Industry Analysis & Industry Trends
The Rail Freight Transport industry has grown strongly over the past five years, driven by increased downstream demand from mining as exports of coal and iron ore have risen. Industry profitability is strongest when heavy commodities are carried over long distances, as this leverages the economies of scale and fuel efficiency of rail transport. Over the past five years, the bulk freight segment has strengthened, as the mining sector shifted from a boom in prices to a boom in output. Industry revenue is therefore forecast to rise at a compound annual rate of 4.4% over the five years through 2015-16, to reach $8.2 billion. A substantial fall in the world price of iron ore in 2014-15 is projected to slow industry growth to 2.9% in 2015-16... purchase to read more
Industry Report - Starting a New Business Chapter
The main barriers to entry in the industry involve capital requirements, staffing, regulation and track access. New entrants need funding to buy or lease expensive equipment, to purchase access to rail networks and attract appropriately skilled staff. The substantial cost of rolling stock and the difficulty in attracting suitable staff are compounded by the substantial economies of scale involved in the industry. In order to maximise profitability, operators need to also maximise services, given the substantial rail access fees. This in turn increases the equipment and trained staff requirements.
Legislative compliance also remains high. Route accreditation is required before track owners offer train paths... purchase to read more