Rio shipping service opens up Pilbara
The first freight shipping service from Singapore to the Pilbara will also give the region's steel fabrication businesses the option to export direct to overseas customers.
Rio Tinto has secured the first commercial freight shipping service for the iron ore region, which until now received freight by road from Perth, 1500km south. The arrival of the MCP Graz at the port of Dampier on Friday will mark the beginning of a regular service that cuts costs for Rio Tinto but also for other local businesses that opt in.
Rio Tinto predicts an annual saving of around three million litres of diesel fuel by reducing road train travel from Perth by more than 3.8 million kilometres. Over time, it hopes more than 50 per cent of its freight requirements to Western Australia will use this service, increasing the speed of delivery and lowering costs. The vessel is due to deliver essential maintenance supplies for Rio Tinto Iron Ore's operations in the Pilbara, including rail wagon wheels, wagon parts, oil and lubricants.
Future shipments are expected to include tyres for heavy earth moving equipment, conveyor belts, rail wagon and locomotive parts and mining consumables.
Rio Tinto Iron Ore official Richard Cohen described the new service as a breakthrough that would reduce costs to business but also reduce the cost of living for residents.
"It is an important breakthrough not only for our business, but it will also provide a great opportunity for the local Pilbara economy by helping to unlock small business growth and supporting job creation," Mr Cohen said.
The ship could bring "anything that goes in a container", which meant even small businesses in the Pilbara could benefit. Mr Cohen said the highly proficient steel fabrication businesses in the region could ultimately use the freight service's return trips to export their products without needing to transport them to Perth.
Rio Tinto expects the service to reduce the lead time for goods into the Pilbara by six to 10 days compared with freight via Fremantle.
Toll Global Forwarding and other freight forwarders offer a service for smaller volumes on the vessel. Toll Group global logistics president Peter Stokes said there were enormous possibilities to deliver more efficient supply chains to the Pilbara. "We are proud to be partnering with Rio Tinto on this landmark project, which will provide businesses in the north with a significant opportunity to access international imports and exports," he said.
Originally published as Rio shipping service opens up Pilbara