The efficiency of railways specialized in transporting iron ore and pellets

Abstract

Objective: The objective is to compare the relative efficiency of the railways specialized in transporting iron ore (MFe) and pellets (PLMFe), which are part of the assets of mining companies and pellet plants considering the 2016 scenario.

Methods: The Data Envelopment Analysis (DEA) technique was used, with the application of the output-oriented Constant Returns Scale (CRS) model; the initial combinatorial multicriteria method for choosing the input variables; and Tobit regression as a validation strategy for the DEA model.

Results: Of the twelve railways evaluated, three railways were identified as efficient: Estrada de Ferro Carajás, Fortescue and Mount Newman.

Conclusions: The applied model was considered as a good method to evaluate the efficiency of railways specialized in transporting MFe and PLMFe, as it determined the efficiency of each railway, suggesting the necessary increase in the output variable or adjustments in the input variables so that the railways reach the efficiency frontier. With that, companies can use the results of this study to guide future improvements to make their railway more efficient or maintain on the frontier of efficiency.