The changing face of the terminal operator business

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The changing face of the terminal operator
business

• Discussion David Greig

July 2007
ACCC regulatory conference
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European and Australian geography
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The main trades

• Exports (minerals, grain) from inland by rail to
  nearest port
• Usually a unique port, sometimes two (Vic/SA
  grain, Qld coal)
• Imports shipped direct to each main (coastal)
  market
• Coastal shipping limited to bulk commodities
  (petroleum, alumina, cement) and Tasmania
• Not much land bridging

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Land bridging

• Adelaide-Melbourne for shipping frequency
• Melbourne-Darwin didnt happen
• A blip of rail land bridging during a temporary
  shipping shortage
• Some by transfer between ships
• Generally uneconomic because of Australias
  geography

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Transport barriers to entry

• Trucking close to perfect competition
• No real barriers to coastal shipping
• Ports
• physical barriers low land available or
  reclaimable
• commercial barriers significant need to enter 2
  or 3 ports (Melbourne experience)
• Logistics skills replicable
• Rail entry barriers declining

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Rail entry barriers

• Entry constrained by infrastructure capacity
  train paths
• Best paths taken train length, time of day
• However a major Auslink/ARTC upgrade is under way
• Many more long passing loops and can keep
  adding and improved signalling
• Much more capacity, for growth and new entrants
• Contrast with Europe

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Mode choice
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Mode performance 2004 M to B
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Road and rail availability
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Rail market share
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Conclusions

• Far less port choice than Europe
• Far more port operator market share than Europe
• However
• ACCC gt Toll/Asciano split
• Stevedoring somewhat contestable
• Rest of the chain is becoming contestable.