The Hindu Business Line : Tata Steel halts use of Concor Jamshedpur ICD

Tata Steel has stopped using the Jamshedpur inland container depot (ICD) of Container Corporation of India (Concor) for nearly a month now, ever since the Railways hiked the haulage charges.

Normally, the ICD handles about 300 containers every month on the Tata Steel account. In April, the throughput was 95 TEUs (till increased rates became effective) and zero so far in the current month.

Reverse logistics

Concor, it is learnt, is in favour of renegotiating the rates but there has been no progress in this regard. Tata Steel too is believed to favour rate renegotiation but at a level unacceptable to Concor.

The increased railway haulage rate has slapped an additional burden of over Rs 200 per tonne on Tata Steel's despatches of finished goods in railway containers, mostly to southern destinations.

The private sector steel giant is believed to be working on reverse logistics by road.

That is to say, the same trucks that bring in materials to the Jamshedpur plants of Tata Steel and Tata Motors from the southern region, would be used to send finished products to that region.

With this arrangement, the company hopes to strike a better deal and save substantially on logistics costs. Concor generally charges per container rate.

However, inquiries reveal that it has a special package for Tata Steel.

Tata Steel package

The rates under the package cover a variety of operations such as the cost of picking up cargo from the plant, bringing them to the ICD, stuffing them in containers, having them unitised (through proper choking and lashing), transporting them by rail, unloading them at the destination, destuffing and deploying trailers to reach the cargo in break-bulk to various customers.

The package thus covers door-to-door service. Concor pleads that it has merely passed on the increased railway haulage rates to Tata Steel, without charging anything extra. However, such a plea would cut no ice with Tata Steel.

Throughput maintained

Fortunately, Concor, despite the withdrawal of Tata Steel, succeeded in maintaining the monthly throughput of the ICD in April thanks to cargo support from a few other private sector steel plants, though much smaller in size.

About two rakes of traffic, equivalent of 130 TEUs, have been handled by the ICD so far in the current month, it is learnt.

More Stories on : Railways | Supply Chain Management | Tata Steel Ltd

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Tata Steel halts use of Concor Jamshedpur ICD