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Airport expansion

Newcastle Airport

The expansion of Newcastle Airport is a boon for passengers, but the most transformative opportunities might lie below the wing.

With Prime Minister Anthony Albanese at Newcastle Airport recently to mark the beginning of construction of a $110 million expanded terminal, the majority of the local interest focused on the accompanying opportunities for tourism and passenger growth. Understandably so, given international flights will inject around $12.7 billion into our regional economy and create 4410 new jobs over the next 20 years.

While international flights could in time attract up to 850,000 new visitors annually to the region, the belly of arriving and departing planes offers the region, the State – and indeed the nation – untold economic prosperity. 

Australia’s international competitiveness is underpinned by a dependable and effective transport sector. Increasingly, air freight has become a fundamental factor of the freight task. Air freight carries the nation’s highest value product (measured in per tonne terms) and most time-critical loads both across the country and through two-way trade with the rest of the world. Indeed, air freight accounted for almost $125 billion of the value of Australia’s international trade in 2020 despite the pandemic grounding 90 per cent of all international passenger flights. 

These flights include high value and time sensitive goods such as pharmaceutical and medical products, fresh premium perishable produce, precious metals and gemstones, mobile phones, technology hardware, and vital spare parts and materials. 

Of note, the export volume of air freight, measured on a per capita basis, has increased significantly over the last five years and more than half of the growth in air freight exports can be attributed to significant increases in demand for fresh food products from a rapidly expanding middle class in many countries, especially in neighbouring Asia. Our love of online shopping has also contributed significantly to this increase. 

Sam Martin-Williams, Vice Chair, SCLAA.
Sam Martin-Williams, Vice Chair, SCLAA.

There are a limited number of export gateways for the air transportation of perishable and time sensitive goods. The primary gateways are the capital city airports such as Sydney, Melbourne, and Brisbane, which are a significant distance from the majority of export production.

For NSW export producers, access to foreign export markets is restricted by access to these gateway ports. 

Most agricultural exporters are based in regional areas that are significant distances away from these export gateways. Fresh perishable products grown in regional NSW for export are typically transported over long distances by road to Sydney Airport, Melbourne Airport, or Brisbane Airport. The local economies of regional NSW are disadvantaged by the time taken for the fresh perishable products they grow to arrive at their foreign export markets, which in turn impacts the quality and financial returns to our farmers. 

Currently, there is no regional airport in NSW that has a dedicated freight aircraft service to international markets. And it is here that Newcastle Airport, with its expanded capacity and a compelling case for a holistic inter-port and air coordination strategy, can make its greatest economic contribution to our region and state.

Toowoomba Wellcamp Airport, 150km from Brisbane, is a regional example of a fully licensed international air cargo terminal with cold store capabilities, security and customised freight solutions delivered through integrated and strategic partnerships.

Research by Deakin University has examined models both internationally and within Australia where air and seaports have created a regional logistics epicentre, creating location capabilities and economies of accumulation for regional economies. 

Prime Minister Anthony Albanese announces the Newcastle airport expansion.
Prime Minister Anthony Albanese announces the Newcastle airport expansion.

In other words, with its expanded capacity and international reach, Newcastle Airport – together with other regional gateways such as the Port of Newcastle – offers a unique regional transport and logistics cluster, where complementary freight and supply chain opportunities in all modes of transport are utilised, each within their best capacity and within a network of infrastructure.

The growth of an international trading ecosystem will enable our region to attract new global connectivity and investment. There are a number of identified trades that each ‘port’ can target in order to meet import and export requirements, helping to expand global market access for growers, manufacturers, and retailers. 

For Newcastle Airport, these include high value components and equipment for Defence manufacturing and supplies, food, electronic devices, pharmaceuticals, and livestock. For the Port of Newcastle consumer goods, cotton, processed agrifood product, and mining and resources equipment will be key to container trade.

For both gateways, a shared offering to the agrifood sector as well as Defence operations supply, Aerospace manufacture, and Resources and Energy sector will support the growth of the region and signal to these industries that the international gateways are responsive to flows of product and people. 

Trade in a 21st century global context is about achieving scope, scale and a trade-oriented environment that embraces technology solutions to support reliable and timely goods flow. The growth of Newcastle Airport has the potential to deliver much more than just additional passengers. Hang on for the ride!

For more information on the Supply Chain & Logistics Association of Australia, click here

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