CBH cites truck and train driver shortage as key reasons for missing shipping commitments at regional ports

A shortage of train and truck drivers has resulted in WA’s biggest grain exporter missing multiple shipping commitments, costing the State “tens of millions of dollars” and risking its reputation as a reliable supplier. CBH Group notified its 3700 grower members this morning that it faced challenges which were impacting its supply chain and export programs, warning the problems were likely to continue in the months ahead. “A key challenge we are experiencing is the shortage of both train and truck drivers,” CBH consultant co-ordinator Stephanie Matson said. “This shortage is significantly impacting our ability to move grain to our ports as rapidly as required to meet our fully-booked shipping commitments.” CBH chief operations manager Ben Macnamara said since the start of its shipping period on October 1, CBH had loaded 178 vessels containing just over seven million tonnes of grain. WA farmers delivered an above-average harvest of 15.1mt in 2020. While CBH targets an average turnaround of four days per vessel, over the past month 14 vessels had turnaround periods of more than 10 days, with most delays occurring at Geraldton. “Issues vary according to the port,” Mr Macnamara said. “While performance in Geraldton, since mid-February, has not been what we would like, our performance in most other port zones has been satisfactory so far, but we are concerned about what the forecast looks like over the next four to six weeks.” Mr Macnamara said the delays had put CBH about two weeks behind its shipping schedule. The amount of demurrage — late shipping charges borne by the marketers selling the grain — was difficult to quantify, he said. WAFarmers grain section president Mic Fels said the hold-ups were likely costing the State tens of millions of dollars in demurrage and jeopardising WA’s enviable reputation as one of the world’s most reliable suppliers. “We have been talking about the chronic skills shortage for some time, now the impact of that is really starting to manifest itself and have a real impact,” he said. Tony Critich, a Mullewa farmer and former CBH director between 1990 and 2008, including the latter three years as chairman, said demurrage was about $25,000-$30,000 a day, and growers would ultimately wear the cost. WAFarmers president John Hassell said the delays reinforced the need to get more grain on rail, citing in particular the closure of the Tier 3 rail network in the Wheatbelt. “A truck may cart 50t of grain on road, while a train could carry 5000t. In both cases just one labour unit is needed,” he said. “There are many reasons to use rail over road, including the lower labour requirement.” CBH said Wooroloo bushfires, flooding at Northam and a third-party derailment in the Avon Valley also contributed to around half of its current logistical delays. Another issue, specific to Geraldton, was reduced availability of fumigatable storage. Mr Macnamara said CBH was working to manage its shipping program, and working closely with export customers. Short-term plans to address the challenges include leasing additional narrow-gauge rail fleets and drivers, engaging additional trucking contractors and increasing the frequency of movements, and working with customers to optimise vessel loading efficiency.