Operators of the Wimmera Intermodal Freight Terminal at Dooen are seeking a commitment from the State government that a rail freight scheme won't be scrapped after June 30.
The Mode Shift Incentive Scheme was introduced in 2014 to encourage a shift of containers from road onto rail.
Wimmera Container Line general manager Tim Guidera said: "It would be such a shame for the Wimmera to see this government initiative that has been so successful be scrapped.
"As well as supporting our regions primary producers MSIS has resulted in a significant reduction of heavy vehicles from our roads by levelling the playing field somewhat between road and rail access charging. We share in the good times and bad with our customers which can see our annual container volumes fluctuate from 7,000 to 25,000 per annum depending on seasonal conditions.
"There is no way the road industry would cope with these peaks and troughs should our rail services cease to exist. You just can't pull those additional trucks during peak seasons. The end result is that produce wouldn't get to port and transport prices would go through the roof."
Mr Guidera said the MSIS subsidy rate was originally set at $100 per 20-foot container based on a road cost comparison, which has since reduced to $81.45.
"Our rail charges are increased every year whilst road charging, which is largely recovered through a diesel rebate, has remained static for a number of years," he said.
"The lack of clarity on the future of the MSIS scheme creates obvious challenges around capital investment in trains, terminal expansion and longer-term planning in general. The scheme is also capped at present, so there is no extra subsidy available to win over any new business."
"A higher subsidy rate with no cap that provides market certainty for several years is required if we are to... have a viable rail service."
Mr Guidera said many of the advantages of rail were not factored into the cost equation, such as reduced road congestion, road wear and tear and greenhouse gas emissions.
He gave Ports and Freight Minister Melissa Horne a tour of WCL's Dooen facilities on Wednesday. The aim of this was to give her an insight into how the terminal is too small to meet demand at peak times such as harvest.
Tony Huebner, operations manager of Horsham grain and hay exporters Johnson Asahi, said the company had chosen to transport its hay by road instead of rail for the next three years because it was cheaper. The business had previously used the freight terminal since it opened in 2012.
"We transport about 70 containers per week to Melbourne wharf, and then have to bring empty ones back at full production," he said. "We would normally do that in the first six months of year before it quietens off around July. Before this year, the only trucks we had on road were between our Plumpton Road base and Dooen."
"The cost of transporting by rail doesn't have to be equal to road, just thereabouts. We haven't shut the book on rail for sure."
The Victorian Budget 2019/2020 delivered $4 million to extend funding for the Mode Shift Incentive Scheme for a further twelve months.
While in Horsham on Wednesday, Ms Horne disputed claims by Member for Lowan Emma Kealy that the government had cut the MSIS by 20 per cent.
The Mail-Times also asked Ms Horne questions about passenger rail, including the future of the Overland train and more regular services returning to Horsham.
She urged the South Australian government to help fund the Overland, without saying whether the state government would continue to fund the service unilaterally after March 31 if no agreement was reached.
"We are constantly talking to different stakeholders about how we can improve public transport," she said.
Ms Horne did not say whether the state government would upgrade the Dimboola to Rainbow railway line.
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