Sowing the seeds for Australia’s future wheat infrastructure

A new study by the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) has identified the future infrastructure needs of the Australian wheat industry and examined the impact that significant growth in wheat production will have on Australia’s road and rail networks.

ABARES Executive Director, Karen Schneider, said previous analysis identified wheat as one of the main commodities where Australian producers may benefit from a significant increase in global demand.

“While Australia is already a major food exporter to Asia, the extent to which Australian producers can take advantage of emerging opportunities will be influenced in part by the efficiency of the supply chains used to deliver their products,” Ms Schneider said.

“Using case studies from Western Australia and New South Wales, the report identifies a number of issues currently affecting the movement of wheat from farm to port. While there are differences in wheat supply chains in the eastern and western states, the main impediments appear to be similar, and mainly relate to transport.

“Simulations undertaken by ABARES using a wheat freight movement model suggest that road use could increase significantly in the future because of increasing wheat production and rationalisation of the rail network.

“However, the current road charging and funding allocation system used in Australia is unlikely to be very responsive to increases in the volume of wheat transported using road. The first step to addressing this is to collect better data on road use, road condition and the cost of maintaining and upgrading roads.

“While the main constraints are in the transport sector, other issues identified in the study include a lack of mobile phone coverage, which could potentially restrict grain marketing activities during harvest, and the allocation of access to grain loading facilities at ports.

“This report highlights the importance of taking an integrated approach to planning and investing in different modes of transport, with decisions on investments in the rail network affecting road use.”

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