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India’s freight availability, rates uptick in September as festive season kicks in

The pan-India freight index by CRISIL showed an uptick in the freight rates due to a rise in the fast-moving consumer goods and durables (FMCD/FMCG). The freight availability also inched up on the back of Agri-products, parcel/loose goods, and cement, the CRISIL index highlighted.

India’s freight availability, rates uptick in September as festive season kicks in
Among various commodities, the freight rates for FMCG/FMCD witnessed a sharper increase when compared to others, the CRISIL report noted. (Photo Credits: PTI)

India’ freight activity inched up in September after maintaining a stable course in the second quarter of the current fiscal year. With the onset of the festive season, the freight rates as well as the freight availability showed a marginal increase, according to CRISFrex. The pan-India freight index by CRISIL showed an uptick in the freight rates due to a rise in the fast-moving consumer goods and durables (FMCD/FMCG). The freight availability also inched up on the back of Agri-products, parcel/loose goods, and cement, the CRISIL index highlighted. However, the scenario for commodities such as textiles, petroleum, mining products, auto carriers, market load did not show any on-month improvement and was flat.

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Among various commodities, the freight rates for FMCG/FMCD witnessed a sharper increase when compared to others, the CRISIL report noted. A slight increase in freight rates was witnessed for parcel/goods, petroleum tankers, textiles, and Agri-products. According to the CRISIL freight index, steel was the only commodity that saw a dip month-on-month in freight rates. The improvement in the CRISFrex index also improved the free cash flows (FCFs) of transporters in September. The industry’s free cash flows (FCFs) maintained the three-month course and stayed at 20 per cent. The CRISIL index also highlighted how the freight rates have been strictly aligned with the fuel rates over the past few months. The utilisation levels also remained healthy, with commodities like Agri-products and parcel/loose goods witnessing a marginal improvement. The average number of trips per truck also improved slightly from the August levels.

The pan-India index by CRISIL is constructed by factoring in the views and data of 100-150 transporters to get insights into the freight dynamics and operational aspects such as key cost heads, trips, and commodities being carried. The operating cost includes things like driver, toll, maintenance, fuel, among other things. The index is built on the back of 159 route-commodity combinations spanned across 32 routes and 11 commodity types. The indicators mentioned in the index highlight the momentum of the economic activity in the country and the overall trucking scenario in India.

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First published on: 09-10-2022 at 09:45 IST