WA’s bumper grain harvest is on the Aurizon

The stakes are high for Australia’s biggest rail operator Aurizon after taking on WA’s lucrative grain-on-rail freight contract months from what could be a record harvest. But the company’s iron ore and central west general manager Anna Dartnell says the ASX-listed company is up for what she has labelled an “exciting” challenge. Aurizon made headlines earlier this month when CBH Group announced it would hand its above-rail operations to the company ahead of WA’s predicted record 20 million tonne harvest. With less than two months until new season grain starts to drop into bins in the Geraldton Port Zone in October, Ms Dartnell, pictured, said she and Aurizon’s hundreds of staff knew it was a big task ahead. The new deal with Aurizon has been spruiked by CBH’s acting chief executive Ben Macnamara for its potential to boost CBH’s grain rail capacity by 30 per cent. “Both CBH and Aurizon are committed to seeing more grain on rail. We think that it delivers the best efficiency for the supply chain,” Ms Dartnell said. “We feel a great sense of privilege to have the opportunity to haul WA grain and support the delivery of growers’ product to market.” CBH has done business with Aurizon previously — when the rail company was named ARG — but dumped the rail freight operator in favour of US-company Watco in 2010. On August 6, Mr Macnamara announced CBH would end its 10-year contract with Watco six months early and swap to Aurizon Holdings as its preferred rail service provider. CBH was 9.5 years into a 10-year agreement with Watco to run 10 fleets across Arc Infrastructure’s rail lines for CBH, with the agreement set to expire on April 30. Aurizon this month started a three-month transition period with Watco, which is expected to see all of CBH’s above-rail operations transferred to Aurizon by November. As part of the deal, Aurizon will supply locomotives and wagons across three fleets — two narrow gauge and one standard gauge — to bolster CBH’s 10 existing fleets. All of CBH’s 28 locomotives and 574 wagons will be driven by Aurizon train drivers. Aurizon will also provide maintenance and operational facilities at Forrestfield, Narngulu, Merredin, Albany and Wagin. Its Avon and Wagin depots will roar back to life for the first time in nearly a decade as part of a broader plan to upgrade depots, including Narngulu, Merredin and Albany. Ms Dartnell said the Avon site — a large, dual gauge transfer centre located near CBH’s Avon Valley bins — would become Aurizon’s primary maintenance hub for trains involved in the CBH deal. Sod has already been turned at Avon, which as well as being transformed into a major maintenance facility, will also include a training hub for aspiring train drivers and operations employees. Ms Dartnell said the “world-class training facilities” at Avon would include virtual reality training to bolster the regional opportunities for staff. “There will be significant investment and upgrades to infrastructure and facilities there (at Avon),” Ms Dartnell said. “It will provide some great opportunities to bring both narrow and standard gauge fleets into one central, extensive rail network. “That will enable CBH and Aurizon to increase the volume of grain driven out of Kwinana, which is CBH’s biggest port area for export.” Aurizon’s Wagin site will also be “brought online”, Ms Dartnell said, while its West Merredin depot would become a hub for “central corridor” operations. The magnitude of transporting what has been predicted to be a record crop — with the latest Grain Industry Association of WA estimate at 20.02 million tonnes — has not been lost on Ms Dartnell. She said there was no doubt it would be a “challenging first year”. “Everyone is aware we have a strong season coming in and we are expecting large volumes,” she said. “We know there is going to be challenges, as there are with any transition ... and when you have a potentially record-sized harvest coming through. “But the reality is that the offer we have put to CBH — and the contract we run — is underpinned by CBH’s existing fleet and bringing in additional Aurizon fleets.” Ms Dartnell said Aurizon had put a “lot of work” into mitigation plans, while the company’s focus was on creating “additional capacity” to help transport surge volumes of grain. “At the same time, there is a lot of excitement around a big harvest which will be great for the growers and great for WA,” she said. Aurizon is Australia’s biggest rail freight operator and shifts more than 250 million tonnes of commodities each year, with operations in Queensland, NSW and WA. Ms Dartnell said the new grain arrangement fit into Aurizon’s Bulk business which included road and rail and port services, for mining, industrial and agricultural customers. Aurizon’s WA clients include BHP Nickel West, Alcoa and BP with more than 500 employees across the Mid West, Goldfields, South West, Wheatbelt and Perth regions. Ms Dartnell said the company was looking forward to “engaging with CBH” and “bringing something a bit different” than Watco. In swapping to Aurizon this month, Mr Macnamara said the transition needed to happen before harvest to “minimise disruption” during the important shipping months. Ms Dartnell said Aurizon had experienced “really open, transparent engagement” with CBH so far and the two organisations would work as a partnership. Pushing CBH’s core message, she said Aurizon was focused to “deliver for the growers”. “We have worked really closely with CBH around what the transition process looks like ... and how we have minimum disruptions for the network,” Ms Dartnell said. With CBH and Aurizon fleets set to run in tandem, Ms Dartnell said it also operated fleets owned by customers South32 and Mineral Resources in WA, and Linfox in Queensland. “This will be another hybrid model where we have a mixed fleet with a customer fleet supplemented by Aurizon investment,” she said. Ms Dartnell had a message for WA growers ahead of the bumper harvest. “We understand that CBH is one of our nation’s largest and valuable export supply chains,” she said. “So to be part of delivering WA products to market, for CBH, is a fantastic win for us. We look forward to working with the farmers and the grower community.”