Considering Kochi's close proximity to the international shipping routes, the Kochi port has drawn up an ambitious plan to scale up its international bunkering prospects, in order to overtake the neighbouring Colombo port in volumes in the near future.

Infrastructure

The plan, however, involves improving infrastructure for bunkering considerably in view of the fact that the factors that influence bunker trade included the ability of the suppliers to provide bunkers at internationally competitive prices, sound bunkering facilities at load/discharge ports, simultaneous bunkering with cargo operations, avoidance of diversions for bunkering and lower port tariffs for bunkering calls.

Fuel tax cut

In this respect, the Kerala Government's recent reduction in sales tax to 0.5 per cent on fuel and lubricants to foreign going vessels has already made the bonded furnace oil prices competitive with respect to the neighbouring bunkering ports.

As a result, vessels which are plying in the international trade routes are showing keen interest in picking up bunkers in Kochi, highly placed sources in the port said.

In view of the potential, some of the leading bunker players are also actively considering setting up operations in Kochi in the near future, the sources added.

Besides the recent commissioning of the ICTT at Vallarapadam, the prospects of Kochi's potential for bunkering is bound to go up as Kochi has plans to develop two port-based SEZs at Vallarpadam and Puthuvypeen in addition to the Petronet LNG Terminal, the cruise terminal and the ship repair complex already in the pipe line.

Annual volume

The annual volume of bunkering at Kochi has been to the tune of around 40,000 tonnes, out of which major contribution comes from duty paid bunkers supplied to Navy, Coast Guard and the Lakshadweep shipping lines. The international bunkering sales at the Kochi port last year were only around 10,000 tonnes.

According to sources, the world bunker market is estimated to be around 150 mmtpa of which Singapore continues to be the largest market with volume close to 40 mmtpa followed by the other major international bunkering ports such as Fujairah, Rotterdam, Houston, Shanghai and Colombo in their order of business.

With the Indian shipping industry registering an all-time high growth rate, the domestic oil marketing companies are increasingly looking at bunkering business as a potential avenue to increase their fuel sales volume. Ironically, India continues to be a major supplier of bunker cargoes to neighbouring bunker hubs such as Singapore, Colombo and Fujiarha.

Going by the development in bunker trade in Indian ports, there are clear signs that the country's bunker sector is set for a period of significant growth, the sources added.

Indian Oil Corporation Ltd is the dominant supplier of bunker fuel in majority of Indian Ports catering to the Indian Navy, shipping and dredging companies. The numerous port projects all along Indian coast have thrown open huge opportunities for bunkering of fuels and lubricants.

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