Home >companies >Cargo transport moving towards containerization

Mumbai: In a bid to cut costs, save time and reduce theft, shipping and logistics companies are increasingly moving to the use of containers to transport cargo, especially ones that have been traditionally moved in open trucks or general cargo ships.

While commodities such as iron ore, steel, benzene, project machinery, copper concentrates, sugar, cement, cars and carbon black are now being moved in steel containers, some firms are even experimenting with scooters and motorcycles in 20- or 40-foot containers for transporting by rail, road and sea.

“The main advantage of containerizing cargo is that it will help reduce pilferage," said Sudhir S. Rangnekar, managing director and group chief executive officer, Sical Logistics Ltd.

Efficient transport: Cars waiting to be shipped at the Jawaharlal Nehru port, the country’s largest container port. Containerization is expected to encourage and facilitate multi-modal transportation. Ashesh Shah / Mint

In 1973, when a container ship first called at the Kochin port, it marked the advent of containerization in the country. Since then, several container handling terminals have been set up across India following the increase in such cargoes.

“India has a fairly long way to go to achieve higher levels of containerization of cargo," said S.N. Srikanth, senior partner at maritime consultancy firm Hauer Associates. “...Only about 50% of India’s trade by volume is shipped in steel containers. In comparison, the global average is 80-90%."

“A container is a standard. A lot of equipment and support systems can operate as per that standard. It encourages and facilitates multi-modal transportation that can move seamlessly from one mode of transport to another," said G. Raghuram, a professor at the Indian Institute of Management, Ahmedabad. According to Srikanth, containerization cuts port time, saves on packaging costs and reduces inventory and transportation costs.

The Jawaharlal Nehru Port Trust, or JNPT, Navi Mumbai, is the country’s largest container port, handling some 60% of India’s container trade.

The Indian Railways also opened rail container transportation to private players in 2007. As a result,16 companies including three state-run firms have picked up licences to run container trains across India.

“Traditionally, cars were moving in second-class rail coaches after taking away seats and were able to carry 150 cars in a single rake," said Yogendra Sharma, chief executive officer, Adani Logistics Ltd, part of the Ahmedabad-headquartered Adani group. But by using containers now, they can carry 220 cars, and handle other cargoes on the return journey, he added.

“We are also handling cargoes such as benzene and carbon black in 20-foot containers. Otherwise this would have been carried in tankers by road and wasted time," Sharma said. According to him, more commodities would be containerized, based on volumes generated, cost benefits and convenience.

Adani Logistics plans to carry scooters and motorbikes by container trains. It is already in talks with manufacturers such as Hero Honda Motors Ltd and TVS Motor Co. Ltd.

The company has started transporting Maruti Suzuki India Ltd’s cars from northern India to Mundra, Gujarat, from where it is shipped to Kochin along the coast in smaller container ships owned by Shreyas Shipping and Logistics Ltd.

Boxtrans Logistics (India) Services Pvt. Ltd, owned by JM Baxi and Co., also moves cars by containers from northern India to Visakhapatnam, Andhra Pradesh.

Meanwhile, Sical Logistics has signed a deal with Hindustan Copper Ltd to transport 250,000 tonnes of copper concentrate in 20-foot containers. Hindustan Copper used to deal with nearly 10 different logistics operators to transport copper concentrate from Malanjkhand in Madhya Pradesh to its Taloja plant in Maharashtra.

Rangnekar said earlier this commodity was moved in different modes of transport as bulk cargo. According to him, containerization will help Hindustan Copper save 10% in logistics cost.

Sandeep Mehta, chief executive officer (Mundra Port), Mundra Port and Special Economic Zone Ltd, said an increasing amount of cargo is getting containerized and traditional cargoes such as sugar and cement are now moved in boxes.

A senior executive with leading shipping company APL, a wholly owned subsidiary of Singapore-based Neptune Orient Lines Ltd, said even refrigerated cargo was being containerized for ease of handling with the help of advanced technologies. Certain small project cargoes, including oddly sized machinery, are handled in specialized 20-foot containers.

“Cargoes such as oil cakes, iron ore, steel billets, ferochrome, etc., are now getting containerized. It is an efficient mode of cargo handling," said D.K. Tewari, chief executive officer with MSC Agency (India) Pvt. Ltd, the India unit of Geneva-based Mediterranean Shipping Company SA, the world’s second biggest container ship operator.

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