Port of Tauranga and the Tainui Group Holdings subsidiary Port Ruakura LP have agreed on a 30-year rail freight partnership to support the development of the planned Ruakura Inland Port in Hamilton.
Port of Tauranga chief executive Mark Cairns told the Bay of Plenty Business News the agreement announced in August was a significant development.
“We’ve been talking with Tainui for a quite a long time, but have made a lot of progress in the past three months where we’ve put some ink on a 30 year deal to develop the Ruakura centre with them,” he said.
The agreement allows Port of Tauranga’s cargo trains running between MetroPort Auckland and Tauranga to service the Ruakura Inland Port. That will allow Waikato-based importers and exporters direct access to fast international shipping services calling at Tauranga, which is the only port call for the biggest 9640 TEU (twenty-foot equivalent units) container ships visiting New Zealand.
Cairns said the planned Ruakura Inland Port offered significant cargo handling capacity and scope to meet future needs.
TGH describes Ruakura as a “visionary logistics hub” designed to help importers and exporters unlock the golden triangle. Offering genuine scale, the core of the development is a 30ha inland port which will offer direct access to major seaports via main trunk rail services and the Waikato Expressway.
“It’s an excellent example of Port of Tauranga’s partnership approach to providing supply chain infrastructure beyond our Bay of Plenty hinterland.”
– Mark Cairns
Complementing the inland port is a 192ha logistics and industrial precinct offering room to grow for businesses seeking a substantial footprint, and adjoining precincts for commercial, residential and retail use. Ruakura is long-term project by TGH and its business partners.
The ‘new black’
“Inland ports are the new black with all of the port companies at the moment,” said Cairns.
He noted that in the Waikato, Port of Tauranga was working with Fonterra out of Te Rapa, and that Ports of Auckland was expected to put around $200 million into its Northgate Business Park development in the Waikato.
“The Ruakura development will provide a highly efficient rail hub in the Waikato by utilising our existing train services linking our MetroPort Auckland inland freight hub with Port of Tauranga, which is New Zealand’s international hub port and the main cargo gateway for the upper North Island,” said Cairns.
“It’s an excellent example of Port of Tauranga’s partnership approach to providing supply chain infrastructure beyond our Bay of Plenty hinterland.”
Cairns also cited the potential impact of the government’s comprehensive Upper North Island logistics and freight review, aimed at ensuring New Zealand’s supply chain is fit for purpose in the longer-term. This includes a feasibility study to explore moving the location of the Ports of Auckland, with serious consideration to be given to Northport. Under the original terms of the study, the group was expected to deliver a final report to cabinet in September 2019.
“I would suggest we have sufficient latent capacity to handle all of [POA’s] volume,” said Cairns.
Key step for Ruakura
Tainui Group Holdings chief executive Chris Joblin said he welcomed the long-term partnership on behalf of Port Ruakura LP.
“This initial 30-year agreement with Port of Tauranga is a key step towards fulfilling our vision for Ruakura to unlock the golden triangle of Auckland, Hamilton and Tauranga for importers and exporters,” he said.
“The agreement will see Port of Tauranga trains initially call at Ruakura four times daily and this is likely to grow. This service will underpin the significant supply chain savings we have been modelling with prospective customers and tenants of Ruakura.”
A TGH subsidiary, Port Ruakura LP will invest in and provide the necessary infrastructure, including a rail siding, hardstand and cargo storage areas which will then be utilised by the Port of Tauranga cargo trains.
Over the past 12 months, TGH has been working with LINX Cargo Care, its New Zealand subsidiary C3 and specialist advisors on the design and layout of the inland port and the development costs are confidential for commercial reasons.
The golden triangle already accounts for around half of all freight volumes in New Zealand and container volumes are forecast to grow 60 percent by 2042.
“This initial 30-year agreement with Port of Tauranga is a key step towards fulfilling our vision for Ruakura to unlock the golden triangle of Auckland, Hamilton and Tauranga for importers and exporters.”
– Chris Joblin
Port of Tauranga’s partner KiwiRail operates up to 86 trains per week between MetroPort Auckland and
Tauranga.
(See story here for Port of Tauranga’s latest 12 month results).
The route currently has unused capacity and the additional service stop will improve utilisation and reduce the number of trucks on roads.
The agreement provides Port of Tauranga with priority rail slots at the Ruakura facility for an initial term of 30 years.
Port Ruakura LP will provide the necessary infrastructure, including a rail siding, hardstand and cargo storage areas.
Development of the Ruakura Inland Port is scheduled to follow the completion of an adjacent Hamilton section of the Waikato Expressway currently expected to be late 2021.
KiwiRail chief executive Greg Miller says the upper North Island is a key growth region for KiwiRail and New Zealand.
“This is another example of the supply chain collaborating with KiwiRail to design and deliver rail infrastructure to better connect New Zealand,” he says.
