A RAPID increase in firms moving goods by container has seen a international logistics business start work converting a former biofuels refinery site into a £2.6m rail terminal.

AV Dawson's Tees Intermodal Terminal will have rail sidings capable of handling trains carrying up to 80 containers at any one time.

Work started this week on the facility at the former D1 Oils site on Middlesbrough's Riverside Park, which family owned AV Dawson bought in 2009.

It could be up and running within four months, with the Middlesbrough based firm, employing 152, expecting to create up to 12 jobs in the next year.

An increase in use of containers to transport goods saw nearby Teesport owner PD Ports, handling more than 150,000 containers last year for the first time in its history.

AV Dawson's managing director Gary Dawson said: "The growth areas we are seeing in logistics have been in freight by containers.

"It is now moved in containers where traditionally it was moved in conventional trucks.

"Ten years ago you might have a single container in your transport fleet, now we are providing between 30 and 40 containers a day and storing 300."

After the 45per cent increase in containers it handled last year PD Ports announced in January that it was creating 50 jobs as work began on the first phase of an expansion to its Teesport container terminal, which could see £29m invested.

Mr Dawson said: "PD Ports has announced huge expansion in its container terminal and, if we take the model we have seen in the big southern ports such as Southampton, the opportunities for people to provide logistics, container support and storage that go on around a major container port are significant.

"We have bought land and are putting the infrastructure in so it is set for this growth of traffic."

The firm is also looking to move into transportation for the region's growing renewables sector and Mr Dawson added: "We can't satisfy these opportunities with the existing infrastructure, that is why we are looking to put these new facilities in place."

Mr Dawson believed both reducing carbon footprint and the increasing cost of fuel played a part in more firms deciding to move goods long distances by rail.

He said: "Rail has always been a very competitive and environmentally friendly alternative to road transport.

"At the front you have one locomotive using the fuel as opposed to as many as 50 trucks."

Industry experts are predicting growth in global container traffic of 7.1per cent over the next five years.

"From our perspective, our ability to move goods by road, rail and sea places AV Dawson in a prime position to handle container traffic," Mr Dawson added.