Recovering from cyclone Biparjoy, 12 govt ports witness 4.5% uptick

They handled 2.35% more cargo YoY in FY24 so far

After remaining nearly flat in June because of cyclone Biporjoy, traffic at major central government-owned ports witnessed a rebound in July and grew 4.5 per cent year-on-year (YoY), provisional data from the Indian Ports Association (IPA) shows. The 12 major ports across the country handled approximately 66.2 million tonnes (mt) during the month.

These ports cumulatively handled 266.51 mt of raw materials and goods in FY24 so far, up 2.35 per cent from the year-ago period.

In 2023-24 so far, cargoes of major commodities like crude oil and coal have witnessed little growth or contraction, while coking coal (10 per cent), iron ore pellets (30 per cent), and fertilisers (54 per cent) have seen strong growth. Container movement grew 4 per cent during the period under review.

Before the July rebound, traffic growth in the first quarter of FY24 was 1.7 per cent. The government port sector, which had been seeing steady growth between 7 per cent and 9 per cent every year after the Covid pandemic, has been dwindling this financial year. On a year-on-year basis, April and June witnessed almost negligible growth.

The Centre has been undertaking several projects to increase both private participation and efficiency parameters at major ports, as historical deficiencies have kept state-owned ports congested over decades.

Meanwhile, non-major ports – owned by state governments or private players – witnessed uneven growth trajectories. Adani Ports and Special Economic Zone, India’s largest private port operator, showed cargo growth of 12 per cent in April-June 2023, the company said in its Q1 results.

Ports operated by the company handled 101 mt cargo in the first quarter, increasing its revenue by 24 per cent.

While the July traffic data for all non-major ports has not been released yet, these ports witnessed 3.8 per cent growth year-on-year in the first quarter of FY24, according to data by the transport research wing of the shipping ministry.

Global trade has been less than steady as India’s exports fell 22 per cent Y-o-Y in June and imports dipped 17 per cent. Trade data for July has not been released yet. Global container demand, used to ascertain the movement of finished goods internationally, has also failed to show signs of optimism for the industry.

Sector trackers expect demand to increase in the second quarter of FY24, but remain considerably low as compared to the past three years.

Considering the reduced purchasing power of consumers in the US and the EU, demand henceforth would be soft but better than what it had been in 2023 so far, a forecast by Germany-based firm Container xChange said.

Christian Roeloffs, a top executive of Container xChange, said:  “2023 started with a significant oversupply of containers and high uncertainty in the market -- which led to substantial rate erosion. The average container prices have been free falling and there are no signs of revival as we approach the busiest period in the shipping industry. It is quite evident that the peak season is almost invisible.”