Container Volumes to Boost Indian Ports, Coal Traffic to Decline: Report

A Motilal Oswal report projects container traffic to drive growth for Indian ports at a 7-9% CAGR through FY28. Meanwhile, coal traffic is expected to decline by 2-4%, and POL traffic will see moderate growth of 2-4% due to stable demand.

Representative Image (File Photo/ANI)

Container traffic is expected to remain a key growth driver for Indian ports, supported by favourable macroeconomic conditions, rising domestic consumption, and greater adoption of containerization, with volumes projected to expand at a 7-9 per cent CAGR over FY26-FY28.

Diverging Trends Across Commodities

According to a Motilal Oswal report, the expansion in container volumes will diverge significantly from other commodities. Coal traffic is likely to post a compounding decline of 2-4 per cent as higher domestic coal production, renewable energy adoption, and import substitution reduce thermal coal imports, although coastal coal movement is expected to remain resilient.

Petroleum, Oil, and Lubricants (POL) traffic is projected to clock a moderate 2-4 per cent CAGR over FY26-FY28. The report noted that this trajectory is "driven by stable fuel demand but moderated by improving fuel efficiency and increasing use of alternative energy sources."

Meanwhile, iron ore traffic is expected to recover at a 5-7 per cent CAGR during FY26-FY28, supported by higher coastal transportation to domestic steel plants and increased imports amid elevated domestic ore prices, despite relatively subdued export demand.

FY26 Performance Review

The report noted that the projections followed a strong performance in FY26, during which India's major ports delivered healthy numbers. Cargo volumes rose approximately 7 per cent year-on-year to 915 MMT, driven by healthy growth in both overseas (+6.6% YoY) and coastal (+8% YoY) traffic. POL and crude, holding a 30 per cent share, led growth with a 16 per cent YoY rise, while coal and container traffic recorded gains of 21 per cent and 10 per cent, respectively.

Non-Major Ports

In contrast, non-major ports reported modest growth, with cargo volumes increasing roughly 1.4 per cent YoY to 753 MMT in FY26. POL and crude volumes remained stable, while fertilizer volumes rebounded strongly by 52 per cent.

Future Outlook and Challenges

The report stated that "with focused policy support, private investments, and infrastructure development under initiatives such as Sagarmala and the Maritime Amrit Kaal Vision 2047, India is well-positioned to emerge as a global maritime hub."

The report further added that "addressing challenges related to policy delays, connectivity gaps, and environmental concerns will be the key to unlocking the sector's full potential." (ANI)

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