“Given the complexity of our operations and the range of agreements in place, this may take 4-6 weeks. Our focus is on our people and we’ll provide an update when the time is right.”
He said facilities used by WPI at the port were of high quality and strategically located on-port, functioning as warehouses and container packing operations, and could be multi-purposed for other users without too much difficulty to accommodate different cargo types and purposes in future.
WPI exported 15,000 to 19,000 20ft-container equivalents (TEU) of containerised timber and pulp from Napier a year, with its net contribution at 7% to 8 % to earnings guidance in the 2023-2024 year.
“With the cessation of pulp and timber production by WPI, there was now a greater supply of harvested logs available for export from the central North Island,” Dawson said.
“Additionally, demand for space at Napier Port remains high, with both current and prospective customers seeking more on-port storage and packing solutions.”
WPI had also indicated plans to explore a potential sale of its timber and pulp mill assets.
KiwiRail has been a reliable partner and “we continue to work closely with them while we explore new cargo opportunities to replace the WPI volume on this line,” he said.
“We do move other import and export cargo on that line, and at this time we are not concerned about the future viability and ongoing support by KiwiRail on this line. Both road and rail are valuable infrastructure for freight into and out of Hawke’s Bay.”
Ashton said KiwiRail had begun a multi-year transformation plan to reshape its business, starting with focusing on “delivering the reliable services that our customers want, at competitive rates”.
“To be competitive, we need to lower our own costs and ensure our services are configured to meet the changing demands of the freight markets we serve, including in Hawke’s Bay, where freight volumes to Napier Port have fallen.
“We remain committed to running rail freight between Palmerston North and Napier (a daily service) and connecting Hawke’s Bay into our national network.”
“However, the changes we are making to meet customers’ needs will impact KiwiRail roles and discussions are currently underway with our union partners and affected staff in Napier and Palmerston North,” Ashton said.
“We will comment on the number of roles affected only after we have completed our consultation processes.”
The services were disrupted for seven months last year after the Cyclone Gabrielle destruction of much of the Waitangi railway bridge over the Tutaekuri River, beside State Highway 51 near Awatoto, between Napier and Clive.
With the destruction on February 14, 2023, and limited road options given the damage to the roading network, urgent measures were implemented to re-establish the bridge, with the line reopened last September.
