Freight transportation (Russian market)

Main article: Russian economy

Rail transport

Main article: Railway freight transportation (Russian market)

Railway transport: international, inter-road and intra-road (local) traffic.

Pipeline transport

Main article: Transneft

Pipeline transport: pumping of oil, petroleum products and transportation of gas.

Sea transport

Main article: Freight transportation by sea (Russian market)

Sea transport: overseas and coasting.

Inland water transport

Main article: Freight transportation by inland water transport (Russian market)

Inland water transport: overseas and inland navigation.

Road transport

Main article: Truck transportation (Russian market)

Road transport: international, intercity, intra-city and suburban services.

Air transport

Air transport: international and domestic lines.

Electronic waybills

Main article: Electronic consignment notes (Automation of document flow in cargo transportation)

2024

Increase in freight prices by 17% in 10 months

The freight tariff index in Russia is growing at a record pace. In 2022, prices increased by an average of 28.4% YoY, in 2023 the price increase amounted to 16.5% YoY, over 10m24 prices have already increased by 17% YoY with a clear escalation (in October prices are growing by 20%).

If at the moment we compare prices in oct.24 to oct.21, the growth was almost 69% in three years!

From 2011 to 2021 inclusive, the average annual growth was only 5.7%, from 2022 on average 21% per year.

In 2025, another near-record acceleration of prices is expected, the FAS has already approved the indexation of tariffs for railway transportation by 13.8%.

The tariff index for freight transportation calculated by Rosstat reflects the change in tariffs for the transportation of goods by various modes of transport without taking into account changes in the structure of transported goods.

Reasons for the increase in tariffs:

• Rising prices for vehicles and services due to sanctions that made it difficult to import imported equipment, maintain existing equipment, and import substitution is difficult due to a shortage of production base, the lack of the necessary density of intermediate products, mainly supplied earlier from unfriendly countries.

• Changing supply chains: reorienting from the West to the East "does not reorient itself." The infrastructure, which was built for more than half a century, turned out to be unclaimed, and it was expensive, long and difficult to create a new one, plus the transport shoulder increased several times.

• The shortage of personnel transport in and the general inflation in the economy, this can also include an increase in fuel and electricity prices, plus the effect of devaluation ruble and an increase in exchange rate costs.

Logistics occupies an important part in the structure of the cost of goods and services, therefore, price growth at a rate of over 20% per year forms the starting point for general economic inflation. A spiral of self-sustaining price increases.

At the Russian-Chinese border, trucks stand for weeks due to the electronic queue system

In early September 2024, it became known that China Blagoveshchensk congestion arose at the largest border crossings with Zabaikalsk and Heihe. Trucks and car trucks cost weeks, and the average waiting time in the electronic queue has doubled.

According to the Izvestia newspaper, congestion at border crossings is associated with an increase in the supply of equipment from the PRC before an increase in utilization rates. Approximately 70% of the total volume of goods transported across the border at the points "Zabaikalsk" and "Blagoveshchensk - Heihe" are vehicles and special equipment. Importers are actively importing cars and trucks, buses, construction vehicles and other equipment that are subject to the increase.

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At multilateral automobile checkpoints (MAPP) there is an electronic queue: cars arrive at the booked time. But when drivers receive documents for cargo, then in anticipation of crossing the border, they are forced to spend the night in their vehicles to advance in line. In this regard, the Federal Customs Service has taken a number of measures to prevent congestion. In particular, the mandatory registration of transit customs operations directly at the MAPP was canceled: this function was transferred to the nearest temporary storage warehouses. The preinformation procedure is used instead of the transit declaration.

The electronic queue, as noted by the Federal Test Chamber, allows you to ensure order and control when forming the sequence of trucks to checkpoints, distribute the load on the MAPP, make the border passage time predictable and reduce the costs of carriers. However, problems remain. Congestion on MAPP with China leads to a rise in the cost of logistics. The turnover of trucks slowed down for a week, which is comparable to one transportation to the PRC. This leads to an increase in tariffs.^[1]

Russia will conduct an experiment on the introduction of a national digital transport and logistics platform

Prime Minister Mikhail Mishustin signed a decree on an experiment to create, test and implement a national digital transport and logistics platform. This was announced on July 5, 2024 to TAdviser by representatives of the Digital Transport and Logistics Association. Read more here.

2022

The total cargo turnover of transport in Russia remained unchanged - 2.92 trillion ton-km

The total cargo turnover of transport in Russia at the end of 2022 reached 2.92 trillion ton-km, which almost exactly corresponds to the indicator of a year ago. This is evidenced by the data released in December 2023 by the analytical company BusinesStat.

According to experts, the Russian freight market in 2022 remained at the level of the previous year, despite the significant changes that took place on it due to Western sanctions against the Russian Federation. The study notes that in the spring of 2022, the volume of Russian foreign trade halved. Throughout 2022, the business was forced to rebuild logistics chains. Moscow as a logistics hub has lost its previous importance. Cargo traffic from St. Petersburg has decreased, as the volume of cargo delivered through the Baltic ports has decreased, the researchers note.

Thanks to the re-export regime, cargo traffic in the southern direction through Turkey, Iran, Georgia and Azerbaijan has grown. Parallel imports also helped. In addition, the North-South transport corridor from the category of unpopular passed into the status of promising. In 2022, freight traffic was opened on the first automobile bridge over the Amur River, which connects Blagoveshchensk with the city of Heihe in China, which made it possible to form new logistics chains with the participation of road freight transport. Promising destinations included transportation along the previously unpopular North-South transport corridor through Azerbaijan to Iran, India and the United Arab Emirates.

BusinesStat analysts add that the reorientation of cargo flows to the East revealed port infrastructure problems, as well as limited throughput of marshalling yards and railways.^[2]

Decrease in cargo traffic in air transport by 59% to 0.6 million tons

In Russia, at the end of 2022, the volume of cargo transportation by aircraft decreased by 59% compared to 2021 and amounted to 0.6 million tons. This is evidenced by data from analysts BusinesStat, published in December 2023.

The tangible drop in the market is due to the fact that against the background of sanctions, a significant part of foreign markets has become inaccessible to Russian carriers due to the reduction or severance of trade relations with a number of countries, as well as the risk of aircraft seizure abroad. According to the researchers, part of the fleet of domestic carriers is equipped with foreign liners, and under the conditions of sanctions, their operation and maintenance have become significantly more complicated. Direct deliveries of new liners or spare parts for them are impossible, and establishing supplies through parallel imports takes time and inevitably increases costs. BusinesStat estimates the share of international flights in the total volume of cargo transportation of Russian airlines at 70-75%.

The study notes that in the first two months of 2023, transportation was carried out without restrictions and accounted for 35% of the total value for the year. According to experts, the volume of cargo transported by air in Russia will decrease by 25% by the end of 2023. There are no prerequisites for a significant increase in cargo transportation tonnage in the near future, according to an analytical report published in December 2023.

The following companies were named the leaders of the Russian cargo transportation market by aircraft in 2022:

• Aeroflot-Russian Airlines;
• AK AirBridgeCargo;
• Siberia Airlines JSC;
• Rossiya Airlines;
• Ural Airlines.

Their market shares in the study are not indicated.^[3]

The Russian market for transport and logistics services grew by 12.5% to 4.66 million tons

Analysts at the GuideMarket marketing research agency estimated the volume of the Russian transport and logistics services market at 4.66 trillion rubles in 2022. This is 12.5% more than a year earlier. The study was published in July 2023.

The costs of transport and logistics services in the Russian Federation continued to increase steadily - in 2021, the growth rate in the market was measured at 13.3%, largely due to an increase in cargo transportation and prices for them.

Despite the difficulties associated with the closure of the European direction, the reorientation of supply chains and excessive supply in the domestic market, in 2022 the positive market dynamics was due to the increase in tariffs with an increase in tonnage and freight turnover in domestic traffic. At the same time, difficulties were noted with the forecasting and uniformity of the load of transport, since in 2022 the demand changed monthly in response to the next sanctions restrictions or changes in transportation technologies, such as hooks, overloads, etc.

According to experts, in the context of an increase in the cost of cargo transportation and warehouse processing of goods (due to the rise in the cost of consumables, restrictions on the purchase of freight transport, an increase in the cost of servicing equipment, personnel, etc.), there is a high probability of a deterioration in the financial indicators of market participants, some of which will be forced to stop their activities.

The study also notes that by the end of 2020, the volume of the transport and logistics services market decreased by only 0.1%. The main factor that preserved the market was the development of e-commerce amid the growth of online purchases due to the pandemic, the emergence of additional demand for goods for work from home, the development of online solutions of retailers and improved user experience.^[4]

Revenue of the largest cargo airlines decreased by 69.2%

In 2022, the revenue of the largest Russian cargo airlines decreased by 69.2%, to 71.9 billion rubles, which was the minimum in five years. At the same time, the total net loss of such companies reached 2.1 billion rubles against 59.6 billion rubles a year earlier. This was reported by RBC at the end of May 2023 with reference to the reporting of carriers according to Russian accounting standards (RAS).

In 2022, the companies' financial performance was negatively affected by the cessation of transportation on Western international routes and difficulties with other foreign destinations due to the rupture of leasing contracts and the refusal of ground service, adds Alla Yurova, junior director of corporate ratings at the National Rating Agency. An important part of AirBridgeCargo's business - the transit of goods from Europe to Asia - has almost completely zeroed out, says aviation expert Grigory Pomerantsev.

According to the Federal Air Transport Agency, at the end of May 2023, there are 48 Russian (22) and American (26) aircraft in the fleet of seven main airlines (in 2021, provided at least 54% of all traffic, data for 2022 were not published) specializing in the transportation of goods.

• AirBridgeCargo (18 aircraft Boeing 747777 /).
• Volga-Dnepr (eight An-124s and five Il-76s).
• Aviastar-TU (five Boeing 757 and three Tu-204).
• Aviakon Citotrans "(five Il-76s).
• Atran (two Boeing 737s).
• "Erofei" (one Boeing 757).
• SkyGates (one Il-76).

2022 turned out to be "generally difficult" for the global air cargo market, notes aviation expert Grigory Pomerantsev. The demand for the transportation of aviation cargo in 2022 decreased significantly compared to the level of 2021 and was also slightly lower than the indicator of pre-pandemic (coronavirus pandemic COVID-19) 2019, he explains.^[5]

Transportation services market growth by 40% in 5 years to RUB 4.79 trillion

The volume of the Russian market for freight forwarding services in 2022 amounted to 4.79 trillion rubles, an increase of 40% compared to 5 years ago, when - in 2018 - the figure was measured at 3.42 trillion rubles. This was announced in May 2023 by BusinesStat analysts.

According to the researchers, in 2022 the Russian market for transport freight forwarding faced a new sanctions crisis, so its growth rate significantly decreased - to + 6.4% (relative to 2021) from 20% in 2021. Western sanctions have led to a significant reduction in international air and road cargo transportation. The sanctions contributed to the shift of foreign trade from west to south and east of the country, demanded that freight forwarding companies complicate the chains of delivery of European products, and develop new transportation routes. The increase in transportation tariffs and an increase in freight forwarding margins ensured an increase in the turnover of freight forwarding services in 2022.

It is noted that at the end of 2022, the share of forwarding services in the total cost of forwarding services in Russia increased to 6.2%. The turnover of forwarding services grew in 2022 faster than the turnover of the freight forwarding market as a whole. Changing the geopolitical situation required the search for non-trivial logistics and transport solutions. The services of forwarding companies as professional organizers of transportation have become more in demand, the report said.

It also follows from it that by the end of 2022 in Russia there were more than 32 thousand enterprises conducting auxiliary activities related to transportation. Most of these companies are private (85.8%). Most of the freight forwarders are small and micro enterprises. Part of freight forwarding companies are part of large industrial and agricultural holdings, federal retail chains.^[6]

Growth of the freight transportation market by 6% to 2.18 trillion rubles

By the end of 2022, the Russian freight transportation market grew by 6% compared to 2021 and reached 2.18 trillion rubles. This is evidenced by the data of the consulting company Strategy Partners (a subsidiary of Sberbank), which were released at the end of March 2023.

According to Rosstat estimates, the volume of freight transportation in physical terms in 2022 amounted to 5.51 billion tons, which is 0.3% more than a year ago. In 2022, road transport accounted for about 70% of the total cargo volume, says Sergei Semenov, director of the department of state policy in the field of automobile and urban passenger transport of the Ministry of Transport, whose data is provided by RBC.

The volume of freight transportation in physical terms in 2022 amounted to 5.51 billion tons

The publication notes that the trucking market is divided into two main segments - with Full Truck Load (FTL) and transportation of prefabricated goods (Less than Truck Load, LTL). According to Strategy Partners, in 2022 the FTL segment amounted to almost 1.91 trillion rubles (+ 5% by 2021), the LTL segment - 270 billion (+ 11%). Analysts calculate the market volume as the amount of revenues of Russian motor transport companies engaged in domestic and international (excluding transit) commercial and captive FTL and LTL transportation.

According to Anatoly Grek, partner of Strategy Partners, one of the main drivers of the growth of freight transportation was the change in supply chains and the limited capacity of railways. The general director of INFOLine-Analytics, Mikhail Burmistrov, explained that due to the congestion of railways, consumer goods were increasingly transported by road. According to him, the trend will only intensify.

Also, the growth of the freight transportation market is influenced by increased control over the market, including through the introduction of an electronic bill of lading, an increase in the cost of transportation and the need to update the fleet of trucks, the growth of the e-commerce market and inflation, experts add.^[7]

Freight transportation by rail in Russia decreased by 3.8%

Freight transportation by rail in Russia in 2022 decreased by 3.8% compared to 2021 and amounted to 1.23 billion tons. This was reported to Russian Railways in January 2023.

Railways in 2022 immersed:

• coal - 354.4 million tons (-4.6% by 2021);
• coke - 10.1 million tons (-15.7%);
• oil and petroleum products - 216 million tons (-0.7%);
• iron and manganese ore - 115.2 million tons (-4%);
• ferrous metals - 66.3 million tons (-4.3%);
• ferrous scrap - 12.9 million tons (-21.5%);
• chemical and mineral fertilizers - 60.5 million tons (-6.9%);
• cement - 24.9 million tons (-6%);
• forest cargo - 31.4 million tons (-24.8%).

Freight transportation decreased in Russian Railways over the year

In addition, 23.9 million tons of grain (-4.8%), 133.9 million tons of construction cargo (+ 5.7%), 18 million tons of non-ferrous ore and sulfur raw materials (-8.7%), 22.8 million tons of chemicals and soda (-6.2%), 31 million tons of industrial raw materials and forming materials (-13.1%), 113.1 million tons of other cargo, including in containers (+ 1.6%).

In 2022, loading on all railways of the eastern landfill increased: Krasnoyarsk (+ 1%), East Siberian (+ 2.2%), Trans-Baikal (+ 9.6%), Far Eastern (+ 7.2%). Freight turnover amounted to 2636.1 billion tariff ton-km (-0.1% by 2021).

According to Kommersant, Russian Railways, despite a sharp deterioration in conditions for international container traffic, at the end of 2022 demonstrated an increase in railway transportation of containers by 0.3%, breaking the record in 2021. Market participants interviewed by the newspaper, despite the discrepancy between the data and the statistics of Russian Railways, also talk about a relatively good situation, the improvement of which is constrained by infrastructure restrictions. The companies are calling for further infrastructure development, maintaining the appointment of additional trains to the Far East and solving container transportation problems in the North-West. ^[8]

2019

The industry is showing negative dynamics: for 9 months of 2019, the volume of commercial cargo transportation decreased by 3.7%, especially the sphere of road transportation sank - by 5.3% (according to the latest data from the Ministry of Transport). In the stagnating market, there are two opportunities for business growth: to increase share at the expense of competitors, or to reduce costs and increase their own efficiency. In both cases, we cannot do without the introduction of modern technologies and the automation of business processes. Given the specifics of the freight transportation market, the industry needs mobile solutions^[9]

2018

Russia is in the middle of the World Bank ranking in terms of logistics development among 160 participating countries. The Logistics Performance Index (LPI) reflects not only the work of customs authorities and the state of infrastructure, but also the quality of logistics services, the speed and cost of delivery, the presence of transportation delays and the ability to track cargo. We see a clear correlation between the position in the ranking and the level of digitalization of logistics in the participating countries. The leaders of the rating - Germany, Sweden, Belgium, Austria, Japan - also differ in the high level of penetration of new technologies into the field of cargo transportation. In the past two years, Russian carriers have actively taken up digitalization, and this will become a driver for the growth of logistics efficiency in the near future^[10][11].

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 2.1% compared to 2011 and amounted to 8732 million tons, cargo turnover - by 1.7% to 4998 billion t-km.

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 3.6% to 5235.6 million tons, cargo turnover - by 0.6% to 3318.4 billion t-km.

Analyzing the dynamics of the industry development, based on the indicators of the volume of cargo transportation in physical terms, it can be seen that the leading position (about 70%) belongs to road cargo transportation, and several times less than the volume of cargo transportation by rail and pipeline (about 15% and 13%, respectively) (DISCOVERY Research Group data).

If we consider the market structure for such an indicator as cargo turnover, then the leading road transport has only 5%, and rail accounts for 44.5%. The leader in the speed of delivery of goods is pipeline transport - in the total volume of cargo turnover it occupies almost half - 48%.

This difference in the structural distribution by types of transport occurs because the calculation of cargo turnover also takes into account the duration of transportation, while when calculating the volume of transportation - only the volume of million tons. And since in the structure of road cargo transportation most of them are intra-city and intra-regional transportation, which are transportation at close distances, with a large volume of transportation they make up a very insignificant part of the total cargo turnover in Russia. A noticeable redistribution of roles in the market in the coming years, according to experts, is not expected.

According to experts, the freight transportation market will continue its further development at a moderate pace. At the same time, among the main factors contributing to the growth of industry indicators will be growing competition, intensive development of the automotive segment, the active use of information technologies, the growing volume of trade with European countries, as well as ensuring the transportation of goods between China and the European Union.

According to the strategy for the development of the transport complex of Russia for the period until 2030, the volume of the freight transportation market according to the basic scenario will amount to 17.15 billion tons, according to the intensive scenario - 19.92 million tons, cargo turnover - 3822.2 billion tons-km. and 4267.3 billion t-km. respectively.

See also

• Air cargo (Russian market)
• Freight transportation (Russian market)
• Road freight transportation (Russian market)
• Freight transportation by inland water transport (Russian market)
• Cargo transportation by sea (Russian market)
• Railway freight transportation (Russian market)
• Passenger air travel

Notes