AS part of Project Regeneration, GrainCorp has confirmed it will invest $60 million in upgrading 13 country sites this year, starting this month.
Last June, Australia's largest agribusiness announced it would spend $200 million over three years to revamp its country grain storage network, in an attempt to return up to 1 million tonnes of grain to rail through reduced train cycle times and more streamlined and reliable operations. The investment represents the single largest capital investment in the country network in the company's history and should see rail costs reduced by around $5 a tonne.
The improvements planned for this year include new sites at Yamala, Queensland, and Calleen, NSW, and new loading equipment at Nevertire and Ardlethan, NSW. Sites slated to receive upgrades are Narrabri, Burren Junction, Spring Ridge, Junee, Oaklands and Tocumwal in NSW, and Rainbow and Murrayville in Victoria. Red Bend, NSW, and Ardlethan are also set for capacity expansion.
GrainCorp managing director and CEO Mark Palmquist said works would be staged for the receival of this year’s winter crop.
The project will see GrainCorp overall consolidate its country network to around 180 sites that already receive around 90 per cent of all grain delivered to GrainCorp's network, and close 72 of its smaller sites that receive the residual 10pc of grain.
It will also develop three new state-of-the-art country storage sites in Queensland and NSW.
The ambitious three-year revamp of its storage network means GrainCorp will shed 80 jobs and operate far fewer sites this harvest. When taking into account smaller sites that have been used as surge capacity in big harvests over the past five years, the total number of sites to close will exceed 100.
The consolidated country network will have storage capacity of 20 million tonnes, enough to hold double GrainCorp’s average intake.
Farmer reaction to the announcement of the launch of "Project Regeneration" last year was mixed.
NSW Farmers grains committee chair Dan Cooper welcomed GrainCorp’s announcement.
“It’s a great investment. Some would say its overdue, but nevertheless it’s great to see money flowing back into receival sites.”
Mr Cooper said the grain rail network is inefficient and investment is needed to reduce grain growers’ freight cost.
“Speed and weight restrictions, as well as passing loops that can’t carry whole trains, are the key concerns,” Mr Cooper said.
“That means breaking trains up into multiples and having to and load trains at various sites.
“Rail is the biggest impediment to unlocking efficiencies for growers. Any increase in network capacity will see money flow back to growers.”