The Hindu Business Line : Cochin Port moving into favourable wind

For more than 10 years, Cochin port's traffic stagnated at 13/14 million tonnes (mt). Only in 2006-07 that it achieved a little more than 10 per cent growth. "A traffic volume of 15.31 mt in 2006-07 is not something to crow about," Mr N. Ramachandran, Chairman of Cochin Port Trust, told Business Line in Kolkata recently. "But, then, we faced so many challenges."

First, the cargo mix. Nearly two-thirds of the port's traffic comprises crude and petroleum products and that too on account of only one customer, Bharat Petroleum Corporation's Kochi Refinery. While depending so much on a single customer may not be a sound business proposition, the port authorities hardly have any choice. "We do not handle any dry bulk traffic such as coal or iron ore because the hinterland is not cut out for that kind of traffic," the Chairman said. "After all, Kerala is not a highly industrialised State."

The major items the port handled therefore included marine products, coffee, tea, cashew nut, coir and rubber products, garments — all low volume, high value cargoes.

High-Cost Operations

Second, the port suffered from high cost operation caused by, among other things, restrictive practices by various outside agencies. For every truck that entered the port with export cargo or left the port with an import shipment, "fees" were collected by a cartel posing as the labour welfare body.

In reality, there was hardly any labour welfare in it; merely an extortion racket run by a handful. There were similar rackets in the deployment of contract labour in various kinds of jobs for handling cargoes.

Finally, the level of mechanisation and modernisation of operation, which left much to be desired. "Ours is an old port with ageing infrastructure and ancient handling equipment requiring urgent replacement," Mr Ramachandran said. He does not foresee any dranatic change in the cargo mix happening in the near future, nor any big jump in traffic before 2009, by which time the Vallarpadam terminal would have come up. A host of other facilities, such as the LNG, LPG and bunkering terminals, two port-based Special Economic Zones, and a Free Trade Warehousing Zone are at various stages of implementation or approval. All these will add to the port's capacity from 2009 onwards.

The single buoy mooring (SBM), now under construction, will be ready for operation in the next few months and with this, the port's capacity to handle crude oil traffic will rise substantially. However, until 2009 no big increase in crude oil throughput is expected because the KRL's capacity expansion programme is unlikely to be completed before that. Which means, even with the SBM becoming operational shortly, the port has to contend with the existing volume of crude oil traffic. What happens to the present oil jetty once the SBM is commissioned? "Perhaps we've to find out ways and means as to how to put it to proper use," came the reply. "We are discussing the matter with various other possible users and we intend to invite Expressions of Interest (EoI) very soon".

New Cargo

Another interesting area has been the gradual emergence of a new type of cargo — processed food. "Malayalees are fond of their food and the various items being churned out by the food-processing units in the State have thrown up huge overseas demand so much so that the Malabar Parantha, a typical Malayalee food item, is now available in various parts of the world," Mr Ramachandran said.

"Banana is another item whose exports are rising. The ports in many western countries have banana terminals only for handling banana imported from the Caribbeans and Latin America and perhaps we may also explore a similar kind of facility, because our port handles agriculture and horticulture products as major items of traffic The port-based Special Economic Zone coming up at Vallarpadam will have specific units including cold storage facilities for handling processed foods and horticultural produce."

A significant achievement has been the elimination of extortions. "With help from the Kerala government, the port has succeeded in curbing those malpractices," said Mr Ramachandran.

"More important, the message has reached across that the port is now free from such unhealthy practices with the result the importers and exporters who shied away from the port are now keen to return.

"Under the National Maritime Development Programme, we have lined up several ambitious projects which, when completed, will transform Cochin into a world-class port. The Willingdon Island itself is going to be re-developed for more efficient space utilisation and better utilisation of the deep-water front.

We have been receiving great support from the Ministry of Shipping in this regard," he said

Vallarpadam Terminal

Much hope is pinned on Vallarpadam transhipment container terminal which will be ready for operation by 2009. The licence agreement stipulates that the rail/road connectivities are to be commissioned simultaneously, along with the commissioning of the terminal, and Mr Ramachandran hopes to meet the deadline.

"The terminal will be located 11 nautical miles from the international sea trade lane to West Asia and 74 nautical miles from the international sea lane to Europe/US whereas Chennai is more than 600 nautical miles away from the international sea trade lane," he said, adding, "but then the Vallarpadam terminal should target not only transhipment traffic but also hinterland traffic."

How can Cochin attract hinterland traffic, after all several ports in the South compete with one another to attract traffic from the same hinterland?.

"With modern and efficient facilities and the right draught, the Cochin port is sure to attract cargo from other States as the trade will save substantial amount of time and money by avoiding multiple handling. Frankly, we are in for exciting times."