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Future Freight Networks : Yearbook 2016
95 FUTURE FREIGHT NETWORKS 2016 ALC MEMBER INSIGHTS ports, especially the Port of Brisbane, we risk creating a potential bottleneck with trade,’ says Cummins. ‘The current over-reliance on road transport is unsustainable.’ Cummins says a more balanced approach is essential to achieve ‘better resilience in the supply chain’, which, in turn, will lead to greater efficiency, lower costs and greater ease of movement in the long term. ‘There has been good investment in roads, and we have excellent road connectivity to the Port of Brisbane,’ he says. ‘You can literally drive from Fisherman Islands on to the motorway and not hit a stop light for about 100 kilometres. But that has, to a certain degree, camouflaged the need for other modes of transport. ‘We are investing in roads ourselves. This year, we will invest something in the order of $110 million on upgrading the motorway connection to the port. So it is not that I am an apologist for rail, or coastal shipping, against road. It is simply that if we do not do something, then what appears now to be a sustainable situation will not look that way in the future.’ Cummins says it is estimated that the freight task facing Australia will double by 2030. For Brisbane, that means that the current traffic load of approximately 3.5 million trucks will double to seven million trucks. Such an increase, he says, cannot be accommodated within the existing infrastructure. ‘It doesn’t really matter how good your road system is; at a certain point, it is going to become an unsustainable situation in terms of volume and community issues, congestion, safety and carbon emissions. If we are to be well placed in a situation where the freight task will double in the next 10 to 15 years, we have to have a more balanced modal situation. The situation is quite urgent.’ Cummins says that if coal is excluded, then less than five per cent of the traffic to the Port of Brisbane moves by rail. Elsewhere in the world, it is usual to have about one-third of the transport being undertaken by non-road options. ‘The level of non-road transport is extraordinarily low for a country of this size, and for a state of this magnitude. Clearly, there is a lot of room for improvement. The more containers you can take off the road, the better the overall picture will be for everybody. ‘Typically, what we find in Australia is that the volume of traffic moving by rail, and the volume of traffic moving by coastal shipping, is much lower than one would expect in a continental-size country. If you compare it to other locations in Europe or the United States, these modes are significantly underused in Australia.’ Which mode is best? Identifying which mode of transport is best for which product type involves considering a number of factors, says Cummins. ‘It is a function of time, cost and capacity. It will also depend on the nature of the goods, and it varies for different types of cargoes and commodities. ‘For example, if you are moving high-value imports, there will always be a predominant role for road because time is an issue, and value is an issue. For import cargo, road will always play an important role, given that most imports are delivered within close proximity to the major capital ports; however, what we are seeing in other areas is the development of inland ports. Rail shuttles can then be established to these inland ports, where imports can be further distributed by truck for local delivery. ‘If you are looking at agricultural exports, they will typically want to move by rail. If you can move them en masse by rail to the port, that is far and away the most efficient solution. So, it is a case of horses for courses. That is why a balanced modal share is really the way to go. ‘There is also a role for coastal shipping, given the distances in Australia. You have something in the order of 900–1000 kilometres between each capital city port. If sensible reforms can be put in place, they would generate meaningful increases in the volume of trade between places like Tasmania and Queensland, and also with the outer ports of Queensland: Brisbane to Townsville, and Brisbane to Mackay. ‘To put it in context, the current system is so restrictive that if you are a dairy farmer in Hobart, and you want to move your dairy produce up to Brisbane using the existing modal systems, it would cost you something in the order of $4000 per container. You can literally ship a container several times around the world for that money.’ Which financial metric? One challenge, when making such large investments, is to find the most appropriate financial models. Cummins says that the large outlays involved generally mean that the state or federal government must be involved. Much depends on what factors are used in the analytics. One approach is called the Business Case Ratio (BCR), which has been used in the documentation for the Inland Rail link between Melbourne and outer Brisbane that is being proposed by the federal government (it was positive). But Cummins says that when looking at dedicated freight corridors, the analysis becomes more ‘fraught’.