Rail the backbone of reliable international freight

Although the coronavirus (COVID-19) has caused major disruptions to international supply chains, not all freight and logistics networks have been affected equally.

As countries around the globe have closed their borders to air freight, due to the restrictions on passenger flights which carry most airborne cargo, shipments via rail have continued unabated, including long haul routes from China to Europe. Additionally, seaborne freight has been first hit by shutdowns in China and now by lockdowns in the US and Europe, causing freight liners with large capacities to cut back services.

Into this situation has come rail freight, which within Europe has bypassed kilometres long lines of trucks stops at internal borders, and has picked up the slack left by ocean-going lines being reduced. In mid-March, DHL announced that while routes via air were uncertain and blank sailings (cancelled ship cargo services), rail freight continued as normal.

“All DHL Global Forwarding Rail services, including FCL and LCL service from China to Europe (Westbound) and Europe to China (Eastbound), continue normal operations,” the company announced on March 10.

More recently, Finnish logistics operator, Nurminen Logistics has announced the schedules of its Helsinki, Finland to Hefei, China service. Senior vice president sales, Mikko Järvinen, said that flexibility is key.

“Everyone has had to improvise with these disturbances in international logistics. One of the tools we have had for our customers has been the fast cargo train service,” he said.

With the demand for essential medical supplies more critical than ever, and with China manufacturing many of these goods, a reliable shipping option has needed to be found, and in this case, that has been rail.

According to Chinese media agency Xinhua, the first quarter of 2020 saw a 15 per cent increase in freight rail trips between China and Europe, and an 18 per cent increase in freight units. From March 21 until the beginning of April, China had sent 333,800 pieces of epidemic control supplies via rail to Italy, Spain and other European nations.

Within Europe, logistics operators were hit hard by border closures within the Schengen zone. Which in one case at the border between Germany and Poland led to a line of trucks stretching for 50 kilometres. In the Czech Republic, the border into Slovakia is clogged with 30 kilometres of trucks. Rail, however, is continuing across borders without any stops with Austrian operator Rail Cargo Group announcing on March 24 that all freight trains are running on schedule without any restrictions.

Furthermore, rail has also proven its flexibility. In one instance, an urgent shipment of pasta from Italy to Germany was hauled by rail at short notice. DB Schenker transported 400,000 packages of pasta, over 200 tonnes, for retailer Aldi.

“The current Coronavirus pandemic emphasises the importance of reliable supply chains. Logistics keeps the world running, as demonstrated by our solution for ALDI to transport pasta from Italy to Germany on short notice,” said Christian Drenthen, board member for land transport at DB Schenker.

QR enables extra freight movements

Over the past weekend, Queensland Rail has been taking extra steps to ensure that freight rail can continue to transport essential goods to Australia and export commodities to ports.

Over the weekend of April 4 and 5, six freight trains travelled in each direction between Brisbane, Townsville, and Cairns. The extra capacity on the network was enabled by Queensland Rail cancelling a scheduled maintenance closure and only completing essential maintenance on the South East Queensland network overnight.

Carrying household goods, groceries, manufacturing materials, and exports, the freight services are more in demand than ever for businesses, households, and exporters.

“Queensland Rail is working closely with its freight partners to ensure Queenslanders get the essential supplies they need, by keeping the network open to extra freight services wherever possible,” said Queensland Rail CEO, Nick Easy.

Although some long-distance and tourist-focused rail services in Queensland have been cancelled, the continuation of freight rail has been a priority for state and federal governments around Australia. Easy said that the network was open for greater freight movements, if required.

“Queensland Rail is continuing to liaise with its freight partners to discuss any necessary changes to future works to accommodate freight services, should they be required,” he said.

“Most lines across the Queensland Rail regional network can currently accommodate more freight movements alongside normal timetabled passenger services. Reducing long distance Travel and Tourism passenger services has naturally increased network capacity for freight operators should they require it.”

Aurizon purchases bulk transport and handling business

Aurizon has acquired Townsville Bulk Storage and Handling (TBSH) to grow its capacity to shift bulk freight in North Queensland.

Finalised on March 21, the acquisition expands Aurizon’s bulk freight business and the company will be now known as Aurizon Port Services. According to an Aurizon spokesperson, the acquisition comes as Aurizon looks to grow its business.

“Aurizon has been assessing growth opportunities for our bulk business to extend supply chain services beyond our core rail capability.”

The purchase enables Aurizon to provide bulk transport, handling, and stevedoring services in North Queensland, and extends capabilities across its North Queensland network.

“In the future, our Mt Isa and Cloncurry terminals will aggregate products that will be railed directly into the newly-acquired business providing a fully integrated service with significant benefits for customers,” said the Aurizon spokesperson.

The acquisition is hoped to complement Aurizon’s existing rail services. The Mt Isa line connects to the Port of Townsville, where commodities extracted from the North West Minerals province are transported for export.

“Aurizon continues to have an optimistic outlook for bulk commodity markets within Australia – products that are required to support the demands of the modern economy and a general increase in living standards throughout the world,” said the spokesperson.

Aurizon’s bulk business transports mineral commodities, agricultural products, mining and industrial inputs, and general freight throughout Queensland and Western Australia. In the last year, Aurizon has significantly grown its bulk segment of the business with a 208 per cent increase in earnings before tax, interest and depreciation.

Freight and logistics councils streamline movement of goods

The freight industries in Western Australia and South Australia have each joined together to provide an efficient source of information for freight operators during the coronavirus (COVID-19) crisis.

In WA, the Freight and Logistics Council of WA (FLCWA), along has formed the WA Supply Chain Covid Response Group. The group brings together the FLCWA, Northern Territory Road Transport Association, and Western Roads Federation to ensure the safety of workers and the continuing supply of essential goods.

Leading the group will be Nicole Lockwood, chair of FLCWA, and the combined group will provide a single source of information to the WA and Northern Territory governments and agencies on behalf of the freight and logistics industries.

“We’re here to help any freight company who requires assistance in dealing with operational impacts due to Covid-19 and encourage them to get in contact with us,” said Lockwood.

Since its formation two weeks ago, the response group has been providing advice on the impact of border closures and supported the delivery of products such as hand sanitiser to the freight industry.

“Our key priority is the safety of all workforce involved to maintain the movement of food, medical supplies and general freight. I’d like to acknowledge the dedication from the front-line truck drivers, train drivers and Port workers in ensuring essential goods are kept flowing into Western Australia,” said Lockwood.

WA network operator Arc Infrastructure has been planning for the COVID-19 pandemic since February to ensure that operations continue. Those who can work from home are doing so, and while regional depots and head office remain open, face-to-face meetings are limited unless business critical.

Arc Infrastructure has also implemented new control centres in the metro area, increasing the number of available train controllers, decentralising work locations, and making sure that expertise and qualifications are evenly spread across the network.

In South Australia, Minister for Trade and Investment, David Ridgway, has formed the Export Recovery Taskforce to support South Australian freight businesses overcome the economic effects of COVID-19.

“South Australia has an immense task ahead of us, and the impacts of COVID-19 are being felt across all export sectors. We recognise the enormous economic and logistical issues challenging our industries, businesses and individuals right now as a result of the necessary restrictions on travel,” said Ridgway.

While international air freight has been restricted, ports and ship-borne freight remain operating. According to Evan Knapp, executive officer of the SA Freight Council, while the initial focus is on shipments via air, future discussions could incorporate impacts to goods shipped by rail, for example grain.

“Rail is still moving relatively well at this stage. Grain has been affected by the massive change in value of our currency which will have short term impacts, but in the longer term the currency depreciation will make Australian goods much more attractive in markets around the world.”

Knapp added that the SA Freight Council and others have reiterated to governments that rail workers and rail safety workers are essential workers and must be permitted to cross state borders to make urgent repairs to rail networks, when required.

Now is the time for Team Australia

Not since World War II has Australia’s social and economic way of life been put under such pressure. Businesses are struggling or closing, thousands have already lost their jobs, governments are shutting down all non-essential activities, and millions are working from home.

Australia’s Reserve Bank has slashed interest rates to record lows and governments are spending tens of billions to help stabilise the economy.

Anxiety is gripping the nation, with panic buying of food and household items by nervous consumers.

Now is the time for Team Australia to kick in.

What many Australians may not realise is the army of essential freight and logistic workers toiling day and night to help keep our economy ticking over. They are making sure necessities and raw materials find their way to supermarkets, retail stores, petrol stations, warehouses, steel and flour mills, and manufacturing plants.

As Australia’s largest rail freight company, Pacific National is proud to be doing our part, hauling the nation’s goods and commodities 24 hours a day, 365 days of the year along railways linking key supply chains across our vast continent.

Without goods trains, domestic and imported products like food, clothing, medical and pharmaceutical supplies, cleaning products, fuel, household products, chemicals, electronics, steel, and machinery and parts cannot be efficiently transported to depots and warehouses between cities and regional towns.

A double-stacked 1,800-metre interstate goods train can haul more than 330 shipping containers, thereby helping to free-up hundreds of truck drivers each week to focus on delivering goods and products the remaining ‘last mile’ from warehouses to stores where consumers need shelves restocked.

To put this in perspective, a single shipping container can hold approximately 25,000 toilet paper rolls, 55,000 food cans or 1,500 cases of beer.

Without freight trains, bulk exports like grain, meat, fresh and dry produce, cotton and coal cannot be efficiently hauled to ports, the gateways to global markets.

Paddock to port, pit to port, or manufacturing plant to port – essential rail freight services stretch across state borders, servicing finely-tuned supply chains.

Our company has been providing essential rail freight services since 1855. Back then we were called New South Wales Government Railways.

Today, our 600 locomotives are crewed and serviced by 2,500 men and women right across the nation. Each day and night they clock onto their shifts after practicing strict hygiene and social distancing procedures. Rail freight has the added benefit of operating within railway corridors and depots prohibited to the public.

The health and safety of our train crews are paramount, and I’m immensely proud of their efforts and dedication.

Unless ill or otherwise required by law, these crews continue to run essential freight train services around the clock. Without them, critical supply chains across state borders will break. Largely out of sight, each day they help underpin the productivity and wealth of our nation.

We thank federal and state governments for working closely with our sector during this challenging time. They moved quickly to protect the nation’s supply chains.

So next time you see a big blue and yellow Pacific National locomotive, take comfort knowing there is an army of freight and logistic workers doing their bit for Team Australia.

Dean Dalla Valle
Pacific National CEO

Transporting cars by train cuts emissions by 75 per cent

Automaker Volvo Cars has found significant emissions reduction by shifting the movement of cars from road to rail.

The company has utilised rail to transport vehicles from a production plan in Ghent to a depot in Italy, and reduced CO2 emissions by 75 per cent. On a separate route from Ghent to Austria, emissions were cut by half.

The Swedish-headquartered carmaker, owned by Chinese company Geely, was previously using trucks to transport the newly made cars within Europe. However, internationally, Volvo cars uses rail to transport vehicles in the US and China.

Two trains per week take Volvo cars made in China to Europe. Trains are also used to move cars within China and to Russia.

In the US, cars assembled in Charleston, South Carolina, are moved by rail to depots around North America.

“When we said we planned to significantly reduce emissions across all our operations, we meant it,” said Javier Varela, senior vice president of manufacturing and logistics at Volvo Cars. “Our logistics network is just one piece of that puzzle, but an important one nevertheless. This is one example of our commitment to reducing our impact on the environment through meaningful, concrete steps.”

The move to rail forms part of the company’s wider strategy to cut carbon emissions by 40 per cent per car between 2018 and 2025. The plan involves a 25 per cent reduction in operational emissions, which covers logistics. The company overall aims to be climate neutral by 2040.

European states asked to reduce border checks for freight

The European Commission (EC) has requested that all European member states implement ‘green lanes’ on border crossings for freight transport.

The measures follow the disruption of European supply chain networks following border closures implemented to contain the coronavirus (COVID-19). The EC hopes that the green lanes will allow for freight to continue moving through the EU.

Guidelines for the implementation of the green lanes stipulate that no checks and health screenings should take more than 15 minutes, and procedures should be minimised to what is strictly necessary. This involves checks and screening being carried out while drivers remain in their vehicles.

“Our guidance document is intended to protect the EU’s supply chains in these difficult circumstances, and to make sure both goods and transport workers are able to travel to wherever they are needed – without delay. A collective and coordinated approach to cross-border transport is more important today than ever before,” said commissioner for transport, Adina Vălean.

The ‘green lanes’ are encouraged to be implemented across all the border crossing points on the Trans-European Transport Network (TEN-T), the continental network of rail, road, and waterways connecting European countries.

While the measures are designed to speed up the movement of goods, the EC also hopes that reducing unnecessary stops help improve the health of transport workers.

“The green lanes are also specifically designed to protect transport workers at the frontline of this crisis. This set of recommendations will ease their already stressful mission and it will bring more safety and predictability to their work,” said Vălean.

The EC has also encouraged that enhanced hygiene measures should be undertaken at railway stations and transport hubs.

Room for growth in trying times

While the COVID-19 pandemic is causing an undeniable impact upon the Australian economy, the rail industry is continuing to play its vital part in moving people and goods around Australia.

During these times, Rail Express will continue to deliver timely news and industry insights to our audience of rail professionals. Rail Express is the only publication dedicated to the rail industry that is publishing daily briefs as the story evolves. Our email newsletter database and online page views have been experiencing substantial growth over the past months, and we will endeavour to ensure that they continue to do so, even as disruption occurs.

Already, we have seen significant interest in how the rail industry will continue to be the lifeblood of Australia’s logistics supply chain. We have spoken with our key industry associations and partner organisations to understand that in fact, the demand for key rail services, particularly in the freight sector, is growing, with the resulting need for suppliers of equipment and services to continue to engage with the industry.

In addition, the growing government stimulus packages have a direct impact upon organisations working in the rail industry, many of whom are looking for the stimulus to go further so they can continue to meet the demand for mobility.

Finally, when the initial impacts of the virus subside, the rail industry will be continuing to grow as infrastructure spending is adopted by governments as a way to kickstart the economy.

More than ever, Rail Express is the resource that the Australasian rail industry turns to. The publication is continuing to grow in both print and online to meet the needs of the sector’s growth as a whole.

Industry seeks clarity on status of rail freight

The Australian rail sector is calling for a clear statement from governments that rail freight is an “essential service” and can continue to operate despite coronavirus (COVID-19) shutdowns.

“With state borders around the country closing, rail freight is more important than ever. It needs to be clear that essential services such as rail freight movements can continue during this time,” said CEO of the Australasian Railway Association (ARA), Caroline Wilkie.

The Australian Logistics Council (ALC) also reiterated the need for governments to take a definitive position on the status of rail freight.

“It would be helpful if governments at all levels reinforced this point in their communications and made it clear that freight operations will not be impeded by border closures,” said ALC CEO, Kirk Coningham.

The statement follows border closures in Queensland, Western Australia, South Australia, and the Northern Territory and shutdowns of “non-essential services” in NSW and Victoria.

In some cases, the demand for rail freight is increasing, as Matthew Roberts, rollingstock operations manager at CFCL Australia (CFCLA) highlighted.

“Our assets and maintenance workshops are running as normal ensuring the servicing, maintenance and continuation of rebuilds of rollingstock for rail operators and other rail freight shippers continues. The CFCLA leasing business is also working with customers to increase the supply of locomotives and wagons in service in some areas.”

However, as supermarkets, pharmacies, and other retail stores remain open, rail freight is required to keep supply chains moving.

“ALC’s conversations with governments and regulators at federal and state/territory level have been focussed on ensuring freight and logistics across all transport modes remain classified as an essential service. So far, that advice is being accepted, and as a result, our supply chains are continuing to function,” said Coningham.

To date, freight is yet to be told to reduce services.

“The COVID-19 situation is unlike anything we have faced, but rail freight is providing the backbone to our nation’s supply chain during these challenging times. Our members are keeping freight moving, ensuring that essential goods such as canned food, toilet paper and cleaning products continue to get to where they need to be,” said Wilkie.

Transport for NSW secretary, Rodd Staples, said that the agency will work to ensure freight continues in NSW.

“A key part of our role is ensuring goods and services are able to get to where they are needed most, including supermarkets. The team is continuing to work closely with the freight industry to ensure we don’t see any barriers emerge in critical supply chains, across roads, ports and rail.”

While curfews have been lifted for road freight to supply supermarkets and stores that have had to deal with panic buying, curfews still apply to rail freight movements. Additionally, as passenger demand drops, there is the potential for increased freight movements.

“We appreciate the need to keep critical passenger train services moving in our cities but if we see a reduction in passenger services on metropolitan networks, rail freight access should be increased to these networks to facilitate the transport of essential goods. This could include modifications to current curfews to increase frequency and availability of freight services,” said Wilkie.

Coningham also highlighted that the seamless movement of goods is critical at this time.

“Our supply chains cannot afford to have rail freight being delayed at check points for hours if we want to keep essential goods flowing. The health and welfare of Australian communities needs to be our priority – and in order to ensure it,  we have to keep food, clothing and medicines moving to the places they need to go.”

Rail freight operators are ensuring that they are able to provide a safe and reliable service to customers by increasing cleaning procedures.

“To mitigate the potential person to person contamination risk, workshop crews are being split into small teams and working hours are staggered with crews running two shifts instead of the normal day shift reducing person to person contact as far as possible. Cleaning of workshops has increased each day and between shifts and importantly cleaning locomotive cabs has been stepped up further as they pass through for servicing,” said Roberts.

“CFCLA is taking seriously the supply of goods and services necessary to the freight sector with the health and wellbeing of all Australians being paramount.”

ARA

Rail industry continuing during COVID-19

While the rail industry is still coming to terms with what impact COVID-19 will have on the sector, the industry’s peak body, the Australasian Railway Association (ARA) has been ensuring that it continues to act as a collaborative voice for the industry.

At a federal government level, ARA CEO Caroline Wilkie has been part of the Commonwealth Department of Infrastructure transport industry teleconference, and is providing a voice for the rail industry at senior governmental levels.

For the industry itself, the ARA has held passenger transport and freight industry teleconferences to discuss the impact of COVID-19 on these sectors. The discussions enabled members to share learnings from direct operator experience.

Further meetings are planned for the Rail Industry Group and Rail Contractors Group.

All ARA working group and committee meetings will continue, however via video-conferencing, with details sent to members.

While face-to-face meetings are temporarily on hiatus, the ARA is coordinating a webinar program, and asking for contribution from members for topics and speakers. The webinars will cover new redevelopments and host debates on pressing topics.

The ARA has communicated that passenger rail operators are experiencing significant reductions in patronage as well as social distancing between customers on networks in Australia and New Zealand. Services have not been reduced, however.

For freight, contractor, and supply chain operators, challenging conditions are being reported, and some stimulus measures may be available.

For freight operators, the Australian Logistics Council has been working with the federal and state governments to ease conditions for logistics operators. NSW, Queensland, and South Australia have announced lifted restrictions for freight movements to allow for supermarkets to restock. These allowances may ease some pressure on logistics companies working further up the supply chain.

“The most pressing challenge for logistics companies at present is getting stock into stores quickly enough to satisfy extraordinarily heightened levels of consumer demand. The existence of curfews that prohibit deliveries during certain hours are a barrier to addressing that challenge,” said ALC CEO Kirk Coningham.

“Australia’s freight and logistics sector is working around-the-clock to deal with the enormous challenges presented by COVID-19 and it is important our governments provide practical support to help the industry’s efforts to support local communities.”