News / Russia eyes record 7m teu box traffic this year, despite sanctions

© Vladimir Grigorev

Russia hopes to increase its container cargo traffic to a record 7m teu this year, despite sanctions and its ever-growing isolation in the international arena.

According to TransContainer, Russia’s leading container cargo operator, it will be achieved by modernising domestic seaports and their rail approaches and developing transport and logistics centres.

Viktor Markov, first VP of TransContainer, said the eastern vector of logistics remained a powerful driver for Russia and its transport sector and a target has already been set for boxes from the far east region is 6,000-6,500 teu on average, per day  – twice the current 2,900 teu.

“The task is ambitious, but achievable,” said Mr Markov. “A number of measures will help to increase shipments to the Russian Federation by 7% compared with the level of 2022. That will be also be achieved by the use of larger trains and more double ‘export’ trains.”

There are also plans to develop alternative routes, particularly those via Russia’s north-west, mainly St Petersburg.

As a significant part of Russian cargo traffic has already been re-oriented to the east, ports in the far east in recent months have faced excessive utilisation of their capacities. As a result, the ministry of transport, together with rail monopoly RZD, established a special office, which focuses on the organisation of containers from the port terminals in the far east.

Some local analysts believe the sanctions imposed on Russia, may have actually had some positive effects on its transport and logistics sectors.

And Andrey Severilov, chairman of Russian transport company Fesco, said during the St Petersburg International Economic Forum, that the departure of global liners had led to the container market becoming a premium sector for Russian companies.

“There is stagnation and even rather a decline in the global container market, because on a global scale we have returned to 2019 prices and there is an excessive capacity. However, in the Russian container market, the situation is radically different,” he said.

Although average global tariffs for container transport from South-east Asia to Europe and America have decreased by almost 80%, compared with January-March 2022, according to Alexei Misailov, business development director of FM Logistic, the same cannot be said for Russia.

He told Russia’s SeaNews, the exodus of global container lines from the country led to the growth of domestic tariffs by five to six times.

Mr Misailov added: “Now there are some small maritime companies with small-tonnage vessels, which operate on Russian routes, that can hardly cover the increased demand for delivery from the ports of China and other Asian countries to the Russian far east, and in the opposite direction, which leads to higher prices.

As a result, according to him, rates are currently at $6,000-$8,000 per teu – about five times higher than pre-pandemic rates.