China sending more goods via Russia than ever before

RUSSIA / FSU POLITICS - In Brief 30 Mar 2021 by Alex Teddy
On March 27 the Financial Times reported that China is increasingly transporting its products to the EU via Russia and Central Asia. This is due to the increased cost of seaborne transport. Over 2 000 freight trains from China crossed Russia in January and February 2021. That is a 100% YoY increase. Use of trains to move goods increased in 2020 and 2019. Since 2016 the use of rail freight from China via Russia is up 700%. However, rail transport of goods is still much less than sea transport.There are not enough containers worldwide to meet shipping demand. Transport by train is often faster than by sea. This has made rail freight an alluring option even though it is costlier than seaborne transport. Ships from the Far East take 31 days on average to reach North Europe via Suez. That route makes up 12% of all goods shipped worldwide. Transit times via the Cape of Good Hope are often double that of the Suez route.Fesco Transport Group is a Russian company that transports goods from the Far East to the EU overland. The transit time is as little as 19 days.Rail freight comprises about 10% of exports via Yangshan Port, China. China's subvention to the Belt and Road Initiative means that rail costs could fall.Hellenic Shipping News, China Daily and Sputnik have been reporting on the growth of rail freight. Russia is confident that rail freight is growing and is investing accordingly. In November 2020 Russian Railways opened a new rail service center at Zabailalsk on the frontier with China.The recent blockage of Suez Canal underscored the chancieness of sea transport.

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