Port Kembla diversifies as coal export declines and clean energy imports grow

Port Kembla is in the middle of a cargo transformation as the structural decline of coal imports for the Wollongong steelworks — which had historically been the port's largest single cargo volume — is replaced by growing activity in grain exports, vehicle imports, and the development of a green hydrogen import terminal that will position Port Kembla as the primary clean energy import gateway for the NSW market when operational.

The green hydrogen import terminal, proposed by the Korean-Australian joint venture led by POSCO and Hyundai, would receive liquid hydrogen produced offshore from renewable energy and store and distribute it to industrial customers — initially BlueScope for the steelworks' direct reduced iron program — and ultimately to the broader NSW economy as hydrogen fuel cell vehicles, industrial processes, and power generation create a domestic hydrogen demand that Australian and international production is developing to serve.

Grain exports have grown significantly as NSW's inland agricultural districts continue to expand winter cereal production and as Asian importers — particularly Indonesia, South Korea, and the Philippines — increase their demand for Australian wheat and barley. The Port Kembla grain terminal, operated by GrainCorp, has invested in expanded storage and shiploading capacity to serve the growing export pipeline from the Riverina and South West Slopes agricultural zones whose closest port access is Port Kembla.

Vehicle imports have grown as Port Kembla has captured a growing share of Australian new vehicle import volumes from competitor ports, competing on stevedoring cost, road and rail connectivity to the Sydney metropolitan area, and processing capacity that allows vehicle importers to receive, check, and distribute vehicles efficiently. The port's proximity to the Sydney market, combined with its lower land costs than Sydney's Port Botany, creates a cost advantage that several vehicle importers have acted on by shifting import volumes to Port Kembla.

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