Milburn ‘Inland port’ gets backing

A southern MP says a recent $1.2 billion cash boost for KiwiRail could be a “game-changer” for the Clutha economy.

Lawrence-based NZ First list MP Mark Patterson said yesterday he supported the establishment of an “inland port” at Milburn, in South Otago.

An inland port provides a remote storage hub for export goods such as logs and frozen produce, linking a region’s production zones and sea port.

Mr Patterson said the $1.2 billion funding for KiwiRail announced in the recent Budget could help provide the upgraded rail network essential for such a facility.

The Government’s draft New Zealand Rail Plan, published in December last year and expected to be finalised shortly, has identified Milburn as a preferred site, servicing Port Otago.

Mr Patterson said the area was a natural crossroads between Central Otago, Southland and Dunedin, and had a “compelling case” for selection.

“The studies have shown we need to move additional freight on to rail, and this idea has the support of both Dunedin and Clutha [councils].

“Experience elsewhere shows that where you have an inland port, major industry follows, so this could be a game-changer for Clutha.”

On June 11, Clutha District Council is expected to finalise the rezoning of more than 330ha of land between Milton and Milburn to industrial.

Businesses including Calder Stewart and Pan Pac Forest Products already adjoin the land.

Clutha Mayor Bryan Cadogan said the rezoning would allow Milton and surrounds to “fully realise their potential”.

“The zonal changes and financial investment we’re now making in Milton are building blocks we’re laying for a more vibrant future for the district.

“We’ve maintained for a long time Milton has Clutha’s greatest potential for growth. If ever we needed that potential realised, it’s now.”

Cubic turns 20

20 years ago a new start up company was formed. Cubic Transport Services Ltd started operating in the newly deregulated New Zealand domestic shipping market, shaking up the duopoly that existed, and driving down prices to realistic levels. We soon introduced rail service options over all routes, and added RORO services, and even container sales and leasing.

We are lucky to have great customers and staff. Most of our team have been with us for several years, and some former long time staff have gone on to do really interesting things, sometimes in other industries.

Mike Oates, Rebecca Brown, Jenna Brown, Judy Meharry, Mike Catty and Junior Amituanai all played a part in shaping the company over several years, as did Kalene Sciascia, Andrea Brown and Chrissy Andrews who are still with us, along with newer members of the team – Kayla Kearns and Bianca Sciascia.

20 years ago we had no idea of the changes we would see. Competitors have come and gone, shipping options have grown and keep changing, rail services have improved.

Five years ago we moved to a decentralised remote working business model, meaning we could retain or attract great staff who could incorporate Cubic into their lifestyle. Whether growing their family or moving to a different location they could still work with Cubic.

We have seen many natural disasters, with the Kaikoura earthquake being the most disrupting for supply chains.

And now a once in 100 years pandemic has created a new normal for us all, but has proven that for many companies our remote/decentralised working model actually works really well, and that you CAN actually trust staff, and save them from the daily commuting torture that many people endure.

I’m looking forward to seeing what the next 20 years throw our way…

Cheers
Dave

Transmission Gully project ‘likely’ pushed out to 2021

You can forget November. And there will be no Christmas present for frustrated Wellington region motorists either. Transmission Gully won’t be open in 2020.

Delivery of the $1 billion highway will likely be extended to 2021, the New Zealand Transport Agency has confirmed.

The project has been flattened by Covid-19 and steamrolled by the Government’s alert level restrictions. Now it also faces the challenges of winter.

But it’s unclear whether the likely delay will mean the public-private consortium tasked with building it will be fined thousands of dollars every day it misses its original deadline.

The latest assigned Transmission Gully delivery date was November 1, with NZTA previously warning of a $16,000 fine for each day it was late.

If the road wasn’t open by December 18, it was to be slapped with a $10 million penalty.

“As [NZTA] is currently involved in negotiations with the JV [joint venture], we’re not in a position to provide further comment at this time,” a spokeswoman said on Sunday, when asked about whether the fines would still occur.

Transmission Gully roading works at Takapu Road. Housing developments on the Kāpiti Coast are growing with the building of the commuter road to Wellington.
ROSS GIBLIN/STUFFTransmission Gully roading works at Takapu Road. Housing developments on the Kāpiti Coast are growing with the building of the commuter road to Wellington.

Andrew Thackwray, NZTA senior manager in project delivery, said it was clear the Level 4 lockdown and Level 3 restrictions “will have an impact on the completion date, which will likely extend into 2021”.

“As the project is a public-private partnership with different commercial terms, Waka Kotahi [NZTA] is negotiating with the builder, CPB/HEB Joint Venture, to confirm and agree a new completion date.”

Work resumed on April 29 at a number of sites along the 27-kilometre route, Thackwray said. New work sites were being progressively started as crews were re-inducted to ensure compliance with Covid-19.

“We understand that the builder has made adjustments to the programme of work in line with the change of season,” Thackwray said.

“Typically these changes would be more gradual as we go through the seasons, however all work was suspended during the lockdown and we are now heading into winter so we expect changes need to be made to reflect that.

“Many of the activities due to be completed were not scheduled to be worked on at the onset of winter so this requires a major change in how work on Transmission Gully will need to be delivered.”

Work was under way to develop a new delivery plan as quickly as possible, using local resources, Thackwray said.

He said there were 182 people working across four reopened sites. Another 59 were working from home to support the project.

A “significant portion” of site engineering and supervision team – about 80 roles – and some of the operations personnel were still overseas at home, unable to return to the site with border restrictions, he said.

Nick Leggett, chief executive of the Road Transport Forum.
THE-PRESSNick Leggett, chief executive of the Road Transport Forum.

When the nationwide Covid-19 lockdown was announced, reports emerged of a mass exodus of Australian construction workers, who chose to head home rather than wait out the lockdown here.

News of the likely delay comes after Nick Leggett, chief executive of the forum which represented several regional trucking associations, said there were suggestions the project’s budget had been cut and the timeline extended for two years.

“In the final straight of construction of such a large project, which was due to be completed by the end of this year, it is a worry to hear that contracts for supply and equipment have been cut, and workforce numbers reduced.”

National Party transport spokesman Chris Bishop labelled a rumoured two-year extension to the Transmission Gully as "excessive" and "extremely concerning". ROSS GIBLIN/STUFF
ROSS GIBLIN/STUFFNational Party transport spokesman Chris Bishop labelled a rumoured two-year extension to the Transmission Gully as “excessive” and “extremely concerning”. ROSS GIBLIN/STUFF

National’s Transport spokesman Chris Bishop echoed Leggett’s concerns, saying the Government’s rhetoric wasn’t matching up with what’s happening on the ground and called for urgent clarification.

Have Your Say On Proposed Changes To The Regulatory System For Transport

Friday, 24 April 2020, 2:28 pm
Press Release: Transport and Infrastructure Committee

The Transport and Infrastructure Committee is calling for submissions on the Regulatory Systems (Transport) Amendment Bill.

The bill is a vehicle for small regulatory fixes that are intended to increase the effectiveness and efficiency of the regulatory system for transport. It intends to achieve this by:

· addressing duplication, gaps, errors, and inconsistencies in transport legislation

· ensuring regulators are able to keep the regulatory system up to date and relevant

· removing unnecessary compliance costs.

The bill would enable land and maritime transport Rules, through the usual Rule making process, to include transport instruments. A specified person, which could be the New Zealand Transport Agency or the Director of Land Transport (a role that would be established by the Land Transport (NZTA) Legislation Amendment Bill), or the Maritime Transport Authority or Director of Maritime Transport, could then establish and maintain the transport instrument. Examples of what a transport instrument could do include listing standards, controlling activities, setting requirements, procedures, or means of compliance.

The bill would also clarify powers of exemption from secondary legislation (including the revocation of exemptions) and make amendments to other minor regulatory stewardship matters.

These amendments would not justify standalone bills, but are more significant than amendments generally included in a statutes amendment bill. The bill is part of a series of activities described in the Transport Regulatory Stewardship Plan for 2019 – 22, which aim to support the regulatory system for transport.

Some of the changes in the bill complement changes being made in the Land Transport (NZTA) Legislation Amendment Bill, which is also being considered by the Transport and Infrastructure Committee.

Tell the Transport and Infrastructure Committee what you think

Make a submission on the bill by midnight on 1 June 2020.

For more details about the bill:

· Read the full content of the bill

· Get more details about the bill

· What’s been said in Parliament about the bill?

· Follow the committee’s Facebook page for updates

Covid 19 coronavirus: 2500 construction workers set for work on transport projects

Auckland Transport will reopen 160 worksites and get 2500 workers back on the job next week. Photo / Michael Craig
Auckland Transport will reopen 160 worksites and get 2500 workers back on the job next week. Photo / Michael Craig
Ben Leahy

By: Ben LeahyBen Leahy is a reporter for the New Zealand HeraldBen.Leahy@nzherald.co.nz

Around 2500 construction workers are set to head back to work on Auckland Transport projects next week.

AT had earlier closed down 160 worksites across the city during the Covid-19 alert level 4 lockdown, but they would now reopen from next Tuesday.

“These projects are worth hundreds of millions of dollars,” AT chief executive Shane Ellison said.

“Some are high profile, like the huge Eastern Busway project, the Downtown programme and Karangahape Rd enhancements, while others are smaller local projects, like road sealing, footpath works and building pedestrian crossings.

Auckland Mayor Phil Goff said getting the 160 sites going again would be a big boost for the local economy, but it wouldn’t be the only one.

The Government announced in January it was putting up money under the Infrastructure Upgrade to invest in a series of big projects.

Goff said new projects that were shovel-ready and able to tap into that funding would be announced next month.

Getting worksites up to new safety standards was important, he said.

“But it’s also important that we can start to regenerate economic activity and contribute to a growth of income and jobs needed to drag the city and country out of recession.”

AT’s Ellison said that while reduced traffic on city streets offered a great chance to get on with the projects, going back to work would look different for some time into the future.

“Lunch break, for instance, is going to be very different with the workers still having to maintain safe distancing and bubbles,” he said.

Each project site has developed a health and safety plan based on Ministry of Health guidance and the Covid-19 Standard for NZ Construction Operations.

These measures include physical distancing, construction bubbles, compulsory personal protective equipment, hygiene practices on-site and separating teams into zones on larger projects.

One of AT’s most high-profile projects was in the city centre, where 190 construction workers would be back on the job from Tuesday.

Programme director Eric van Essen said workers would be kept in about 30 bubbles on six sites.

“Each worker will be assigned to a bubble and, if they need to go between bubbles, they will have to wear a mask and keep 2m distance.

“We will keep a strict record of anyone entering or leaving a bubble, including anyone making site deliveries,” van Essen said.

The first activity on the site will be setting up cleaning and hygiene stations and bubble entry and exit points.

“We will do this preparation work ahead of Tuesday and then be ready when alert level 3 kicks in on Tuesday and the workers turn up for this new, more challenging way to work.”

AT said it had helped construction companies keep workers in jobs by making $18 million in advance payments to contractors on existing projects.

The cash injection came through an Advance Entitlement Payment scheme for construction contractors, with the NZ Transport Agency also offering a similar scheme to its contractors.

How AT plans to keep workers safe during alert level 3

* Inductions for new project staff and compulsory Covid-19 education and training will be part of ongoing site protocols while in level 2 and 3 scenarios

* Crews will stay in their work bubbles when travelling to and from work and while at work and going on toilet and meal breaks

* Whenever possible, individuals will maintain at least 1m distance from others.

* There will be no entering other work bubbles unless prior approval is granted.

* Masks will be worn if individuals are working within 2m of their team member or enter a different bubble.

* There will be no sharing of any food, drink or cigarettes or kitchen utensils, cups, plates and other equipment.

* There will be no sharing of plant, equipment and tools across bubbles and there will be minimal sharing within each work bubble.

* All crews are to follow hygiene guidance.

* All crews are to follow existing PPE requirements, including the wearing of gloves and safety glasses.

* No person is to come to work if they, or any members of their home bubble experience flu-like symptoms.

*Every person is to keep a record of all interactions with anyone outside of their home and work bubbles in case contact tracing is required.

Warning NZ ports may start to seize up this week if non-essential freight can’t be moved

Allowing only essential freight to be transported to businesses by road, not that simple, haulage organisation warns.
JOHN KIRK-ANDERSON/STUFFAllowing only essential freight to be transported to businesses by road, not that simple, haulage organisation warns.

A “pile-up” is looming at the country’s ports that will restrict the movement of food and medical supplies if non-essential freight destined for closed businesses can’t be cleared, Road Transport Forum chief executive Nick Leggett has warned.

“All manner” of freight could arrive at the same time on cargo ships, he said.

“We now have a situation where many businesses that receive some of that freight are closed and there is nowhere for it to go,” he said.

“The issue with non-essential goods is you can remove them from the port, but if there’s nobody at the receiving end at work, where do you put them?’

The Government needed to recognise that “all freight must move” during New Zealand’s coronavirus lockdown, and not just essential items, Leggett said.

He forecast “constipation” at the ports and massive problems, if the issue wasn’t addressed.

“This an absolute real live thing.”

Containers need to be cleared and emptied to ensure essential supplies can get in and exports can get out, Road Transport Forum chief executive Nick Leggett says.
SUPPLIEDContainers need to be cleared and emptied to ensure essential supplies can get in and exports can get out, Road Transport Forum chief executive Nick Leggett says.

​Mainfreight chief executive Don Braid said it wasn’t seeing congestion yet, but the forum was “making good points”.

“Under the lockdown rules, it is not possible to deliver non-essential freight.”

A successful outcome would require “innovative thinking and action”, he said.

“We are attempting to assist the government agencies through this where we can.” 

Leggett said officials at the Transport Ministry had “definitely listened” to the forum’s concerns, but had said the rules stood at this point.

“If it is deemed by the Government to not be essential, it cannot be moved.

“We absolutely appreciate the reasons for that but if we don’t have an ‘all-of supply’ chain solution to this we believe there will be issues in a couple of weeks,” he said.

Transport Ministry supply chain manager Harriet Shelton responded to the forum’s concerns with an update that said its lockdown rules did allow the movement of non-essential goods “if necessary to move or create space for essential goods”.

Leggett said the forum would not have put out its warning lightly at this time.

Reopening closed businesses to accept non-essential freight would “fly in the face” of the reasons for the lockdown, which were to keep as many people home as possible, he said.

“We do appreciate that, but we need a solution.”

Leggett said another problem was that if containers in which non-essential goods were imported were not emptied, there would be a shortage of containers for exported goods going out.

“All freight needs to move during this time to enable the valuable exports that are going out, such as kiwi fruit, access to ports.”

Port of Tauranga says non-essential freight can be stacked next to its terminals but will then take time to retrieve, so it is important essential goods are identified first.
MATT SHAND/STUFFPort of Tauranga says non-essential freight can be stacked next to its terminals but will then take time to retrieve, so it is important essential goods are identified first.

Customs Brokers and Freight Forwarders Association chief executive Rosemary Dawson agreed that the delivery of non-essential cargo remained an issue that would need to be dealt with to avoid congestion. 

“Sea freight was operating fairly normally now,” she said.

But Dawson said she “absolutely” shared some of the concerns expressed by the Road Transport Forum, including with regard to the availability of empty shipping containers.

Port of Tauranga chief executive Mark Cairns said it had put in place new measures to allow importers to identify imported cargo required for essential services before it arrived in New Zealand “so that it can be handled and transported first”.

It needed the support and co-operation of importers and exporters to help it manage the flow of cargo “and avoid blocking the path of essential food, medicine, equipment and other supplies”, he said.

Mainfreight chief executive Don Braid says the Road Transformation Forum is making good points and innovative thinking will be needed.
CHRIS HUTCHING/STUFFMainfreight chief executive Don Braid says the Road Transformation Forum is making good points and innovative thinking will be needed.

Non-essential imported cargo could be temporarily stored on or off-site until it could be collected by truck or transferred by rail to MetroPort Auckland, he said.

Spokeswoman Rochelle Lockely said non-essential freight could be stored near its terminals in Auckland and Tauranga, but once freight went into that “locked stack” it would not be fast to retrieve, so it was important essential items were identified first.

There was a worldwide shortage of shipping containers because of the disruptions caused to supply chains globally by the coronavirus, but that was not something the port had detailed information on, she said.

The port would not charge extra fees for storing non-essential cargo until April 26, apart from one-off handling charges and for power charges needed to keep refrigerated containers cool, Cairns said.

The Road Transport Forum has suggested that some goods that can’t be delivered to closed businesses could be stored on land owned by Kiwirail, but Leggett believed that could only be part of any remedy.

“Closing down the country to the scale we have now hasn’t been done before and it does reveal some issues that need to be addressed pragmatically,” he said.

To illustrate the problem, Leggett said 14,000 cars were expected to arrive from Asia over the next month.

“Those cars cannot stay on the port; they have to go somewhere. The dealers that would normally take them are closed.

“We appreciate cars are not an essential service, however, they are holding space that is needed for essential goods.

“Our industry is looking at how we could find storage for the freight with nowhere to go, but we need the Government to allow that freight to move,” he said.

Leggett said some truck drivers had been stopped by police and asked what they were doing on the roads.

“Well, they are doing a job and it is one that is essential at a time like this.

“They cannot be forced by the Government to be arbiters of what is essential and non-essential on the back of their truck,” he said.

Stuff

The feebate failure shows EV action must come from the people

As Winston Peters obstructs a scheme designed to encourage take-up of electric and hybrid vehicles, we’ll have to look elsewhere for leadership on electric vehicles.Prime Minister Jacinda Ardern’s apparent inability to stand up to New Zealand First leader Winston Peters is looking not just embarrassing for her but perhaps costly for the country. Effective action on housing, child poverty and the environment were the standout promises of Labour’s campaign in the last election. The pledge to be “transformational” is now not only a broken promise but an increasingly deep disappointment. On top of the Government’s well-known failure with KiwiBuild, new figures show family poverty to be grudgingly intransigent. Sadly, the Government’s struggle to make headway is now not only in housing and poverty, but also in the environment.

With scientists warning the world has just 10 years to avert catastrophic global warming, the urgency for political parties to agree on workable measures is greater than ever. Yet for each step forward, such as the net-zero carbon legislation, there is another going back.

The latest backward step is the indefinite delay of the proposed feebate scheme designed to hasten and encourage take-up of electric and hybrid vehicles.

New Zealand is one of only two OECD countries to do nothing to regulate vehicle pollution and, thanks to petty political wrangling, we’ll be staying with Australia in the slow lane a while longer.

The scheme is not yet in ideal shape, but agreements were in place to neutralise the potential unfairness – and therefore the political risk – of making petrol and diesel cars pricier. The technical fishhooks could well have been straightened out through the select-committee process. In response to criticism from National and others, the Government had early on agreed to exempt farmers and those who depend on powerful, load-towing vehicles not yet available other than in diesel or petrol form. However, NZ First has now stalled the policy.

The Greens’ response has been to make their frustration public, thus depleting any remaining goodwill between them and NZ First. Labour has once again been left looking ineffectual in the face of coalition rivalry, and Ardern ineffective in preventing Peters from running the show.

As for the National Party, whose leader and transport spokesperson both drive EVs and which has an increasingly influential blue-green wing, it has yet to propose an alternative way to encourage New Zealanders to make the switch to electric vehicles.It’s fair to say both National and NZ First still have valid concerns about the proposed scheme’s effect on rural and provincial New Zealand, but it’s also true they could be “grandfathered” until suitable green vehicles emerge.

The Treasury argues the Emissions Trading Scheme would be a better way to drive our fleet conversion. But the scheme is complex, controversial and largely incomprehensible to most. The feebate’s transfer mechanism has the virtues of simplicity and comparative ease of implementation.

One can also argue that a compulsion to switch to electric vehicles – which are by no means free from environmental problems – will hasten the research and development required to improve them.

The limited, and often overstated, range of EVs, the paucity of charging facilities and sluggish supply of vehicles into New Zealand’s small market are all problems, with or without a feebate. Questions also abound over the sustainability of the EV batteries’ mineral-dependent manufacture and short life. And how do we greenly repurpose the redundant global fossil-fuel car fleet?

These issues need, and are receiving, urgent global attention.

Meanwhile, our most effective response to the greenhouse-emissions problem is a widespread conversion to EVs as soon as practicable.

Sure, the scheme was never perfect, yet perfect is not always the aim. Many people want to make the switch from petrol- and diesel-driven engines, and this scheme may perhaps have been less politically untenable than NZ First and National seem to presume.

In the face of the changes New Zealand must make to reduce environmental degradation, the feebate scheme is minor. However, as a signal of political commitment to move in the right direction, it is vital.

Those who can afford to switch to electric or hybrid vehicles, and who can see the value to New Zealand, should do so, knowing that environmental protection is too important to leave to political vagaries. They should be applauded, along with all Kiwis who consciously keep their transport emissions down. Leadership on this will have to come from the people.

This editorial  was first published in the March 7, 2020 issue of the New Zealand Listener.

New Zealand ports see growth amid potential cargo shift

in Port News 18/02/2020

New Zealand’s ports have generally continued to experience growth in container volumes amid potential that all freight operations at the Ports of Auckland could eventually get dispersed amongst other nearby ports.

Ports of Auckland plays a huge role in New Zealand’s trade with other countries, being that it handles the second highest amount of container volumes in New Zealand, with the Port of Tauranga taking first place. However, the Ports of Auckland did experience year-over-year declines in net profit and container volumes for fiscal year 2019, which ended June 30, 2019 for New Zealand’s ports.

From port to port. New Zealand’s ports collectively handled 3.43 million TEUs in FY 2019, up 1.3% from FY 2018 and up 7.4% from two years prior, as illustrated in the chart below, which was built using data from the relevant port authorities across the country.

Six of the ports saw container volumes increase year-over-year in FY 2019, while three experienced a decline, as illustrated in the chart below, which was also built using port authority data.

The chart below, built using data from BlueWater Reporting’s Port Dashboard tool, shows the Port of Tauranga is called by the most liner services that connect New Zealand to regions beyond Oceania at 13, nine of which are container services, followed by the Ports of Auckland with 11 liner services, six of which are container services.

The Ports of Auckland and the Port of Tauranga have the strongest global ties of New Zealand’s ports. While the vast majority of the liner services that call New Zealand don’t sail beyond Oceania or Asia, there are four liner services that call New Zealand that sail beyond these two regions.

The chart below, built using data from BlueWater Reporting’s Port Dashboard tool, shows the three container services calling New Zealand that also sail beyond just Oceania and Asia. All three call the Port of Tauranga, while two of the three call the Ports of Auckland.

Not included in this chart is a roll-on/roll-off service operated by Wallenius Wilhelmsen. Although the ro-ro service’s rotation changes slightly with each voyage, it tends to sail between North Europe, the East Coast of North America, Central America, Oceania, Asia, West Coast North America, Mexico, Central America, East Coast North America and back to North Europe. The ro-ro service tends to only call Auckland in New Zealand.

Shift proposal. A final report by The Upper North Island Supply Chain Strategy (UNISCS) Working Group, an independent working group that reported to New Zealand’s Ministers of Finance, Transport and Regional Development, found that the Ports of Auckland is unviable long term.

The final report, titled, “Transforming Auckland; Transforming Northland – Final Report of the Upper North Island Supply Chain Strategy (UNISCS) Working Group,” was released in November.

The UNISCS Working Group recommended that Northport, which operates a multi-purpose port in Marsden Point, should be developed to take over much or all of Auckland’s existing and projected freight business, while the Port of Tauranga’s existing expansion plans should proceed to accommodate growth.

“The new two-port configuration should be supported by a rejuvenated North Auckland rail line and spur to Northport, and a new inland freight hub in northwest Auckland to complement and be connected to Metroport (Auckland) in the south,” the UNISCS said.

MetroPort Auckland is an intermodal cargo hub that connects to the Port of Tauranga via rail.

The working group recommended the government give the ports until Dec. 1 of this year to reach a commercial agreement on how the strategy should be implemented. Additionally, the working group recommended the transition begin immediately and be fully implemented by no later than 2034.

The working group said it “argues for Tauranga to continue with its growth plans but for Northport to be the major site to cater for freight growth over the next 15 years and beyond.”

In response to the finding’s, New Zealand’s Ministry of Transport said in December that the working group’s recommendations raise a range of economic, social and environmental questions for the government to consider. Consequently, the government instructed the Ministry of Transport to undertake further analysis and report back to the Cabinet in May.

Time for a shift? There appears to be numerous reasons to shift freight operations from the Ports of Auckland, with one of the largest being the amount of money that would have to be invested into the site for it to remain viable.

The UNISCS Working Group noted how the Ports of Auckland’s freight operations are already constrained, particularly on the landside, adding how it would require an estimated NZ$4 billion in investment over the next 30 years and the dredging of a further two million metric tons from Auckland’s Waitemata Harbor for the port to effectively handle New Zealand’s expected freight growth.

Additionally, existing port operations in Auckland remain highly industrial, and include the importation and storage of containers, vehicles, coal and cement. “These uses produce very poor returns for its owner, Auckland Council, with dividends dropping as low as NZ$8.7 million for the privilege of occupying land with probable value of NZ$6 billion,” the working group added.

Business at the port was not exactly booming in FY 2019. The Ports of Auckland’s annual report for the fiscal year showed that compared to the prior fiscal year, breakbulk cargo volumes (including cars) fell 3.3%, container volumes fell 3.5% and car volumes fell 14.3%.

Ports of Auckland CEO Tony Gibson said container volumes were down because infrastructure work needed to automate the terminal reduced the terminal’s capacity and made operating more difficult. Additionally, he said car volumes were hindered by a drop in car sales, as well as new treatment rules for imported vehicles, which are designed to prevent the brown marmorated stink bug from entering the country.
However, data from Ports of Auckland shows that container volumes for FY 2019 were the lowest they had been since FY 2016, as illustrated in the chart below.

Additionally, Auckland’s economy is no longer based on manufacturing, let alone agricultural commodities, but is overwhelmingly dominated by services, according to the UNISCS Working Group, which added how Auckland generates export revenues from tourism, education and IT, which don’t require a port.

It also appears most Aucklanders don’t necessarily want a port in the area. A June 2019 Colmar Brunton study, dubbed, “Aucklanders’ Sentiment Towards Moving the Auckland Port,” which was prepared for the Ministry of Transport on behalf of the UNISCS Working Group, asked respondents, “How do you think moving the cargo port would affect Auckland’s attractiveness as a place to live, work or visit?” Sixty-two percent of respondents said they thought that moving the cargo port to a new location (possibly outside Auckland) would make Auckland much/slightly better.

Potential prospects. Auckland, Tauranga and Northport make up the Upper North Island’s three ports. While Northport is New Zealand’s newest port with a massive amount of potential, the Port of Tauranga is the country’s biggest port and continues to see rampant growth.

“The progressive and managed closure of Auckland’s freight operations, the development of Northport and the continuation of Tauranga’s existing expansion plans is in the best interests of Auckland, the rest of the Upper North Island and New Zealand as a whole,” according to the UNISCS Working Group.
In regards to Northport, the working group noted how there is a vast supply of flat, industrial-zoned land adjacent to the port with no higher alternative uses. “The storage of imported vehicles, empty containers and bulk goods can take place around Northport at a fraction of the cost possible in Auckland,” the working group said.

Additionally, the working group pointed out how New Zealand relies mostly on agriculture and forestry to supply exports to provide income for the country. “Of the Upper North Island’s three ports, Tauranga is close to producers of export commodities and is known best as a successful export port, but is also taking an increasing share of Auckland’s import business. Like Tauranga, Northport is also close to producers of export products and also handles the importation of all of New Zealand’s fuel, but its expansion is hampered by the absence of a rail connection.”

Northport features a three-berth facility at Marsden Point with a total wharf length of 570 meters, according to Northport’s website. For berths one and two, there is 13 meters of water available at chart datum and 14.5 meters at berth three.

The port’s terminal primarily focuses on the export of forest products, although it can cater to large, multi-purpose vessels. The port features 58 hectares of land, 30 hectares of which are currently paved and being used for cargo operations, while there is over 180 hectares of land outside the port that is available for port-related ventures to set up and operate from.

Meanwhile, container volumes over at the Port of Tauranga are booming, as well as substantial upgrades at the port.

“International experts have told us that Port of Tauranga can easily accommodate up to 2.8 million TEUs on our current footprint. We already have the next stage of capacity expansion under way,” Port of Tauranga CEO Mark Cairns said in December. “We still have plenty of capacity on the rail connection between Tauranga and Auckland, with the ability to double the current number of trains per day.”

A Port of Tauranga spokesperson told BlueWater Reporting in January that the port owns 190 hectares of land on both sides of Tauranga Harbor, with about 40 hectares still available for development.

“Our next significant capital expenditure will be extending the container terminal quay to the south. Port-owned land adjacent to the existing berths will be converted from cargo storage to a fourth container vessel berth, adding up to 385 meters to the overall quay length. We hope to have this completed in about two years,” the spokesperson added.

The port’s ninth ship-to-shore crane is being delivered in early 2020 as well as seven straddle carriers.

“Future stages of expansion will be driven by cargo volume growth and will primarily involve rail-mounted stacking cranes and additional ship-to-shore cranes,” the spokesperson said.

Ports of Auckland’s perks. Although business at the Ports of Auckland did decline in FY 2019, it still plays a huge role in New Zealand trade, and upgrades at the key port remain underway.

Current projects in the works include automation at the container terminal, as well as a car handling facility.

Beginning in 2020, the container terminal will become the first in New Zealand to use automated straddle carriers to load and unload trucks and operate the container yard, according to a Ports of Auckland FAQ pamphlet updated in January. There will be a total of 27 automated straddles, although the terminal will retain 24 manual straddles for servicing the vessel cranes and the out of gauge, oversized cargo truck lanes. The northern berth will be automated first in late March 2020, while the launch of phase two is expected to occur in May, in which automated straddles will work the southern half of the terminal.

Meanwhile, the Ports of Auckland reiterated in its December 2019 quarterly newsletter that its car handling facility will be complete by August 2020. The facility will allow the port to handle more cars in less space and will be capable of holding up to 1,700 vehicles.

Additionally, the Ports of Auckland does still appear to economically benefit Auckland and New Zealand as a whole. The consulting firm New Zealand Institute of Economic Research (NZIER) released a report in October 2019, dubbed, “Location, location, location – The value of having a port in the neighbourhood,” which found that the national economy, measured by GDP, would be well over NZ$1 billion smaller per year if goods moved through another port.

NZIER noted how the value of cargo crossing the wharfs at the port has grown faster than the volume, especially on the import side, as well as how the downtown port serves the country’s largest and fastest growing center of economic activity.

The port “gives firms in Auckland a competitive advantage: the final leg of an import journey is a short one, as is the first leg of an export journey,” NZIER said.

Additionally, data from BlueWater Reporting’s Country to Country Transit Analysis by Service tool shows how the Ports of Auckland plays a key role in liner shipping operations from China, New Zealand’s top trading partner, in terms of imports and exports.

The first chart below shows that four of the five fastest liner shipping transits from China to New Zealand involve Auckland. However, the second chart below shows that from New Zealand to China, the fastest transits involve the Port of Tauranga, followed by the ports of Napier and Lyttelton.

Source: Bluewater Reporting

Trucking sector suffering as coronavirus outbreak stalls freight

The coronavirus outbreak in China is having a serious impact on the New Zealand trucking sector, with an industry leader predicting it could get worse.

The National Road Carriers Association (NRC) represents 1800 road transport companies collectively operating 16,000 trucks throughout New Zealand.

Chief Executive, David Aitken said companies which carry exports like logs and meat to ports or Chinese imports to New Zealand warehouses and retailers were feeling the pinch. 

“It’s potentially going to get worse quickly,” said Aitken.

“With Chinese towns and cities in lockdown, many factories are closed and therefore not taking goods, nor producing goods. We are aware of importers who are not able to place orders and expect to run short if production doesn’t get back to normal soon. “This has consequences for our sector,” he said.

A number of forestry operations throughout the country have stopped logging with the Forest Industry Contractors Association reporting about 30 percent of the country’s logging crews are unable to work amid the supply chain disruption and no one knows how long the situation will last. 

“This will have a flow-on effect to truck operators.”

Meat works have reduced kills for the China market meaning farmers are having to keep stock even during the drought conditions we are experiencing, so stock are not being carried to the meat processors, and processed goods are not transported to ships. 

“We understand freezers and chillers are full so this will further affect the processors’ ability to take stock.

“There are also limited goods coming out of China, so the number of containers with goods destined for New Zealand shop shelves is expected to be down. These are just some of the effects, all of which will reduce the number of road transport movements.”

Aitken said NRC was advising its trucking company members to be aware of the situation and plan where possible.

“We are telling trucking companies to do what they can to keep their company infrastructure in place. When this virus blows over, which it will, there will be a mad rush to move goods around again. Chinese people need to eat, and China needs materials to get its industries up and running again.”

Silver Fern Farms chief executive Simon Limmer told RNZ that the company was working hard to try and balance storage and processing capacity.

“It’s a little bit of a perfect storm I guess at the moment because whilst we’ve got big livestock flows, plus the drought really putting pressure on processing capacity, the coronavirus situation has meant we don’t have a lot of confidence to in our ability, or the supply chains ability to get product into China just at the moment.”

Using Road Funds For Rail “highway Robbery”

The Government’s plan for “user-pays” road funding to further subsidise KiwiRail is highway robbery, Road Transport Forum (RTF) chief executive Nick Leggett says.

“The RTF opposes funding rail from the National Land Transport Fund (NLTF), which is funded by road users, and we have made a submission to Parliament’s Infrastructure Select Committee considering this law change,” Leggett says.

“We believe the excessive funding planned for rail is ideologically driven, rather than based in any business reality, and we don’t believe road users should have to pay for that. It’s highway robbery.

“The Government is expecting the NLTF to cover the already depleted road and rail infrastructure from a finite revenue source, and it will be road users paying for that. As the road money gets siphoned off for rail, we expect to see even more unsafe roads.

“Despite this Government’s desire to control markets, customers decide which freight mode best suits them. The Ministry of Transport’s National Freight Demand Study 2017/18 shows demand for road freight increased by 16%, while demand for rail freight declined by 17%. This is because the advantages of road over rail are many.

“Rail’s environmental benefits over road are simply illusionary, as any level of success for rail transport is entirely dependent on truck transport. Measuring environmental performance solely on the basis of the relative performance of the truck versus train, instead of the reality of point-to-point sender to receiver, is a very narrow perspective, typically favoured by academics without any interest in economics.

“This Bill stacks up the rail track network, owned exclusively by KiwiRail, against roading infrastructure utilised by all road users, owned by the Crown and a number of road controlling authorities (RCAs).

“Road users who pay into the NLTF have no ownership rights whatsoever, but are obliged to pay prescribed fees to use and maintain roads, ensuring safety expectations are met.

“Road users are also subject to property rates for providing accessibility to the roading network. This makes the suggested funding model in this Bill inequitable for road users.

“While the Bill attempts to counter this inequity with reference to track user fees (TUCs), there is no evidence of what those TUCs might look like.

“The road freight sector does not believe TUCs are going to meet the rail programme spend, which the Government has indicated will be significant. The principal rail operator arguably has no mandate to operate on a full cost recovery basis, so this puts road freight at a disadvantage to its heavily subsidised freight competition. “We agree rail services need support to provide a service complementary to road freight, however, rail freight’s strength is in long distance transportation (over 500km) of high volumes of relatively low value products, such as coal.

“In New Zealand’s freight market, the two modes should operate as complementary, not competitive,” Leggett says.