No mining truck owner will earn enough to pay off loans

TEAM HERALD

PANJIM: Figures sometimes tell you facts that words never do. Goa’s mining dream may well be truly over and the figures that don’t quite stare in the face, but are chillingly correct. With a cap of 20 million tonnes annually, each truck owner will earn around Rs 63,000 a month, less than half his earnings during the peak period. Back of the book calculations reveal that after paying off expenses, the owner will be left with a mere Rs 32,000 per truck. And, that is before paying his EMI which will be in the range of Rs 30,000 plus. Thus, if their demand of doubling the rate of transportation is not met, they are better off being off the road than carrying ore.

Members of the truck owners association agree that this is indeed the hard truth.

So here are the facts:

Fact 1: If the annual cap of iron ore export is 20 million tonnes, (as directed by the Supreme Court) the average tonnage per month will be 25 lakh tonnes, taking into account that mining exports happen for 8 months only. (25 lakh tonnes x 8 months =  200 lakh or 20 million tonnes)

Fact 2: There are 800 registered trucks in Goa of all get an equal share, each truck will carry 312.5 metric tonnes. This is calculated at the rate of approximately Rs 200 per tonne at Rs 18 per tonne per kilometer.

Fact 3: Thus the maximum earning per truck calculated by multiplying 312 x Rs 200 tonnes is Rs 62,400 per month.

Fact 4: The Total expense per truck less EMI on loan is Rs 30,000 with an EMI ranging from Rs 30-35,000 per truck, total expenses are between Rs 60 and 65,000 per month.

Truck owners will therefore need continuous subsidy even after resumption to habour hope of business. Nilkant Gawas, the President of the All Goa truck owners Association, described the impending doom clearly to Herald. “It is impossible to survive. And please remember your calculations are based on a best case scenario. There are 8000 owners but over 12,000 registered trucks, so the earning per truck will be even less. Hence, even if our demand of doubling our rates per trip is met, it still won’t be enough”.

And to make matters worse, the international price of ore has plummeted to a new low, making it impossible for mine owners to raise transportation rates.

An established mine owner rubbed in the last rites. “We won’t pay and the trucks won’t ply”. And that is the last fact.