The instability that has shaken the Red Sea for months does not seem to bother the Russian railway network much. As a result of a peculiar “domino effect” of geopolitical and commercial decisions, international logistics has increased the demand for rail transport in Russia. The context and consequences are complex. The sequence of events does not quite explain this: Houthis’ attacks on ships passing through the Red Sea on their journeys between Asia and Europe have dragged the Suez Canal, one of the largest axes of international trade, into crisis. This has led companies to look for alternatives for their products.

One option is to lengthen the ships’ route and direct them towards the Cape of Good Hope. Another is to use rail between Asia and Europe, which reduces travel time. Problem: Your most interesting options are through Russia.

I’m looking at the railway. The war in Gaza has shaken the waters of the Red Sea, the transit point for 12% of world trade and nearly 30% of container shipping. The risk of being attacked by the Houthis when approaching the Suez Canal or the Gulf of Aden has led shipping companies to seek alternatives, even resorting to long routes such as landing at the Cape of Good Hope. As a result, “door-to-door” travel times between China and Northern Europe have increased by seven to ten days, to nearly 50 days, or almost two months.

In the face of this complex scenario, the train option becomes attractive for transporting goods between the Far East and Europe. There are several options on the table; for example, the route between China and Turkey via Kazakhstan and Azerbaijan, using ferries to cross the Caspian Sea; But this runner needs Finance TimesIt requires more time than a cruise between China and Europe, so it is mainly of interest for goods moving in Central Asia.

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…and Russia option. This being the case, there is another option that has gained importance in recent months: crossing Russian territory. DHL estimates that using this alternative the journey between Chengdu in China and Duisburg in the German state of North Rhine-Westphalia would only take 25 to 30 days.

The German company assures that since the Red Sea is in crisis due to Houthi attacks, requests and inquiries from customers interested in railway services have increased by almost 40%. The company states that most of them pass through Russia. He’s not the first person to point this out. In February, the CNBC network reported that railway routes passing through Russian territory were arousing increasing interest, with a “sharp increase” in inquiries and bookings.

Different data, same trend. DHL is not the only indicator. Finance Times He mentions at least two other people. RailGate Europe predicts a demand increase of 25% to 35%, and Rail Bridge Cargo points out that rail freight traffic through Russia this year is 31% higher than in 2023.

The Russian railway alternative is not the only alternative affected by turbulence in the Red Sea. The sector also states that there is a significant increase in demands for the Middle Corridor extending from China to Turkey. “One of the reasons for this is that sea freight prices have increased significantly and we expect them to increase further,” Maria Magdalena Pavitsich, spokeswoman for Austrian OBB Rail Cargo Group, said in February.

But… What is the reason? Transportation times are also closely related to costs. The risk of exposure to a Houthi attack in the Red Sea led shipowners to seek alternatives and detours such as the Cape of Good Hope; This caused travel time between China and Northern Europe to skyrocket from seven to ten days, reaching 55 days. This, of course, is reflected in transportation costs. Months ago, some estimates said the price of a 40-foot container between North Asia and Europe had increased by more than 600%.

What about the war in Ukraine? Russian is not any land. Since the start of the invasion of Ukraine two years ago, Moscow has been subject to significant international sanctions affecting its economy, goods and transport. DHL itself admits that it imposes “strict export controls” and emphasizes that it does not conduct traffic to or from Russia in order to fully comply with restrictions on exports.

F.T. but points out that restrictions imposed by the EU could close off the transport of goods by road to Russia and Belarus and veto access to certain financial services for RZD, which is responsible for Russia’s extensive railway network; However, they do not prohibit the transportation of goods by train across the country.

Question about numbers. “Since the beginning of the war, the number of bookings via Russia has decreased significantly, but over the past year this route has been recovering due to good transit time and good prices,” RailGate director Julija Sciglaite told CNBC Europe. This flow of demand has “skyrocketed” since events were recorded in the Red Sea.

Igor Tambaca, another voice of the industry who knows logistics in the region, spoke more clearly: “Transfer to Russia is rejected only by customers who have ethical problems with Russia. The majority do not care about ethics when stopping their chains of supply to Europe. They need a fast and reliable solution.”

with perspective. Although the trend is interesting, it currently leaves modest numbers. A good example of this is the Eurasian Railway Alliance, a company responsible for organizing the transport of goods by rail over broad gauge.

January data reflects a 36% year-on-year increase in container movements from China to Poland, but in absolute terms the results remain modest: amounting to 14,532 TEUs, which does not fill even one of the large container ships currently in use. ship owners.

In the background is the Russian railway company RZD, which operates most of the trains and is owned by the Russian state. some experts They are already warning that its revenues could fuel Moscow’s war machine.

Image | Artem Svetlov (Flickr)

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