Australia: New five-year rail contract signed between ABB Grain and AWB Ltd
ABB Grain and AWB Ltd announced on January 6 they have signed a new five-year contract with the Australian Railroad Group for rail haulage of grain in South Australia, after several months of negotiations.
The new rail contract places strong emphasis on efficient use of infrastructure and acknowledges investment made by ARG in rail infrastructure to service the grain industry through a fixed and variable charging arrangement.
ABB Grain’s managing director, Michael Iwaniw, said grain rail branch lines throughout Australia faced an uncertain future due to deteriorating rail infrastructure and comparatively low tonnages hauled.
“However, this new contact between ABB, AWB and ARG enables much needed investment to be made in rail and road infrastructure for the grain industry in SA,” Mr Iwaniw said. “About $25 million is being spent on Eyre Peninsula grain lines with the State Government spending $8 million on the region’s road system to improve grain logistics.
“ABB has already made a significant investment of $3.5 million towards the region’s rail infrastructure by upgrading our Cummins site outloader and building three mobile grain outloaders. Since 2004, we’ve also spent $3.2 million on fast rail outloaders and related equipment at 18 sites outside the peninsula.”
The Eyre Peninsula funding has been due to a cooperative approach between state and federal governments, the grain industry and the local communities, all of whom have recognised the need for an efficient transport system to meet export shipping requirements and address community concerns.
“A complementary road and rail transport system is important for accumulating grain in an efficient and timely manner, especially with increasingly larger vessels using our ports,” Mr Iwaniw said. “Rural communities have also said quite strongly they want rail retained due to concerns about road damage and road safety. The signing of this new contract ensures rail does have a future.”
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