Oversized coal impacts freight costs, wagon turnaround time: Draft National Coal Logistics Plan

The draft national coal logistics plan has pointed out that oversized coal is leading to higher wagon turnaround, a scenario which analysts say is not just adding to freight costs but also exacerbating the coal supply crisis. “Oversized coal increases wagon turnaround, resulting in higher freight costs via demurrage. So, coal sizing is crucial and must be done properly,” the draft plan recommended.

The plan has been prepared by SBI Caps and Primus Partners, and the Coal Ministry has asked all stakeholders to share their views on the same by July-end. “One factor contributing to the increased turnaround time is oversized coal that does not pass-through bottom discharge underground dumps; additionally, on tipplers, such oversized lumps constitute a significant challenge when handling coal at power plants,” the plan pointed out.

Consumes time, money

The draft plan pointed out that the process of manually unloading one rake (58-60 wagons) takes about five hours. A rake typically has around 58 wagons and carries about 3,800-3,900 tonnes of freight. “To make matters more complex, the wagons must be re-joined into a rake and freed from the wagon tippling area in a limited time scale with zero damage to them after being emptied one at a time. Furthermore, keeping the wagons longer than the time limit or causing damage due to inefficient operations results in a significant financial penalty for the corporation in the form of railway demurrages,” the draft logistics plan added.

These suggestions assume importance as India experienced an unusually hot summer season and electricity demand creating new records, with the Power Ministry struggling to secure adequate coal supplies for the plants. “Had the Power Ministry not ordered imports, power plants would have been left with coal stocks for just four days, a scenario that created havoc in October 2021. With monsoons upon us, the situation has become serious and there is a possibility of stretched supply lines due to rains,” a top government official said. The draft plan aptly suggests dealing with boulders. Many power plants and coal consumers have complained about boulders being loaded into wagons, which leads to more time to offload them. Railways too had pointed out this anomaly, the official added.

BusinessLine spoke with several industry associations, both Power and non-Power, who also pointed out the issue of boulders in supply.  Industry sources explained that the 250 mm coal comes with lots of boulders. Generally, the 100 mm coal is prioritised to the Power Sector, and the 250 mm coal is sent to non-Power Sector (NPS). Currently, due to shortages, Power is also getting the 250 mm coal hence there are concerns. NPS has been getting this at least for a year. 

Railways’ suggestion

Indian Railways suggested the Coal Ministry to focus on efficiencies by reducing the loading time at colliery sidings and to avoid loading over-sized boulders on rakes.

For instance, around 56 rakes daily are detained for more than five hours for loading. Besides, about 136 rakes per day are detained for more than three hours. “Cutting down this time to three hours will free an additional 3-4 rakes per day. Also if the PSU miners avoid loading boulders and over-sized coal on rakes, it will improve WTR (Wagon Turn Around) and help adding another 10-15 rakes per day. The ministry should also focus on the health of tipplers and hoppers as well as preventive maintenance to improve unloading of rakes,” said one of the sources.

Railways has already improved the WTR by 16 per cent during September 2021 to February 2022 and more efforts are underway to further improve the situation. For better WTR, the draft plan suggested, “Automating loading and unloading process detention of trains can be reduced by adopting loading through overhead silos and by utilising Retractable Ohe, which eliminates the use of diesel locos on the electrified territory. An automatic truck loading and unloading system refers to the automatic insertion and removal of minerals into/from a truck with minimal operator intervention. Such technologies can help in wagon turnaround time.”

COMMENT NOW