By Anne Gibson
Port of Tauranga has been called the most productive, efficient port in Australasia in a glowing report which pegs it as having excellent prospects in the next few years.
The glowing report just out from Morningstar said trade volumes in 2012 had increased by 20 per cent. The amount of cargo handled from 15.4 million tonnes to 18.5 million tonnes, in the face of subdued international trade.
“Container volumes have been particularly impressive as the company continues to gain market share. Log and forestry volumes have been on an up trend due to increased demand from Asia, a trend that should continue for the foreseeable future. We estimate trade volumes to double in 12 years, given that shipping lines are increasingly favouring the company over its rivals due to significant cost advantages,” Morningstar said.
“Through the cycle, we believe the company will comfortably earn returns in excess of its cost of capital and there is virtually no competition on the horizon, leaving us confident that the firm has a wide economic moat.”
Last week, the port announced a continued national expansion by buying up 15ha of commercial land in Canterbury to create a new inland port, partly to capitalise on the lucrative dairy export trade.
The company is buying land in the Izone Industrial Park at Rolleston, 12km south of Christchurch, for a freight hub or village, after last year spending $21.6 million to buy a half-share of Prime Port Timaru and $37.2 million expanding at Onehunga, where it already has its MetroPort inland port operations.
Chief executive Mark Cairns said the new Rolleston site would be an export hub for primary products and particularly dairy exports, fish and fruit and the business could spend about $20 million on the land and infrastructure although no price was disclosed because the deal remains conditional.
The site is in the middle of a diary mecca, north of one of Fonterra’s largest sites, Clandeboye, processing up to 13.2 million litres of milk a day, about 40 per cent of all Fonterra’a South Island milk. Synlait’s plant is south at Rakaia and Cairns noted how Westland Milk Products was also at Rolleston.
The Warehouse has its South Island distribution centre at Rolleston and Cairns indicated the train line to Timaru was a key component of the new deal, because containers would travel between Timaru and Rolleston by rail.
The New Zealand Herald