Deceleration in cargo decline at major ports in Q2

According to a recently released report by credit agency ICRA, “the Indian Port sector is witnessing deceleration in cargo decline in Q2 FY2021, with cargo at Indian ports witnessing Y-o-Y decline of ~9% each in July and August, after severe contraction of ~22% in Q1 FY2021 due to the impact of Covid-19 pandemic. The recovery has been relatively better at non major ports.”

Sai Krishna, Assistant Vice President and Associate-Head, Corporate Ratings, ICRA added: “The deceleration in cargo contraction is a favorable trend, but recovery in certain segments like POL, which was expected to be faster with easing of lockdown, has not materialized in line with expectation due to continued subdued demand. Further, the recovery in segments like coking coal and containers may be prolonged compared to other segments. Also, the recovery trend in certain segments like thermal coal has been volatile at non-major ports. Hence, the sustainability of recovery trend remains a concern at present and the sector is not out of the woods. ICRA reiterates its expectation that while general cargo throughput may witness ~6-8% contraction for full year 2020-21, the container segment may witness a decline of 12-15% during the same period.”

(Representational image used)

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