When Nature Hits... Don't Let It Stop Your Business
It’s no joke when we say that Australia cops its fair share of weather events and natural disasters – but what happens when those that keep us moving come to a halt? If there’s one thing the transportation industry knows, it’s how to keep chugging along in harsh conditions, but these weather events are becoming increasingly frequent often leaving economic disaster in their wake.
Most of South-East Queensland and Northern New South Wales are still cleaning up the damage from Cyclone Alfred, many of whom also experienced the severe flooding events of 2021 and 2022. The 2020 bushfires burnt over 17 million hectares, including critical transport infrastructure, significantly affecting key thoroughfares for road and rail freight.
With the ever-growing demand for ground freight across domestic supply chains, it makes us wonder how we overcome such hurdles on a frequent basis.
What happens to our drivers?
Each time a natural disaster strikes Australia, it has the potential to reduce or cut off domestic trade routes for road and rail couriers. Flooding can destroy roads and rail tracks forcing couriers to remap their routes, and fires can cause couriers to commute through dangerous conditions to complete the job.
Not only this, when these events occur – trucks get stuck and drivers are risking longer hours, hazardous detours and face safety risks with the chance they might be unable to complete their jobs gives rise to economic challenges. Let’s look at the recent effects of Cyclone Alfred and how it disrupted the industry.
Loss of business and economics
When trucking operation stalls, it doesn’t just mean a late delivery – it means that businesses are on a time sensitive downward spiral. With the majority of dairy products produced in the southern states and fresh produce nationally, the loss of spoiled goods is a significant cost to farmers and their transport partners. Many of these businesses lose revenue due to undelivered freight or face contractual fines related to delivery failures and damaged infrastructure. However, if the trucks can reroute, there are often additional costs associated with this or expediting alternative transit methods to ensure that deadlines are met.
Small-to-medium transport companies often operate on tight margins. A week-long disruption from a flood or fire could wipe out a significant portion of their monthly revenue. For some, it’s enough to force closure.
Wider economic impacts
Not only does the business lose out, but the economy often does as well – experiencing the ripple effects of stock delay and induced panic buying. Retailers and manufacturers are probably the biggest hit during severe weather events, facing stock delays which in turn leaves many shelves empty of essentials. Agricultural producers and farmers have the potential to miss market windows for their business when severe weather hits during harvest season – setting them back months, if not years. It doesn’t just affect us domestically, but internationally as well, with exporters facing bottlenecks at ports due to the reduced road and rail freight capacity.
These cascading delays translate to millions in economic losses nationally. Experts are predicting that ex-Tropical Cyclone Alfred will cost the economy up to $1 billion per day that services were closed from operations. Not only this, AMP Chief Economist Shane Oliver highlighted that the effects of Alfred would mirror that of the 2022 eastern floods. Having two multi-billion-dollar hits on the Australian economy only shows that action needs to be taken to get us back on the roads sooner.
Is over-reliance a root cause of this issue?
The short answer is – we don’t know yet. Is it entirely possible that Australia has become over-reliant on the traditional methods of domestic transportation? Quite likely, but we’ll need to look at New Zealand’s relevant parallel of this situation with the challenges that come earthquakes.
New Zealand industry leaders have raised the viability of capitalising on their coastline to relieve the pressure put on their road networks. Despite raising the concern over the timetabling and extra time required when ordering, could this be a viable solution for our east coast? The majority of our production is done between North Queensland and Victoria, so why not put some of our most travelled routes to use by sea?
Luckily, Australia is already implementing trials for domestic coastal shipping initiatives, while boosting careers in marine operations so we don’t need to rely on our Armed Forces.
It may not replace road freight, but diversifying our transport modes could cushion the blow when disaster strikes.
With severe weather events and natural disasters as an annual occurrence for most of Australia, it’s time we rethink how we move goods – and build a freight system that weathers the storm.
