As the downturn in global trade continues, Indian ports have seen volumes shrink for more than five months now. The 12 major ports, which handle 90% of the country's export-import cargo, saw traffic fall 4.2% in February as compared with the same period last year. Volumes fell in nine of the 12 ports during the month.
The ports have also failed to meet their yearly targets, according to data released by Indian Port's Association, which represents the 12 government-owned ports. Only the Ennore, Marmagao and Kandla ports saw volumes meet their annual targets.
Around 95% of India's international trade volumes are handled by the country's state-owned and privately-managed ports. Of this, almost 70% is contributed by the 12 major ports. Hence, experts feel cargo growth at these ports is a good indication of the situation of the Indian economy and its trade status.
However, the decline in volumes started post-September; hence cumulative traffic has recorded an increase of 2.24% year-on-year.
Capt J Bhargava, vice-president Chartering of J M Baxi & Co, said iron ore remains the worst-hit commodity, owing to China's withdrawal from imports (decision to suspend imports). Besides, exports of agri-commodities to Japan and Korea have also seen a decline.
"Chinese yards already have about 65 million tonnes of iron ore stock lying (India contributes about 17 million tonnes), and hence there is no requirement," Bhargava said.
Coal, India's second largest traded commodity, saw lower imports as companies tried to re-negotiate freight rates owing to the drops in coal prices. "Even power companies are not lifting the full requirement of coal," Bhargava said.
Along with the weak commodity shipping market, shipment of high-value cargo through containers saw one of the sharpest falls, with volumes plummeting 26.2% in February. The largest container port, Jawaharlal Nehru Port Trust, handled 2.58 million Teus in February.
While the removal of the export ban on Basmati helped exports, import volumes were hurt by the ban on import of Chinese toys.
Owing to reduced demand for cargo, JNPT is expecting to see yearly growth of only 3.6% against last year's 23%. "We do not expect much growth as we will handle close to 57 million Teus in FY2008-09 as against 55 million Teus last year," said S N Maharana, chief manager-operations at JNPT.
Industry observers feel March could follow the trend of the last two months and the container volumes could temporarily bottom out.
Bhaskar Chakroborty and Param Desai of IIFL wrote in their latest report that as finished goods inventories remain high across the globe, it points to weak growth.
"De-stocking is likely to extend for the next 4-6 months," they said.
The ports have also failed to meet their yearly targets, according to data released by Indian Port's Association, which represents the 12 government-owned ports. Only the Ennore, Marmagao and Kandla ports saw volumes meet their annual targets.
Around 95% of India's international trade volumes are handled by the country's state-owned and privately-managed ports. Of this, almost 70% is contributed by the 12 major ports. Hence, experts feel cargo growth at these ports is a good indication of the situation of the Indian economy and its trade status.
However, the decline in volumes started post-September; hence cumulative traffic has recorded an increase of 2.24% year-on-year.
Capt J Bhargava, vice-president Chartering of J M Baxi & Co, said iron ore remains the worst-hit commodity, owing to China's withdrawal from imports (decision to suspend imports). Besides, exports of agri-commodities to Japan and Korea have also seen a decline.
"Chinese yards already have about 65 million tonnes of iron ore stock lying (India contributes about 17 million tonnes), and hence there is no requirement," Bhargava said.
Coal, India's second largest traded commodity, saw lower imports as companies tried to re-negotiate freight rates owing to the drops in coal prices. "Even power companies are not lifting the full requirement of coal," Bhargava said.
Along with the weak commodity shipping market, shipment of high-value cargo through containers saw one of the sharpest falls, with volumes plummeting 26.2% in February. The largest container port, Jawaharlal Nehru Port Trust, handled 2.58 million Teus in February.
While the removal of the export ban on Basmati helped exports, import volumes were hurt by the ban on import of Chinese toys.
Owing to reduced demand for cargo, JNPT is expecting to see yearly growth of only 3.6% against last year's 23%. "We do not expect much growth as we will handle close to 57 million Teus in FY2008-09 as against 55 million Teus last year," said S N Maharana, chief manager-operations at JNPT.
Industry observers feel March could follow the trend of the last two months and the container volumes could temporarily bottom out.
Bhaskar Chakroborty and Param Desai of IIFL wrote in their latest report that as finished goods inventories remain high across the globe, it points to weak growth.
"De-stocking is likely to extend for the next 4-6 months," they said.