A new study commissioned by the Australian Railway Association drills into the viability of getting short-haul rail working in conjunction with Australia’s main containerports.
Short-distance rail shuttles to and from Australian ports can be competitive with trucks but only if there are suffi cient payload and backloads as well as prompt turnarounds. This was the proposition put to delegates at the Australian Maritime Logistics Research Network (AMLRN) 2020 Symposium in November by Tristan Anderson, Market Sector Leader – Transport, GHD Advisory.
In an address entitled, “Impediments to rail mode shift to/ from ports – can we get more freight on rail?” Anderson pinpointed load factors plus quick turnarounds for the shuttles to drive up rail productivity, but also highlighted wider obstacles to the rail mode, such as railheads that are distant from the actual container terminal, even if they are on the port itself.
Impediments to Rail Usage
The Australian Railway Association (ARA) commissioned GHD Advisory to undertake research and analysis into the impediments to rail mode shift. This report was released just before Christmas and Anderson’s presentation was based on its findings.
The report examined the challenge for port rail from three perspectives – whether rail could deliver sufficient return on investment; whether there are regulatory and compliance cost disparities which disadvantage rail compared to road; and whether rail service levels can be competitive?
Anderson says the distance of travel to/from a port matters in terms of rail’s competitiveness – the common perception being that rail is only advantaged for long-hauls – but, interestingly, suggests the challenges commonly associated with short haul rail are not insurmountable. What matters most, he contends, is productivity, to offset the high fixed cost rail has in locomotives and wagons.
Consequently, short-haul rail can be productive if the load factor of wagons is high, if there are increased backloads, and quick turnarounds to ensure more return-trip cycles can be achieved in a 24-hour period.
“Last-mile” Challenges
The challenges for rail shuttles include potential network limitations, port handling costs and “last mile” costs. Rail gauges vary across Australia making connections complex. Long distance rail transports may entail transfer to short haul to complete the journey.
If the port railhead is not within the container terminal, the box needs additional handling from the railhead to the terminal, hence handling costs are often significantly higher for rail than road. As a measure, the GHD analysis finds that an extra handling cost of $10 per TEU may require a 10% increase in train utilisation to retain the viability of rail as a workable option. Generally, however, any increase in port or terminal handling charges is seen to negatively impact on rail, effectively shrinking the catchment area in which a rail shuttle will be viable.
Anderson notes that these last-mile costs make land-use planning important for ports, particularly in preserving space for rail corridors and railheads that feed directly into terminals. He also suggests that ports could consider subsidies to encourage freight to move to rail, removing congestion from roads.
Transport regulators additionally need to review how rail is dealt with, to see whether there are regulatory imbalances between the rail and road modes and to encourage open access to infrastructure.
Timely for Ports – Especially Melbourne
The ARA report comes at a time when several Australian ports are striving to increase the percentage of cargo being fed to their terminals by rail. There is a recognition that steps need to be taken to get freight off the road with all the practical and environmental benefits that this brings to metropolitan and other areas.
A notable example is the Port of Melbourne, where the Port Rail Transformation Project is moving ahead, albeit with discrepancies in terms of how different terminals will benefit. The two Swanson Dock terminals, of DP World and Patrick respectively, will benefit from nearby intermodal rail nearly a decade before the Victoria International Container Terminal (VICT) terminal on Webb Dock, which is the most modern of Melbourne’s container handling facilities.
Kirk Coningham, Chief Executive, Australian Logistics Council, recognises this omission, saying it is crucial for the Commonwealth and Victorian governments to preserve corridors and make investments permitting Webb Dock to also be connected to Victoria’s rail freight network – i.e. earlier than current plans envisage.
Brendan Bourke, CEO, Port of Melbourne Corp, recently told Port Strategy that the 2050 Port Development Strategy (PDS) and the Plan for Rail 2020 identifies a Webb Dock Freight Link as a key project to be delivered around 2030 to cater for the forecast increase in container capacity that will be serviced at Webb Dock.
Early planning work has commenced in cooperation with the State Government in this regard. This plan is also aligned with the development of a second container terminal at Webb Dock, a project that requires extensive pre-planning to implement.
