Jindal Steel and Power may offer 50% more cargo to Railways this year

Jindal Steel and Power Ltd (JSPL) expects s to increase its rail freight loading by 50 per cent this year – with plans to lug 30 million tonne (mt) in the ongoing fiscal year against 20 mt in FY2018.

With this, the company’s overall spend on the rail freight will be about ₹3,700 crore for hauling raw material to its plants and final products to customers. This will add ₹1,200 crore to the national transporter's freight earnings kitty this year, as JSPL had a rail freight bill of about ₹2,500 crore last year.

Kapil Rawat, Executive Director - Group Logistics, told BusinessLine that the company is widening its special wagon investment portfolio by investing in flat wagons — wider than what Railways has — in order to carry wider steel plates that can be used to make pipes, windmills, boilers and construction projects.

The company, which has two plants in Raigarh and Angul, moves raw material to these plants from ports located on the east coast like Paradip, Dhamra and Visakhapatnam.

Raw materials

While the company transports these raw materials – coking coal and limestone – from ports to its plants, another raw material – iron ore – is moved from nearby mines for steel plants.

JSPL's raw materials traverse a distance up to 500 km based on the port and plant.

It is 220 km for Paradip Port -Angul plant and about 500 km for the Visakhapatnam port-Raigarh plant. However, the company's finished products – steel – move longer distances of 1,000-1,200 km – from its plants in Angul, Odisha, and Raigarh, Chhattisgarh, to customers located in South, West and North.

This year, the company plans to move 30 million tonne (mt) cargo by rail and another 25 mt cargo by road, It would have liked to move more cargo via the rail mode — which is cheaper — had there been available capacity.

Wider wagons

JSPL is also widening its investments in special wagons — under the special freight train operator (SFTO) scheme of Indian Railways — which enables it to get discounts on freight rates by carrying cargo using those wagons.

JSPL, which acquired an SFTO licence to move long rail tracks to be laid in the ongoing Eastern dedicated rail freight corridor under construction, invested in three special trains to move these rail tracks.

In a similar move, it has invested in another type of special wagons to move the large steel plates it is manufacturing as they cannot fit in the present wagon stock of the Indian Railways, or the existing trucks, said Rawat. “These wider plates are used for making pipes, windmills, boilers, defence ships and other infrastructure in steel plants, power plants and various redevelopment projects of NBCC,” said Rawat.

These newly designed special wagons – called BRN wagons that are open, flat wagons – are wider than what the Railways has in their wagon pool.

The company already has the nod from the railway regulatory body – Railway Design and Standards Organisation. JSPL has now placed order for three rakes – sets of wagons – from Jindal Rail Infrastructure.

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