Mumbai Port leads the way as coastal shipping catches on

Port currently handles iron ore, cement, petro products, steel; now eyes agri products, engg goods

In a bid to strengthen its revenue from coastal cargo, Mumbai Port, the country's largest port, has chalked out a strong marketing strategy to garner a variety of bulk cargoes such as agri products and engineering goods in the coming months.

"We are in talks with EEPC (Engineering Export Promotion Council of India) for project cargo and FCI (Food Corporation of India) for various agri products as we aim to further increase our volumes from the growing coastal division," Y A Wanage deputy chairman told Business Standard.

Currently, Mumbai Port handles coastal cargo for iron ore, cement, petroleum products and finished steel goods.

Over the last two years, finished steel (under break-bulk category) has seen a ten-fold growth in coastal cargo volumes, having jumped to nearly 500,000 tonnes during April-December from a meagre 43,120 tonnes during April-March 2014-15.

According to Mumbai Port data, steel companies such as Bhushan Steel, Essar Steel and Tata Steel, among others, have increased their cargo volumes via coastal shipping. "Volume growth for coastal from steel companies over the last couple of years only indicates their growing confidence in the cheaper mode of transport," said Wanage.

Between April-December, Bhushan Steel saw its finished steel cargo jump four-times to 57,499 tonnes, from 12,700 tonnes in 2014-15, according to the port's data.

Meanwhile, Mumbai Port has also lined up meetings with the National Bank for Agriculture and Rural Development (NABARD) and All India Association of Industries (AIAI) later this month to explore coastal business opportunities.

At present, coastal shipping contributes only about seven per cent of the total domestic cargo movement in the country. The Ministry of Shipping, under its port-led-development programme Sagarmala, is promoting coastal shipping as a cheaper mode of transport.

In order to attract more companies to use coastal shipping, Mumbai Port, along with other major ports across country, is offering a 40 per cent discount on cargo tariff. Besides, Mumbai Port has kept two dedicated berths for coastal shipping, which ensures timely loading and unloading of cargoes.

"Due to congestion at ports, companies were initially apprehensive about coastal shipping as unavailability of berths could delay goods delivery but we have addressed this issue by offering dedicated berths for this segment," informed Wanage.

Though the port does not have a target for coastal shipping volume as of now, its aim is to grow this business to the greatest extent possible. "We are currently focused on improving volumes in this segment and hence will continue to offer tariff discounts till traffic increases considerably and trade stabilises," said Wanage. "We have also approached the shipping ministry to allow the port to handle fertilisers," he added.

According to the annual report for FY15, Mumbai Port handled a total traffic of 61.66 million tonnes, as against 59.18 million tonnes during the year 2013-14. With all major ports handling a total traffic of 581.13 million tonnes during the year 2014-15, Mumbai Port's share in the total traffic stood at 10.65 per cent.