While recommendations in the Ports and Maritime Administration Act 1995 Options paper suggest train lengths into Port Botany are reduced from 1200 metres to 600m, Port of Newcastle wants to develop an automated container terminal which caters for train lengths as long as 1800 metres.
The concept could go a long way to reducing current bottlenecks plaguing NSW ports.
The only catch is the business is highly unlikely to invest the $2.4 billion needed to build the terminal while still under the constraints of the Port Commitment Deeds (PCDs).
The PCDs, which were created as part of the privatisation of Port Botany and Port Kembla by the NSW Government, require both ports to be compensated if Port of Newcastle exceeds specific container movement numbers.
If it was to go ahead, the Newcastle Multi-Purpose Deepwater Terminal would be situated on the 90 hectare site of the old BHP steelworks at Mayfield.
The concept has a two million TEU (20-foot container) a year terminal, fronting a channel which 10,000 TEU vessels can access.
Port of Newcastle believes the terminal could reduce freight costs by $10 to $15 a tonne for some regional exporters.
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Speaking at the recent NSW Farmers annual conference in Sydney, Kate McArthur, senior manager of business development at Port of Newcastle, said construction of a container terminal would greatly benefit regional exporters.
"A restriction on our trade is a restriction on your (farmers') income," Ms McArthur said.
"The economic benefits for famers are savings in the order of $2.8 billion over 30 years, which means more money in your pockets.
"Almost 30 per cent of NSW container exports originate from northern NSW and the Hunter, yet despite being the most cost-efficient port to export goods, stock and produce is sent to Sydney at a higher cost, or to Brisbane - the unofficial second container port of NSW - and more recently, we are seeing at times both ports bypassed to Melbourne.
"We cannot move forward with this project due to the PCD in place.
"A container terminal in Newcastle would mean by 2050, broadly for farmers in the Port of Newcastle catchment will see significant freight savings of over $240 million per year, the average freight journey in the region will decrease in distance by 40 per cent, bringing down the cost of freight and saving exporters $220 million a year, and more efficient operations at the terminal would also save exporters $30 million a year.
"These economic benefits go all the way to businesses.
"For example, a single food processing business in Narrabri, exporting around 170,000 tonnes of pulses per annum, could save up to $5.3 million a year.
"A cotton farmer in Wee Waa or Warren could save around $1.3 million a year.
"Lower freight costs would see export activity in the manufacturing, agriculture and food processing sectors expand by around $800 million a year by 2050."
Despite the current PCD restrictions, Port of Newcastle has purchased two mobile harbour cranes and chief executive officer Craig Carmody believes the $28.4 million investment will increase the port's container handling capabilities.
"These two new mobile harbour cranes will allow us to move cargo and containers within the limits that the PCD bind us, so that we can give our customers a viable alternative," he said.
