KiwiRail says a new rail hub proposed south-west of Dannevirke may be able to take 200,000 tonnes of logs off the roads.
Officials have been allocated $400,000 to evaluate the potential for the hub to take trucks off local roads and better integrate freight flows through Hawke’s Bay.
If approved, the state-owned rail operator will receive $4 million from the Provincial Growth Fund to develop the hub at Tapuata.
KiwiRail is developing a forestry hub at Wairoa as part of the reopening of freight services to Napier. It has a three-year project underway to develop a new freight hub near Palmerston North and last month increased capacity on its rail service to CentrePort in Wellington from the Waingawa log hub south of Masterton.
Deputy chief executive Todd Moyle said the company had been considering a hub near Dannevirke for some time and the staged approach is sensible. It will now work with the New Zealand Transport Agency and other agencies on the project.
Ernslaw One’s Titoki forest lies about 37 kilometres to the east between Te Uri and Weber and is already sending more than 50,000 tonnes of logs to Napier Port annually.
“With harvests expected to hit 200,000 tonnes in the coming years it makes sense to get as much of that volume on rail as possible,” Moyle said.
“Not only does rail have 66 percent fewer emissions per tonne than road transport, it would also reduce the number of logging trucks on the roads, improving road safety and saving in road maintenance costs which burden the local councils and NZTA.”
Log exports are booming, with many ports working to increase capacity to handle trees planted in the 1990s. Logs and timber are the country’s third-largest export and brought in $5.5 billion in the 12 months through April, 13 percent more than a year earlier.
KiwiRail is also investing heavily to capture more of that harvest for its own business. It is converting about 100 container wagons annually to carry logs and is expecting to receive an additional 200 new log wagons by the end of the year.
The rail funding was part of more than $40 million in funding announced today by Fletcher Tabuteau, under-secretary for regional economic development.
Just over half the PGF funding was allocated for upgrades of roads and bridges from Waipukurau to Porangahau to improve resilience and improve delivery of logs and farm produce to Napier.
A further $14.7 million has been allocated to Hawke’s Bay Regional Council to investigate development of storage in the Tukituki catchment to capture winter flows and replenish aquifers in Central Hawke’s Bay.