The former Chief Executive Officer of both Macarthur Coal Limited and SunWater has been appointed to the board of directors of Qube Holdings Limited.
Qube has announced that Patrick Terminals has extended its tenure at the Port of Melbourne to 2066 and will invest $15 million to develop a rail terminal at its adjoining logistics site at Coode Road.
Qube Holdings reported a 55 per cent fall in annual profit to $87.5 million in its full-year results. The company credited its diversified logistics operations and its agreement with Woolworths as factors that helped to mitigate the impact of the coronavirus pandemic.
Woolworths Group and Qube have announced plans to invest in an automated Regional Distribution Centre and a semi-automated National Distribution Centre in New South Wales. The total investment in the facilities from both companies will reach approximately $1.2 billion.
The Australian Competition Consumer Commission (ACCC) has announced that it will not take any further action in relation to Qube Holdings’ acquisition of Maritime Container Services.
The ACCC’s investigation focused on the supply chain for containerised freight through Port Botany, particularly the role of empty container parks in the chain. MCS controls Cooks River, a container park with rail sidings used by some of Qube’s rivals, often for regional containerised rail freight.
“It is important for regional exporters and rail operators to have access to empty container parks with rail facilities,” said Rod Sims, Chairman, ACCC. “While there are a limited number of these types of empty container parks in Sydney, there appear to be sufficient choices for Qube’s rivals in rail, stevedoring and logistics.”
The ACCC considered whether the vertical integration of an empty container park with Qube’s existing rail assets, intermodal terminals and 50 per cent interest in Patrick stevedores could result in preferential treatment for Qube or discrimination against Qube’s competitors. A key consideration was whether the acquisition could reduce competition in the market for rail container transport services between regional New South Wales and Port Botany.
The ACCC identified alternative empty container parks operated by DP World Logistics, and soon by Linx, that could act to constrain Qube’s incentive to discriminate against rivals.
“The alternative empty container parks with rail access will provide exporters in regional New South Wales and rail operators the option of moving to other facilities if they consider they are receiving less favourable treatment from Qube,” said Sims. “Some large regional exporters have already moved to alternative container parks. The threat of continued switching by customers limits the impact of discriminatory behaviour by Qube, and may also act to constrain Qube from engaging in such behaviour in the first place.”
The ACCC considered that it would be unlikely that Qube could leverage the operation of MCS to preference Patrick, because of the availability of alternative empty container parks and the role of shipping lines in choosing stevedores.
Qube and MCS completed the acquisition in late December 2017, just days after Qube notified the ACCC of its intention to do so. At the request of the ACCC, prior to completion, Qube gave the ACCC a court-enforceable undertaking to hold the MCS business separate from Qube until at least 14 March 2018.
By choosing not to seek informal ACCC clearance before completing the transaction, Qube and MCS were exposed to potential legal action seeking divestiture and penalty orders had the ACCC formed the view that the acquisition was likely to have the effect of substantially lessening competition, in breach of section 50 of the Competition and Consumer Act 2010.
The Qube acquisition of Melbourne Container Services (MCS) has hit a snag with the Australian Competition and Consumer Commission formally questioning the deal, The Australian has reported.
MCS operates shipping container import and export handling, empty container storage and road and rail transport services in Sydney.
The acquisition occurred in late December 2017 and has been completed. However, Qube has provided the ACCC with an undertaking that it will keep the MCS business separate and independent from the remainder of Qube’s existing operations until at least 14 March 2018.
According to The Australian, Qube also tried to acquire MCS in 2010 in a deal that the ACCC blocked.
Logistics & Materials Handling has reached out to Qube for comment.
Qube has announced the appointment of Sue Palmer to the Board of Directors effective 1 September 2017.
According to Qube, Palmer has extensive financial and commercial experience across a range of industry sectors in Australia and Asia, including construction, mining, energy, infrastructure and agriculture.
Palmer has over 30 years’ experience in senior executive financial roles with a diverse range of organisations, which have included Incitec, CS Energy, Leighton Contractors and Thiess, Qube said.
Palmer was identified as part of the process of board renewal following the resignation of Robert Dove in 2016 and the retirement of Chris Corrigan as Chairman in June 2017.
Welcoming Palmer to the Board, Qube Chairman, Allan Davies, said, “I’m delighted Sue has agreed to join the Qube board at this time. She has precisely the mix of skills and experience the company needs, particularly with the ongoing development of the Moorebank intermodal project.”
Qube Holdings has announced that it has reached an agreement to develop major new warehousing at Moorebank Logistics Park for Target Australia.
Through the agreement, Qube will develop 37,860m2 of warehouse and office facilities for an initial lease term of 10 years.
Due for completion in early 2019, the facilities will be among the first purpose-built operations within Moorebank Logistics Park, alongside the new, dedicated freight rail terminal.
Target Australia will be investing in the latest technology scanning and sortation systems at the facility, Qube explained in a statement. Target Australia also entered into a new five-year logistics services contract with Qube Logistics, covering freight from Port Botany to Moorebank.
“The Moorebank development is certainly a once in a lifetime opportunity,” said Maurice James, Managing Director, Qube Holdings. “Linking one of the nation’s busiest ports by rail to an inland facility with the sheer scale and location benefits of the Moorebank site is a game changer that will deliver huge long-term benefits to consumers and businesses.”
William Hara, Director of Qube’s Strategic Assets Division, added, “Securing Target Australia is testament to the quality product that is Moorebank Logistics Park, combining a superior property location and efficient logistics. Qube is looking forward to working with the Target Australia team in delivering an optimal warehouse and logistics solution for their operations.”
On a panel of logistics industry experts at the Future of Freight event held by the Committee for Economic Development of Australia (CEDA) in Melbourne on 17 July, Maurice James, Managing Director of logistics and infrastructure company Qube stated that the arrival of e-commerce giant Amazon on Australian shores will have a major impact of the business and logistics strategies of the nation’s enterprises.
“We are going to see disruptors come into freight,” James said. “There’s a big one coming next year, Amazon.
“Amazon is a logistics company that sells products online, and it’s going to change our freight paths and our freight patterns.”
He noted that the company’s existing retailers are now thinking about how to operate both online and brick-and-mortar models successfully, and how to change their supply chains to compete.
“If we look at any capital city, what we’re going to see is a significant increase in white-van movements, possibly to the detriment of big truck movements,” he said.
Dr Don Gunasekera, Research Fellow in the Centre for Supply Chains and Logistics at Deakin University, added, “We need to look at the way our supply chains operate in a totally different manner – Amazon’s coming, there will be a bit of competition between Amazon and the other providers.
“The issue will be how consumers are going to perceive all these changes, and the extent to which they are going to benefit.”
Gunasekera also noted that the way the industry moves product will likely be impacted, due to the increasing likelihood of driverless trucks, and the declining cost of drone technology.
“All these things will have a disruptive effect, but hopefully the sector is positioning itself to take advantage of these changes,” he said.
Moorebank Logistics Park, Australia’s largest intermodal precinct, continues to make headlines with yet another multi-million funding boost.
Freight and logistics company Qube which is developing the project, has secured $150 million from the Clean Energy Finance Corporation (CEFC) under the premise of increasing the use of rail networks to distribute containerised freight to and from Port Botany.
According to the CEFC, the project is expected to reduce freight truck emissions by switching the movement of over 1.5 million freight containers at Port Botany from road to rail, with an estimated annual abatement of more than 110,000 tonnes of CO₂.
As such, it is expected to reduce the distance travelled by container trucks on Sydney’s road network by 150,000km every day, and 93,000km per day for long-distance interstate freight trucks.
Locally in Sydney, it will cut an estimated 3,000 truck journeys per day from Sydney’s road network, particularly the M5, according to the CEFC.
“Emissions from road freight transport are a substantial part of our carbon emissions challenge. By switching to rail solutions, the Moorebank project will reduce emissions, reduce urban congestion and improve national freight connectivity for years to come,” said CEFC CEO, Ian Learmonth.
Learmonth added that despite its massive scale – operating across a site the size of Sydney’s CBD – the freight and energy efficiencies delivered via the Moorebank Logistics Park are expected to result in net emission reductions totalling more than two million tonnes of CO₂ over a 40-year period.
However, this net reduction takes into account construction emissions, embodied energy within building materials, offsite transportation, operational emissions and savings from the onsite use of renewable energy. It does not factor in inevitable advances in technology over that 40-year period – for example the imminent introduction of Euro-VI engine technology.
Still, Qube Holdings’ Managing Director, Maurice James, said the Moorebank Logistics Park would transform the containerised freight supply chain in Sydney and deliver significant community-wide benefits.
“Our focus at Qube has always been on how we can improve the efficiency of the import and export supply chain, how we can provide a faster and more cost-effective way to get goods to consumers and the Moorebank terminal is certainly a key part of that strategy,” he said.
“Being able to deliver a faster and more reliable supply chain that creates savings for our customers, as well as remove thousands of truck trips from our roads at the same time as delivering very significant environmental benefits is a great trifecta.”
The Moorebank Logistics Park will be developed across 243 hectares in south-western Sydney, taking advantage of its location near the Southern Sydney Freight Line, M5 and M7 motorways and in an area of rapid population and economic growth.
It is expected to deliver “significant job creation”, with the precinct employing as many as 6,800 people when operating at full capacity and over 1,300 jobs to be created during the construction phases.