Railway freight transportation (Russian market)

2024

In Russia, a Pacific railway is being built for 140 billion rubles, which will connect Yakutia and the Khabarovsk Territory

In Yakutia and Khabarovsk Territory, a large-scale infrastructure project for the construction of the Pacific Railway worth ₽140 billion is being implemented. This was announced on September 27, 2024 at the Russian Energy Week by the head of the Republic of Sakha (Yakutia) Aysen Nikolaev, stressing the strategic importance of this facility for the development of the region's coal industry. Read more here.

The President of Farmasintez has created a company for the construction of a railway terminal for receiving containers for billions of rubles

In September 2024, the president of the Pharmasintez group of companies Vikram Punia registered a new company for the implementation of a large-scale project - the construction of a railway terminal in the Perm Territory. This project, worth billions of rubles, is designed to provide the region with modern infrastructure for receiving container cargo, including raw materials for the pharmaceutical industry. Read more here

2023

Growth in the rail rental and leasing market by 15.9% to ₽272,4 billion

The volume of the rental and leasing market for railway transport in Russia reached ₽272,4 billion in 2023, showing an increase of 15.9% compared to 2022. The study was published in October 2024.

According to GuideMarket, the main factor in the growth was the increase in prices for railway rental services - the cost of renting gondola cars increased by more than 30% annually in the period 2022-2023.

Despite the positive dynamics of the last two years, the market volume remains 17.1% lower than in 2019, when it was ₽328,5 billion. The most significant drop was observed in 2020, reaching 39.7%.

The industry is experiencing significant structural changes - in 2023, 24.2% of the fleet of cars in operation changed owners. At the same time, the total volume of cargo transportation remains stable, fluctuating in the range of 1.35-1.4 billion tons.

The main directions of the market development were the digitalization of booking and rental services for cars, including the launch of the Freight Transportation electronic trading platform, as well as the introduction of online transportation cost calculators.

JSC "Federal Freight Company" is developing the segment of counter-rail transportation and is testing high-speed 80-foot platforms with a maximum speed of 140 kilometers per hour. In car building, there was an increase in the production of innovative models, especially hopper grain carriers, the fleet of which increased 31 times.

Developments in the industry are focused on increasing infrastructure capacity, optimizing the cost and timing of cargo delivery, as well as ensuring the technological sovereignty of Russia in the field of railway transport.^[1]

The largest operators of railway freight transportation are named

At the end of 2023, the volume of railway cargo transportation in Russia amounted to approximately 1.35 billion tons, which is 0.3% less than in the previous year. The share of the 30 largest operators of the market in terms of cargo transportation decreased from 82.1% to 80.8%, and their total cargo turnover decreased by 3.3% to 83.7%. Such data are reflected in the INFOLine report published on March 19, 2024.

According to the results of the study, in 2023, a decrease in coal transportation by 3.1% was recorded - to 380.7 million tons. The volume of transportation of oil cargo compared to 2022 decreased by 4.2% - to 219.2 million tons. Ore transportation fell by 2% (to 141.8 million tons), forest cargo - by 10.4% (to 36.4 million tons), construction materials - by 0.3% (to 229.8 million tons). At the same time, fertilizer transportation rose by 15.9% year-on-year, reaching 78.4 million tons. Ferrous metals accounted for 87.2 million tons, which is 2.9% more compared to 2022.

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INFOLine

The rating of the largest railway freight carriers in Russia at the end of 2023 is headed by the "First Freight Company" ("PGK"), whose traffic volume, as noted, decreased by 11.3% compared to 2022. In second place is the Federal Freight Company (FGK) with a drop of 2.8%. The National Transport Company (NTK) closes the top three, which also showed a decline.

In the top ten, a slight increase in traffic at the end of 2023 was shown by Demetra-Holding (2.7%), Globaltrans (0.7%), Modum-Trans (2.1%), Atlant (0.6%), Coal-trans "(0.3%). The INFOLine study says that the contribution of dozens of leaders decreased by 0.6% - to 58.3% of the total traffic, while the total share of the top three players decreased by 0.8%, amounting to about 25.1%.^[2]

Railway freight transportation in Russia decreased by 0.2%

Railway freight transportation in Russia in 2023 decreased by 0.2% compared to 2022 and reached 1.23 billion tons. This was reported to Russian Railways on January 9, 2024.

According to the company, in 2023, railways were immersed:

• coal - 350.3 million tons (-1.2% by 2022);
• coke - 11.5 million tons (+ 13.7%);
• oil and petroleum products - 210.1 million tons (-2.7%);
• iron and manganese ores - 110.3 million tons (-4.3%);
• ferrous metals - 67.8 million tons (+ 2.3%);
• ferrous scrap - 13.7 million tons (+ 6.7%);
• chemical and mineral fertilizers - 63.8 million tons (+ 5.4%);
• cement - 24.3 million tons (-2.2%);
• forest cargo - 26.9 million tons (-14.2%);
• grain - 32.8 million tons (+ 37.1%);
• construction cargo - 129.7 million tons (-3.1%);
• ores of non-ferrous and sulphur raw materials - 17.7 million tons (-1.3%);
• chemicals and soda - 21.8 million tons (-4.5%);
• industrial raw materials and forming materials - 32.9 million tons (+ 6.1%);

Cargo turnover in 2023 amounted to 2636.7 billion tariff ton-km (at the level of 2022), cargo turnover, taking into account the empty run of cars - 3274.6 billion ton-km (-0.8%).

Loading on Russian Railways in December 2023 amounted to 100.7 million tons, which is 1.9% lower than the same period of the previous year. Freight turnover in December 2023 amounted to 208.9 billion tariff ton-km (-6.5%).

As Kommersant writes with reference to Russian Railways, the slowdown in loading dynamics in the fourth quarter is due to the continuing restrictions on the export of petroleum products, a decrease in the transportation of construction goods due to the completion of a number of large infrastructure projects in the central part of the country, the closure of a number of shipper enterprises for unscheduled repairs, an increase in the downtime of locomotives for repair from service companies and large-scale construction and repair work deployed on the network.^[3]

2021: GLONASS became mandatory for all locomotives in Russia

In January 2021, an order of the Ministry of Transport of the Russian Federation on equipping GLONASS equipment with railway transport began to operate. The satellite navigation system shall be installed in locomotives of passenger trains and trains carrying special and dangerous goods, as well as municipal waste. Read more here.

2016

Freight turnover on the railways of the Russian Federation in 2016 increased by 1.6%, to 2.342 trillion ton-kilometers. Loading on the networks of Russian Railways in 2016, according to operational data, amounted to 1 billion 222.3 million tons, which is 0.6% more than in the previous ^[4] In particular:

• coal shipments increased by 1.7% (to 328.6 million tons);

- construction cargo - by 7.9% (up to 141 million tons);

• iron and manganese ore - by 0.5% (up to 109.5 million tons);
• chemical and mineral fertilizers - by 4% (up to 53.5 million tons);
• timber cargo - by 6.9% (up to 42.2 million tons);
• grain - by 1.5% (up to 19 million tons);
• non-ferrous ore and sulphur raw materials - by 3.1% (up to 21.1 million tons);
• scrap of ferrous metals - by 0.3% (up to 15 million tons);
• coke - by 5.5% (up to 11.7 million tons)

At the same time, loading of oil and petroleum products in 2016 decreased by 6.1% (to 235.8 million tons), ferrous metals - by 0.5% (to 71 million tons), cement - by 6.9%, to 26.7

2013

However, in the first half of 2013, similar indicators showed negative dynamics: the volume of loading compared to the same period in 2012 decreased by 3.5% to 606 million tons, cargo turnover - by 3.2% to 1069 billion tons-km.

The main types of loading in the first half of 2013 were coal 25.1%, oil and oil products - 20.6%, construction cargo - 13.6%, iron and manganese ore - 9% of the total cargo volume. At the same time, the general situation in the industry in the first half of 2013 was most significantly affected by the drop in loading of construction materials and oil.

Among the main freight operators, the largest share is occupied by UCL Rail holding - the owner of the First Freight Company, the largest carriage operator in Russia. Its main competitor is OJSC Federal Freight Company, which existed until November 2012 as the Second Freight Company (VGK). In addition, there are a number of other significant players in the market, each of which continues to strengthen its position through large and small mergers and acquisitions.

According to experts, by the end of 2013 we should not expect significant changes in the industry, the market growth for the year will be close to zero.

2012

At the end of 2012, despite the decline in industrial production in the country as a whole, the industry managed to demonstrate positive development dynamics. In particular, the volume of loading increased by 2.4% compared to 2011 and amounted to 1272 million tons, cargo turnover - by 4.4% to 2222 billion ^[5].

Notes