The government of the eastern Indian state of Odisha has imposed restrictions on the number of trucks plying to ports, which is expected to tighten iron ore export supplies, market sources said on Thursday, July 9.
According to a state government official, the maximum number of trucks that can ply to Paradip port has been fixed at 935 per day and those heading towards Gopalpur port at 332 per day, in order to check increasing congestion on highways and in port areas, and also to check the spread of Covid-19. This in effect is estimated to bring down truck traffic to ports by at least 60 percent per day.
Market sources said that the imposition of limits on trucks destined to ports would severely impact July shipments of iron ore sales already contracted.
The sources said that a lot of exportable volumes have been accumulated at iron ore pitheads in anticipation of lower production during the monsoon rainy season that is expected to gather momentum from the end of this month, and transportation, loading and shipment of these stocks will be delayed, while there are also risks of transporters missing the sailing dates of vessels at port.
While the exact impact of trucking restrictions is still not clear, at least two merchant miners in the state said that export shipments risked shrinking by at least 20-30 percent over the next two months of the rainy season if the restrictions are not lifted.