In the second part of the National Freight Demands Study's Executive Summary forecasts of future volumes and flows of freight are described.

Replacement of the National Freight Demands Study

At the time the study was done it provided an accurate picture of freight movements in New Zealand. However, the study uses base freight movements as they were in 2006/07. Since then the global financial crisis, the Canterbury earthquakes, and changes in supply chains have impacted on freight demand, and the freight projections may be too optimistic in the shorter term. To address this the Ministry will be updating the National Freight Demands Study in 2013.

Forecasts for the future

For each of the commodities identified forecasts have been made of future volumes and flows, based on national projections, industry views and the consultants own analysis. 

Over the period from 2006/07 to 2031 the freight task for the commodities identified is expected to increase by about 70-75 percent in terms of tonnes lifted and in terms of tonne-kms transported.  This figure of growth to 2031 can be compared with alternative estimates of growth in tonne-kms of about 70 percent between 2005 and 2020 based on work undertaken by TERNZ and forecasts of growth of up to 100 percent by 2040 based on work undertaken internally by the MOT, and lies broadly between the two.

The freight task is therefore expected to continue to have strong growth, both in response to increases in outputs of basic commodities for which trip lengths are likely to be short and of more sophisticated products which are typically transported longer distances.

Growth by mode and by region

Introduction

The forecast growth of the freight task will offer expanded markets for those transporting the goods.  Forecasts by mode have been made.  These take into account general growth trends for particular commodities identified in the course of the study and some specific opportunities to increase the modal shares of rail and to a lesser extent coastal shipping in commodity movements in which these modes already participate.  These do not include the effects of interventions by the government specifically aimed at changing modal shares, although the effects of the Emissions Trading Scheme have been considered.  These effects are however likely to be only very limited.

Forecast growth by rail

The forecast growth in rail freight movements is set out in Table E4.

Table E4. Forecast growth by rail
Product Group

2006-07

2031

Growth to 2031

Dairy products inc milk

2.20

4.08

85%

Meat

0.48

0.54

13%

Logs and woodchips

1.29

3.24

151%

Timber, wood products,
pulp and paper

1.41

1.75

24%

Horticultural products

0.13

0.42

223%

Other agricultural products

0.17

0.18

6%

Coal

4.07

5.50

35%

Aluminium and steel

0.36

0.36

0%

Chemicals, fertiliser and
minerals

0.21

1.38

557%

Food, other manufactured
products or not elsewhere
specified

3.29

5.61

71%

Total

13.59

23.06

70%


These forecasts would imply that the modal share of rail would remain broadly constant, with the 70 percent increase in rail tonnage being slightly below the overall increase forecast of a growth of about 75 percent.  Nevertheless it would represent a very substantial increase on present day flows, representing an annual average increase of about two percent, compared to the current position of broadly constant flows.

Forecast growth by coastal shipping

For coastal shipping, the movement of petroleum is likely to grow with the expansion of the refinery at Marsden Point and the movement of cement will be reduced as product is distributed by land within the South Island.  For the rest of the commodities handled, which we have classified as general cargo, we have tentatively forecast that this might increase at the same rate as for manufactured goods. Overall this would therefore give forecasts for 2031 of about 8.5-9.0 million tonnes, broadly double those of 2006-07, but again in line with or slightly ahead of the growth of the sector as a whole.

Again this represents a considerable increase from current levels.  Our understanding is that coastal shipping movements have been generally constant over recent years.

Figure E4. Forecast Growth in Freight Traffic Generated in Regions (million tonnes)

Figure E4. Forecast Growth in Freight Traffic Generated in Regions (million tonnes)

Figure E5. Forecast Growth in Freight Traffic Attracted to Regions (million tonnes)

Figure E5. Forecast Growth in Freight Traffic Attracted to Regions (million tonnes)

For the traffic generated by regions, substantial growth is forecast for Waikato and Canterbury regions, reflecting growth in the forestry or dairy industries and in the case of Waikato in the volume of aggregates being produced to serve the needs of the region itself and the neighbouring Auckland region. 

For goods attracted to the regions the highest growth is predicted for Auckland, in part reflecting the movement of primary products from Northland and Waikato.  The Canterbury region is also forecast to have substantial growth, reflecting the growth of the dairy industry and to a lesser extent of coal traffic from the West Coast.

Following on from this freight study

To make the best use of the data summarised above and presented in the Main Report, it is recommended that the government institutes a programme of regular data collection covering the three main modes used for the transport of freight.  This would provide information on emerging trends and would enhance the value of the data already collected, improving its usefulness to those who operate within the freight sector, to the government in its management of the sector and its achievement of sustainability goals and to those who provide the infrastructure and related services necessary to support an efficient freight industry.

Acknowledgements

The successful undertaking of this study has been greatly assisted by the support and advice received from many participants in the freight sector in New Zealand, who have given their time and resources to assist us.  These include the operators of transport services by road, rail, and coastal shipping, manufacturers and producers, employers associations and chambers of commerce, port companies and government departments.  We would like to acknowledge the contribution these have made to this work and trust that they find it of use in the development of an efficient and sustainable sector able to meet the evolving needs of New Zealand.

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