"This is welcome news," said NZ Forest Owners Association chief executive Rob McLagan.

"The rail system is an important component of the forest industry's transport requirements, particularly as we seek to move the expanding harvest in priority regions."

Forest Industries Council chief executive Stephen Jacobi said the Government's decision reflected the industry's view that rail should be put on a neutral footing relative to other forms of transport.

"Tracks are no different from roads. To be utilised more by the forestry industry, rail will need to be as efficient and competitive as other forms of transport.

"The best way to achieve this is for the Government to own the tracks and to provide access rights to licensed operators in the private sector in a competitive environment."