CIL, Railways to negotiate soon on rake allotment

To secure coal offtake and streamline coal movement especially during the last quarter of the fiscal when the coal production reaches its peak, Coal India Limited (CIL ) has decided to take up the issue of allotment of rakes in a review meeting with the Indian Railways.

“We would take up the issue of allotment of rakes in a meeting with the Indian Railways which is expected to be held by the middle of July this year”, Partha S Bhattacharyya, chairman, CIL told Business Standard.

CIL had asked all its eight subsidiaries to come out with their respective month-wise rake requirement list and this exercise is expected to be completed soon.

The objective of the meeting with the Railways would be to secure rake supplies for the subsidiaries of CIL to help improve coal offtake and clear the pithead inventory of coal particularly during the last quarter of any fiscal when the production of the coal PSU (public sector undertaking) reaches its peak.

CIL has been constantly taking up the issue of inadequate rakes with the Indian Railways but the Railways is not able to provide additional rakes as the rakes were reserved for movement of food grains and fertilisers.

It may be noted that owing to inadequate rakes, CIL’s stockpile at the pitheads of all its subsidiaries had gone up to about 43 million tonnes by the end of March this year. CIL’s coal production which is hit during the monsoon season picks up in the second half of any fiscal and reaches its peak during the last quarter (January-March). On an average, CIL’s coal production during January-March stands at around 1.6 million tonnes per day out of which the coal PSU (public sector undertaking) is able to secure offtake of about 1.3 million tonnes.

In the last quarter of any fiscal (January-March), the navratna coal PSU (public sector undertaking) needed 192 rakes per day for securing coal offtake.As CIL was scaling up its coal output target every fiscal, it needed more rakes to ensure that the coal offtake kept pace with its rising production.

The coal PSU targeted to produce 435 million tonnes of coal by the end of this fiscal and its production was projected at about 520 million tonnes by the end of 2011-12.

The coal major was also scouting for acquisition of coal properties abroad and had planned to set up an in-house import cell for importing non-coking coal. The plan to set up an import cell is under the active consideration of the CIL management and an approach note has been prepared in this connection, said Bhattacharyya.