Iron ore, sponge iron makers say rail rakes still short in supply

Representative image

The number of railway rakes needed to move India’s high production of coal and iron ore is falling below demand and has failed to keep pace with the rise in output, according to iron ore and sponge iron producers.

A railway rake is a trainset that in this instance refers to a dedicated freight train.

“We need 21 rakes a day, we are provided only about 15-16 a day,” said DK Mohanty, director, production, at NMDC Ltd, India’s largest producer of iron ore and which was earlier known as National Mineral Development Corporation. The official said NMDC’s iron ore inventory held at mines is at 10 million tonnes, the higher ever. Mohanty was speaking on the sidelines of the India Steel 2023 conference in Mumbai on April 19.

Sponge iron producers shared similar complaints of a rake shortage to move coal. “We won a coal linkage under the e-auction route from Western Coalfields three to four years back. We are yet to receive that supply. I believe it is due to a rail rake shortage,” said an executive from a Mumbai-based sponge iron company. The executive added, “In the absence of the particular grade of coal, we are forced to keep our production curtailed on and off.” Coal is an important input in making sponge iron.

A senior official from Coal India, India’s largest coal miner, in March had replied to Moneycontrol that the company is in constant touch with Indian Railways for increased rake availability to meet higher demand.

Also read Coal India prepares for the great Indian summer

To be sure, Indian Railways’ freight movement of 728 million tonnes of coal in FY23, according to data from India’s Press Information Bureau, is an impressive growth of 11.4 percent year-on-year. Of this, 569 million tonnes was moved to the power sector, 17 percent higher than last year. Data available with the coal ministry also shows that rake movement for supply to the power sector rose in March but fell overall when taking all sector into account. According to data from the ministry, the average movement of rakes for March this year was 294 a day, a dip of 0.27 percent from a year ago. Rake movement for supply to the power sector as a standalone figure rose by 0.82 percent over the same period.