Australia's freight task to surge by 2030

The domestic freight task has doubled in size over the past two decades, growing at an average annual rate of 3.5% to 521bn tonne kilometres in 2007, the Bureau of Infrastructure, Transport and Regional Economics (BITRE) report said.

BITRE predicted that this trend would continue, although with slightly slower growth of about 3% annually between 2005 and 2030, as the global financial downturn dampens growth in the short term.

Domestic demand for manufactured goods will support road freight growth during the period and mineral exports will underpin the growth of rail freight, according to the report.

Thirty-five percent of Australia's domestic freight task was shifted by road in 2007, 40% by rail, 25% by coastal shipping and less than 0.1% was carried by air, the report said.

Road was the main form of freight transport for the bulk of inter-capital corridors, while rail was predominant on the eastern states-Perth corridor, where it currently shifted just over half of non-bulk, origin-to-destination freight.

One area where road and rail worked together was intermodal freight, with road transport providing local pick-up and delivery to and from the rail terminal, the report said.

"Such intermodal freight services are complementary in the sense that if the demand for one falls, demand for the other also falls," it said.

"However, such intermodal road-rail freight tasks can often be substituted by road-only freight services."  

One example was inter-capital non-bulk freight.

Where the two modes compete, road and rail freight growth would depend not only on economic activity but on relative modal costs.

The Australian Rail Track Corporation's (ARTC) $2.1bn planned investment on the north-south interstate rail line would cut transit times, improve reliabilty, increase capacity and reduce ongoing track maintenace costs, helping rail compete with road, BITRE said.

These investments could double rail's share to almost one-fifth of Sydney-Melbourne and Sydney-Brisbane non-bulk freight, and 60% of Melbourne-Brisbane's non-bulk freight.

However, ongoing investment on the Hume and Pacific highways would improve transit times and cut road freight operating costs, countering the improvements on rail, the report said.