BHP said in a statement on Wednesday that it had been trialling direct shipping to Port Hedland since 2020 and would now ship 7.5 percent of the containerised supplies it receives into its Western Australian Iron Ore operations (WAIO) from all over the world through Singapore, directly to Port Hedland.
WAIO supplies were previously shipped to Fremantle Port, in the WA capital of Perth, and then transported by road some 1,650 kilometers to Port Hedland, so the new route will dramatically reduce heavy truck traffic between the two ports.
Pilbara businesses will be able to benefit from the direct shipping as BHP plans to make its direct route open to businesses interested in reducing transport costs.
BHP said the move will also reduce the greenhouse gas emissions related to the transportation of the re-routed goods into the Pilbara region by up to 75 percent, per container, and reduce overall transport costs for supplies.
BHP's WA Iron Ore executive Cindy Dunham said since the trial began the business had seen safety, cost, efficiency and environmental improvements.
"BHP wants to work with businesses in Port Hedland to explore opportunities to optimise their own supply chains via this shipping route," Dunham said.
Pilbara Ports Authority (PPA) chief executive Roger Johnston said direct shipping demand had grown faster than predicted with flow-on benefits to the port and the local economy.
"The service is generating more inbound and outbound freight opportunities which, in turn, creates local opportunities for warehousing and distribution," he said.
Johnston said a recent report had estimated the economic benefit of near-port freight efficiencies to be about 5 million Australian dollars (about 3.56 million U.S. dollars) per annum, while imported cargo freight efficiencies were about 60 million Australian dollars (about 42.87 million U.S. dollars) per annum.
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