The Hindu Business Line : Lack of rly siding facility hits steel supply to Kerala

LACK of adequate siding facilities at the railway station at nearby Kalamassery and the consequent low allocation of steel by the Vizag Steel Plant (VSP) has deprived the State of adequate supply of good quality steel when it is in good demand.

Kerala has an estimated demand of 1.2 lakh tonne a year of steel plant manufactured good quality "re-bar" used in construction activities. As against this only around 80,000 tonne is supplied to the State at present.

The main reason attributed to the low allocation is lack of siding facilities at the Kalamassery railway station, which currently receives steel materials from VSP with a maximum placement of 15 wagons.

At present, only 23 to 24 wagons are being permitted to book to Kalamassery. But, even this necessitates two placements and therefore if 30 wagons were permitted, the same could also be completed in two placements, steel yard operators told Business Line.

They said that the peak demand period for steel in Kerala is from January to March and during these months the market could easily absorb over 10,000 tonne of re-bar.

But non-availability of wagons often forces the dealers to switch over to road transport.

VSP is the main manufacturer of high quality steel re-bars of 8mm to 16 mm used in building constructions here. According to industry sources the total demand for steel per month is around 22,000 tonne and as against this re-bar supply is only around 8,000 tonne while the balance are met by supplies from "re-rollers" in Tamil Nadu and Karnataka.

If the bottleneck of siding facility were removed around 2,500 tonne more of re-bar steel would come to Kochi every month. The railways would then be able to make an additional revenue of an estimated Rs 3.5 crore a year, they claimed. This would also increase the sales tax revenue of the State Government from the present Rs 10 crore a year from the Kalamassery yard to Rs 12.5 crore, they said.

According to the sources, if the railway authorities agreed to steel bookings in multiples of 15 wagons, the VSP would accordingly increase the allocation, as more sales to South India would be beneficial to the steel plant because of the freight advantage. The station already has the largest siding in the area, they said.

Railway sources said that part of the siding area was being used for placing ballasts, essential for railway development work.

The industry sources said that they would be seeking the intervention of the Chief Minister to resolve the issue by taking it up with the railways.

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