Australian Aurizon’s coal volumes via rail rise 7% on year in fiscal 2017-18 to 212.4 mil mt
Australia’s largest rail freight operator Aurizon carried 7% more coal by rail year on year in fiscal 2017-2018 (July-June) at 212.4 million mt, amid increases from both its Queensland and New South Wales operations, the company said Monday.
In the thermal coal dominant region of Hunter Valley in New South Wales, Aurizon carried 52.3 million mt of coal year, up 10% from a year earlier, the company said while releasing its results for the fiscal year.
Its giant metallurgical coal powerhouse, the Central Queensland Coal Network, carried 152.5 million mt in the fiscal year ended June 30, up 6% year on year, with two out of its four networks registering an increase.
Above rail volumes on the Goonyella system – which connects the export terminals at Hay Point, Dalrymple Bay and Abbot Point to mines operated by the largest coal miners including BMA, Glencore and Peabody – rose to 62.4 million mt, up 15% from a year earlier, the results showed.
The Newlands corridor – which links to Goonyella and provides customers with additional flexibility to access Abbot Point, servicing customers such as Glencore, Jellinbah Resources and QCoal – saw a 15% hike in volume to 20.4 million mt.
The major Blackwater system’s above rail volumes, however, fell to 58.5 million mt, down 2% from a year earlier, it said. Blackwater links Central Queensland mines from the Bowen Basin to two export terminals at the Port of Gladstone – RG Tanna and Wiggins Island Export Terminal.
The Moura corridor, which also connects to the terminals at the Port of Gladstone, also saw volumes drop to 11.2 million mt, down 7% year on year, it added.
Further south in Queensland, its South-West Rail Corridor (not part of CQCN), which connects New Hope’s coal mines to the Port of Brisbane registered a total of 7.6 million mt for the period, up 9% year on year, it said.
Thermal coal’s share of total volumes across all operations rose from 30% to 33% across the two years, while metallurgical coal fell from 70% to 67%, the company said.
Aurizon said that further growth was expected in fiscal 2018-2019 with total above rail coal volumes pegged at 215 million-225 million mt, the company said.
For the April-June quarter, CQCN’s volumes were 38.9 million mt, up 23% year on year and up 9% from the January-March quarter. Its NSW and South-West Rail Corridor volumes combined were 15.8 million mt, up 8% from a year earlier and 12% higher than the the March quarter, the company said.
Source: S&P GLOBAL PLATTS
DBCT coal vessel waiting times back to a month long
The vessel queue waiting to access the Dalrymple Bay Coal Terminal (DBCT) in Australia’s Queensland has grown to 44 today from 31 at the start of July, as the port struggles to meet firm demand amid maintenance and rail disruptions.
The waiting time for vessels in the queue outside DBCT is back up to around a month, which is the same level seen in December when delays at the port were a factor in pushing hard coking coal prices above $250/t fob Australia. The ship queue has increased to 44 vessels, just short of the 47 in December and more than double the average of 18-20 vessels.
Other Queensland coal ports, including Gladstone, Hay Point and Abbot Point, all have fairly normal shipping queues, but shipowners cannot easily switch between the Queensland ports. DBCT is the second-largest coal port in the state at a capacity of 85mn t/yr.
Premium hard coking coal prices have rallied to $185/t fob Australia from $173/t at the start of the month.
DBCT has been disrupted by maintenance as one shiploader was initially planned to have maintenance from 8 July to early August but completion was later extended for a week until 14 August. This information was made public to customers only on 9 August. DBCT Management has not replied to queries on the matter.
The situation has alarmed some buyers in Asia as it is similar to the DBCT congestion that drove prices higher late last year, although there is some optimism that the vessel queues will shorten soon.
“It looks like a very serious situation, but if we see the queues start to decline from here then I guess we have nothing to worry about,” an Indian buyer said.
DBCT is also the port most likely to be affected by recent maintenance changes at rail network owner Aurizon. DBCT has small stocks and depends on just in time rail deliveries from mine sites. The Goonyella rail line that services it is the part of the network that has been most affected by the new Aurizon maintenance system. Aurizon increased its coal haulage forecast for 2018-19, implying that it can manage the disruption caused by the rail maintenance changes over the year.
DBCT Management at the end of last year blamed overallocation from mining firms in previous months for the lengthening of the vessel queue. This may again be a factor, as mining firms may have overallocated in June in an attempt to ship extra coal before the end of the month.
DBCT shipped 5.63mn t in July, down from 5.99mn t in June and from 5.82mn t in July 2017. The port has the capacity to ship 7.08mn t/month and hit 6.95mn t in August 2017 but it has only broken 6mn t/month in just two months this year. DBCT ships around 75pc coking coal and 25pc thermal coal.
The BHP Mitsubishi operated adjacent coking coal port of Hay Point shipped 4.26mn t in July, up from 4.25mn t in June and from 4.06mn t in July 2017. Shipments from Abbot Point rose to 2.58mn t from 2.37mn t in June and 2.37mn t in July 2017, while shipments from the state’s biggest coal port of Gladstone fell to 5.78mn t in July from 6.33mn t in June and from 6.05mn t in July 2017.
Total shipments from the four Queensland coal ports fell to 18.25mn t in July from 19.14mn t in June and from 18.3mn t in July 2017. Shipments for the four ports were 123.13mn t for January-July, up from 110.67mn t in the same period last year when Cyclone Debbie disrupted shipments in April.
Source: ARGUS
JNPT considers ‘phased-in’ free-time reduction for railed cargo
Shipper trade groups’ efforts to persuade Jawaharlal Nehru Port Trust (JNPT) to review a plan to drastically reduce free storage times for railed containers — intended to shorten rising dwell times — appears to have worked to some extent.
Following a stakeholder meeting last week, JNPT agreed to adopt a “phased” approach to implementing uniform free times for freight handled by road and rail, on which it earlier sought approval from the regulator Tariff Authority for Major Ports (TAMP).
Officials at the meeting concluded that instead of a sudden, sweeping policy change, the port will work toward reducing free times for all “export containers” handled via inland container depots (ICDs) to six days from seven days and, depending on the progress, a further reduction will be considered.
Additionally, JNPT will await the recommendations of the Bureau of the Research on Industry and Economic Fundamentals (BRIEF) — a consulting agency hired by India’s Ministry of Shipping — before scaling down the free time allotted for railed imports to three days from the current seven days to stay on par with that for truck cargo.
At the meeting, JNPT officials also suggested stakeholders identify ICD locations where a three-day, free-time program can be rolled out in the first phase.
Further, reiterating the government’s stated position on supply chain efficiency and related cost reductions, port officials told stakeholder representatives that aveage dwell times for ICD cargo moved by train remain a major concern, exceeding 105 hours for exports and 90 hours for imports during the first quarter of last fiscal year.
A determining supply chain segment — dwell time
Dwell time is the time taken for exports inside terminal gates to be loaded onto a ship and imports onto a truck or train.
“The high [rail] dwell time has impacted both the average dwell time of JNPT and India’s ranking in [the] World Bank’s evaluation for trading across the border,” officials stated. “There are frequent complaints from importers who have suffered inventory wash-out.”
According to BRIEF, the clearance of ICD containers generally take twice as long as container freight station (CFS)-bound containers. Railway officials stated that each segment of the supply chain ecosystem — CFS, ICD, and direct port delivery (DPD) — presents unique challenges and hence, all of these need to be treated differently. They also said besides Railways and Container Corporation of India (Concor), private intermodal rail operators have an equally responsible role in this process.
A representative of the Container Shipping Lines’ Association (CSLA) highlighted the intricacies tied to mixed-train operations, under which rail operators are allowed to carry cargo from multiple terminals and discharge or load containers at one terminal, and said when inventory levels increase as a result of such complex operations, shippers and carriers end up paying extra demurrage charges.
Port officials also expressed concern that despite a surge in yard inventory levels — increasing to 9,000 TEU from an average of 3,000 TEU to 4,000 TEU earlier — train deployments remain unchanged at 12 per day.
JNPT’s chairman said terminals must ensure seamless operations and that they need to adhere to the defined timelines for cargo loading/unloading operations. Further, he drew stakeholder attention to a previous government suggestion that if rail operators are unable to improve their clearance speed, other logistics modes, especially trucking, should instead be used to avoid cargo backlogs.
He also emphasized the need for better coordination among all stakeholders and sought carriers’ comments regarding a suggested stakeholder plan to introduce a “penalty system” for those failing to meet the agreed guidelines.
“Trade is suffering, as accountability is not fixed in the whole process,” JNPT’s chairman said, addressing the meeting.
Authorities at JNPT, which handles the majority of India’s container freight, have been working hard to minimize the delays and their impact on the emerging market economy’s growing export-import trade.
Source: JOC.COM
Railways may invest Rs 44,000 crore on West Bengal-Andhra Pradesh freight corridor
Indian Railways plans to invest Rs 44,000 crore to build a 1,100-km greenfield freight corridor along the country’s east coast to connect Kharagpur in West Bengal with Vijaywada in Andhra Pradesh.
In June, Railway Minister Piyush Goyal had declared a target of doubling the national transporter’s revenue to Rs 4 lakh crore by 2025. One of the ways he hopes to achieve that is by enhancing freight capacity since it already accounts for 65 per cent of its total revenues.
In fact, the buzz is that the Indian Railways wants to increase its share of total freight movement from 33 per cent to 45 per cent. No wonder it is now looking beyond the 3,300-km long eastern and western freight corridors currently being constructed.
According to The Economic Times, the Indian Railways plans to invest Rs 44,000 crore to build a 1,100-km greenfield freight corridor along the country’s east coast to connect Kharagpur in West Bengal with Vijaywada in Andhra Pradesh. In other words, this proposed corridor – likely to be announced in the budget proposal for 2019-20 – will link up the mineral-rich areas of the country with industries in the south and is expected to carry about 200 million tonnes of freight per annum.
“There is very heavy traffic on this route. The work on the proposal is currently going on,” Anurag Sachan, managing director at Dedicated Freight Corridor Corporation (DFCC), told the daily, adding, “We will be proposing funding from multilateral agencies along with some equity from Indian Railways for the project.”
However, before the DFCC turns its attention to this corridor, it has to deliver the eastern and the western corridors, which have missed several deadlines. To remind you, the eastern one runs from Ludhiana, Punjab, to West Bengal’s Dankuni, totalling 1,856 km. Meanwhile, the western corridor links Dadri, near Delhi, to Jawahar Lal Nehru Port, Mumbai (1,504 km).
A source in the railway ministry had told PTI after a review meeting in May that the entire project, being constructed at the cost of a whopping Rs 81,000 crore, would be completed by March 31, 2020. Incidentally, this is India’s first mega railway project since Independence.
The report added that the first phase of both corridors – 432 km of the western corridor and 343 km of the eastern one – is likely to be operational by the end of the current fiscal itself.
The western corridor is being funded by Japan International Corporation Agency while the eastern corridor from is being partly funded by the World Bank.
When ready, these dedicated corridors would ease the burden of the existing railway network and strengthen the economic backbone of the country. Freight trains on these corridors will run at 100 kmph as against the current maximum speed of 75 kmph on Indian railway tracks. The average speed of freight trains will also increase from existing 26 kmph to 70 kmph. This will not only significantly reduce the travel time between Delhi and Mumbai and Delhi-Howrah, the country’s most congested rail routes, but also allow the Railways to run more trains.
And, of course, freight capacity will shoot up. The daily reports that once operational, these corridors will increase the national transporter freight carrying capacity to over 2,000 million tonnes, up around 66% from the existing 1,200 million tonnes.
“It will also lead to reduction in cost of freight transportation,” added Sachan. After all, as the Railways adds more capacity, its freight rates will come down and that, in turn, will increase volumes.
Source: BUSINESS TODAY