By Rob McKay
Nolan said the Queensland Government understood the importance of these lines as the only state still transporting cattle by rail.
“AgForce was pleased to see minister Nolan’s commitment to future rail transport but the service delivery on the ground is now required,” the rural lobby’s spokeswoman said after the most recent meeting with Nolan.
AgForce has a major gripe with the state-owned rail enterprise, saying that a lack of transparency in figures quoted by QR regarding the real costs of transporting cattle to south-east Queensland processing plants was “the single biggest stumbling block in resolving the rail transport issue”.
“Industry and customers have no confidence in the existing QR costings and business model, and do not accept the level of implied subsidisation – which it claims is a $25 million loss – put forward by QR and Queensland Transport,” AgForce cattle spokesman Peter Hall said.
The lobby had been told two years ago that the cattle transport business was operating at 95 per cent efficiency, he said.
“It is crucial that there be an independent review under the auspices of minister Nolan to scrutinise and review the business costs and the potential community service obligations associated with rail transport.”
AgForce has claimed that 184,000 cattle from remote parts of Queensland would be slaughtered in South Australia and Townsville without the rail services, with the likely loss of 900-1,200 jobs at the Teys Bros and JBW Swift processing plants in south-east Queensland.
“I have met with Agforce twice, as well as industry representatives and QR,” Nolan said.
“A joint process is underway with Agforce to find solutions to the unique challenges of the cattle industry.
“Only about 10 per cent of Queensland stock movements are by rail, but we know these services are needed, especially to move cattle from sale-yards to abattoirs.
“That’s why we are working hard with industry to ensure they will continue.
“It’s also why we provide a $25 million a year implicit subsidy to the meat industry via the loss QR makes on these services.”
She highlighted the complexity of the issue, whereby QR had fixed costs in rolling stock and limited train paths, whereas the meat industry was variable and subject to climate and demand.
It was on the latter point that AgForce found the idea of take-or-pay arrangements unacceptable.
“Finding a balance between high fixed costs and variable demand is the challenge we are working with AgForce and industry on,” Nolan said.
“But that doesn’t just mean cutting services – it means working together to find a solution for the future.
“I understand industry is concerned about recent temporary service disruptions affecting supply to south-east Queensland abattoirs – especially out of the south west.
“I have taken this on board and I am raising it with QR.”
Nolan said she would continue to work with industry and community representatives.
“The Integrated Transport Strategy for Agricultural Commodities being developed by my department and AgForce will be available soon,” she said.
“This will be the starting point for further detailed discussions between QR and its customers about future arrangements for services.”
Source: Lloyd’s List Daily Commercial News – www.lloydslistdcn.com.au
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