Grain producers confront Eyre Peninsula freight impasse and call for state blueprint

A freight study released by the State Government has shown major issues with continuing to transport grain by rail on the Eyre Peninsula.

Grain Producers SA chief executive officer Caroline Rhodes says SA needs a statewide infrastructure blueprint for the grain industry.

A freight study released by the State Government has shown major issues with continuing to transport grain by rail on the Eyre Peninsula.

It follows Viterra announcing that it will stop using the Eyre Peninsula rail network to cart grain from May 31, partly due to the condition of the rail infrastructure, owned by Genesee & Wyoming Australia.

Key findings in the report include:

ENSURING rail infrastructure remained reliable was likely to result in rail charge increases, leading rail rates to become uncompetitive with road transport.

OWNER Genesee & Wyoming would be unlikely to commit to investment in capital upgrades of the rail network without suitable commitment from Viterra to an ongoing contract.

VITERRA was unlikely to commit to an ongoing contract unless it was confident that the necessary capital upgrades would occur to support an efficient freight task.

POTENTIAL infrastructure changes on the Eyre Peninsula, including Iron Road’s proposed Cape Hardy port, could change the demand for use of rail, road and port infrastructure.

Transport Minister Stephan Knoll said the State Government had negotiated a $100 million funding package to upgrade Eyre Peninsula roads in the wake of the rail closure, including $25.6 million dedicated to the lower Eyre Peninsula.

“This will ensure the road network is able to cater for the additional road freight movements we will see as a result of GWA and Viterra’s decision to no longer use the rail network,” he said.

“It’s important to remember that 60 per cent to 70 per cent of grain is currently hauled by road on the Eyre Peninsula.

“The way grain is transported around Eyre Peninsula is continuing to change with the establishment of the T-Ports facility at Lucky Bay, which will start receiving grain for the 2019 harvest. There are also grain port proposals for Cape Hardy, Port Spencer and Decres Bay.

“All of these ports and proposals for future grain ports will further reduce future rail freight volumes, making the rail network even more unviable.”

Grain Producers SA chief executive officer Caroline Rhodes welcomed the government’s funding announcement but said there was still a need for a statewide infrastructure blueprint for the grain industry.

“While this funding package is great news for growers on the Eyre Peninsula, GPSA believes a statewide infrastructure blueprint for the grain industry is necessary to enable long-term planning and better targeted government funding,” she said.

“This will improve export pathways and ensure growers across the state continue to have access to the largest possible range of markets across the world for their grain.”

Ms Rhodes said a blueprint would help South Australian growers remain globally competitive.

“SA has an excellent reputation for providing clean, premium agricultural products. Grain supply chains and enabling infrastructure must be designed to meet both customer demand and market access requirements, which may change according to seasonal conditions and international trade dynamics.”