The cement industry in Gujarat is trying to come to terms with the increase in freight charges following the Supreme Court ban on overloading as the prices in cement are ready to take a further leap. The cement charges have shot up by Rs 5-10 per bag containing 50 kgs after the ban. Although most of the cement companies are opting for rail transport, they still heavily bank on trucks due to increasing demand of cement.
According to a senior executive of Gujarat Ambuja Cement Ltd, "We produce nearly 4000t of cement daily of which we transport approximately 1200-1500t. We are left in a lurch owing to shortage of trucks as our factory stands isolated in Kodinar. Also, there is also no rail facility here."
The prices of Ambuja cement have been hiked by Rs 5 in the past one month and it is further likely to rise by another Rs 10, the official maintained while adding that the dispatches have grown by seven per cent to almost 1.2Mt since past one month.
Earlier companies used to carry double the capacity of cement hence the transportation cost has nearly doubled for them now, sources further revealed. A top official of Sanghi Cement admitted that the price of cement has gone up by Rs10 per bag due to imposition of ban on overloading of trucks said the freight cost has gone high by almost 45 per cent. "We are moving cement by rail and sea in Gujarat to mitigate the problem of shortage of trucks," he maintained.
The 10 Wheeler Double XL truck can carry 17 tonnes of cement and the companies used to overload it to 30t whereas for 6 wheeler single XL the loading capacity was 9t which used to be overloaded to 15-18t before the SC ruling.
Kamal Modi of CTA Logistics, the largest multi model transporter of western region said, "Earlier cement was never transported by train. It was exported to states like Punjab, Hariyana, Delhi and UP in trucks that were heavily overloaded.” The freight charges from Kodinar to Ahmedabad was about Rs 450 which has today increased to Rs 630. The freight rates have gone up by nearly 35 per cent, he added.
"This move by the Supreme Court is a welcome respite for truck owners," he said. and added that the demand for trucks has doubled.