Upper North Island Supply Chain
Now that I am Northlander and holding a few MMH shares and while enjoying a winters day, I've been paying a bit more attention to what is going on in Wellington.
A couple of links attached, the second one to the first report which is "interesting" reading.
https://www.transport.govt.nz/multi-...hain-strategy/
https://www.transport.govt.nz/assets...tegy_Final.pdf
A few snippets....might be to many ?
"Our view is that Port of Tauranga capitalised on the public infrastructure provided to the Bay of Plenty region which subsequently has made the port a success. We will therefore be considering whether similar investment in Northland would provide similar results for the region and Northport. "
"Ports of Auckland occupies 77ha on the Auckland waterfront. Its current location is generating concerns of social licence and prompting public debate about whether there are better alternative uses for its land. "
"While Ports of Auckland reports a lower tax rate of 10.2%, investigations show this is artificially lowered through its access to the tax losses of a fellow owned council subsidiary, which has allowed Ports of Auckland to appear more profitable than it otherwise would. The impact of this accounting treatment will need to be reviewed as this option is not available to other port owners and may be a perverse incentive."
"The Ports of Auckland reports that the 77ha, on which it sits, has a book value of approximately $735m ($955/sqm), ……"
and
"Ports of Auckland reported land value of $533/sqm is lower than that of comparable industrial land in the Auckland Central Business District. In recent times, neighbouring land sales have been between $2500/sqm and $7500/sqm giving total land values between $2bn and $6bn, based on best alternative use. This represents an approximate return of between 0.8% and 2.5% to shareholders. Considering the dividend of around $50 million paid to Auckland Council each year9, although more work is required to confirm this, this calculation does suggest a potentially hidden subsidy. This excludes the massive social, cultural, environmental and economic value that would be created by transforming this property into a globally iconic waterfront. "
"Stakeholders provided examples of current issues with the rail network including:
The lack of rail connection to Northport (Northport and Nelson are the only ports in New Zealand without a rail connection)
The North Auckland line between Auckland and Whangarei has a number of issues.
For example, while other lines have had improvements to their tunnels over time, many of the tunnels on the North Auckland line remain too low to accommodate, industry standard, high-cubed containers.
The Northland rail network has had no capital investment for the last few decades and has been in a managed decline.
Lack of an East to West rail corridor in Auckland
Some cited issues with the Auckland rail network arising from the fact that freight needs to compete with passenger services.
The risk to Port of Tauranga arising from its reliance on the rail line through the Kaimai tunnel."
"We believe that the success of Port of Tauranga and smaller investments such as the relocation of the port from Whangarei to Northport were as a result of strategic vision rather than detailed business cases which have difficulty anticipating and valuing the mulit-generational benefits crated by catalytic infrastructure. Much of the infrastructure in New Zealand today was also justified on the basis of vision rather than business case. There is a need to be deliberately strategic in developing and evaluating investment options for the supply chain of the Upper North Island;....."
Interesting stuff (I thought anyway), More there for anyone interested. Hope folk are.
Anyway.....time to get back outside.
Cheers RTM