Logistics Activity Muted In Jan, Freight Rates Improve

After a strong pick-up in Dec' 21, logistics activity was muted in Jan'22, Motilal Oswal has said in a report.

"The e-way bill generations were down 4% MoM in Jan'22 and came in at 69m (+9% YoY) after a near all-time high bill generation of 72m in Dec'21.

Freight rates improved marginally by 2-3% during the month even as fuel prices were unchanged. Demand environment remained strong with higher dispatches at major production centers, robust EXIM trade and increased food supplies at APMCs. Capacity utilization for trucks is strong at present at 80-85% levels," the report said.

Volumes handled at major ports registered a marginal decline of 3% YoY to reach 63mmt, flat MoM. Jan'22 saw YoY growth in Container traffic and other cargo that was offset by the decline in the Iron ore, Coal and Fertilizer segments. Growth was negatively impacted by the container shortage and elevated sea freight rates.

According to the Motilal Oswal report, after exhibiting flat growth in Nov and Dec'21, traffic handled at major ports declined 3% YoY in Jan'22.

"Container segment grew 7% YoY and other cargo rose 26% in Jan'22. This was more than offset by a sharp decline in Iron Ore / Coal/ Fertilizer segments by -32% /-19% /-14% YoY, respectively. Among the major ports, Ennore reported a jump of 34% YoY, New Mangalore (+19%), J.N.P.T (+7%) and Deendayal (+6%). On the other hand, Mormugao, Kolkata, V.O. Chidambaranar and Paradip reported decline of 44%, 19%, 15% and 10% YoY, respectively. Container cargo (TEU basis) grew 6% YoY in Jan'22," the report noted.