On the back of increased production by its anchor customers, Essar Ports Limited (EPL) has registered significant growth in cargo handling over the last three months. In March 2016 alone, EPL’s four operational ports handled total cargoes of 6.25 million tonnes (MMT), which translates to a run rate of 75 million tonnes per annum (MTPA). With the recent commissioning of the 20 MMT Salaya Bulk Terminal, cargo handling will see a further boost in FY2017.
The contribution of third-party traffic to overall cargo handling stands at about 10% currently. About 90% of the cargo handled at EPL’s Hazira, Vadinar, Vizag and Paradip ports is contracted with captive businesses, like Essar Steel India Ltd, Essar Oil Ltd and Essar Power Ltd. The Company expects cargo handling to increase from 59 MMT in FY2016 to 85 MMT in FY2017—a growth of more than 40% on year-on-year basis.
Essar Bulk Terminal, Hazira
The bulk terminal at Hazira handled 1.62 MMT of cargo in March 2016, largely to service the requirements of its anchor customer, Essar Steel India, which has enhanced its capacity utilisation. This resulted in higher cargo volumes of both raw material and finished products. The terminal also handles cargo, primarily coal, of third-party customers. With Essar Steel’s production expected to rise further during FY2017, total cargo handling at Hazira is expected to reach 25 MMT in FY2017.
Vizag Terminal
EPL’s iron ore terminal at Vizag handled 0.95 MMT of cargo in March 2016. The main form of cargo at this terminal is pellets for Essar Steel, and the iron ore supplied by National Mineral Development Corporation (NMDC) to its clients. Both these cargo movement contracts are long term and sustainable in nature. With prices of iron ore firming up, third-party exports are also expected to pick up in FY2017 and total traffic is expected to be 12 MMT.
Paradip Terminal
EPL’s bulk cargo export terminal at Paradip Port has also registered good performance, having handled 0.4 MMT in March 2016. Essar Steel’s pellet plant at Paradip, which is its primary customer, is recording continuous performance improvements. With the second unit of the pellet plant close to commissioning, traffic at the Paradip Terminal during FY2017, is expected to be more than 5 MMT.
Vadinar Terminal
The liquid terminal at Vadinar has shown consistent growth in traffic. In March 2016, it handled 3.28 MMT of liquid cargo. The Essar Oil refinery at Vadinar has demonstrated sustained growth. The refinery’s capacity has increased from 10.5 MMT in 2008, when it was commissioned, to 20 MMT currently. With no plans for a refinery shutdown in FY 2017, the cargo traffic through Vadinar terminal is expected to be over 40 MMT.
Commenting on the performance, Mr Rajiv Agarwal, Managing Director, Essar Ports Ltd. said, “The rising volumes of cargo handled at our various ports and improved operational performance, reflects the modern facilities at our ports. This will only help our customers with faster turnaround of ships and better utilisation of capacities in the current year.”