"It may be beneficial to handle coastal vessels through separate, but closely located terminals.
"A hub import/export port may be beneficial. Its location needs investigation; a west coast port has significant financial and GHG emission advantages."
The report says for larger ships to call at New Zealand ports, most port infrastructure will need to be rebuilt.
"Berths are too small and increased length, beam and draft poses issues for port entry. A purpose-built hub port such as on the Manukau Harbour could address these issues from the outset."
Coastal shipping is included as a stand-alone transport activity task in the 2021-2024 Government Policy Statement on Land Transport.
The report is the first of three to help Waka Kotahi on how best to invest the $30m funding allocated for coastal shipping and to inform the agency of the shape the sector is in and the challenges and opportunities ahead.
The report found the coastal shipping sector and the overall domestic transport system to be "robust and working well" though chinks had appeared in the 2016 Kaikoura earthquake and the pandemic.
It found "cargo presently moves at a cost that is acceptable" - a conclusion likely to be challenged by frustrated New Zealand importers and exporters experiencing doubled and trebled shipping costs since the pandemic outbreak.
Transport minister Michael Wood said the report was another step towards developing a resilient and sustainable coastal shipping sector.
The transport agency was developing guidance for the sector on how to develop proposals and apply for funding.
It expected to engage with the sector early next year on the next steps, said Wood.
Investments Waka Kotahi would look at making included new domestic shipping services, increased frequencies and more ships for new or existing container and bulk services, and improving efficiency with road and rail link upgrades to and from ports.
It would also look at investing in upgrading maritime infrastructure such as shore power connections at ports, small new regional ports and expanding existing ports, he said.
New Zealand's coastal shipping sector is mainly dedicated to the transport of dry and liquid bulk supplies, containerised cargo and rail and road roll-on roll-off cargo and passenger services.
Of New Zealand's total annual freight task of 278.7 million tonnes, coastal shipping carries about 10m tonnes or 3.5 per cent, the report said.
Container cargo, hit hardest by the post-pandemic consumer shipping boom and subsequent supply chain crunch, and empty containers are carried by domestic service Pacifica, and international carriers transiting through New Zealand ports.
Pacifica's Moana Chief vessel carried 22 per cent of the total 418,470 boxes transported in 2019, and the remaining 78 per cent went on international carriers.
The report identified gaps in available information on New Zealand's transport system.
The most pressing were in the area of demand statistics (current and historic); shipper needs; special needs of cargoes; supply of vessels for the future; rail capacity; freight rates for sea, rail and truck; container terminal data to help with benchmarking and planning; port charges and inland ports.
The input of selected stakeholders in the project would guide the final assessment of challenges and opportunities for the sector to be developed in the final stage of the project, the report said.
The challenges and opportunities were to increase resilience and reduce emissions without unduly affecting New Zealand's domestic transport and logistics.
Key challenges ahead for the coastal shipping sector included moving cargo onto the most appropriate transport modes; obtaining a level playing field with international shipping, other domestic modes and within the coastal shipping sector and resolving New Zealand's lack of an adequate dry dock for servicing ships.
The report also identified priority berthing at terminals for coastal ships as an area needing attention.
