The commissioning of the International Container Transshipment Terminal (ICTT) would help the Cochin Port regain a chunk of the bulk cargo business it had lost to competing ports like Tuticorin and Mangalore. With Kochi Refineries constructing a single point mooring for the handling of crude in 2007, Cochin Port lost a sizable chunk of its revenue and it was finding it difficult to compete for cargo, given the high cost and slow turnaround at its berths.
The Cochin Port Trust (CPT) strategically decided to derisk its business by developing a container transshipment terminal capable of handling mother vessels and promoting other industries in the land held by the authority. The total investment in ICTT Vallarpadam, which is on course for commissioning in August 2010, is pegged at $500 million. The DP World-promoted terminal at Kochi will be able to handle the 13,000-container capacity ships commonly used on the Asia-to-Europe routes. A substantial portion of the Indian container volume is currently transshipped at the neighboring ports of Colombo, Singapore, Salalah and Dubai. Taking the containers in small ships to these mother ports has adverse time and cost implications for Indian traders, CPT sources said.
?ICTT will help CPT to double or multiply its revenue as the number of vessels handled will be more. The terminal can handle one million TEUs annually from the current capacity of 3 lakh TEUs,? CS Kartha, CPT trustee and former president of Cochin Steamers Agents Association, said. ?Currently, CPT handling charges are higher compared to other transshipment ports. We have decided to reduce vessel related charges to make Cochin a major transshipment hub in the global arena of shipping,? a CPT source said.
Indian shippers use the Sri Lankan port because of lower costs, deepwater facilities and relaxed regulations. Sources say that more than 50% of India?s transshipment trade is handled by the Colombo port.
Similarly, the terminal handing charges at the ICTT will be kept in parity with handling charges at the competing ports, sources said. Container traffic at Indian ports is growing rapidly, increasing at the rate of about 13% per annum over the past ten years. The terminal, enjoying strategic proximity to international sea routes and having excellent hinterland connectivity, could help boost trade in the subcontinent.
?But the most important milestone in the history of CPT would be the commissioning of the LNG terminal. CPT revenues will multiply at least ten times as the wharfing and royalty from the proposed plant is advantageous to the port,? Kartha said.
CPT has a concession agreement with Petronet LNG Limited (PLL) for setting up a LNG terminal and a regasification plant. The Rs 4,000-crore project will come up in the SEZ promoted by the CPT at Puthuvype island near Cochin. The new facility will have a nominal capacity of 2.5 mmtpa, expandable to 5 mmtpa later.
CPT has granted 33.40 hectares at Puthuvypeen SEZ to Petronet LNG on lease for 30 years for setting up the LNG regassification project. ?Petronet LNG has also agreed to bear 50% of the annual dredging expense. This would help cut down expenditure and also help in bringing bigger vessels to the port,? Kartha added.
During the financial year 2009-10, increased shipments of petroleum products, cement, iron scrap, container and timber logs have helped CPT to achieve an all-time high cargo throughput of 17.43 million tonnes. Though the port?s traditional cargo like coal, fertilisers and industrial salt have recorded a fall of about 10%, the deficit was more than compensated by higher volumes in liquid bulk as also general cargo. There is an increase of about 11% in the container traffic. A total of 2,89,817 TEU containers were handled during the year, as against 2,60,784 TEUs handled during 2008-09.
The vessel traffic registered an increase of 18% in 2009-10 while the average turnaround time of ships showed an improvement of 3%. The average ship berth day output also registered an improvement of 2%. The increase in cargo throughput has brought in additional revenues of about Rs 6 crore to the port in terms of wharfage alone. Additional revenue through storage charges and vessel-related charges through increased vessel traffic has also accrued to the port on account of the higher throughput, sources said.
The port also hosted during the last fiscal 44 cruise ships on international calls and seven high-seas overnight voyages. During 2009-10, for the first time, Cochin played homeport to the cruise vessel MV Aquamarine of Louis Cruises, a Cyprus-based cruiseline. A total of 12,283 Indian tourists cruised within a short period of December 2009-January 2010.