Melbourne rail review

VICT “It seems crazy that VICT’s customers importing containers should get lumped with an additional cost with no benefit,” contends Paul Zalai, Director, Freight and Trade Alliance

Fierce criticism of the Melbourne Port Rail Shuttle plans have sparked a review

The Port of Melbourne faces all the usual challenges to move container freight from road to rail but has the added major challenge of providing port-side intermodal rail capacity that offers a level playing field to the port’s three container terminal operators.

Current Port Rail Shuttle plans do not achieve this – with ironically the disadvantaged party, Victoria International Container Terminal (VICT), being the Webb Dock based operator which is supposed to represent the future of container handling in the port.

This reality, combined with fierce criticism of the idea of a A$15 container levy on all loaded container imports moving through the port to pay for the new rail arrangements, has led the Victoria State Government to announce a review of the plan and a related study which is expected to consider port traffic management at a wider level. The study is to be undertaken on a fast-track basis with initial findings expected around March next year.


The current Port Rail Shuttle plan, which is effectively the first major initiative proposed by the Lonsdale Group the new owners of the port of Melbourne, foresees the establishment of a Port Rail Shuttle (PRS) which will operate between a portside Metropolitan Intermodal Terminal (MIRT) and two suburban terminals, one in the north located at Somerton and one in the south west at Altona.

The shuttle trains themselves are envisaged to have a maximum length of up to 600m, a locomotive at each end (push and pull) and a nominal capacity of 84TEU. Five sites have been identified by Port of Melbourne management as potential locations for the MIRT – all of these sites are basically ranged around Swanson Dock where DP World and Patricks operate their respective container terminals.

And herein lies the problem in that these two locations will primarily focus on regional rail coverage for Australian exports and as result VICT will be competitively disadvantaged to the point that it will basically be shut out of this market sector.

And to leave VICT without a rail connection – and come to that the other Webb Dock terminals including the new auto terminal – is in the words of many port users ridiculous given that Webb Dock is acknowledged to be the primary location in the port designed to facilitate future traffic growth. VICT, unlike the two Swanson Dock terminals, is not constrained by the air draft restrictions imposed by Westgate Bridge and as such is the only container terminal in the port of Melbourne able to accept the higher capacity vessels being introduced into Australia’s primary container trades.


Hardly surprisingly, given the foregoing, VICT has called on the state Government to delay its decision on the port’s proposed A$15 a container levy for import units. In a public statement on the issue VICT states: “The Port Rail Shuttle is intended to improve the port’s interface with Victoria rail networks and thereby reduce the number of trucks using local roads.

“But as currently planned, the Shuttle does not link with Melbourne’s metropolitan rail network, but rather the regional exports and leaves stranded the port’s Webb Dock growth
terminals. This has little prospect of taking trucks off Melbourne’s roads and will not mitigate the much greater truck congestion that is a growing reality today.

“The government, VICT argues, “should take the lead to develop a much wider plan to optimise the existing links between the port area and the intermodal freight hubs in greater Melbourne locations such as Dandenong, Camberwell and Altona. Consideration in this review,” it elaborates, “should be given to the wider more efficient management of port traffic including greater utilisation of off-peak periods and more extensive use of high productivity freight vehicles and one-stop freight hubs. This can be done at much more manageable cost, scaled much better and deliver more efficient solutions for the supply chain.”

The leading industry body Freight & Trade Alliance, which includes in its membership diverse port users, has also questioned the rationale of the Melbourne port rail plan. Paul Zalai, Director, FTA, speaking to PS comments: “While Australian exporters are the winners from the proposal. There are clearly a range of significant losers. Major importers argue that they should not be subsidising exports and some of those not using rail are questioning why they should be paying any fee at all.

“The argument,” Zalai elaborates, “then extends to VICT at Webb Dock that does not have a rail interface. It seems crazy that their customers importing containers should get lumped with an additional cost with no benefit.”

And voicing the view of many he concludes “…the proposal needs further consideration and a closer correlation to a user pays basis.”


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