AusRAIL, Market Sectors

Queensland grain back on rail under interim plan

<p>Queensland Rail (QR) and Export Grain Logistics (ExGL) have agreed an interim solution that will enable this year’s harvest to move through Queensland on rail, rather than road.</p> <p>ExGL said the agreement meant the immediate restart of grain trains and would also allow the execution of its shipping program.</p> <p>More than six months of negotiations between QR and ExGL had previously failed to agree a new rail grain haulage contract to replace the one that expired on August 31.</p> <p>Freight rate increases and liability clauses were the two major sticking points.</p> <p>A third-party facilitator appointed last week was able to broker the new agreement, which will apply until February 2006.</p> <p>Both parties will continue to negotiate a long-term solution before that date.</p> <p>ExGL said freight rates would rise by an average 10% under the new interim agreement although the total increase could be higher "due to fuel costs continuing to escalate".</p> <p>"While the questions of liability were satisfactorily settled, the fact that freight rates are set to increase by 10% is extremely disappointing given the efficiencies made in the grains supply chain by all parties, which have rescued the operating costs to QR considerably," ExGL said.</p> <p>QR chief executive Bob Scheuber said the "challenging issues" of liability and rates had been worked through "to the agreement of both parties".</p> <p>"The interim agreement includes a weighted average freight rate increase for wheat of 10% with potential for a fuel adjustment if required, and an appropriate liability allocation," Mr Scheuber said.</p> <p>The grain harvest is already under way in central Queensland.</p> <p>It is expected that more than 800,000 tonnes of grain will be moved out of southwestern and southern Queensland for export. </p> <br />