Apr 12, 2017: Essar Shipping Limited (ESL) has reported strong operational performance in FY 2017 with a 22 percent growth in cargo. At the same time, the company’s 14 vessel fleet grew its capacity utilisation to 94 percent from 80 percent last year. The Baltic Dry Index has also gone up by four times during FY16-17 from an all-time low of 290 in February 2016 to a high of 1,300 in March 2017.
In FY17, ESL carried dry bulk cargo of almost 11.5 million tonnes, as against 9.4 million tonnes in the previous financial year. More than 80 percent of its fleet carries dry bulk cargo, which includes products like iron ore, coal, bauxite and limestone.
ESL’s two VLCCs MT Smiti and MT Ashna are primarily depolyed to carry crude oil. Owing to the price volatility in oil prices these carriers were used on spot contracts in the last year.
A highlight of the FY17 fiscal was the doubling in coastal cargo movement triggered by the increased capacity utilisation at Essar Steel, which is among ESL’s key customers. The company also benefitted from a considerable growth in backhaul cargo both on the east and west coasts of India because of the all-round growth in Essar Steel.
Ranjit Singh, executive director and CEO, said, “Our strategy to have an ideal mix of captive and market cargo has ensured better utilisation of vessels in FY17. The stronger Baltic Dry Index, coupled with increased activity and capacity utilisation at Essar Steel, has also made a positive impact on our top lines. I am happy that we have been able to demonstrate our commitment to promoting the government’s initiative by growing our coastal cargo movement significantly. Almost half of our fleet is currently engaged in the coastal movement.”