Freight hub 'should benefit Lyttelton'

MARTA STEEMAN
Last updated 05:00 15/01/2014

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Lyttelton Port will gain more than Timaru's port in the short term from Port of Tauranga setting up an inland port at Rolleston.

That's the view of New Zealand's largest manager of export container freight.

Chris Greenough, chief executive of Kotahi, which manages 40 per cent of New Zealand export container freight, said Port of Tauranga's planned freight hub at Izone industrial park at Rolleston 12 kilometres south of Christchurch was port "agnostic".

Tauranga which bought half of Timaru's port last August announced on Monday it was setting up an "inland port" at Rolleston to provide South Island exporters and importers with a way of using Timaru.

Greenough said hardly any international ships called at Timaru and a limited number of coastal ships called there so not a lot could be shipped out of Timaru.

He expected Tauranga to steer more freight initially through Lyttelton than Timaru.

"As we understand, the investment they [Tauranga] announced this week in Rolleston is not essentially around feeding product directly to Timaru.

"Until such time as there are additional services available in Timaru I think realistically the majority of the product will probably go through Lyttelton." Kotahi is a cargo joint business between Fonterra and Silver Fern Farms to manage exports of milk and meat products and about 30 other exporters' products.

Greenough said Timaru would have to attract more coastal services to be able to ship goods to Tauranga to export from there.

He considered it would be "quite a challenge" for Timaru-Tauranga to compete with Lyttelton. While Tauranga offered more international services than Lyttelton, there were few options to connect from Timaru to anywhere. Timaru would have attract direct international services or reasonable scale coastal shipping services.

Given the increasing volume of cargo coming into Canterbury for the rebuild and the growing dairy exports there was plenty of business for two ports, he said.

"In the meantime, I would suggest Lyttelton is going to benefit more than Timaru simply because they have the ships," Greenough said.

Synlait Milk general manager supply chain Matthew Foster said companies like Synlait incurred greater costs when trucks carrying their goods had to spend a lot of time sitting at the port. Lyttelton's congestion problems in December had gone for the time being.

Synlait sent most dairy exports out of Lyttelton but "we send a little bit out of Timaru as a consequence of December".

"For Canterbury at large what's wrong with another option?" Foster said. Part of Lyttelton's problems was the rapid growth in exports in the region.

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Asked if the Timaru Tauranga alternative was credible and tempting, Foster said "It's very early days."

Large container carrier Hilton Haulage said some companies had already switched to shipping goods out through Timaru.

- BusinessDay.co.nz

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