RAIL: Steel Lifelines

Australia’s ports, cities and communities are connected by a vast, complex rail network that is expanding with trade growth

THE SUPPLY chain is full of unpredictability, from rough seas and questionable cargo to trade tensions and economic blows. When the foundations of logistics are complex and unstable, there is something straight-forward, constant and uncomplicated about train tracks.

Two strong, parallel rails could easily symbolise consistency and structure, establishing a route travelled again and again. But the sector it represents is far from unchanging. The networks are complex and fragmented, growing with trade and expanding with populations. Schedules and infrastructure are at the mercy of the Australian weather.

But the rail sector is also being reshaped by disruptive thinking. Industry bodies are advocating for harmonisation of national standards. Intermodal hubs are firmly securing their place and importance in the national supply chain. Ports are increasing rail volumes. And in the Northern Territory, a rail freight operator and shipping line have partnered on an innovative landbridging system.

Land and sea freight

In February this year, Aurizon and ANL announced their partnership on a landbridging initiative for container traffic through the port of Darwin.

Aurizon conceptualised the system following its 2022 acquisition of the 2200-kilometre railway between Tarcoola and Darwin, a rail haulage business in South Australia and the Northern Territory, and terminal and stevedoring assets at the port of Darwin. Aurizon completed its acquisition of One Rail Australia in July that year. The initiative has been building momentum since November 2024.

The landbridging partnership with ANL means containers shipped from Asia Pacific ports can be offloaded at Darwin, discharged and cleared at the port, then transferred onto rail for a direct connection to Adelaide and other locations in southern Australia. At the end of their rail journey, containers are collected at Aurizon’s railhead at Gilman, a suburb in north-western Adelaide.

ANL’s PAX service calls Darwin every 10 days. Trains run six days per week, leveraging the existing assets of track infrastructure and double-stacked container freight trains, integrated with Aurizon’s port and terminal facilities in Darwin. Aurizon has described the service as an alternate supply chain for shippers and freight customers.

Aurizon group executive containerised freight Gareth Long told DCN the vision for the landbridge came from customer and market feedback and Aurizon seeking to solve industry problems.

“We were looking at how we leverage our unique network of assets from Darwin [to] Adelaide and connected to the national network,” he said.

Market discussions helped Aurizon identify a number of issues facing the import and export sectors. Those issues were port and landside congestion, increasing regularity of supply chain disruptions, rapidly increasing unregulated landside costs, inefficient use of capital (vessels and warehousing), inefficient “milk run” vessel routes and increasing emissions pressures and “a general feeling of inertia” meeting customers’ needs.

“Aurizon looked at how these problems were being met around the globe and identified the use of regional ports, and hub and spoke rail landbridging solutions as a key model,” Mr Long said.

“This solution was the perfect fit with ANL’s leading Darwin service and Aurizon’s Australian rail network which links directly to the port in Darwin.”

Container movements at Darwin Port – part of Aurizon’s landbridging initiative with ANL. Image: Aurizon

Lincoln Dundas, ANL’s general manager intra Oceania trades, said ANL had established stevedoring engagements with Aurizon at other ports across Australia, and that Aurizon was aware of the shipping company’s focus on regional port development in Australia.

“Through our regular meetings, the concept of utilising the central corridor for international cargo was discussed which has recently become a reality which we are extremely proud of,” he said.

Mr Dundas said ANL’s initial perception of the landbridging concept was a positive one; he said rail is often used around the world for transporting cargo, and in Australia, there is opportunity to expand its use. Collaboration between rail and sea freight opens potential for innovation, which is something ANL is always looking to offer its customers.

“The landbridging service provides a unique method of transporting their cargo by combining both sea and rail freight,” Mr Dundas said.

“Since covid, we have seen … significant disruptions in the supply chain, most recently with the Red Sea crisis. Landbridging provides [an] alternative solution that can assist in alleviating supply chain challenges during times of disruption.”

Mr Dundas said the time savings of landbridging are significant.

“Compared to our other ANL services into Adelaide, we are able to achieve time savings of approximately 12 days over our sea only options,” he said.

“Supply chain disruptions, particularly in ocean freight, will likely continue, as we have witnessed during the Red Sea crisis and throughout covid, which created substantial cargo backlogs. Through adopting the Darwin-to-Adelaide and Melbourne routes, customers can take advantage of a new gateway which will in turn assist in mitigating these challenges.”

Crossing the landbridge

Aurizon’s Mr Long said introducing landbridging to the market was a relatively straight forward process, especially with likeminded entities such as ANL and Darwin Port recognising the opportunity to deliver an initiative that would address the identified challenges.

“As with any new business or supply chain there are the usual start-up challenges, however the key has been successfully gaining alignment between all the participants and the desire to jointly take the solution to the market.”

Once the system got going in November, some fine tuning of customer processes (import documentation and container collection) now provides a foundation to potentially extend the landbridging service to other capital cities.

Mr Long said Aurizon is implementing a number of initiatives across the landbridging supply chain that are expected to enhance capacity, frequency, resilience and optionality. The company intends to keep customers informed of these opportunities.

But ANL is not the only shipping company Aurizon is working with. The freight rail operator noted in its 2025 half-year results announcement that it is working with NYK on “the feasibility of several landside logistics business opportunities” to support the import and distribution of motor vehicles into Australia.

The ongoing nature of this work means Mr Long was unable to expand on this news at the time of writing, “except to say that we are working with NYK to design and test the feasibility of a number of landside business activities that are expected to disrupt and enhance the importation and distribution of motor vehicles into the Australian market”.

“The nature of these business activities is prevalent in a number of offshore markets and the work is aimed at optimising these activities in the Australian context and for a number of specific motor vehicle importers,” Mr Long said.

“The overall benefits of the motor vehicle landbridging mirror those of containerised landbridging.”

The landbridging service provides a unique method of transporting their cargo by combining both sea and rail freight.

Lincoln Dundas, ANL

Aurizon, whose CEO Andrew Harding chairs the Freight on Rail Group, is one of several major rail freight businesses that make up the industry group. The group’s stated objective is “to contribute to a policy and regulatory environment that enables the ongoing development and operation of an efficient, integrated and sustainable freight transport sector, including an innovative and high performing rail freight industry”. Mr Long highlighted a handful of areas Aurizon would like to see improvement in.

“For Australian rail freight supply chains – in which Aurizon is a major player – we need to continue removing state-based regulations and harmonise systems and interfaces that remain a major barrier to productivity and efficiency,” he said.

“Targeted investments to improve the capacity, as well as resilience and reliability of key interstate rail corridors, will also unlock significant productivity benefits for the economy.

“Increasing freight volumes on rail would also deliver safety benefits reducing the need for many thousands of truck journeys on our major long-distance roads.”

The case for consistency

Harmonisation in an Australian rail context relates to achieving consistent standards across the rail systems that make up the national network. A harmonisation research report published last year noted that the national rail network is not a singular system, but a “large and complex” composition of 29 distinct networks. The entire system involves an estimated 197 accredited operators.

The Harmonisation of Rail Standards Research Report was prepared by GHD Advisory and funded by the Australasian Railway Association (ARA), National Transport Commission, Office of National Rail Industry Coordination and the Rail Industry Safety and Standards Board. It suggested fragmentation of the network is problematic for existing and prospective rail freight operators; each separate network has its own unique standards, operating rules, processes, infrastructure and approaches to workforce training.

In this respect, Australia has been likened to operating across seven different countries, according to the ARA. The association said suppliers and contractors are generally national or multi-national organisations who provide products and services across different networks and jurisdictions and experience the significant inefficiencies that come with divergent processes, standards and requirements, leading to increased costs for suppliers, procurers and operators.

Harmonisation would involve aligning standards, competencies, requirements, processes and technologies to create a more seamless operating environment and efficient rail network. This includes everything from the procurement processes to the unification of safety systems, safe-working rules, product type approvals and the competence of rail workers. The goal is to reduce duplication, enhance interoperability, support sustainable local manufacturers and improve the overall freight customer and passenger experience.

The report outlined several recommendations to streamline standards, technologies and processes for operating the rail network and recommends a national body oversee the development of a National Rail Standards Harmonisation Strategy, in conjunction with industry.

“A national approach to harmonising standards and regulations is essential for a more resilient, innovative and competitive rail network,” ARA CEO Caroline Wilkie told DCN.

“Improved interoperability across Australian networks would yield significant benefits to both rail operators and the wider supply chain. It would enable increased investment and economies of scale with more standardised rail componentry to support a safer and more innovative rail system. It would support a national approach to training and labour mobility in addition to facilitating rail’s transition to net zero.”

Ms Wilkie said a considerable portion of trips in Australia require operation across two or more networks, each with varying standards, infrastructure performance, access requirements and rule books.

“With the industry undergoing significant technological transformation, we risk a digital break of gauge in our future rail systems, exacerbating existing challenges, if we do not act now.”

Interoperability

ARA and the Freight on Rail Group were both involved in a research project, Future of Freight, alongside the Department of Infrastructure, Transport, Regional Development, Communications and the Arts. The project sought to identify the barriers hampering rail productivity and offered solutions to increasing rail mode share.

According to the project’s summary report, initiatives to move more freight on rail have been frustrated by policy settings that limit rail freight productivity and efficiency and underutilise the advantages of rail.

“Rail moves almost three quarters of Australia’s bulk commodities, but accounts for just 17 per cent of non-bulk freight,” the report says.

“Rail is well suited to moving freight in large volumes over long distances. However, it has traditionally struggled to capture market share on key Australian freight routes between Sydney, Melbourne and Brisbane. New policy settings can and should help address the traditional barriers to using rail more to support a more sustainable, resilient freight network.”

We need to continue removing state-based regulations and harmonise systems and interfaces that remain a major barrier to productivity and efficiency.

Gareth Long, Aurizon

According to ARA, a lack of interoperability was identified as the single most significant drain on productivity for the rail freight sector, directly contributing to the cost of operating rail freight services, reducing operational efficiency and flexibility, dampening the uptake of new technology and pace of innovation and ultimately undermining its competitiveness.

Rail freight is considerably constrained by the differences between networks, both across and within states, of which there are nine that facilitate intermodal freight movements, ARA said. For example, to operate locomotives and wagons on a given network, a complex approval process is imposed which differs between networks and often requires rollingstock to be physically tested.

Further supporting the case for harmonisation, ARA noted the differences make it difficult for global or local manufacturers to bring new technology to the Australian market, constrains where given rollingstock as part of a national fleet can operate across the country, increases service costs and dampens competition.

ARA said that, without being resolved, this fragmented approach to facilitating the entry of new rollingstock to the national network will also be a major barrier to decarbonisation by creating unnecessary cost and uncertainty to the transition to alternative fuels.

Infrastructure versus nature

There is also a reverberating call for rail resilience, Ms Wilkie telling DCN the nation needs a more reliable, efficient and interoperable rail freight network to harness the environmental and safety benefits it delivers.

“We were thrilled to see $1 billion allocated to enhancing rail resilience, including $540 million in last year’s federal budget, following extensive advocacy by the ARA and rail freight stakeholders for investment in the nation’s ageing rail infrastructure,” she said.

“It recognises the critical role rail plays in supporting a strong national supply chain and the significant economic and environmental benefits of getting more freight on rail.”

The resilience discussion seems to resurface with every severe weather event. Supply chain disruptions after extreme rains over the past few years have shown Australia again and again how much it relies on a functioning freight rail network. ARA believes severe weather and consequential disruptions also have devastating impacts on the long-term reputation of rail freight.

“We will continue to face major disruptions to the supply chain due to extreme weather events – there is an urgent need for ongoing, co-ordinated investment in a reliable and resilient network to ensure rail remains competitive,” Ms Wilkie said.

“Industry and government must work together to address this as a matter of priority. While the impacts on industry and business are significant, communities also suffer from shortages of goods and increased prices.”

The association said no two flood events are alike, but high-quality rail infrastructure means a greater chance of efficient recovery, provides opportunities for landbridging and optimal use of available resources and vehicles across land transport sectors to service impacted communities and businesses.

The most recent flooding situation was brought on by Tropical Cyclone Alfred early this year. According to ARA, its impacts demonstrated that effective planning and co-ordination with freight customers, land transport providers, governments, emergency services, supermarkets and retailers could enable rail to deploy targeted resources to restore services and continue to transport critical supplies when roads are closed.

ARA believes recent experiences also underscore the value of major infrastructure investments such as Inland Rail to provide secondary routes and alternatives to the interstate network, particularly to vulnerable coastal rail infrastructure.

Mighty Inland Rail

With work underway since 2018, the Inland Rail project needs little introduction beyond the obligatory recap: the 1600-kilometre rail line will connect Melbourne and Brisbane via regional Victoria, New South Wales and Queensland. The project comprises 12 sections and involves upgrades or enhancement works to around 1000 kilometres of existing track and construction of 600 kilometres of new track. It is now being built by Inland Rail Pty Ltd – a subsidiary of the Australian Rail Track Corporation since May 2024.

Once the Inland Rail is complete, it is expected to cut rail freight travel time between Melbourne and Brisbane by almost a third, from 33 hours to less than 24 hours. According to the project company, infrastructure operators and logistics companies deliver about four billion tonnes of goods across Australia each year – that equates to 163 tonnes of freight for every person. And with the population predicted to reach between 37.4 million and 49.2 million people by 2066, that’s a lot of needing to be moved. Two thirds of the freight that will be carried on Inland Rail will be for domestic use.

Inland Rail CEO Nick Miller told DCN in March 2025 that the project is making strong progress in Victoria, finalising construction projects from Beveridge to Albury (B2A) tranche one works and releasing designs for upcoming tranche two works.

“In New South Wales, we have now started early works on the Albury to Illabo (A2I) section, establishing our first site compound that will enable us to conduct works including surveying and environmental sampling, site clearing and earthworks as well as some utility relocation activities,” Mr Miller said.

“In addition, we are also making good progress on the Stockinbingal to Parkes (S2P) section and recently opened a new level crossing at Daroobalgie as part of our works.

“Looking ahead, we will soon be conducting our next round of track possessions, with works taking place along the alignment at B2A, A2I and S2P sections in late March.”

It hasn’t really been at the forefront of industry’s mind to change cargo flows, because it does mean a big change to the way traditional cargo has moved around cities in Australia.

Sue Tomic, SCLAA

A recent project milestone was the Australian government’s environmental approval of the Illabo to Stockinbingal (I2S) section in New South Wales, enabling the I2S project to move into the construction phase this year.

“The I2S approval means by the middle of this year we will be in construction in every section of Inland Rail from Beveridge to Parkes, putting us on track to meet our objective of completing Beveridge to Parkes by 2027,” Mr Miller said.

“In terms of delivering Inland Rail North of Narromine, we are focusing on the works required to gain approvals to help secure the gazettal of rail corridors, completion of land acquisitions, geotechnical investigations, and early engineering designs, to help us gain greater certainty on future cost and schedule.

“With the Australian government having approved the Narromine to Narrabri (N2N) section in February 2024, the remaining NSW approval north of Narromine in New South Wales is Phase two of the Narrabri to North Star section, where consultation with the local community is in progress.”

And in Queensland, Inland Rail has made “significant” progress on the revised draft of the Queensland-New South Wales border to Gowrie environmental impact statement, with all documents submitted to the Queensland Coordinator-General for adequacy review.

Mr Miller said Inland Rail will enhance the national freight network and supply chain capabilities, connecting existing freight routes through rail, roads and ports.

“Delivering Inland Rail will help us keep pace with the increasing freight demands of Australia’s growing population,” he said.

“It will better link businesses, manufacturers and producers to national and global markets and generate opportunities for industries and regions during construction and beyond.

“Inland Rail has the potential to support new opportunities and industries along the alignment, including grain storage, food processing and logistics hubs.”

The Parkes Special Activation Precinct in New South Wales is home to the National Logistics Hub, where the National Intermodal Corporation is exploring the construction of an open access rail facility to further stimulate the use of rail for moving freight around Australia, according to Inland Rail.

The Parkes precinct covers 4800 hectares in the state’s Central West region. It is situated at the only junction of Australia’s two rail spines, the Inland Rail and the Trans-Australian Railway.

Inland Rail described the work at Parkes as “a great example” of what the future looks like for regional Australia when the project is completed, building the infrastructure to get more freight onto rail while delivering vital economic growth to regional Australia.

Intermodal logistics

The regions are only part of the national rail landscape, however. Intermodal terminals and the wider metropolitan movement of freight on rail are also vital to the supply chain.

Sue Tomic, known well to industry as chair of the Supply Chain and Logistics Association of Australia, is also chief strategy officer for Enfield Intermodal Logistics Centre. The logistics hub is 15 kilometres west of the Sydney CBD and has direct freight rail access to Port Botany.

Intermodal terminals are facilities where freight is transferred from one mode of transport to another. They are an integral part of the supply chain, but Ms Tomic believes Australia is lagging behind other parts of the world, particularly Europe and the United States, in terms of seizing the advantages of intermodals and their role in transporting goods inland for distribution to various destinations.

“We haven’t really made use of the hub and spoke intermodal solution to alleviate congestion of ports,” Ms Tomic told DCN.

“What one truck can do with maybe two or three containers … one train can do with 150 or 200 containers. It’s the scale and the efficiency with which freight on rail can move across the city, from port to different intermodal hubs, different parts of the interior that makes it efficient.”

It’s a compelling alternative to the traditional road-wharf cartage model, and from Ms Tomic’s perspective, an imperative one. She has observed a shift in attitude toward intermodals and metropolitan rail freight over the past five years.

“It hasn’t really been at the forefront of industry’s mind to change cargo flows, because it does mean change to how traditional cargo has moved around Australian cities.

“The industry is road-mode dominant and a little bit slow to change. Certainly, freight on rail with a NSW government target of 28% by 2021 has not been achieved. During 2024, rail mode low was 13.9% and high was 18.9% - still well below the set target.”

“With freight volumes expected to increase by 50% by 2036, it is clear that moving freight on rail is the more efficient way to manage port trade growth.”

Cost and reliability of rail as the alternative transport mode have been the main barriers to industry uptake.

“There has been a major shift within the Greater Sydney Metro area as ever-increasing road tolls and the hidden cost of road congestion erode productivity and margins.

“Road carriers are realising they can increase their profitability by truck when they don’t need to travel to port and can collect FCL containers from intermodal depots. Shippers are also embracing the multimodal solution as it aligns with their ESG strategies and any part of the freight journey on rail, reduces carbon emissions and assists them with their target reporting.”

This article appeared in the April | May 2025 edition of DCN Magazine