The Sri Lankan crisis could be a boon for the Cochin port in attracting transhipment cargo from Colombo port. And, the Cochin Port Authority (CPA) has already set the ball rolling to divert cargo from Colombo.
Having secured the fourth position in container traffic for the second consecutive year, the CPA has reviewed its strategy in granting rebates to attract liners and ad-hoc calls to increase throughput — both origin-destination and transhipment. This is also timely to possibly divert cargo from Colombo.
The market conditions in 2020-21 has necessitated a review of the current rebate scheme to adapt to the current scenario and to mitigate risks arising due to the crisis in maritime trade and also to en-cash the opportunities to attract additional calls, says CPA’s chairperson M Beena.
New scheme
The new scheme will link a minimum guarantee throughput for each vessel call, limiting the concession to the volume of business transacted to minimise blank sailing possibilities. It would offer a competitive and stable tariff regime conducive to promote trade; to attract ‘ad-hoc’ calls, in view of the turbulent scenario worldwide in container shipping trade. There are opportunities for getting business or revenue from ‘ad-hoc’ calls of different shipping lines or consortium members.
The new scheme will also promote a feeder eco-system to complement the mainline calls — which is an essential requirement for a successful transshipment hub — and bring additional volume to the port, she said.
It is expected at the Cochin port this fiscal fiscal year, there will be an increase of 10 per cent in transshipment traffic over that of 2021-22, said a port official.
The proposed scheme is expected to bring more vessels to Cochin to benefit the trade, and patronise the International Container Transhipment Terminal (ICTT) through frequent connections and avoiding congested transhipment ports like Colombo. All these are expected to provide additional business and revenue for ICTT, she added.
Prakash Iyer, Chairman of Cochin Port Users Forum said that Colombo is facing several issues due to the fund crisis, forcing shipping lines to skip calls. Cochin Port would have an advantageous view of its close proximity to international shipping routes.
Praveen Joseph, CEO, DP World Cochin pointed out transhipment volumes in ICTT have increased by 131 per cent in 2021 compared to the same period in 2020. Over 25 mainline service calls were made for transhipment to ICTT in 2021 from major carriers, including MSC, Maersk and CMA, as an alternative to Colombo.
DP World Cochin has evolved as a major hub for coastal transhipment volumes increasing by 48 per cent in the 12 months of FY 21-22 compared to FY 20-21.