Monday, November 11, 2013

Krishnapatnam Port: The emerging edible oil hub on East Coast


Krishnapatnam Port is slowly but steadily emerging as a hub for edible oil refineries on the East Coast of India. It has become more evident from the fact that there are over seven firms setting up their refineries near the port and a few more are expected to finalise their plans soon.
According to a senior port official, Krishnapatnam has attained the status of preferred port among the edible oil producers in the country due to the dedicated and quality infrastructure.
The port has laid a direct pipeline without any branches with complete isolation system to the plants directly, to unload edible oils from the ships to the storage tanks in the plants. The port has provided a dedicated berth for edible oil vessels.
The port has a 16” dia pipeline for discharge of edible oils which gives a very good discharge rate compared to any other port in the country.
As a result, demurrage at Krishnapatnam Port is minimal. This feature has also helped the port to successfully complete one million ton discharge of edible oils through single pipe line in FY 2012-13.
According to the latest data released by the Solvent Extractors’ Association of India, country’s premier association for vegetable oil industry and trade, for the period from November 2012 to September 2013 (11 months), Krishnapatnam Port handled 1,006, 495 million tons (MT) against 701, 820 MT for same period last year.
While Chennai Port had handled 971, 148 MT in the same 11-month period, Krishnapatnam’s nearest port Kakinada had handled 729, 232 MT in the period.

It may be noted here that Kolkata Port (Haldia Complex) remained on top for the same period among East Coast ports in handling edible oil imports while Kandla Port in Gujarat placed firmly on top among the West Coast ports.
“We commenced the pipeline operations in October 2010 and till date there has been zero complaints,” claimed the senior official.
Besides, the port offers proximity to three major domestic markets – Andhra Pradesh, Tamil Nadu and Karnataka. It also has huge tracts of land that have been attracting industrialists to set up their units in the region.
In its effort to serve customers in an efficient manner, the port offers assistance to edible oil industries to set up their units in the region. As a result, both traders and consumers have benefited by setting up their plants near the port. The port is also offering its rail connectivity to cater to distant markets.
With production units in the close proximity, there is no need for producers to maintain storage points inside the port unlike in the past when they were procuring edible oils from other ports. It helps the firms to save unnecessary costs because of double handling and pass on the price benefits to the end users.
Edible oil business has a great potential in India looking with the growth in consumption at 5 per cent per annum. This growth potential will continue for at least another 10 years due to increase in population and per capita consumption.
The edible oil industry in Nellore has been growing consistently in the past four years due to Krishnapatnam Port.
Almost 100 per cent of the raw materials required for refined edible oil are imported through the port. While crude palm oil is imported from Indonesia and Malaysia, crude sunflower oil comes from Ukraine and crude soya bean oil from South America.
“It is the quality service and the efficient infrastructure at the port that have worked wonders for the edible oil units. The port will soon build a second pipeline quickly in view of increasing volumes of edible oils,” added the senior port official.

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