World meat industry news

Container shipments continued to grow in August and, following the results of eight months, exceed last year's figures by almost 13%. Analysts warn that there is an overheating of the market, which, under the influence of the weakening ruble and infrastructure restrictions, will result in a decrease in traffic as early as 2024.

The growth drivers were the transportation of cars and components, as well as mineral fertilizers. The market expects to exceed the mark of 7 million TEU by the end of the year.

In January-August, 4.8 million TEU of loaded and empty containers were transported across all types of traffic, which is 12.7% more than a year earlier; the number of loaded containers increased by 17.8%, to 3.54 million TEU. The maximum growth was shown by the transportation of cars and components, as well as mineral fertilizers (an increase in both indicators by 2.1 times, to 296 thousand and 169 thousand TEU, respectively). Transportation of ground products increased by 1.5 times, and vegetables and fruits by 1.4 times.

Container traffic from the Far East, which experienced a crisis in the fall-winter, is also growing. In August, the average daily export from the region's ports amounted to 3,176 TEU, 17.4% more than a year earlier. JSC Russian Railways is increasing transportation from the Far Eastern Federal District of containers in gondola cars, which are currently subject to a 20.7% discount introduced a year ago. Gondola cars accounted for about a quarter of container traffic from the Far East.

In July, JSC Russian Railways also said that the current pace makes it possible to achieve this figure (this implies an increase of 7.3% compared to last year).

“Among the challenges holding back the growth of transportation are the principles of regulating access to scarce railway infrastructure, as well as the imbalance of imports and exports in the Far East, which creates tension throughout the entire network,” notes Delo Group of Companies.

Increasing the volume of import and export cargo flows is limited by the capacity of the Eastern range, say Delo Group of Companies, adding that in order to export cargo from the Far East, it is necessary to provide access to the railway infrastructure rationally and according to an understandable mechanism.

“According to our assessment, without fair rules for coordinating transportation, as well as intensive development of the infrastructure of the Eastern Polygon, plans to expand and build new terminals will not bring the desired effect for the economy,” they say.

FESCO notes that there is now an active discussion on the methodology for distributing priorities for the passage of container trains in the eastern direction.

“FESCO supports this initiative, but the plan for transporting container trains in the direction of the Eastern range must be balanced with the number of similar trains that depart from the Far Eastern ports to the west of Russia,” they note.

The head of Infoline-Analytics, Mikhail Burmistrov, says that now the main obstacle holding back the growth of container shipping is infrastructure bottlenecks - border crossings to China, approaches to the ports of the Far East and South.

At the same time, he notes that in terms of parallel imports and in the consumer segment in general, the market is overstocked and will cool: there was an overestimation of demand on the part of suppliers and retailers and a favorable exchange rate, but now a change in the exchange rate, as well as tightening of the Central Bank’s requirements for consumer loans will lead to that market growth will slow down by the end of the year.

Considering that, from the point of view of railway transportation, the situation with abandoned trains and downtime at ports is not improving, in 2024, most likely, taking into account the high base of 2023, a decrease in the volume of import container traffic can be expected, the expert believes.