Qube in Port Kembla grain coup


James hails ‘significant strategic project’ with Noble, Cargil and Sumitomo as company picks up two more haulage firms

Qube’s bulk haulage and logistics growth strategy has gone into overdrive with trucking firms bought and a grain initiative underway that could involve three of the globe’s biggest commodities traders.

The Australian port services and transport and logistics firm has formed a joint venture, Quattro Grain, with a subsidiary of Noble Group to develop and operate a major new multi-user grain handling facility at Port Kembla, New South Wales, with a view to involving Cargill Group and Australia’s Emerald Group, owned by Japan’s Sumitomo, at 20 per cent of Quattro each.

"This is a significant strategic project which we believe will alter the dynamics of the tightly controlled grain handling market," Qube Managing Director Maurice James says of the $50 million deal.

"The joint venture looks forward to supporting grain producers by providing high levels of service and modern infrastructure to customers seeking to export grain from Port Kembla."

His firm will now invest in eight locomotives and 130 bulk rail wagons to support new contracts for bulk rail services to the grain traders on top of those that started in January.

These will involve about 150 bulk rail services a year per customer once fully operational.

To cost $75 million and be operational by late next year, the port facility will have storage and handling capacity for more than 1.3 million tonnes a year of export grain.

NSW Ports has agreed to extend Berth 103 to accommodate Panamax-size ships, Qube says.

It will seek to raise $200 million from a share placement to fund this and other growth moves.

The past month has also seen Qube spend $40 million snapping up Beaumont Transport last week and Walmsley Bulk Haulage last month.

"The acquisition provides Qube Ports & Bulk with geographic diversification of its bulk logistics operations into southern and central Queensland with an existing customer base, assets, depots and experienced personnel. It also provides additional diversification into the bulk dry tanker market," it says of Beaumont.

It adds that the move " establishes a foundation for geographic diversification and bulk market expansion into Southern and Central Queensland with an existing customer base, assets, depots and personnel".

The Walmsley purchase dovetails with Qube’s Port Hedland activities.

The new facility will source from growers in the northern Riverina and Central West NSW.

Emerald Grain Managing Director John Murray says New South Wales Grain growers are set to benefit from the new agreement: "The terminal will bring more competition to the supply chain; improving services and reducing costs for New South Wales grain growers."

Emerald’s storage and receival sites at Ardlethan, Coolamon and Goolgowi will feed grain through to the terminal by road and rail.

"And we are looking to bring even more storage sites into the network to provide New South Wales grain growers with an efficient, alternative pathway to international markets," Murray says.

Emerald has extended its existing lease of Qube locomotives and wagons as part of the agreement, meaning a long term commitment to the third train in Emerald Grain’s South East Australian network.

"Our aim is to create a truly integrated supply chain from the farm gate to the international end user – by doing this we create efficiencies and premiums which are passed on to the grower."

In NSW, Sumitomo-owned Emerald accumulates grain through Southern Ag Grain, a joint-venture partnership with grower-owned Southern Agventure.

"Because Southern Ag Grain is 50 per cent grower-owned, we provide that crucial link between the Asian end-user and the New South Wales grain grower," Murray says.

"We firmly believe in a competitive, efficient grain supply chain – ultimately it will make Australian grain more competitive in international markets."

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