergency vehicle towing and repairs; Parking for vehicles; Rest areas and public amenities 3. Roads and Maritime also requires: That the centre is open 24 hours a day, seven days a week; That all traffic arrangements are safe and efficient; At least 25 heavy vehicle parking spaces (nominally to suit B-Doubles, with capacity to expand to cater for longer combinations in the future) be provided; A number of parking spaces for recreation vehicles and coaches; The provision of children s play areas and tourist information; That use of toilets and other amenities be free of obligation to purchase goods or services; Separate undercover fuel areas for heavy and light vehicles; That no alcohol be sold on site 4. Highway service centre and rest stop locations along the Pacific Highway were identified in the RMS Pacific Highway Rest Stop Strategy. The strategy is included as Appendix A of this report. It is considered the location of highway service centres and rest stops provide a service to the transport industry, however they do not contribute directly to the inbound or outbound freight task. As such no further consideration is given to highway service centres and rest stops in this study Roads and Maritime Service, 2014, Highway Service Centres along the Pacific Highway, RMS available online Regional Development Australia Mid North Coast 11

15 Section 3 The Current and Forecast Freight Task This section of the report details the current and forecast, inbound and outbound freight task on the Mid North Coast and identifies: The key commodities and volumes which made up the outbound and inbound freight task in the study area; The commodity types best suited to the road and rail markets; The percentage of freight transported by each mode. The key focus of this section was to determine if sufficient freight volumes existed in the study area, to consider rail as a mode of transport. The data used to analyse the freight task on the Mid North Coast was obtained from Transport for NSW, Bureau of Statistics and Analytics, Strategic Freight Model. The model was developed in response to Task 1A-3 of the NSW Freight and Ports Strategy to maintain a single agency for streamlined data collection and strategic analysis 5. The original source data ranged (in age) from between 2004 to Based on input growth rates by commodity, all data were then adjusted to provide a base year estimate for 2011 and to forecast 20 years into the future in ten year increments (i.e and 2031). The forecast years are consistent with most other significant data collection and modelling activities between NSW and the Commonwealth (such as the ABS Census and the BTS population and employment forecasts) Overview of the Freight Task on the Mid North Coast The Mid North Coast of NSW generated 1,972,000 tonnes of outbound freight and 2,518,000 tonnes (excluding intra-regional freight - freight transported between the Local Government Areas) of inbound freight in The highest volumes of outbound freight were generated by: 1. Forest products 2. Dairy Products 3. Containers and General Freight 4. Food Products 5. Meat 5 Transport for NSW, 2014, Bureau of Freight Statistics: Strategic Freight Model Background Information, Version 0.1. Regional Development Australia Mid North Coast 12

16 The highest volumes of inbound freight were generated by: 1. Fuel and Lubricants 2. Consumer Goods 3. Food Products 4. Building Products 5. Containers and General Freight The outbound and inbound freight task on the Mid North Coast, including key origin destination information, is provided in sections 3.2 and 3.3 of this report. The freight task was characterised by: A dispersed market. Both inbound and outbound freight had dispersed origins and destinations. Outbound The outbound freight task produced few commodities with a significant volume of direct, single origin destination freight. The biggest outbound freight volume was generated by Forest Products, with Newcastle Port the key destination. Significant volumes of outbound freight were generated by Containers and General Freight, with Queensland being the key destination. Significant volumes of outbound freight were generated by Food Products, with Victoria being the key destination. Inbound The biggest inbound freight task was generated by Fuel and Lubricants with Newcastle being the key origin. Significant volumes of inbound freight were generated by Consumer goods, with Newcastle being the key origin. Significant volumes of inbound freight were generated by Food Products with Queensland being the key origin. Significant volumes of inbound freight were generated by Containers and General Freight with Queensland being the key origin. Regional Development Australia Mid North Coast 13

17 3.2 Outbound Freight The total outbound freight task for the Mid North Coast in 2011 was 1, tonnes (excluding intraregional freight - freight transported between the Local Government Areas). All of this freight was transported by road as there were no rail freight services operating from the Mid North Coast at that time. The Mid North Coast is characterised by considerable agricultural production. Forest products, dairy products, meat and food products represented the top 5 commodities making up the outbound freight task. Table 2: The top 5 commodities making up the outbound freight task - Mid North Coast (2011) Commodity Category, Key Destination and Volume (kt) 2011 Forest products 1005kt Newcastle Port 349kt Great Lakes 173kt Clarence Valley 138kt Queensland 66kt Port Stephens 46kt Other 233kt KEY DESTINATIONS - FOREST PRODUCTS Other 23% Port Stephens 5% QLD 6% Clarence Valley 14% Great Lakes 17% Newcastle Port 35% Dairy Products 210kt Blacktown12kt Port Botany 11kt Richmond Valley 10kt Sutherland Shire 9kt Fairfield 8kt Other 160kt KEY DESTINATIONS - DAIRY PRODUCTS Blacktown 6% Port Botany 5% Richmond Valley 5% Sutherland Shire 4% Fairfield 4% Other 76% Regional Development Australia Mid North Coast 14

18 Containers and General Freight 150kt Queensland 131kt Port Botany 15kt Victoria 6kt KEY DESTINATIONS - CONTAINERS AND GENERAL FREIGHT Port Botany 10% VIC 4% QLD 86% Food Products 140kt Victoria 82kt Blacktown 34kt Sutherland Shire 1kt Fairfield 1kt Other 22kt KEY DESTINATIONS - FOOD PRODUCTS Other Sutherland 16% Shire 1% Fairfield 1% Blacktown 24% VIC 58% Meat 125kt Port Botany 36kt Clarence Valley 8kt Blacktown 6kt Sutherland Shire 4kt Fairfield 3kt Other 68kt KEY DESTINATIONS - MEAT Other 54% Port Botany 29% Clarence Valley 7% Blacktown 5% Fairfield 2% Sutherland Shire 3% Other 340kt * Source: Transport for NSW, Bureau of Freight Statistics: Strategic Freight Model version 2015.* Data for each of the Local Government Areas making up the Mid North Coast is attached to this report as Appendix B. Regional Development Australia Mid North Coast 15

19 3.3 Inbound Freight The total inbound freight task for the Mid North Coast in 2011 was 2, tonnes (excluding intraregional freight), which was 28% greater than the outbound freight task. All of this freight was transported by road as there were no rail freight services operating into the Mid North Coast at that time. The inbound freight task consisted of Fuel and Lubricants, Consumer goods, Food Products, Building Products and Containers and General Freight. Table 3: The top 5 commodities making up the inbound freight task - Mid North Coast (2011) Commodity Category, Key Origin and Volume (kt) 2011 Fuel and Lubricants (605kt) Newcastle (556kt) Queensland (49kt) KEY ORIGINS - FUEL & LUBRICANTS QLD 8% Newcastle 92% Consumer Goods (565kt) Newcastle (111kt) Queensland (56kt) Sydney (40kt) Baulkham Hills (23kt) Blacktown (20kt) Other (315kt) KEY ORIGINS - CONSUMER GOODS Other 56% Newcastle 20% Blacktown 3% QLD 10% Sydney 7% Baulkham Hills 4% Regional Development Australia Mid North Coast 16

20 Food Products (335kt) Queensland (314kt) Victoria (8kt) Bankstown (1kt) Blacktown (1kt) Fairfield (1kt) Other (10kt) KEY ORIGINS - FOOD PRODUCTS Fairfield Blacktown 0% 0% Bankstown 0% VIC 3% Other 3% QLD 94% Building Products (245kt) Newcastle (28kt) Bankstown (19kt) Blacktown (19kt) Fairfield (15kt) Holroyd (12kt) Other (152kt) KEY ORIGINS - BUILDING PRODUCTS Other 62% Newcastle 11% Bankstown 8% Blacktown 8% Fairfield 6% Holroyd 5% Containers & General Freight (203kt) Queensland (199kt) Victoria (3kt) Port Botany (1kt) KEY ORIGINS - CONTAINERS AND GENERAL FREIGHT VIC 1% Port Botany 1% QLD 98% Source: Transport for NSW, Bureau of Freight Statistics: Strategic Freight Model version Regional Development Australia Mid North Coast 17

21 3.4 Forecast Freight Growth This section of the report details the forecast growth in the freight task by commodity to Forecast data were modelled using the Transport for NSW Strategic Freight Model, which was sourced from a range of data sets including the Hyder/Sd&D regional NSW freight supply chain studies (various); The Metropolitan Freight Movement Model (FMM by Bureau of Transport Statistics) and The interstate freight task (various BITRE datasets for the road and rail task) 5. The forecast freight volume data illustrated in Tables 3 and 4, predicts annualised growth rates between 1.89% and 3.26%. The average annualised growth rate for all outbound freight from the Mid North Coast was 2.44%, and 2.99% for inbound freight. Average annualised population growth for the Mid North Coast was significantly lower at 0.75%, thus it can be assumed forecast growth of outbound freight will need to be largely driven by inter-regional and international trade servicing demand Forecast Outbound Freight (2031) Table 4: Forecast Outbound Freight Volumes by Commodity Category, Mid North Coast, 2031 Commodity Category 2011 Volume 2031 Volume % Increase Annualised Growth Rate % Forest Products % 1.89% Dairy Products % 3.10% Containers and General Freight % 3.24% Food Products % 3.10% Meat % 3.26% Other % 2.56% Total % 2.44% * Source: Transport for NSW, Bureau of Freight Statistics: Strategic Freight Model version Forecast Inbound Freight (2031) Table 5: Forecast Inbound Freight Volumes by Commodity Category, Mid North Coast, 2031 Commodity Category 2011 Volume 2031 Volume % Increase Annualised Growth Rate % Fuel and Lubricants % 3.17% Consumer Goods % 3.13% Food Products % 3.16% Building Products % 3.19% Containers and General Freight % 3.08% Other % 2.39% Total % 2.99% * Source: Transport for NSW, Bureau of Freight Statistics: Strategic Freight Model version Regional Development Australia Mid North Coast 18

22 Freight volume growth rates by Local Government Area (LGA) (Tables 5 and 6), illustrate the highest outbound freight volume increases are forecast for Kempsey, Greater Taree and Bellingen, followed by Coffs Harbour, Port Macquarie Hastings and Nambucca. The highest inbound freight volume increases are forecast for Bellingen, Greater Taree and Coffs Harbour, followed by Kempsey, Port Macquarie- Hastings and Nambucca. Table 6: Outbound Freight Volumes by Local Government Area (LGA) Local Government Area - Outbound Freight 2011 Volume (kt) 2031 Volume (kt) % Increase Annualised Growth Rate Bellingen % 2.41% Coffs Harbour % 1.89% Greater Taree % 2.67% Port Macquarie-Hastings % 1.82% Kempsey % 3.02% Nambucca % 1.79% Table 7: Inbound Freight Volumes by Local Government Area (LGA) Local Government Area - Inbound Freight 2011 Volume (kt) 2031 Volume (kt) % Increase Annualised Growth Rate Bellingen % 3.31% Coffs Harbour % 2.86% Greater Taree % 2.87% Port Macquarie-Hastings % 2.69% Kempsey % 2.79% Nambucca % 2.28% Regional Development Australia Mid North Coast 19

23 Section 4 Road or Rail? Commodities Contestable for a Mode Shift to Rail Road and Rail transport each have particular attributes that render them more suitable, and generally less costly, for the transport of particular commodities. Road offers fast service, flexibility and reliability and is well suited to the carriage of smaller or time sensitive consignments to dispersed locations 6. Rail offers logistical advantages for bulk movements (coal, minerals, grain), but relatively slow door-todoor transit times for other freight because of infrastructure constraints. Rail has pickup and delivery (PUD) costs at each end, so the door-to-door costs charged to customers are less competitive, especially on short-haul trips. Rail also has inferior service quality to road in terms of on-time reliability and ability to serve customers preferred departure and arrival times 7. Transport for NSW identified an overall rail mode share (excluding coal) in 2011 in NSW of just 6.6%. Mode share for selected commodities is illustrated in Table 8, displaying the high percentage of iron and steel (54.2%) and grain (40.5%) transported by rail. The percentages were much lower for the commodities representing the freight task on the Mid North Coast, Forest Products (2%), Containers and General Freight (4.8%) and Food Products (4%). Table 8: Rail Freight Mode Share by Commodity Category in NSW excluding coal Commodity Category Rail Mode Share Sydney Metro Unidentified 0.0% 0.0% Containers & General Freight 4.8% 4.9% Food Products 4.0% 4.1% Manufactured Goods 9.5% 9.5% Building Products 0.0% 0.0% Grains 40.5% 41.0% Forest Products 2.0% 2.2% Fuel & Lubricants 0.5% 0.6% Crude Materials 5.7% 5.5% Iron and Steel 54.2% 57.1% Consumer Goods 0.0% 0.0% Other 5.3% 5.3% Total 6.6% 6.3% Source: Transport for NSW, Department of Infrastructure, Transport, Regional Development and Local Government (2009), Information Sheet 34, Road and rail freight: competitors or complements? ISSN X 7 Ernst and Young, North-South Rail Corridor Study Detailed Study Report, available online Regional Development Australia Mid North Coast 20

24 As all inbound and outbound freight movements on the Mid North Coast are currently transported by road, there was no current regional data to assess commodities sent by rail. In addition data describing the NSW rail mode share (excluding coal) in Table 8 varied considerably, depending upon the commodity. As such it was considered that an assessment of contestable rail freight must consider a variety of mode share scenarios. The following methodology was used to assess contestable rail freight: Step 1 Identified Contestable Rail Freight Step 1 identified freight contestable for rail transport by commodity type. Any commodity currently transported by rail in Australia was included in this assessment to ensure the broadest possible market opportunities were considered. Fuel and Lubricants and Livestock were excluded from the assessment because of the specialised transport infrastructure and storage facilities they require. Step 2 Modal Share Step 2 converted the 2011 and 2031 freight volumes into Twenty Foot Equivalent Units (TEU s) as TEU s is the measure utilised to determine the viability of regional intermodal terminals. In the absence of detailed and accurate TEU mass by commodity type, a maximum TEU weight of 24t was assumed when converting tonnes to TEU equivalent. This was the maximum weight capacity per TEU for rail transport as advised by TOLL Intermodal (November 2015) #. Based upon the range of modal share data outlined above, rail modal percentages tested were 5%, 10% and 15%. It was considered the lower modal share percentage was more likely in the study area given there was no single bulk commodity or significant industry driving demand for rail transport. # Note: Some commodity types may have a weight as low as 5-6tonnes per TEU for Textile fibres or some types of wood (according to a Sydney Ports Corporation publication below). This would have a significant impact upon the volumes of containers which are currently assumed at 24 tonnes per TEU. Regional Development Australia Mid North Coast 21

25 4.1 Identification of Contestable Rail Freight A large variety of goods are transported by rail in Australia and it was considered appropriate to include all currently railed commodities as suitable for rail transport on the Mid North Coast in this assessment. This information has been obtained from the Australian Rail Track Corporation (ARTC) as at November Table 9: Inbound and Outbound Commodities Suitable for Transport by Rail, NSW Mid North Coast Suitable for Rail Transport Containers and General Freight Forest Products Manufactured Goods Food products Meat Building Products Dairy Fruit and Vegetables Consumer Goods (FMCG) Not Currently Suitable for Rail Transport on the Mid North Coast Livestock Fuel and Lubricants 4.2 Intermodal Freight Hub Summary The mode share scenarios modelled in Table 9 illustrates that: The volumes of 2011 outbound freight did not meet the minimum 10,000 TEU s for a sustainable intermodal terminal when a 5% and 10% mode share was tested. The volumes of 2011 inbound freight did not meet the minimum 10,000 TEU s for a sustainable intermodal terminal when a 5% and 10% mode share was tested. The volumes of 2011 outbound freight met the minimum 10,000 TEU s for a sustainable terminal when a 15% mode share was tested. The volumes of 2011 inbound freight met the minimum 10,000 TEU s for a sustainable terminal when a 15% mode share was tested Forecast data for 2031 illustrates that the volume of outbound freight does not meet the minimum 10,000 TEU s for a sustainable intermodal terminal when a 5% mode share is tested. Forecast data for 2031 illustrates that the volume of inbound freight does not meet the minimum 10,000 TEU s for a sustainable intermodal terminal when a 5% mode share is tested Regional Development Australia Mid North Coast 22

26 Forecast data for 2031 illustrates that the volume of outbound freight meets the minimum 10,000 TEU s for a sustainable intermodal terminal when a 10% and 15% mode share is tested. Forecast data for 2031 illustrates that the volume of inbound freight meets the minimum 10,000 TEU s for a sustainable intermodal terminal when a 10% and 15% mode share is tested. Outbound freight volumes consist largely of forest products. Forest products represent a crucial commodity contributing to the volumes needed for a sustainable intermodal terminal. It should be noted that this study is assessing the freight volumes required, for the establishment of an economically viable, intermodal rail terminal. The use of rail transport and existing rail infrastructure on the Mid North Coast, may still be a viable option for individual businesses or commodities, for example forest products, manufactured goods or mining products, and should be assessed on a case by case basis. Regional Development Australia Mid North Coast 23

27 Table 10: Evaluating Contestability Mid North Coast Outbound Freight: Commodity Category Key Destination Commodity suitable for Rail Transport? 2011 Volume (kt) Equivalent TEU's (Max weight for rail 24t) Mode Share 5% Mode Share 10% Mode Share 15% Current Road Volume Meets Freight Hub Threshold? (10,000 TEU's) 2031 Volume (kt) Equivalent TEU's (Max weight for rail 24t) Mode Share 5% Mode Share 10% Mode Share 15% Future Freight Volume Meets Freight Hub Threshold (10,000 TEU's)? Forest Products Newcastle Port Great Lakes Clarence Valley QLD Port Stephens Other Sub-total Yes Dairy Products Blacktown Containers & General Freight Port Botany Richmond Valley Sutherland Shire Fairfield Other Sub-total Yes QLD Port Botany VIC Sub-total Yes Food Products QLD VIC Blacktown Sutherland Shire Fairfield Other Sub-total Yes Meat Port Botany Clarence Valley Blacktown Sutherland Shire Fairfield Other Sub-total Yes Other Total Yes Yes Regional Development Australia Mid North Coast 24

28 Mid North Coast Outbound Freight: Commodity Category Key Destination Commodity suitable for Rail Transport? 2011 Volume (kt) Equivalent TEU's (Max weight for rail 24t) Mode Share 5% Mode Share 10% Mode Share 15% Current Road Volume Meets Freight Hub Threshold? (10,000 TEU's) 2031 Volume (kt) Equivalent TEU's (Max weight for rail 24t) Mode Share 5% Mode Share 10% Mode Share 15% Future Freight Volume Meets Freight Hub Threshold (10,000 TEU's)? Fuel & Lubricants Newcastle QLD Sub-total No 605 Not suitable for rail transport 1093 Consumer Goods Newcastle QLD Sydney Baulkham Hills Blacktown Other Sub-total Yes Food Products QLD VIC Bankstown Blacktown Fairfield Other Sub-total Yes Building Products Newcastle Bankstown Blacktown Fairfield Holroyd Other Sub-total Yes Containers & General Freight QLD VIC Port Botany Sub-total Yes Other Total Yes Yes Regional Development Australia Mid North Coast 25

29 Section 5 - The Road Network This section of the report describes the existing road network, proposed road transport network and assesses the viability of a road freight hub in the study area. 5.1 The Existing Road Network The Mid North Coast has strong connectivity to the National Highway Network, with a total of 285km of highway passing through the region. The Pacific Highway provides the primary road connection between Sydney and Brisbane and is currently being upgraded to a four lane divided road, with completion scheduled by The upgraded road will improve conditions for road transport in the future by providing safer travel: reduced travel times and more consistent and reliable travel. Table 11: Distance to Major Centres Regional Centres To Sydney (km) To Brisbane (km) Taree Port Macquarie Kempsey Nambucca Heads Bellingen Coffs Harbour Figure 5: National Rail and Highway Network Regional Development Australia Mid North Coast 26

30 The outbound and inbound freight task in the study area is met entirely by road transport. The road transport industry in Australia consists of large multi-national transport companies to smaller family owned businesses. Freight companies operating on the Mid North Coast currently provide their own depot, warehousing and storage facilities and it is likely that this situation will continue due to the uncertainty and reduced control associated with externally owned, multi-user facilities. 5.2 Proposed Freight Transport Infrastructure Industry and Councils are very supportive of Transport Hubs as a means to encourage economic development in their region. Each of the Councils on the Mid North Coast were consulted and asked to identify current proposals in their region. The proposals nominated by Councils are best described as road freight hubs, as they are essentially Industrial land developments, with good connectivity to the Pacific Highway. These proposals are summarised in Table 11. Table 12: Proposed Transport Infrastructure on the Mid North Coast Council Name Nambucca Valley Council Port Macquarie Hastings Council Greater Taree City Council Intermodal Name and Description Valla Enterprise Zone Growth Area: 50ha site Located immediately adjacent to the Pacific Hwy upgrade; Incorporate a double interchange and highway service centre Sancrox Employment Lands: 85.4ha current proposal 70 lots from 3500m 2 to 10 hectares. Located immediately adjacent to the Pacific Hwy Sancrox overpass due for completion in late 2016 will allow easy access to the precinct for heavy vehicles. The Northern Taree Entry Freight Interchange. 60 ha site Located immediately adjacent to the Pacific Hwy with access via the Cundletown overpass. Adjacent to the Taree Airport 4 hours drive from Sydney REMPLAN economic modelling indicates some 200 FTE positions may be created from the proposal Estimated cost $3.05 million ($1.8m two lane roundabout and $1.25m Regional Development Australia Mid North Coast 27

31 In addition to the abovementioned proposals, existing industrial land (or land identified for rezoning) with good highway connectivity is identified in the following locations: Coffs Harbour Lot 2 Stadium Drive 3.4 ha, south eastern roundabout corner of the Pacific Highway and Stadium Drive North Boambee Valley 37 hectares of proposed industrial land adjacent to the proposed Pacific Highway bypass of Coffs. The Bypass is scheduled for commencement in 2018/19 and the proposal is in the concept strategic planning phase. Bellingen 2.3ha approved employment lands in Urunga on the eastern side of the railway line. This land is not currently for sale. Kempsey South Kempsey Industrial Park Industrial land adjacent to the South Kempsey Service Centre. Excellent Highway access. 5.3 Viability of a Regional Freight Transport Hub This section provides a discussion of potential road freight hubs on the Mid North Coast based on the sustainability criteria outlined in Section Labour: Does the site have proximity to a large pool of labour? The larger centres of Coffs Harbour, Port Macquarie, Taree and Kempsey have the highest populations and thus the largest labour pools. Coffs Harbour and Port Macquarie-Hastings have the highest predicted population growth rates, with a predicted increase by 2031 of 24% for Coffs Harbour and 20% for Port Macquarie-Hastings. Table 13: Mid North Coast Population Forecast Local Government Area Population Count Population Change (%) Annualised Growth Rate Coffs Harbour 70,950 88, % 1.15% Bellingen 12,900 12, % -0.04% Nambucca 19,250 20, % 0.37% Kempsey 29,150 30, % 0.24% Port Macquarie Hastings 75,250 90, % 0.99% Greater Taree 48,100 51, % 0.40% Total 255, , % 0.75% Source: The NSW Department of Planning, Population Projections, accessed December Regional Development Australia Mid North Coast 28

32 Accessibility Does the location have access to a major transport route? (Highway, Rail, Port) Each of the sites identified in section 5.2 have access to the Pacific Highway, the national highway linking Sydney and Brisbane. Does the region itself have an important production and consumption market? The study area has important production and consumption markets. The highest volumes of outbound freight on the Mid North Coast are generated by forest products, dairy products, meat, containers and general freight and food products. The highest volumes of inbound freight are generated by fuel and lubricants, consumer goods, food products, building products and containers and general freight. The study area is characterised by dispersed origin and destination freight, with few commodities of sufficient volume or direct origin-destination locations. Road offers the most suitable freight transport service as it is flexible and better suited to the carriage of smaller or time sensitive consignments to dispersed locations. Can the location be open 24/7, enabling flexibility of supply chain management? Proposed freight developments and industrial lands identified in section 5.2 are either currently zoned for industrial use or are identified in strategic planning documents for rezoning. This land is considered suitable to accommodate road freight development due to its connectivity to the Pacific Highway. Land Is suitably zoned land available in the region? Is land available to rezone? The proposed freight developments, existing industrial land and proposed industrial land identified in section 5.2 are suitable to accommodate road freight development. Additional sites with good connectivity to the Pacific Highway may be identified in the future. Is the land of sufficient size to accommodate a freight hub? (Min 2ha for smaller operators, up to 12-20ha for national companies) The proposals identified in section 5.2 consist of a 50ha, 60ha and 85.4ha parcel. The final subdivision design is not yet complete for the proposals in Taree and Valla, thus the development can accommodate a range of lot sizes. The proposal in Port Macquarie-Hastings offers a range of lot sizes from 3500m 2 to 10 ha, with flexibility to consolidate or subdivide lots to meet the needs of small, medium and large enterprises. Regional Development Australia Mid North Coast 29

33 Is the land competitively priced? The price of private developments identified in section 5.2 is subject to negotiation with the developer. Infrastructure Services to the land identified in section 5.2 are at differing stages of provision, however all services would be available upon occupation of the land. The proposals identified in section 5.2 have dedicated highway access and it is considered that any future proposals would require similar infrastructure to facilitate heavy vehicle access. Anchor Tenants The proposals identified in section 5.2 have existing adjacent tenants and / or interest from a number of tenants including manufacturing, transport and industrial businesses. Anchor tenants may assist in attracting future tenants and thus create demand for road freight services. Existing businesses are present adjacent to the Port Macquarie-Hastings LGA proposal (manufacturing); and the Kempsey LGA development (Highway Service Centre); which may assist in attracting future tenants. Regulation It is considered the proposals identified in section 5.2 are either suitably zoned or identified for future rezoning and thus will not have restrictive regulations. Growth Forecast freight growth rates provided by Transport for NSW Strategic Freight Model in section 3.4 of this report illustrates sufficient growth to support the expansion of the transport and logistics industry in the study area. The highest growth rates of annualised outbound freight are forecast for Kempsey, Greater Taree, Bellingen, Coffs Harbour, Port Macquarie-Hastings then Nambucca. The highest growth rates of annualised inbound freight are forecast for Bellingen, Greater Taree, Coffs Harbour, Kempsey, Port Macquarie-Hastings then Nambucca. Regional Development Australia Mid North Coast 30

34 Road Freight Hub Summary Three industrial land developments are proposed on the Pacific Highway in Nambucca, Port Macquarie and Taree. These locations are identified as suitable for development as road freight hubs. The South Kempsey Industrial Park is identified as suitable for development as a road freight hub. Proposed industrial land in the North Boambee Valley, adjacent to the Pacific Highway bypass of Coffs Harbour (2018/19 commencement) is identified as suitable for development as a road freight hub. Lots in the abovementioned developments are of sufficient size at all locations to accommodate road transport firms. Services are currently at differing stages of provision, however all services would be available upon occupation of the land. Existing businesses are present adjacent to the Port Macquarie-Hastings LGA proposal (manufacturing); and the Kempsey LGA development (Highway Service Centre); which may assist in attracting future tenants. Expressions of interest have been received for the proposal in the Taree LGA and the Nambucca LGA. Anchor tenants may assist in attracting future tenants and thus create demand for road freight services. No prohibitive regulations are identified. Transport for NSW identify strong growth in the volume of both inbound and outbound road freight to 2031 on the Mid North Coast. Regional Development Australia Mid North Coast 31

35 Section 6: The Rail Network This section of the report describes the existing rail network, proposed rail transport infrastructure and assesses the viability of a regional intermodal terminal in the study area. 6.1 The Existing Rail Network The main north-south rail line from Sydney to Brisbane traverses the study area. This line is used for passenger trains and freight trains, however, freight trains do not currently stop on the Mid North Coast. Passenger stops are located in Wingham, Taree, Kendall, Wauchope, Kempsey, Eungai, Macksville, Nambucca Heads, Urunga, Sawtell and Coffs Harbour. Two major direct origin destination freight services operate on the North Coast rail line - Pacific National and Aurizon (formerly Qld Rail) - representing 90% of the freight task. Smaller regional rail freight operators represent the remaining 10%. The rail freight task through the region is dominated by the movement of container freight from the Port of Melbourne to Brisbane and from Sydney s Port Botany to Brisbane. Return freight predominantly consists of agricultural produce from Queensland returning to Sydney and Melbourne. There are currently no operational intermodal terminals on the Mid North Coast, however there are a number of existing sidings and associated infrastructure in the region. Table 14: Existing Rail Infrastructure, NSW Mid North Coast Location Description of Infrastructure Ownership Taree Railcorp Station Mixed 2 sidings 1 private spur? Kendall Stock and Goods Loop Private Wauchope Railcorp Station Private Goods neck Telegraph Point Small siding, difficult to access Public Kundabung Goods loop Kempsey Railcorp station Mixed Pacific National siding Shell siding Stock Eungai Small siding (close to residential properties) Public Nambucca Heads Small siding, difficult to access Public Raleigh Siding Public Boambee Beach Siding Engineering Goods Private Regional Development Australia Mid North Coast 32

36 Figure 6: Australian Rail Track Corporation: North South Corridor Network Diagram, Rev 7 Jun 15 Regional Development Australia Mid North Coast 33

37 Surrounding Intermodal Terminals In NSW there are six metropolitan intermodal terminals and 22 regional intermodal terminals. There are 7 Regional Intermodal Terminals in the regions adjoining the Mid North Coast being: Table 15: Intermodal Terminals in Northern NSW LGA Name Intermodal Name Status Newcastle Kooragang Is: Mountain Industries Operational Sandgate: Crawfords Operational Kooragang Island: Walsh Point Non-Operational Carrington: Toll Operational Richmond Valley Casino: Casino Rail Freight Terminal Under Construction Casino: Pacific Intermodal and Logistics Industrial Park Proposed Tamworth Regional Tamworth (West Tamworth): Former Hills Transport / Pacific National site Non-Operational Regional Development Australia Mid North Coast 34

38 Figure 7: Intermodal Terminals in NSW 6.2 Proposed Rail Freight Transport Infrastructure A joint Federal and State Government project is currently underway to provide an inland rail connection between Melbourne and Brisbane. This project is described as the Australian Government s priority freight rail project. The project is scheduled for completion in 10 years and when complete, will reportedly reduce transit time between Melbourne and Brisbane to 24 hours, providing a competitive alternative to road. It is likely that much of the Melbourne Brisbane and Sydney Brisbane rail freight currently transported on the coastal rail line, will be diverted to the inland rail when complete. Regional Development Australia Mid North Coast 35

39 Figure 8: Melbourne - Brisbane Inland Rail Alignment Regional Development Australia Mid North Coast 36