A PRIVATELY funded $1.8 billion container port at Newcastle has won critical political backing, with the NSW National Party formally deciding to support the removal of levies that are hampering the port's development.
The port developers have been lobbying the NSW Berejiklian Coalition Government to remove a NSW government tariff on every 20-foot container (a normal size for grain cargoes) of $100 for deliveries outside Port Botany and Port Kembla.
This is due to an arrangement made by the NSW government previously when it leased both the Port Botany and Port Kembla container ports to protect the income of the businesses leasing the facilities.
Winning the support of the junior member of the Coalition is critical in getting the government to overturn its policy, which is also being investigated by the Australian Consumer and Competition Commission (ACCC) for potential anti-competitiveness.
Port of Newcastle chief executive Craig Carmody congratulated the Nats on the party's decision, saying it was in the best interest of the state's regional economy.
"This is further recognition of the significant economic and productivity opportunities ready to be unlocked for internationally-trading businesses throughout the state," Mr Carmody said.
Repealing the tariff would be critical in getting the project off the ground.
While Mr Carmody said he believed the project was extremely competitive on the open market, he felt the $100 per container impost would make it difficult to go head to head against other facilities.
"It would just be too big a head start."
Early feasibility studies have revealed the Newcastle container port could cut freight costs for farmers through its catchment zone by between $12 and $20 a tonne and see grain go to the closest port.
At present, many containerised exports from north-west NSW go via Brisbane.
Mr Carmody said there were benefits for Sydney as well in terms of minimising congestion on its already stretched transport links, quoting a Deloitte Access Economics report last year that found the Newcastle port's catchment area already generates 500,000 full TEUs (standard 20-foot shipping containers) annually, the majority of which currently go through Sydney.
He said the inland rail project, which has Newcastle as the only east coast port connected in its first stage, would also be a boost for the facility.