Last week I attended an all day Kiwi Rail briefing on the future of rail in New Zealand. It was my aim to gain a better understanding of Kiwi Rail plans for the future of the Gisborne to Napier link.
During the discussions around wider freight opportunities Kiwi Rail indicated that in-land forestry hubs were being planned in Marton and Masterton giving foresters the option of exporting their logs out through Napier, Wellington, or New Plymouth by rail. In this regard I understand the Port of Napier is investing in its on-port rail track to ensure it has a line all the way through to its log dump. There are clearly excellent opportunities for additional business through our port from the Masterton and Marton hubs.
I raised the question of an additional hub in or close to Wairoa. This may be one way of helping to ensure the economic success of the Gisborne to Napier line.
I was told by Iain Hill, General Manager of Freight, that Kiwi Rail are in discussions to consider this very option with the matter being on the agenda at a HBRC meeting in Napier on the 23rd of August. Well done to those involved.
The majority of logs around Gisborne and from up the East Coast already go through the Port of Gisborne by truck. Iain Hill conveyed that the issue with hauling logs on rail from and around Wairoa is one of short haul distance. Iain said that it's too expensive to put rail heads up into forest skid-sites so the best option was a collection point or hub, which still requires truck transport, therefore double handling and cost. He told me that once the logs are on a truck it's a relatively short haul to either Panpac or either of the Ports so for a truck/rail option to be competitive it needs to be high volume high efficiency.
Despite these concerns this is a potential solution which may ensure that using rail is a real alternative to trucks. At the end of the day, however, the economics must stack up as forest owners will chose the transport option which gets their product to market at lowest cost.
This aside, it's great to see Kiwi Rail taking positive steps to consider all the options.