Russia expands alternative grain export routes amid Black Sea disruptions

Russia has expanded the list of subsidized rail routes for transporting grain to export ports amid disruptions to shipments via the Black Sea. The new preferential routes cover ports in the Krasnodar region, northwestern Russia and the Far East.

Under a decision by Russia’s Federal Agency for Railway Transport, grain from 17 regions will be eligible for subsidized transportation to port stations in the Krasnodar region and northwestern Russia, including for further exports via the Baltic Sea. Rail transportation costs will be compensated from the federal budget and will not be charged to shippers.

Separate preferential routes have been introduced for the Rostov region, allowing grain, sunflower meal and cake to be transported to ports in the Krasnodar region and northwestern Russia. Grain from five Siberian regions will also be eligible for subsidized transportation to ports in the Far East.

The expansion of alternative logistics comes as Russia’s export capacity through the Azov-Black Sea basin has declined. Russia is trying to redirect some cargoes through the Baltic and other routes, but their capacity is significantly lower than that of the traditional southern corridor. Alternative routes therefore can compensate for only part of the volumes if disruptions at Black Sea ports persist.

The Kremlin said on August 24 that measures had already been identified to ensure the timely shipment of grain intended for export. Russian authorities estimate the country’s export potential at at least 60 mln tons, although the ability to ship such volumes will largely depend on the operation of its main Black Sea export facilities.

Tags: Russia, rail transportation