Ukraine wishes more transshipments from Finland


The railway market and future developments in Ukraine and the Central Asia were discussed in the expert seminar of Freight One Scandinavia, a logistics company specializing in rail transport between Finland, Russia and the CIS Countries. The current year in Ukraine has meant recession practically at all levels.

All in all the Ukrainian railways have had 8% less cargo compared to the time a year ago. Pulp and paper industries’ transport has decreased by one third, the share of Finland even by 41%. 86% of the raw materials consumed by the Ukrainian pulp and paper industry are imported, but because of the current state in the country, the users have reduced their paper buying.

”The traffic between Finland and Ukraine is impacted by the high transport rates of Russia. The transport cost from Finland is some 15-20 % higher than if the country of origin was Russia”, says the General Director of Freight One Ukraine, Mrs. Julia Mordvinova.

Cargo from Finland to Crimean Peninsula flows normally, and there are no changes affecting the freight sender. Increasing transshipments from Finland to Central Europe via Ukraine would be highly welcome. According to Mordvinova, Ukraine’s integration with European Community is the most important factor relieving the current situation.

”Closer integration would improve the chances for recovering economy, and it would positively contribute to traffic between Finland and Ukraine”, considers Mordvinova.

Even though the Ukrainian railway logistics and its related processes have significantly improved over the recent years, challenges still remain with the quality of transporting sensitive cargoes. In their response, Freight One plans to modernize 1.500 box cars by the end of the year.

Kazakhstan to become the logistics center point of Eurasia

Freight One currently brings up their operation, Freight One Central Asia, in Kazakhstan. The future looks promising as the routes to Central Asia pass through Kazakhstan.

”The government of Kazakhstan heavily invests in the local infrastructure. Our advantage is the prime location in the logistics center point of Eurasia and the growing volume of traffic thanks to the development of Western China. We aim at producing the transport services that meet the expectations of Finnish customers in terms of speed, quality of service as well the price”, describes Managing Director of Freight One Scandinavia, Mr. Anssi Laakkonen.

Lively discussion

The expert presentations raised a lively discussion and plenty of questions were addressed to the speakers. One of the questions concerned transshipments across Kazakhstan to China by reloading the goods on trucks from rail cars. This is fully possible, and goods can be shipped either to or from China by cars. Likewise, the bogies of a Russian railway wagon may be temporarily replaced by Chinese ones thus making it unnecessary to reload the cargo into a Chinese wagon.

Especially the cost issues made the audience concerned as direct truck loads from Finland are from time to time very competitively priced.

”Ukrainian railways plan to raise their rates, but considering the prevailing situation, most likely the changes will be spread over the coming year”, explains Mordvinova.

The rates in Kazakhstan are also under pressure to rise due to the increasing maintenance costs of the infrastructure.

The fleet of PGK is more numerous than the other operators have, but many challenges still remain to be solved with individual shipments. Freight One Central Asia has been set up to especially improve the level of service in the region, but the process is still underway. The Finnish senders will be relieved by having local help at hand for making sure the unloaded, empty wagons will be properly and timely returned. In the long run, the competitiveness will also improve as more and more return cargo will be found.

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