CSIRO research into the Melbourne to Brisbane Inland Rail project has found that shifting horticulture and processed agriculture, such as meat, rice and dairy products, from road to rail could reduce transport costs for the agricultural sector by an estimated $70 million per year.
Last year, Australia’s national science agency conducted a pilot study using its logistics modelling Transport Network Strategic Investment Tool (TraNSIT), along with extensive industry engagement, focusing on the area from Parkes to Narromine in central-western NSW.
Researchers identified a baseline of existing freight movements in the area to estimate the potential transport cost savings for the entire Inland Rail project, marking the first time such a detailed analysis on road to rail supply chains in Australia has been completed.
Their analysis showed if existing agricultural road trips were shifted to Inland Rail, the sector could save between $64 and $94 per tonne, depending on back-loading.
This equates to about $70 million in reduced transport costs per year based on the shift of 923,000t of horticulture and processed agriculture to the lower-cost transport option that Inland Rail provides.
Additional analysis revealed that if existing coastal rail trips shifted to inland trips, this would result in an estimated saving of $28 to $35 per tonne.
“Our research has shown that Inland Rail would bring an improvement in rail travel time and transport cost, particularly important when considering perishable products,” says CSIRO TraNSIT leader Dr Andrew Higgins. “This would make it a lot more competitive with the travel time advantages of road transport.”
Parkes to Narromine was chosen for the case study because it is the first section of track to be constructed and because of the large number of supply chains involving hundreds of stakeholders in the area.
“A big cost in food production is transport, particularly given the large distribution of where and when it is grown across Australia, and the long distances to major domestic markets, often over 1000 kilometres,” Higgins said. “These type of savings with Inland Rail would mean food companies would have lower-cost access to markets further away than they supplied to in the past.
“The benefit is for those selling to market, basically large farming corporations, food companies and those behind processing facilities. You’d expect the savings would then be passed back onto farmers.”
The Australian Government has committed $9.3 billion to complete the 1700km spine of Australia’s freight rail network that will connect Melbourne to Brisbane in less than 24 hours.
As the next step, the analysis will be extended to the broader Inland Rail corridor, commencing with the section from Narromine to Seymour, Victoria, to obtain even more detailed cost savings across a broader range of commodities, including grains, cotton, livestock, wool, minerals and general freight.
The TraNSIT computer modelling tool works by analysing every possible combination of transport routes and modes (road and rail) and determining those that optimise vehicle movements between enterprises in the agriculture supply chain.
It has been used in previous research to test the benefits of transport infrastructure in regard to upgrading roads in northern Australia, and calculating agriculture and forestry transport benefits for industry and various levels of government.