AP ports see decline in capacity utilisation due to sluggish market

Visakhapatnam: The minor ports in Andhra Pradesh have seen nearly 51 per cent surge in capacity addition during the last three years, whereas the sole major port of Visakhapatnam has witnessed an increase of 30 per cent in capacity addition.

However, the

capacity utilisation

at the minor ports and major port has witnessed a decline during the same period on account of sluggish market conditions as well decline in imports of major commodities such as coal, industry sources said.

While the overall capacity of minor ports in AP was around 121.30 million tonne per annum during 2014-15, it has increased to 184.24 million tonnes in 2016-17. However, the capacity utilisation, which was 68.77 per cent in 2014-15, has declined to around 41.35 per cent during 2016-17.

AP has five minor ports including the Kakinada Anchorage Port, Kakinada Sea Ports Limited, Rawa Port, Krishnapatnam Port and Gangavaram Port.

Incidentally, even the sole major port of Visakhapatnam had witnessed a decline in capacity utilisation during the same period. While Visakhapatnam Port had a capacity of 96.76 million tonne per annum in 2014-15, it increased to 126.75 million tonnes per annum in 2016-17. However, the capacity utilisation dropped from 59.94 per cent in 2014-15 to around 43.81per cent in 2016-17.

AP Chamber of Commerce and Industry Federation president elect G Sambasiva Rao said, “The international scenario is not good and on the domestic front the domestic coal consumption has increased. So, the number of customers importing coal has come down. Also, there a limited amount of cargoes available due to which ports have witnessed a decline in capacity utilisation.”

Mentioning that the general economic scenario was poor, Vizagapatam Chamber of Commerce and Industry (VCCI) president AV Monish Row said, “We are a net importing country, but we are also an exporting country. Overall as a country, we were not doing well during the last couple of years, but we are expecting to see better results in the next two to three quarters. There is a pickup in global trade and the freight rates have also seen an increase in the last two to three months, which means there is better demand. We expect better utilisation at ports in the next two to three quarters.”

“There has been no significant addition in terms of industries in the state over the last three years. Many of the projects are in the construction phase, so the overall increase in capacity utilisation can be expected once major industries start moving into the production phase,” observed an shipping industry source.