Influx of goods from China is straining Russian rail network

* Global shipping delays increase attractiveness of rail routes through Russia

* Rail volumes from China up 47% in the first nine months of 2021

* Growth exposes problems with track, checkpoints, rolling stock

* The government is planning investments, the operator is looking for a faster pace

By Gleb Stolyarov

MOSCOW, Oct. 19 (Reuters) – Explosive growth in shipping costs prompts Chinese manufacturers to send more goods to Europe by rail through Russia, but growing demand is creating bottlenecks and strain the capacity of the network.

As countries frantically replenish stocks and export finished products as they recover from the pandemic, global seaports are mushrooming, making rail an attractive alternative.

Russian state rail monopoly said total container traffic passing through Russia jumped 40% in the first nine months of 2021 to 782,000 TEUs (twenty-foot equivalent unit), and could reach a record high of 1 million TEUs this year.

“At the start of the year, the cost of transporting goods in containers by rail between Asia and Europe was twice as low as by sea. Now it is 3.5 times (lower) “said the railway company.

Most of the growth occurred along the China-Russia-Europe route, where transit volumes for the first nine months increased 47% to 568,700 TEUs.

But transport operators and analysts say the rapid growth has exposed infrastructure problems that could significantly limit transit flows.

These include shortages of staff – including managers and crane operators – and rolling stock, said Alexey Bezborodov, head of Infraproject, a consultancy that analyzes data and trends in transportation and infrastructure. .

“No one believed in such a large increase in transit traffic before the pandemic, and no one was ready for it,” he said.

Transport and logistics group Delo told Reuters that the flow of goods was limited by the low capacity of major rail lines and bottlenecks near ports and border checkpoints.

Another source of container transport cited bureaucratic delays and technical issues at border crossings where containers have to be transferred from one train to another due to track gauge differences.

LONG TERM PLAN

The government has established a long-term plan to increase rail capacity. In 2018, President Vladimir Putin ordered him to increase container transit to 1.7 million TEUs by 2024, a four-fold increase from 2017 levels. A draft transport strategy reviewed by Reuters predicts that flows will increase to 3.7 million TEUs by 2035, bringing Russia’s share of Asia-Europe freight traffic to 15% from 4%.

To achieve these goals, Russian railways are investing 200 billion rubles ($ 2.8 billion) from 2019 to 2024 in its “Transsib in 7 days” project, which aims to reduce the transit time of goods to one week. between the eastern and western borders of the world’s largest country. , compared to the usual 11-14 days.

This is part of a larger project worth over 700 billion rubles that Russian railways and the government are funding from 2013, aimed at boosting exports of coal, metals and other products. base to Asian countries by expanding the BAM and Transsib lines that cross Siberia.

This money is spent on additional tracks needed to bypass slow or oncoming trains, on building and increasing capacity of stations, and on strengthening electricity supplies, the monopoly said.

In a statement in response to questions from Reuters, transport operator Delo praised the investments. “But for objective and subjective reasons, the implementation of these measures is not happening as quickly as we would like,” said a representative of the company.

($ 1 = 71.3230 rubles) (Reporting by Gleb Stolyarov; additional reporting by Maria Vasilyeva; Writing by Tom Balmforth; Editing by Mark Trevelyan and Andrew Cawthorne)

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