Thousands of railroad sleepers are rotting and may have been responsible for two derailments, KiwiRail chief executive Jim Quinn says.
Seven thousand of the 100,000 wooden sleepers imported from an Australian supplier have had to be replaced at a cost of millions of dollars after they were found to be showing signs of premature decay.
Two derailments - one on the Napier-Gisborne line and one on a north Auckland line - earlier this year are suspected to have been impacted by rotting sleepers, Mr Quinn says.
The replacement of the sleepers, expected to be completed by next year, is at a cost of between $250 and $1000 each.
Mr Quinn said KiwiRail was in a legal dispute with the supplier of the sleepers.