Loading: The negative trend is stopped

02.08.2010 (15:10)

Loading on RZD's network in the first half of 2010 shows that the economic crisis is not affecting cargo traffic too strongly anymore. Though the growth depends on last year's low results very much, nevertheless, RZD expects better results by the end of this year than final figures last year. We asked Vyacheslav Lemeshko, Vice President of RZD, to tell us about the situation in cargo transport.

- Vyacheslav Grigorievich, how do you assess the results of the company in the first half of the year? What are the main trends of the period? For example, can we speak about some noticeable changes in loading in comparison with 2009? Any other trends?

- I would like to say that our results are generally pleasant for the company. 13.6% more cargo was transported for six months of 2010 in comparison with the first half of 2009. We have to remember that last year there was a 23.1% falling in comparison with the level of the period from January to June of 2008. Thus, RZD has not only managed to overcome the impact of the crisis year's low commercial base, but there were also positive changes. Of course, a certain, if I may say, financial fragility of the economy is still obvious, and it is visible in the company. Generally speaking, all kinds of bulk rail freight have been actively restoring in the first half of 2010, except for grain and ground products. The reason of negative figures in grain cargo loading is smaller grain harvest last year. Also noteworthy is that loading figures are growing faster than the index of industrial production this year.

Thus, from January to May, the industry went 10.3% up, and loading grew by 12.9%. Of course, we have to bear in mind that such a seemingly high growth rate in the first half of 2010 was due to the low base line, because the most dramatic drop in industrial production and, consequently, in loading, took place in the same period last year, that is the beginning of the year.

- What changes have taken place on export-import cargo routes?

- Transport figures in the Russian domestic communication have grown by 13%. International traffic has also changed positively, it went 14.6% up. We lost almost 40% over the same period last year, so you should agree with me that the progress is evident. As regards export, it is 8.8% up. A year ago, this category of cargoes lost 9%. For six months of the year, cargo flows through ports went 14.4% up, and it grew by 3% via border crossings. The positive result at marine terminals was a continuation of the last year's trend, and as regards border crossings, here the company proved its effectiveness, having overcome the last year's 21% fall. RZD's results in import were most important. Here the increase reached 40%. Thus the company has restored its results of the first half of 2008, because during the first six months of 2009 there was a 40% drop in imported cargoes. Also, transits are continuing stable growth. There was five times more cargo than previously in the first half of 2009, and since the beginning of this year, it increased by another 33.7%. It speaks in favour of our great potential transit opportunities.

- What changes have taken place in the the export-import cargo flows?

- Loading of goods for export grew by 27.8% in eastern direction in the first half of 2010, compared with the same period last year, by 7.1% on the north-western routes and by 4.2% in the south. Thus, the same as in the past year, the growth was mostly driven by South-East Asia, in particular, China, our largest partner in the region. Japan and the Republic of Korea are also leading in imports. The main cargo in the direction of South-East Asia are coal, ores, ferrous metals, timber, oil and petroleum products. Since the beginning of 2010, there was a considerable growth in oil cargo traffic, by 70.8%, and coal - by 31.6%. At the same time, there was a 57% decline in loading non-ferrous metals, ferrous metals loading figures fell by 13.5%, and ores - by 12.4%. This was due to reduced purchases of these goods in China and Japan.

Speaking of imported cargoes, it is necessary to mention first of all that the import of coal grew by 45%, as well as ores and building materials, by 35% and 33% respectively. The main states-exporters are Ukraine, Kazakhstan, Belarus, Brazil and China.

- What are the plans of the company until the end of this year? What forecasts can you share with us today?

- It is obvious that there will be a slow down in the regenerative growth in traffic during the second half of the year, because the effect of low start will no longer play a significant role, as it did in the beginning of this year. However, we expect that oil traffic will continue growing fast. Also, we forecast that more mineral construction materials will be carried. However, growth rate of loading of coal and steel goods can slow down considerably.

Nevertheless, given the trends in the loading figures and macroeconomic parameters, as well as the current state of cargo railway transport, we can predict that the growth rate of loading in 2010 will outpace the growth rate of industrial production, including from those industries, where there was the deepest fall in loading, and it will be not less than 3.7% for the year.

Interviewed by Maria Shevchenko

Read the full interview in RZD-Partner № 13-14
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