Container Shortage Forces Russia Rail Service Cuts

The steep drop in Russia’s container traffic has created a container shortage that has forced the cancellation of rail routings and raised exporters’ costs. A weakening economy, exacerbated by the price of oil, Russia’s top export, and Western trade sanctions, has created a shortage of 400,000 containers. As a result, containerized rail services between Moscow and Ekaterinburg, Moscow and Vladivostok, and St. Petersburg and Ekaterinburg have been cut. Russia’s reorientation of its trade toward the Asia-Pacific has led to an accumulation of containers in its Far East, China, and the city of Khabarovsk on China’s border. Some containers are also spread throughout the EU, and the current shortage may pose a threat to the fulfillment of contractual obligations of the companies while driving up export costs. RZD, Russia’s railway monopoly, has taken the brunt of the damage from the shortage.