28 Sep 2016

New hub for wine exporters built at Port Nelson

11:24 am on 28 September 2016

Port Nelson is spending millions of dollars to stay competitive in a rapidly changing shipping industry.

A three-year $60 million development is under way and includes a large new warehouse to support the region's burgeoning billion dollar wine industry.

Nelson city, its waterfront and Port Nelson.

Nelson city, its waterfront and Port Nelson. Photo: RNZ / Tracy Neal

Chief executive Martin Byrne said the expansion was the largest in decades, driven in part by new business opportunities.

"Some of it's replacement of existing assets but mostly it's driven by new business opportunities, whether it's warehousing, distribution - the wine business for example, so it's a mix of new business which is great because it brings new revenue, and then some gear that we just have to replace from time to time," he said.

Port Nelson, jointly owned by the Nelson and Tasman councils, has just reported an $18m annual profit.

The company has teamed up with trucking firm Central Express to create a business, QuayConnect, for the transfer of goods the wine industry needs to package and bottle its products, and then ship it out.

A purpose-built 13,000 square metre warehouse is being built as part of the new hub.

Close to 90 percent of the country's $1.5 billion wine exports came from Marlborough last year.

Tim Nowell-Usticke, managing director of bottling and warehousing firm WineWorks, said Port Nelson was considered a vital global gateway.

Nelson was preferred over Marlborough because of developments constraints at Port of Marlborough and the smaller shipping schedule on offer, he said.

Wineworks, which has bases in Marlborough and Hawke's Bay, has come on board with the joint venture as a key user of new warehouse hasn't invested any capital in the development.

Mr Nowell-Usticke said Port Nelson had put itself on a development plan that made it more attractive to exporters.

"Ten years ago the Marlborough wine industry was using Port Chalmers about 30 percent, Lyttelton about 30 percent, Tauranga about 30 percent and Nelson about 10 percent.

"Now - particularly as the exports to Australia have rocketed and Port Nelson has developed itself as a feeder port for the main export ports - Port Nelson has said, 'hey, not only can we do Australia direct, but we can do US West Coast, we can do Singapore, we can do rest-of-world'," he said.

Mr Nowell-Usticke said the aim of the new hub's operation was to optimise loads shuttling around the region - sending empty bottles to Marlborough and bottled wine back to the port for export.

He said the facility would halve the number of trucks and reduce costs for wine makers.

"All of our glass was coming in from Auckland through Port Nelson and it was then going over the hill in containers to Blenheim, and then those empty 40-foot containers were then going back to Nelson. We were then calling for empty 20-footers to come over the hill to Blenheim so we could pack finished wine into them, and then send those full containers back to Port Nelson."

Mr Nowell-Usticke said they were pushing Port Nelson to do more in the way of gateway development for the wine industry, and the hub was the first step.

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