Russian Railways introduces discounts on the transportation of grains and legumes

From March to July 2021, transportation of wheat, rye, soybeans, oats, barley, corn, buckwheat, beans, peas, beans and other crops will be 38% cheaper.

This «action» will be valid for everyone who wants to transport their goods in grain wagons to the ports of the Azov-Black Sea basin. That is, the measure is mainly aimed at supporting exporters who sell grain abroad.

In this case, the maximum distance of transportation for the discount is 400 km. Thus, we are talking about companies from just a few regions — for example, from the Krasnodar Territory.

Russian Railways explains that the main reason for introducing such a measure is to maintain competitiveness in comparison with road transport. In addition, in the spring, the demand for transport is not too high, since a significant part of the harvest of last year has already been sold (at the end of 2020, exporters showed truly Stakhanov records in grain export in anticipation of the introduction of duties), and a new one has not yet been collected.

In other words, the measure was introduced so that the wagons do not stand idle on the sidings, while truckers receive all the money.

This is not the first time Russian Railways has introduced such a discount. It was in effect last year, which made it possible to significantly increase the volume of railway traffic in the period from March to July. In 2019 (when there was no discount), it amounted to 359 thousand tons, in 2020 (when there was a discount) — 584 thousand tons.


Will the Russian Railways discount help offset the losses from the duty?

According to many producers and exporters of wheat, the duty of 50 euros per ton, which was introduced on March 1, is truly «draconian». On the one hand, the preferential transportation conditions offered by Russian Railways, of course, delight farmers, because now they will be happy with any opportunity to save an extra ruble. On the other hand, RZD is not yet sure how high the demand will be this year. It is quite possible that it will decrease in comparison with last year precisely because of the introduction of duties.

And not least because the majority of producers and exporters have made titanic efforts to take out and sell every last grain from their barns in December-January.

At the same time, the head of the Rusagrotrans analytical center, Igor Pavensky, believes that the effect of Russian Railways discounts would be much more noticeable if they operated not only over short distances of 400 km, but also throughout the country. However, it seems that the carrier is not at all ready for such proposals.