Eastern Australia's largest grains handler, GrainCorp, will cut 80 jobs and shut unprofitable storage sites as part of a $200 million plan to revitalise the company's country grain network.
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GrainCorpwill spend $200 million over three years, the single biggest capital investment in its country network ever, as it attempts to shift 1 million tonnes of grain from road to rail transport.
The company will cut its storage network to 180 sites. It will close more than 72 sites across the network where less than 10 per cent of the east coast crop is received.
GrainCorp is overhauling its network, focusing on localised "clusters", offering end-to-end export logistics and spending money to improve rail loading times.
GrainCorp believes its investment will deliver a benefit to growers of $5 per tonne of grain.
However, it wants state governments to also invest in rail infrastructure, which could deliver an additional $5 per tonne to growers.
The investment program, called Project Regeneration, will create a $4 million one-off restructuring cost for fiscal 2014.
The new country network model would be "largely" in place by the time winter crops are harvested later in the year.
The investment is aimed at securing more grain in to its network as competition from offshore rivals including Cargill intensifies.
"We estimate rail costs in eastern Australia are $10 per tonne higher than best practice, reducing returns to growers by around $180 million in an average season," Mr Taylor said in a statement.
"GrainCorp's investment will significantly improve our network's interface with rail and help reduce rail costs by $5 per tonne.
"However, the full benefits of our network investment - and the rest of the $10 - can only be unlocked if there is also further investment by track owners in the government-owned rail infrastructure that supports the entire industry."
