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This discussion by David Greig in July 2007 explores changes in terminal operator businesses, focusing on European and Australian geography, main trades, land bridging challenges, transport barriers, entry barriers, rail infrastructure, mode choice, port operator market share, and the evolving landscape of the industry.
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The changing face of the terminal operator business Discussion – David Greig July 2007 ACCC regulatory conference
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
Land bridging • Adelaide-Melbourne for shipping frequency • Melbourne-Darwin didn’t happen • A blip of rail land bridging during a temporary shipping shortage • Some by transfer between ships • Generally uneconomic because of Australia’s geography
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
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
Conclusions • Far less port choice than Europe • Far more port operator market share than Europe • However: • ACCC => Toll/Asciano split • Stevedoring somewhat contestable • Rest of the chain is becoming contestable.