Port volumes up 4% MoM, e-way bills up 16%, railway up 16% in Sept

November 3, 2020: India Ratings and Research (Ind-Ra) has published the September edition of its credit news digest on India’s logistics sector highlighting the key volume and realisation trends across three logistics sub-sectors – sea logistics (global and domestic), surface logistics (rail and road) and air logistics (passenger and freight).

In September 2020, India’s ports volumes continued the recovery momentum with a month-on-month (MoM) increase of 4 percent in volumes, thereby arresting the decline to 2 percent year on year (YoY; August 2020: down 10 percent; July 2020: down 13 percent YoY), though it remained down 14 percent during April-September 2020.

In September 2020, E-way bill collections rose 16 percent MoM (up 10 percent YoY); Railway volumes too picked up at 16 percent YoY (August 2020: up 4 percent YoY) though they were down 9 percent during April-September 2020. With airline carriers re-starting operations from June 2020, air transport operated at a passenger load factor of 58 -73 percent during September 2020, though substantial fleet still remains grounded and passenger numbers remain substantially lower than the normal levels.

Ports
The recovery in September was led by a rise in iron ore and container volumes while other commodity volumes remained sluggish. Container volumes which had been declining YoY though reducing MoM, till August 2020 (down 10 percent YoY; July 2020: down 16 percent YoY), grew 25 percent YoY in September 2020. Container freight rates substantially increased by about 50 percent during March-September 2020 due to the shortage of containers amid a demand and supply imbalance. Dwell time for import containers at JNPT Port witnessed a monthly improvement to 21 hours in September 2020 (August 2020: 26 hours) with the gradual opening up of the economy. The port dwell time for export containers increased marginally to 78 hours in September 2020 (August 2020: 75 hours).

Road transport
Road transportation has witnessed traction with improvement in economic activities. E-way bill collection at 57 million in September 2020 (August 2020: 49 million) has returned to normalcy. It grew 16 percent MoM and 10 percent YoY. It stood at a similar level to that seen in February 2020. Diesel consumption too increased by 17 percent MoM in September 2020 (compared to 1 percent MoM fall in September 2019) with the gradual pick-up in the business activities post lockdown. However, the consumption remained lower by 6 percent YoY in September 2020 (August 2020: down 21 percent YoY). While average freight rates have marginally increased, the impact of higher diesel prices is likely to weigh on the profitability of players. Diesel prices however declined by about 4 percent MoM to about ₹71/litre in September 2020. The market share of the road stood at 80 percent during September 2020.

Air transport
Since re-opening in June 2020, both domestic and international air traffic continued to improve in August 2020. Domestic passenger traffic rose 38 percent, MoM, in August 2020, though was down 76 percent YoY. International passenger traffic rose 7 percent, MoM, in August 2020, but was down 90 percent YoY. Passenger load factors for domestic flights ranged from 59 -76 percent during August 2020. Freight traffic continued to improve in August. Domestic and international freight traffic was up 10 percent and 4 percent MoM, respectively, in August 2020.