Starting from Tuesday, some companies will have to pay a higher sum to Railways for transporting iron ore. The entity has raised freight rate of the commodity, based on its use, by Rs 300 per tonne. This is the second hike in the iron ore freight rate by Railways in two months.
The freight rate is hiked on iron ore ??for other than domestic use for manufacture of iron, steel and cement??, Railways stated in a circular issued on May 28. At the end of April also, the national transporter raised the freight on iron ore by Rs 100 per tonne.
The two hikes will add a substantial amount to Railways? freight earnings, considering the percentage of revenue that comes from transporting the commodity. Last fiscal, Railways earned 14.5% of freight earnings from transport of iron ore for exports, steel plants and other domestic use.