6 Nov 2023

Speech: The future of freight

Speech at the launch of the research into rail freight productivity prepared by Australasia Centre for Rail Innovation (NTRO)

Thursday 2 November 2023

Good morning everyone and welcome Minister and guests to the largest interstate intermodal terminal in the country – a perfect setting for today’s important announcement.

As chief executive of Australia’s largest private rail freight company, I’m delighted to host today’s event – the announcement of a unique body of research which we hope will form the foundation for a new and improved era in rail freight.

Safe, sustainable, and cost-efficient rail freight networks and operations are vital to help reduce cost of living pressures for millions of Australian families, not to mention helping to reduce traffic congestion, vehicle emissions, road accidents, and ‘wear and tear’ on local and state roads.

Farmers, miners, manufacturers, processors, supermarket and beverage chains, retail businesses – you name it – they all benefit from a ‘fit for purpose’ rail freight sector.

The Covid pandemic exposed many weaknesses in global and national supply chains – from a lack of skilled labour, including an aging frontline workforce, to freight networks in need of substantial upgrades.

Combined, these factors, have created shortages, inefficiencies, and chokepoints in supply chains…this then feeds inflation in our economy.

Other countries – notably in North America, Asia, and Europe – are now investing heavily in freight networks. As an exporting nation competing on the global stage, it’s imperative Australia doesn’t fall behind the pack.

Pacific National is very proud of the Melbourne Freight Terminal and the critical role it plays in the national supply chain. It employs approximately 200 skilled and highly trained individuals – including freight train drivers and terminal operators – who process more than 400,000 shipping containers each year.

For context, that volume going through this terminal represents approximately 7 per cent of containerised freight in the country.

I would like to thank Minister King for taking time out of her busy schedule to launch today’s report and her continued support of our sector. Having participated in countless COAG transport meetings over the years, the Minister has a deep understanding of both the challenges and opportunities facing our industry.

I’d also like to acknowledge the hard work of many individuals and organisations in making this significant research project – and its key findings and recommendations – a reality.

Notable thanks must go to the Australasian Centre for Rail Innovation and its chair The Hon John Anderson AO. For some historical context, the Freight on Rail Group of Australia approached John back in 2019 to spearhead this piece of work – to his great credit, he took up the task with enthusiasm and dedication, including displaying great perseverance during the disruptive days of the pandemic!

The former CEO of ACRI – Rob Moffat – was also a driving force behind this exercise. It would also be remiss of me not to thank the former and present chairs of FORG – Dean Dalla Valle and Andrew Harding: both long and strong advocates of this initiative.

Other major contributors – both in terms of knowledge input and funding support – included the Australasian Railway Association, the Department of Infrastructure, Transport and Regional Development, the Bureau of Infrastructure and Transport Research Economics, and Synergies Economic Consulting.

The ACRI report represents the first of its kind in our sector, covering everything from modal share along key freight corridors, future infrastructure and planning requirements, rail safety initiatives, and policy settings which need to be either refined or reformed.

It also complements newer initiatives like the National Transport Commission’s Rail Interoperability project, the Schott Report into Inland Rail, and the Australian Government’s focus on enhancing both rail and road network resilience in the national supply chain.

The ‘Anderson Report’ clearly demonstrates that it is well and truly time to give rail freight a ‘fair go’.

Since his elevation to the Acting CEO of ARTC, I’d like to acknowledge that Wayne Johnson has been working tirelessly behind the scenes with above-rail operators like Pacific National in this space.

Putting aside broader competition issues in the global economy, it is an incredibly wasted opportunity that a mere two per cent of freight is hauled by trains between Sydney and Melbourne – the busiest freight corridor by volume in the country.

The result is a conveyor belt of more than 700,000 equivalent B-double return truck trips each year on the Hume Highway…and that’s a conservative estimate!

In 2019, Pacific National estimated increasing the rail freight share between Melbourne and Sydney to 50 per cent would help save multiple lives and $300 million in road accident costs on the Hume Highway each year. Furthermore, annual vehicle emissions along the highway would be reduced by 430,000 tonnes.

Pacific National estimates a modest shift of 10 per cent of containerised freight from road to rail would equate to 40,000 fewer B-double truck trips each year between Melbourne and Sydney.

Similarly, less than five per cent of freight is now railed between Sydney and Brisbane. Even the critical Melbourne-Brisbane transport corridor has a rail mode share of less than 30 percent.

We know that given the right policy settings and investment, rail can compete with road freight. Indeed, on average across major interstate networks, it is approximately 15 per cent more cost-effective to transport containerised freight on rail compared to road.

However, sections of our interstate and regional railways are lacking resilience, which creates freight pinch points and poor connectivity to ports, processing plants, mills, silos, and smelter plants.

Rail lines which warp in the summer heat because of old steel, or bend due to rotten timber sleepers, or sag under foul ballast, or are regularly topped by floodwaters, create disruptions and delays which hurt Australian businesses and families.

Our networks require more duplication, more crossing loops, more staging areas, more and longer rail sidings, larger culverts to handle larger volumes of future floodwaters. Such infrastructure allows quicker operational recovery when natural disasters occur.

In conclusion, this report provides a long overdue opportunity to breathe life back into our rail networks and operations and I urge industry and government to continue to constructively work together.





Pacific National Communications