Roadblock to Newcastle container development

Port Kembla has been identified as the location for development of a container terminal Photo: Matt/flickr/CC BY-NC-ND 2.0
Industry Database

The Port of Newcastle chief executive Craig Carmody has said that the Australian facility is still committed to a container terminal at the port — despite the Government of New South Wales (NSW Government) saying that Port Kembla has been identified as the location for development of a container terminal to increase Port Botany’s capacity when needed.

In the NSW Freight and Ports Plan 2018-2023, the government said that under current arrangements, development of a container terminal at the Port of Newcastle is not forbidden, but they allow instead for the growth of container volumes through Newcastle that service the region.

According to the Newcastle Herald, the document’s contents “are another strong indication of the opposition the privatised Port of Newcastle faces in diversifying beyond coal”.

The newspaper revealed in 2016 that Port Botany and Port Kembla were protected by the NSW Government from container competition after privatisation with a secret fee on any Newcastle container development.

If Newcastle started with 200,000 to 350,000 containers a year, it would need to pay (according to US money) $14.4m and $25.2m annually to the government, which would give the money to Port Botany.

The plan recognised that a Port of Newcastle container terminal was one of the “key issues raised by stakeholders” and noted that it “recognises the interest in … diversifying and expanding the port’s trade base”.

However, it claimed that there exist “medium to long-term constraints on this expansion”, including the “pressures on the shared rail network in the Upper Hunter Valley and access via the New England and Golden highways”. A Newcastle freight rail bypass has long been seen as key to expansion of the port, and the document said this is an “initiative for investigation”. The bypass is still over a decade away.

Mr Carmody said the Australian Competition and Consumer Commission had started looking into the Newcastle charge and he hoped its report would be completed by the end of 2018.

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