Shipping Australia welcomes the priority project status assigned to the Port Botany Rail Line Duplication project and the Cabramatta Passing Loop by statutory advisory body, Infrastructure Australia.
Planned works will include building of kilometres of new track along with realignment and upgrading of existing track. The works will better connect Port Botany to the rail freight network and will increase freight capacity.
The projects are necessary to handle growth in predicted future container freight. The NSW Freight and Ports Plan 2018-2023 notes that Port Botany handled 14.4 million tonnes of freight in 2016 and predicts that 25.5 million tonnes will be handled in 2036.
Careful planning necessary to avoid disruption
Rail upgrades are welcome, but careful planning is required to avoid resulting operational service disruptions and additional costs to shipping lines.
Melwyn Noronha, Deputy CEO of Shipping Australia, raised the issue that current rail infrastructure upgrades at the port are disrupting both existing rail capacity and operations, which is impacting rail services, and are causing costly impacts for shipping lines.
Fees charged in advance
The $190M on-dock rail project at Port Botany that started in 2019, and for which shipping lines are already paying additional wharfage fees, is causing major disruptions at one terminal in Port Botany.
Shipping Australia understands that as a result of the ongoing works, the window capacity for rail operators has been disrupted and there will be no additional windows in the near-term.
Mr Noronha noted that shipping lines are not only having severe disruptions imposed upon them, but they are also being slugged with advance wharfage fees of $3.08 per TEU before the rail upgrade is even complete.
There is also a similar situation developing at the Port of Melbourne. Their approved $125 million port rail project is intended to handle growth in trade from three million TEU now, to nine million TEU by 2050. The project is being funded through an additional tariff of $9.75 per TEU on full import containers from 1 June 2020 but we don’t expect to see any benefits until 2024.
Unfair and unwelcome
This pay before you get charging model is unfair and most unwelcome.
Normal practice is for user-pay construction projects to be built, completed and put into service before there is a charge to use them.
“No-one would expect motorists to pay tolls for a toll-road before the road was ready to be driven upon,” Mr Noronha said.
Shipping Australia calls for careful management of rail upgrade projects to ensure that disruption to port users is minimised. We also call for an end for shipping lines being required to pay for something that does not yet exist.
