A new rail freight hub is set to be constructed in Palmerston North (New Zealand), and is expected to attract $200m of new business to the rail freight industry.

The $40 million investment from The Provincial Growth Fund will buy the land, and it is estimated that the hub will attract huge amounts of business in the area, putting Palmerston North at four times the productivity expectancy than the current use of the site.

Palmerston North reports to already transport a range of freight loads, including 24% of the 2.5 milion tonnes that passes through the region. It is claimed that rail freight loads were two-thirds more fuel efficient than completing the loads by road. With the expected growth of the rail freight hub once the construction has taken place, Palmerston North could be a thriving centre for the rail freight industry.

KiwiRail and New Zealand Transport Agency are said to be working on the distribution plans together, certifying that the regional freight ring road is well connected to the new site. This will increase accessibility and opportunities for a multimodal freight solution for the New Zealand region.