Business Daily from THE HINDU group of publications
Monday, Sep 25, 2006
Supply Chain Management
Agri-Biz & Commodities - Tea
Industry & Economy - Exports & Imports
Columns - On the move
Tea shipments through Amingaon ICD Brewing up an export storm
TEA-BAGS BEING stacked at the Amingaon ICD. Ritu Raj Konwar
Recently in Amingaon
It is the middle of September. A busy time at Amingaon (near Guwahati), home to one of the country's oldest ICDs (inland container depots). Trucks carrying tea-bags from various tea gardens in Assam queue up at the ICD gate, awaiting their turn to unload. The warehouses are full. There is no respite for the reach-stacker and other freight-handling equipment, and little relief for the Concor officials and others connected with tea exports through the ICD. A rake carrying empties arrives at the terminal every fourth or fifth day and leaves within 24 hours, with loaded boxes for shipments through Kolkata port.
"The situation at the ICD is now much better than it used to be a few years ago", said Mr Sudip De, Managing Director of Guwahati-based Technotive Eastern Pvt Ltd, a clearing agency firm involved in the operation of the ICD right from its inception. "The deployment of the reach-stacker since last November has made a good deal of difference, so much so that the unloading of the empties from a railway rake and the loading of the rake with tea-boxes for exports can now be completed the same day instead of the several days required previously, and that too with much difficulty".
Also, it was pointed out, the transit time between Kolkata port and the ICD was now two-and-a-half to three days. "This was inconceivable a few years ago", Mr De said, explaining that the commissioning of the Jogigopa rail bridge on the Brahmaputra river had made it possible.
The throughput of the Amingaon ICD this year, it is estimated, will be at least 10 per cent more than last year's 2,299 TEUs. In other words, the throughput this year is to be more than 2,500 TEUs. This will be possible because of the crop failure in Kenya pushing up the demand for Indian tea. However, it is felt the throughput would have been more but for the drought situation in many parts of Assam, particularly on the north bank of the Brahmaputra.
Ever since the Amingaon ICD was commissioned in 1986, the highest throughput of 2,753 TEUs was achieved in 1997, followed by 2,504 TEUs in 1996. The ICD was one of the handful few such outfits launched by the Indian Railways, long before the Container Corporation of India (Concor) came into being. However, it has since been brought under Concor.
It would be rash to claim, however, that every thing is hunky-dory at Amingaon. The major problem witnessed in the middle of September was the non-availability of the empties in sufficient number, often causing detention of rakes. On certain occasions, the gardens even had to restrict despatch of tea-bags to the ICD.
The problem has been compounded by the insistence of some UK-based buyers to take delivery of tea only in high-cube containers, offering up to 20 per cent cost advantage. Unfortunately, the availability of such containers is extremely limited.
The shortage of containers is believed to have been also caused by the reluctance of some foreign lines participating in the ICD movement to build up the stock of empties at the ICD on cost considerations.
Tackling the problem of inadequate traffic
There is another problem. For Concor, the Amingaon ICD is not terribly exciting from the business point of view, and for several reasons. First, it is a seasonal ICD, coming to life only during the tea shipment season. Second, even during this season, traffic is available only for one direction, that is, the Amingaon-Kolkata port leg. Only the empties are moved in the opposite direction, i..e from Kolkata port to Amingaon.
To minimise the cost, Concor often carries some domestic traffic on the Kolkata port-Amingaon run. But the problem is that the containers used for carrying domestic traffic are not suited for handling international traffic, that is, imports/exports. The tea-shippers resent this, pointing out that to the extent the domestic containers are transported, there is a shortfall in the availability of international containers required for exports. Considering the seasonal nature of operations of the Amingaon ICD, the Customs authorities allowed Concor to handle domestic traffic, provided it did not interfere with the international cargo. The tea shippers, therefore, feel that there should be a complete ban on the movement of domestic traffic between Kolkata port and Amingaon during the peak tea shipment season, particularly from July to October. Alternatively, additional empties have to be organised.
There are some operational problems also. For example, the present line configuration within the ICD is such that a rake has to be split into two halves before it can be handled. Fortunately, Concor is now working on a Rs 3-crore scheme to construct new railway lines, which will be long enough to accommodate and handle two full rakes at a time. No splitting of rakes will be needed. The construction of new lines for full rake handling is necessary as the prospects of domestic traffic are rising. This also calls for separation of facilities at the ICD for domestic and international traffic.
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