Why we need the intermodal freight precinct
Ease the Port Botany bottleneck
Port Botany is critical to the Australian economy as it handles more than $60 billion in trade each year, contributes $2.5 billion to the NSW economy and generates 17,000 jobs.
More than two million twenty foot containers currently pass through the port each year, which equates to around 5,000 containers travelling to and from the port by road each day. Conservative growth forecasts at Port Botany anticipate these figures to increase to at least 6 million containers a year by 2040, which equates to 14,000 containers travelling to and from the port by road each day if we don't develop more intermodal capacity in Sydney. Less conservative forecasts predict Port Botany's throughout will grow to as many as 9 million containers a year by 2040.
Sydney's freight handling capacity is increasingly constrained by a heavily congested road network, so more containerised freight needs to be moved by rail. Moorebank Logistics Park means the number of containers travelling between Port Botany and west/south west Sydney will only grow to 11,000 a day by 2040, rather than 14,000.
Sydney's existing intermodal shortfall
Recognising the need to get more freight on rail, the NSW Government wants to double the proportion of freight moving through Port Botany by rail to 28% by 2020. Moorebank Logistics Park will help achieve this target by providing capacity for around 250,000 containers by 2017 and up to 1.05 million import-export containers by 2030. To increase the rail freight share beyond the 28% target more intermodal capacity will be needed.
Some forecasts predict that Port Botany's throughput will grow to as many as 7 million containers per year by about 2030. The figure shows that, if 40% of these containers travel to and from Port Botany by rail, the Moorebank intermodal freight precinct will handle a large share of this freight but more intermodal terminals would also be needed.
Help move freight around Australia
Moorebank Logistics Park will include facilities for transferring interstate and regional freight between rail and road. Interstate and regional containerised freight moves a wide range of goods around Australia; including agricultural produce, groceries, consumer goods and manufactured materials.
The interstate market is dominated by road transport, but there are several advantages of rail. For example:
- the reduced growth in container trucks reduces road congestion;
- a smaller contribution to air pollution;
- greater fuel efficiencies achieved over long distances; and
- potentially significant operating cost savings.
Sydney has the lowest domestic container rail throughput of the major capitals, despite being the largest city. The Commonwealth Government wants to get more interstate freight on rail and will achieve this by developing more interstate intermodal capacity, including at Moorebank Logistics Park, and by improving rail reliability and transit times through investment by the Australian Rail Track Corporation.
Reduce road congestion for a better environment
Moorebank Logistics Park will enable containers moving between Port Botany and south-west Sydney to undertake much of their journey by rail. This will reduce the growth in road freight traffic from Port Botany, with up to 3,000 fewer truck journeys travelling to and from Port Botany a day, which equates to 60,000 fewer kilometres travelled by import-export freight trucks on Sydney roads each day. This reduction in truck travel will reduce the growth in congestion across the Sydney network, reduce travel times, and increase the reliability of trip duration.
Moorebank Logistics Park will also reduce the amount of interstate freight being transferred by truck through Sydney's roads and on the national highway network.
Moorebank Logistics Park will create jobs at the terminal itself and in a broad range of industries around the terminal and elsewhere.
MIC engaged Deloitte to assess the potential employment opportunities that the terminal will bring to the region (both locally and more broadly).
Employment opportunities, August 2016: This report estimates the job types and employment numbers on site once Moorebank Logistics Park is fully operational. As many as 6,800 new jobs are expected to be created across warehousing, transport, terminal operations, site management and ancillary services.
Economic and employment impacts, April 2017: This report assesses the broader economic and employment impacts (direct and flow-on) of the terminal including the productivity benefits associated with the project for the regions surrounding the precinct over 20-year horizon. The report includes modelling of job numbers generated in various industries.
Around $11 billion in economic benefits will be created over 30 years through the improvements to productivity as well as reduced business costs, reduce road congestion and better environmental outcomes. This includes $120 million a year for the economy of south-western Sydney.
The cost benefit analysis for the Moorebank Intermodal Terminal (Deloitte, April 2017) has been updated to take into account:
- the development of the intermodal terminal and warehousing across the precinct, recognising the achievement of financial close of the agreements between MIC and Qube;
- Deloitte's current demand forecast; and
- MIC's current capital expenditure estimates (both value and timing).