Rail freight, container volumes indicate significant rebound in trade in August
Container volumes at major ports (in terms of 20-foot equivalent units) increased 8.4% in August over a year ago, indicating a significant recovery in trade. Due to the initial disruption caused by the introduction of the goods and services tax (GST), container traffic growth had slowed to around 2-5% in the earlier two months. Encouragingly, volumes at Jawaharlal Nehru Port Trust (JNPT), India’s largest container port, remained strong, clocking a growth of 9.1%, data compiled by PhillipCapital (India) Pvt. Ltd shows.
The Indian Railways freight traffic data also indicates a rebound in trade, though it is helped by a favourable base. Traffic in terms of originating tonnes expanded 7.7% last month, the fastest growth so far this fiscal year. The export-import (Exim) container traffic in terms of tonnage is up 19.5%. Domestic container traffic is up 16%, which is a positive surprise.
An analyst with a domestic broking firm says the data indicates continued market share gains by the railways. The recent rise in diesel prices may have helped tilt the cost curve in favour of the railways.
Nevertheless, these numbers should bode well for the national carrier and container train operators. Traffic not only gained momentum in August but growth so far this fiscal is also better than the year-ago period. Compared to 4.3% growth a year ago, container volume at major ports is up 6.4% so far this fiscal. Similarly, total rail freight volume is up 4.9% so far this fiscal, compared to a 1.4% drop in the year ago. Growth in container traffic on the Indian Railways is also significantly better than for the year-ago period.