Prabhat Ranjan, AGM - Sales & Logistics, Meghalaya Cement
We have plans to setting up grinding units close to the markets so that the finished product transportation cost can be minimized, says Prabhat Ranjan, AGM - Sales & Logistics, Meghalaya Cement. Excerpts from the interview...
What is the possibility of water transport in North-East?
There is scope for inland water transport in North-East through the River Barak. There are barge services from Kolkata through this waterway. We have just taken the initiative of outsourcing one company in North India to transport fly ash and they also transport clinker to Bangladesh. But here also there is a bottleneck as the inland water transportation can be done only for 3-4 months in a year when water level is high.
The government needs to do necessary dredging of the channels so that the waterways can be utilized the fullest. Inland water transport is a cheaper mode compared to other means of transport, but the handling cost is very high and also there are risk factors. Companies are not taking much interest because of the lack of adequate infrastructure in water transport. Infrastructure has to be developed for companies to exploit water transport.
How do you assess the potential for integrated logistics systems?
Integrated logistics system has a great potential. For this, cement companies have made profit centre head as a transportation unit. Now the companies are not fully depending on the market. They have own transportation system; also they are making profit in a way that trucks are getting return load also. There is a cement company which has set up a clinker grinding unit and bulk terminal in Guwahati area. They bring fly ash from outstation to their plant and the same trucks can carry clinker to the grinding unit.
So the trucks will get both freight charges.
Is Meghalaya Cement investing in any other logistics-related optimization projects?
There is only one scope of mechanizing the terminal to get the benefit of return freight. Otherwise, there is no major development exposure in the North-East. There are plans for a thermal power project in Assam. Once this is materialized, the scenario will change: fly ash will be available, and coal transportation also will improve.
What are your views on outsourcing logistics?
Logistics is already outsourced everywhere. Very few companies are involved in running their own logistics, which are also not able to fully capitalise on as cement is a bulk commodity. People can´t depend on their own resources and they have to outsource transportation. I think almost 80 per cent of logistics in cement is outsourced while the remaining 20 per cent is done by the parent companies.
What are your future plans to improve your supply chain efficiency?
We are already in the process as we are plying bulk movements also. We have also plans to setting up grinding units close to the markets so that the finished product transportation cost can be minimized.