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Railways is still the preferred mode of transportation for commodities such as coal, raw material for steel plants, fertiliser and foodgrains.
This is despite the steep freight rate hikes effected earlier this year. But a drop in throughput of cement might be a cause for concern.
This is according to the freight loading and throughput data for March 2012, which is an early indication. Many of these commodities cannot shift to the competing mode of transport immediately, and some of the traders have also passed on the increase in freight charges to their customers.
Indian Railways, with effect from March 6, introduced freight rate hikes of 20-28 per cent for all commodities, barring iron ore, for exports and containers.
The growth in freight loading recorded by the Railways in March — at 5.64 per cent — was higher than the average 5.24 per cent for fiscal 2012.
This trend was also reflected in the net tonne kilometre (NTKM) figure — a productivity parameter that measures both loading and distance. The growth in NTKM in March 2012 was 6.36 per cent, against an annual growth rate of 5.57 per cent.
Supported by the rate hike, the Railways earned 17 per cent more by moving one tonne of goods over one kilometre in March.
The corresponding number for fiscal 2012 was much lower at 4.85 per cent.
The commodities that registered growth in freight loading in March were coal (10 per cent), raw material for steel plants (31 per cent), pig iron and finished steel from steel plants (9 per cent), fertiliser (46 per cent), foodgrains (2.84 per cent) and container movement (11 per cent).
CEMENT
Meanwhile, the muted growth in cement movement may be a cause for concern for the Railways. Cement loading registered 0.19 per cent growth in the month.
Moreover, the cement throughput declined 1.61 per cent, indicating that cement manufacturers used the Railways for shorter distances this March.
Cement accounts for almost 10 per cent of the Railways' freight revenues.
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