GrainCorp says it can reduce rail costs by $5 a tonne by spending $60 million on site upgrades across its network.
The grain handler on Monday announced the $60 commitment as part of Project Regeneration, a three-year plan to spend a total of $200 million, announced in June last year.
GrainCorp says the plan will return 1 million tonnes of grain from roads to rail, while also reducing rail costs by that $5 a tonne figure.
The handler hopes to develop its network to over 50 high capacity country sites, supporting an “efficient rail operation”.
Works at each site fall broadly into four categories: new country sites with new high speed over-rail loaders, new high speed over-rail loaders at existing sites, upgrades to existing rail loading infrastructure, and capacity expansion.
With this year’s $60 million commitment, GrainCorp will upgrade 13 of its sites.
New country sites will be developed at Yamala, near Emerald (QLD), and Calleen, near Ungarie (NSW).
New over-rail loading equipment will be added to Nevertire and Ardlethan in NSW.
Upgrades to existing infrastructure will take place at Narrabri, Burren Junction, Spring Ridge, Junee, Oaklands, Tocumwal in NSW, and Rainbow and Murrayville in Victoria.
Meanwhile capacity expansion works will take place at Red Bend and Ardlethan, both in NSW.
GrainCorp boss Mark Palmquist said the works would be staged for the receival of the winter crop this year, and the rail outloading program next year.
“We are very excited about the benefits this investment will deliver to growers and other customers using our network,” he said.
“Reduced complexity, faster rail loading times and shorter train cycle times will increase the volume of grain transported by rail and reduce supply chain costs, which translates to improved grower returns.
“We continue to work closely with governments to encourage complementary investment in government-owned rail sidings.”
In particular, Palmquist said the company welcomed the NSW government’s focus on increasing grain rail freight, and its $400 million Fixing Country Rail commitment.
“Without the NSW government’s investment to extend sidings at Ardlethan and Nevertire, our investment to upgrade those two sites would not have been possible,” he explained.
Palmquist added that GrainCorp was “encouraged” by its positive engagement with the Victorian and Queensland governments.