CBH Group commits $4 billion for network investment
The CBH Group will commit to investing $4 billion over the next 10 years into the co-operative’s network infrastructure and assets.
This equates to an annual investment of between $350 and $450 million each year to expand and improve current receival, storage and outloading infrastructure in line with the CBH Strategy to reach a monthly export capacity of 3 million tonnes by 2033 or sooner.
Chief Operations Officer Mick Daw said last year’s record crop reinforced the need for CBH to continue with increased levels of investment in the network, particularly in outloading projects that are critical in generating price value for growers in the first half of the year.
“As the crop size continues to grow, we must invest more to improve our ability to receive the harvest efficiently, sustain current assets, and build infrastructure to increase the tonnes to customer capability of the network,” Mr Daw said.
“Over the last five years, CBH has invested more than $1.2 billion in the network, and we are pleased to commit to investing $4 billion over the next 10 years.
“Increasing the capacity of our network is critical to maximising the value of growers’ grain in international markets, and sustainably creating value for WA growers, both current and future.”
Network investment projects for 2023 include site expansions, storage refurbishments, temporary storage builds, accommodation, throughput enhancements, receival equipment upgrades and rapid rail outloading facilities.
In addition, CBH is in the process of purchasing new rail rollingstock, and unlocking supply chain capacity in the Kwinana Zones by progressing work on the Avon narrow-gauge/standard-gauge transfer facility.
A summary of key projects by zone completing in FY22 and commencing in 2023 can be seen in Table 1.
The $350 to $450 million range is a significant increase on previous years’ network investment. Over the past five years, CBH has invested an average $240 million per year, with $285.3 million the most invested in FY2018/19.
Over the past two years alone, CBH has added an extra 5 million tonnes of permanent and temporary storage to the network.
Chief Project Delivery Officer Sam Gliddon said temporary storage played a significant role in bringing in last year’s record crop and will be an important part of the network infrastructure mix moving forward.
“If we look at how much temporary storage has been added to and planned for the network over the past two years, CBH will have increased its entire network storage capacity by over 20 per cent in just 12 months,” Mr Gliddon said.
“This is a phenomenal effort, and much needed across all zones. Our strategy includes converting many of these temporary storages to permanent specifications in the future.”
Rail investment will be a significant feature of network investment moving forward, in line with the CBH Strategy, to increase the logistical performance of the network. Commercial negotiations are currently underway for the acquisition of standard gauge locomotives.
CBH will continue progressing rapid rail outloading and siding projects which has received a contribution from the $200 million in funding from State and Federal Governments through the Agricultural Supply Chain Improvements (ASCI) program. Construction on at least two of these rapid rail outloading facilities will start in early 2023 and an additional nine rapid rail and siding projects will follow.
CBH continues to work through the approvals process with government stakeholders while procuring long lead items for track and outloading facilities, including steel, sleepers, bins and conveyors.
Table: Network Investment projects completed in FY22 and planned to commence FY2022/23
|
Zone |
FY22 Projects Completed |
FY23 Planned Project commencing |
|
Albany |
|
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Esperance |
|
|
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Geraldton |
|
|
|
Kwinana North |
|
|
|
Kwinana South |
|
|
|
*Work will continue in to FY2024 |
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