New Zealand’s port for the future

Port of Tauranga handles nearly a third of all New Zealand cargo by volume, 36 per cent of New Zealand exports and 42 per cent of all shipping containers in New Zealand. It is connected by road and rail to the Waikato, Auckland, and central North Island regions. Photos: Port of Tauranga

NEW ZEALAND’S LARGEST and most efficient port is preparing for the next stage of cargo growth.

Port of Tauranga handles nearly a third of all New Zealand cargo by volume, 36 per cent of New Zealand exports and 42 per cent of all shipping containers in New Zealand. The port handles around 70 per cent of New Zealand’s dairy trade, around 60 per cent of its meat exports, 30 per cent of log exports and almost all kiwifruit exports.

Port of Tauranga is connected by road and rail to the Waikato, Auckland, and central North Island regions and has half shares in Northport at Whangarei and PrimePort Timaru. It operates inland ports in Auckland, Christchurch, and soon Hamilton.

Its extensive national network gives importers and exporters efficient access to markets globally and puts them in reach of the “big ship” services that can only call at Tauranga. These larger vessels are faster and more efficient, and have fewer carbon emissions than smaller ships.

In the six years to 2016, Port of Tauranga invested heavily in capacity expansion to accommodate larger vessels, including deepening and widening shipping channels and expanding cargo storage and handling facilities. The next stage of investment is about to begin. Port of Tauranga intends to extend its container wharves by converting existing port land into an additional berth. The port will also introduce automated electric stacking cranes to increase the number of containers that can be stored and handled on site.

The investments will allow the port to almost double its container handling capacity to around 2.8 million TEUs (twenty foot equivalent units) annually. This will give Port of Tauranga an estimated 35 years’ capacity headroom.

The berth development, which is within the existing port footprint, has been in the planning for the last 30 years. The resource consent application for the project is expected to be heard in the Environment Court in July 2022.

Port of Tauranga Chief Executive, Leonard Sampson, says the development is becoming increasingly urgent as supply chain disruption continues around the world.

“We need to be able to accommodate larger and more frequent vessels, especially as kiwifruit export volumes are predicted to grow up to 40 per cent in volume in the next five years,” he says. left, time is of the essence for this critical piece of New Zealand infrastructure. It will protect New Zealand’s exporting ability for the next three decades.”

Port of Tauranga is also developing a new inland port in a 50/50 partnership with Tainui Group Holdings (TGH). The rail-connected 30 hectare inland port is part of TGH’s Ruakura Superhub freight and logistics complex being built on the outskirts of Hamilton. The first stage of the inland port is due to open later this year.

Mr Sampson says the Ruakura Inland Port will unlock significant environmental and economic benefits for importers and exporters.

Port of Tauranga is the only New Zealand port able to handle larger container vessels and give shippers access to their greater fuel efficiency and lower emissions.

By far the largest proportion of carbon emissions in New Zealand’s container supply chain relates to the “blue water” or oceangoing component of the cargo journey. Landside emissions from road or rail transport contribute only a small percentage of the total carbon emissions related to container imports and exports.

The carbon footprint for a 20 foot, 16 tonne dry container from Shanghai to Port of Tauranga on a ship of that size is more than 20 per cent smaller than the same box shipped on a 4,500 TEU vessel.

Port of Tauranga’s planned automated electric stacking cranes also offer up to 75 per cent carbon emission savings over a traditional diesel straddle operation.

Mr Sampson says Port of Tauranga’s investments will have wide-reaching benefits for the local, regional and national economies.

Although the company directly employs around 270 people, more than 6,000 regularly work at the port. Thousands more work in associated businesses. “The port has a major influence on regional employment and economic prosperity,” says Mr Sampson.

Amidst ongoing discussions about the future of Ports of Auckland, Port of Tauranga is advocating an integrated Upper North Island supply chain that makes the most of existing rail and road networks, inland ports and sea ports.

“Port of Tauranga and Northport have the space, locations, and networks to manage bulk imports and exports, while Ports of Auckland could reduce its footprint and efficiently handle containerised imports for Auckland and some specialised services such as cruise. Tauranga’s ability to host larger container vessels enables it to continue to be the main gateway for containerised exports,” says Mr Sampson.

Port of Tauranga is New Zealand’s largest user of rail. Around 92 trains per week transfer containers between Tauranga and Auckland, and the port is also connected by rail to key bulk cargo sources in Waikato and the central North Island.

Much of the 38 per cent increase in cargo volumes over the past decade has been able to be absorbed without adding significant truck movements on local highways, due to the use of rail and the growth in transhipment (where containers are transferred between ships at Tauranga).

In Auckland, Port of Tauranga’s inland port MetroPort is operated in partnership with KiwiRail. On its own, MetroPort is the country’s fourth largest container terminal. It has capacity for around 2,880 TEU.

In Tauranga, Port of Tauranga owns about 190 hectares on both sides of Te Awanui Tauranga Harbour. It has 2.8 kilometres of berth length, with 15 berths. Tauranga Container Terminal has more than 6,200 TEU ground slots, with more than 3,400 dedicated reefer connections. It is served by nine Liebherr container cranes and 53 straddle carriers.

In the six years to 2016, Port of Tauranga invested heavily in capacity expansion to accommodate larger vessels, including deepening and widening shipping channels and expanding cargo storage and handling facilities.

Port of Tauranga is majority-owned by the region’s ratepayers. Bay of Plenty Regional Council’s investment arm, Quayside Holdings, owns just over 54 per cent of the shares in the NZX-listed company.

Through dividends to Quayside Holdings, the Port has returned more than $724 million to ratepayers in the past 10 years. Quayside’s flow-on contribution to the council’s income currently saves ratepayers $347 on their annual household rates bill.

Quayside has used its shareholding in Port of Tauranga to establish a $200 million infrastructure fund to help pay for regional assets and infrastructure, such as a tertiary education hub in Tauranga.

Mr Sampson says the port is determined to protect and enhance the natural environment in which it operates.

“We occupy a very special piece of real estate and it’s important to us that we look after the environment and the community in which we are lucky enough to operate.”

Port of Tauranga directly supports a number of community-based projects and events across the arts, sport, education, environment, and business sectors.

Port of Tauranga has invested heavily in air and stormwater quality, as well as carbon emission reduction.

The Port has purchased more energy efficient vehicles including hybrid straddle carriers and electric light vehicles. carbon emissions through increased diesel use. However, this was offset by savings in other areas, including further reductions in waste removed to landfill. Waste volumes, primarily wharf sweepings, now sit at about 27 per cent of the volume sent to landfill two years ago.

The COVID-19 pandemic has caused significant challenges for the port, which has felt the consequences of volatile cargo volumes, scarce shipping availability, delays at other ports, and labour shortages due to isolation requirements.

Congestion due to worldwide supply chain disruption is likely to continue for some time yet, with only around 40 per cent of shipping services currently meeting their pro forma berth windows. Port of Tauranga’s container terminal yard storage intensity is still running about 40 per cent higher than the same time last year, although productivity is slowly improving.

Mr Sampson took over the helm as Chief Executive at Port of Tauranga in July 2021, succeeding Mark Cairns who had led the company for 16 years. This year, longstanding Chair, David Pilkington, will also retire from the Board and will be replaced by experienced Director and Chair Julia Hoare.

Mr Sampson says: “We have an important role to play in the Bay of Plenty’s economic recovery from the COVID-19 pandemic and its ongoing prosperity. Our strong relationships with our service providers, employees, customers and community underpin our future success and the ongoing benefits for the region and New Zealand.”