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4 (40) 2014

4 (40) 2014
РЖД-Партнер

Chinese Railcars Are Passing By

Chinese Railcars Are Passing By

Low cost and large volumes are synonymous with Chinese products.
Chinese goods, however, are not popular in every sector. A correspondent of The RZD-Partner International tried to figure out what Chinese machine building products are in demand in the CIS and Baltic countries.

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Alternative Never Used

The first discussions about the import of railcars from China to Russia began back in 2007. At a closed meeting of the Council for Rail Transport of Participants of the CIS, the Baltic States and Finland, President of Russian Railways Vladimir Yakunin proposed with his colleagues to discuss the opportunity of using Chinese railcars, because at that time the situation with rolling stock was unfavourable. Russian railcar builders set high prices because of increased demand for their products. In this situation, Chinese rolling stock seemed to be the most promising alternative. Talks about importing Chinese products, however, were never turned into an actual agreement. During the recession in 2008-2009, Vladimir Putin, Prime Minister of Russia, announced that the Russian Government prohibited the Ministry of Transport and RZD to buy any machinery in China in order to support the Russian industry.

A Railcar for Everyone

There are no Chinese railcars in free circulation in Russia. There are only some components, such as cast parts, on the Russian market.
Despite the fact that Russia did not give Chinese machine builders access to its market, adjacent states decided to try railway products made in China. For example, Turkmenistan has been actively using Chinese products since 2005. Last year, China South Locomotive & Rolling Stock Corporation Limited (CSR) delivered to Turkmenistan 154 passenger railcars.
Uzbekistan Railways JSC bought from Zhuzhou Electric Locomotive 15 electric locomotives in 2008-2010. Amangeldy Otarbekov, Director of the Technical Department at Kaztemirtrans JSC, said that during the period of an acute shortage of freight railcars in the CIS in 2007, senior managers of Kazakhstan Temir Zholy decided to purchase new freight railcars made in China with higher carrying capacity and improved technical specifications.
“Gondola cars of the 12-9920 and 12-9941 models are used on all routes inside the country. They showed good results, there were no fractures or defects of cast parts,” he says.
According to Eduard Kaplan, Chairman of the Board of ENRC Logistics LLC, the main advantage of Chinese-made railcars is the possibility of using modern bogies and wheel sets, equipped with cassette-type bearings, with a 500,000 km distance run between repairs. In his words, the drawbacks of the rolling stock are the need to create new repair facilities, different from the existing ones, for undercarriages, as well as the need to provide rolling stock inspection points and wagon repair companies with specific spare parts.
“When buying Chinese-made railcars, it became necessary to use spare parts specifically for a particular model of a railcar and, as a consequence, to create special reserves of expensive side frames and bolsters throughout the route where the rolling stock operates and at railcar repair depots,” says E. Kaplan. “In addition, when operating Chinese railcars, we had to develop and implement new technological processes of repair, and solve the railway administration issues of rolling stock acceptance after repair.”
All in all, Kazakh Railways purchased from China CNR Corporation (CNR) 2,000 railcars of the EM70 model in 2011. At that time, Estonian Railways (EVR) acquired 16 locomotives produced by the Chinese consortium CCOEC / BRE. It was the first time that a Chinese company had exported rolling stock to a country–member of the European Union.

Which Locomotive to Choose?

According to analysts, Estonia will stop buying Chinese rolling stock. Partly, because of the decision of Russia not to give access to Chinese locomotives to its railway network, which significantly reduces their application range. Other European railways prefer to develop their own production. For example, according to Stasis Gudvalis, Deputy CEO – Director for Cargo Transportation at Lithuanian Railways JSC, modernisation of shunting locomotives began in Lithuania in 2010, and 22 such locomotives were updated.
“In 2012, in cooperation with the Bryansk Locomotive Plant, we began to make shunting locomotives in Vilnius. A new locomotive consumes 30% less fuel. 60 of them work on our railway network now, and some were bought by RZD,” he says.
Unlike the Lithuanian, the Belarusian Railway is actively using locomotives made in China. It purchased the first batch of 12 Chinese electric locomotives in 2012. They were put into operation to service increasing transit flows. Chinese producers, however, failed to attract the interest of Belarusian railwaymen to their railcars, but an agreement about a supply of 18 single-section locomotives in 2015-2016 was signed recently. Vladimir Mikhailyuk, First Deputy Head of the Belarusian Railway, explains that they were purchased especially for express container trains.
“These are new locomotives on the Alstom platform. We used them in winter and in summer. There were no issues,” he added.
Products from Chinese railway machine builders are a remarkable phenomenon on the global market, but they will hardly increase sales because of the specifics of each country’s railways. A transfer to Chinese products in one sector will cause a similar transfer in other sectors, and the Baltic States and the CIS are not ready for it. Everyone, however, including Russian companies, use Chinese components from time to time.
By Tatyana Simonova

our reference
Machine building is an important industry for China. Proceeds from exports reach more than $2.5 billion. The largest machine building centers are Shanghai, Shenyang, Tianjin, Harbin, Beijing, Luoyang, Dalian, etc.
The product range exceeds 50,000 items of goods. The production of railway rolling stock is highly developed. China is the second in the world according to locomotive production volumes. On average, one diesel locomotive is produced in the country every 12 hours, one electric locomotive every 33 hours – electric, a passenger railcar - every 2.6 hours, and a cargo railcar – every 13 minutes.

[~DETAIL_TEXT] =>

Alternative Never Used

The first discussions about the import of railcars from China to Russia began back in 2007. At a closed meeting of the Council for Rail Transport of Participants of the CIS, the Baltic States and Finland, President of Russian Railways Vladimir Yakunin proposed with his colleagues to discuss the opportunity of using Chinese railcars, because at that time the situation with rolling stock was unfavourable. Russian railcar builders set high prices because of increased demand for their products. In this situation, Chinese rolling stock seemed to be the most promising alternative. Talks about importing Chinese products, however, were never turned into an actual agreement. During the recession in 2008-2009, Vladimir Putin, Prime Minister of Russia, announced that the Russian Government prohibited the Ministry of Transport and RZD to buy any machinery in China in order to support the Russian industry.

A Railcar for Everyone

There are no Chinese railcars in free circulation in Russia. There are only some components, such as cast parts, on the Russian market.
Despite the fact that Russia did not give Chinese machine builders access to its market, adjacent states decided to try railway products made in China. For example, Turkmenistan has been actively using Chinese products since 2005. Last year, China South Locomotive & Rolling Stock Corporation Limited (CSR) delivered to Turkmenistan 154 passenger railcars.
Uzbekistan Railways JSC bought from Zhuzhou Electric Locomotive 15 electric locomotives in 2008-2010. Amangeldy Otarbekov, Director of the Technical Department at Kaztemirtrans JSC, said that during the period of an acute shortage of freight railcars in the CIS in 2007, senior managers of Kazakhstan Temir Zholy decided to purchase new freight railcars made in China with higher carrying capacity and improved technical specifications.
“Gondola cars of the 12-9920 and 12-9941 models are used on all routes inside the country. They showed good results, there were no fractures or defects of cast parts,” he says.
According to Eduard Kaplan, Chairman of the Board of ENRC Logistics LLC, the main advantage of Chinese-made railcars is the possibility of using modern bogies and wheel sets, equipped with cassette-type bearings, with a 500,000 km distance run between repairs. In his words, the drawbacks of the rolling stock are the need to create new repair facilities, different from the existing ones, for undercarriages, as well as the need to provide rolling stock inspection points and wagon repair companies with specific spare parts.
“When buying Chinese-made railcars, it became necessary to use spare parts specifically for a particular model of a railcar and, as a consequence, to create special reserves of expensive side frames and bolsters throughout the route where the rolling stock operates and at railcar repair depots,” says E. Kaplan. “In addition, when operating Chinese railcars, we had to develop and implement new technological processes of repair, and solve the railway administration issues of rolling stock acceptance after repair.”
All in all, Kazakh Railways purchased from China CNR Corporation (CNR) 2,000 railcars of the EM70 model in 2011. At that time, Estonian Railways (EVR) acquired 16 locomotives produced by the Chinese consortium CCOEC / BRE. It was the first time that a Chinese company had exported rolling stock to a country–member of the European Union.

Which Locomotive to Choose?

According to analysts, Estonia will stop buying Chinese rolling stock. Partly, because of the decision of Russia not to give access to Chinese locomotives to its railway network, which significantly reduces their application range. Other European railways prefer to develop their own production. For example, according to Stasis Gudvalis, Deputy CEO – Director for Cargo Transportation at Lithuanian Railways JSC, modernisation of shunting locomotives began in Lithuania in 2010, and 22 such locomotives were updated.
“In 2012, in cooperation with the Bryansk Locomotive Plant, we began to make shunting locomotives in Vilnius. A new locomotive consumes 30% less fuel. 60 of them work on our railway network now, and some were bought by RZD,” he says.
Unlike the Lithuanian, the Belarusian Railway is actively using locomotives made in China. It purchased the first batch of 12 Chinese electric locomotives in 2012. They were put into operation to service increasing transit flows. Chinese producers, however, failed to attract the interest of Belarusian railwaymen to their railcars, but an agreement about a supply of 18 single-section locomotives in 2015-2016 was signed recently. Vladimir Mikhailyuk, First Deputy Head of the Belarusian Railway, explains that they were purchased especially for express container trains.
“These are new locomotives on the Alstom platform. We used them in winter and in summer. There were no issues,” he added.
Products from Chinese railway machine builders are a remarkable phenomenon on the global market, but they will hardly increase sales because of the specifics of each country’s railways. A transfer to Chinese products in one sector will cause a similar transfer in other sectors, and the Baltic States and the CIS are not ready for it. Everyone, however, including Russian companies, use Chinese components from time to time.
By Tatyana Simonova

our reference
Machine building is an important industry for China. Proceeds from exports reach more than $2.5 billion. The largest machine building centers are Shanghai, Shenyang, Tianjin, Harbin, Beijing, Luoyang, Dalian, etc.
The product range exceeds 50,000 items of goods. The production of railway rolling stock is highly developed. China is the second in the world according to locomotive production volumes. On average, one diesel locomotive is produced in the country every 12 hours, one electric locomotive every 33 hours – electric, a passenger railcar - every 2.6 hours, and a cargo railcar – every 13 minutes.

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Low cost and large volumes are synonymous with Chinese products.
Chinese goods, however, are not popular in every sector. A correspondent of The RZD-Partner International tried to figure out what Chinese machine building products are in demand in the CIS and Baltic countries.

[~PREVIEW_TEXT] =>

Low cost and large volumes are synonymous with Chinese products.
Chinese goods, however, are not popular in every sector. A correspondent of The RZD-Partner International tried to figure out what Chinese machine building products are in demand in the CIS and Baltic countries.

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Alternative Never Used

The first discussions about the import of railcars from China to Russia began back in 2007. At a closed meeting of the Council for Rail Transport of Participants of the CIS, the Baltic States and Finland, President of Russian Railways Vladimir Yakunin proposed with his colleagues to discuss the opportunity of using Chinese railcars, because at that time the situation with rolling stock was unfavourable. Russian railcar builders set high prices because of increased demand for their products. In this situation, Chinese rolling stock seemed to be the most promising alternative. Talks about importing Chinese products, however, were never turned into an actual agreement. During the recession in 2008-2009, Vladimir Putin, Prime Minister of Russia, announced that the Russian Government prohibited the Ministry of Transport and RZD to buy any machinery in China in order to support the Russian industry.

A Railcar for Everyone

There are no Chinese railcars in free circulation in Russia. There are only some components, such as cast parts, on the Russian market.
Despite the fact that Russia did not give Chinese machine builders access to its market, adjacent states decided to try railway products made in China. For example, Turkmenistan has been actively using Chinese products since 2005. Last year, China South Locomotive & Rolling Stock Corporation Limited (CSR) delivered to Turkmenistan 154 passenger railcars.
Uzbekistan Railways JSC bought from Zhuzhou Electric Locomotive 15 electric locomotives in 2008-2010. Amangeldy Otarbekov, Director of the Technical Department at Kaztemirtrans JSC, said that during the period of an acute shortage of freight railcars in the CIS in 2007, senior managers of Kazakhstan Temir Zholy decided to purchase new freight railcars made in China with higher carrying capacity and improved technical specifications.
“Gondola cars of the 12-9920 and 12-9941 models are used on all routes inside the country. They showed good results, there were no fractures or defects of cast parts,” he says.
According to Eduard Kaplan, Chairman of the Board of ENRC Logistics LLC, the main advantage of Chinese-made railcars is the possibility of using modern bogies and wheel sets, equipped with cassette-type bearings, with a 500,000 km distance run between repairs. In his words, the drawbacks of the rolling stock are the need to create new repair facilities, different from the existing ones, for undercarriages, as well as the need to provide rolling stock inspection points and wagon repair companies with specific spare parts.
“When buying Chinese-made railcars, it became necessary to use spare parts specifically for a particular model of a railcar and, as a consequence, to create special reserves of expensive side frames and bolsters throughout the route where the rolling stock operates and at railcar repair depots,” says E. Kaplan. “In addition, when operating Chinese railcars, we had to develop and implement new technological processes of repair, and solve the railway administration issues of rolling stock acceptance after repair.”
All in all, Kazakh Railways purchased from China CNR Corporation (CNR) 2,000 railcars of the EM70 model in 2011. At that time, Estonian Railways (EVR) acquired 16 locomotives produced by the Chinese consortium CCOEC / BRE. It was the first time that a Chinese company had exported rolling stock to a country–member of the European Union.

Which Locomotive to Choose?

According to analysts, Estonia will stop buying Chinese rolling stock. Partly, because of the decision of Russia not to give access to Chinese locomotives to its railway network, which significantly reduces their application range. Other European railways prefer to develop their own production. For example, according to Stasis Gudvalis, Deputy CEO – Director for Cargo Transportation at Lithuanian Railways JSC, modernisation of shunting locomotives began in Lithuania in 2010, and 22 such locomotives were updated.
“In 2012, in cooperation with the Bryansk Locomotive Plant, we began to make shunting locomotives in Vilnius. A new locomotive consumes 30% less fuel. 60 of them work on our railway network now, and some were bought by RZD,” he says.
Unlike the Lithuanian, the Belarusian Railway is actively using locomotives made in China. It purchased the first batch of 12 Chinese electric locomotives in 2012. They were put into operation to service increasing transit flows. Chinese producers, however, failed to attract the interest of Belarusian railwaymen to their railcars, but an agreement about a supply of 18 single-section locomotives in 2015-2016 was signed recently. Vladimir Mikhailyuk, First Deputy Head of the Belarusian Railway, explains that they were purchased especially for express container trains.
“These are new locomotives on the Alstom platform. We used them in winter and in summer. There were no issues,” he added.
Products from Chinese railway machine builders are a remarkable phenomenon on the global market, but they will hardly increase sales because of the specifics of each country’s railways. A transfer to Chinese products in one sector will cause a similar transfer in other sectors, and the Baltic States and the CIS are not ready for it. Everyone, however, including Russian companies, use Chinese components from time to time.
By Tatyana Simonova

our reference
Machine building is an important industry for China. Proceeds from exports reach more than $2.5 billion. The largest machine building centers are Shanghai, Shenyang, Tianjin, Harbin, Beijing, Luoyang, Dalian, etc.
The product range exceeds 50,000 items of goods. The production of railway rolling stock is highly developed. China is the second in the world according to locomotive production volumes. On average, one diesel locomotive is produced in the country every 12 hours, one electric locomotive every 33 hours – electric, a passenger railcar - every 2.6 hours, and a cargo railcar – every 13 minutes.

[~DETAIL_TEXT] =>

Alternative Never Used

The first discussions about the import of railcars from China to Russia began back in 2007. At a closed meeting of the Council for Rail Transport of Participants of the CIS, the Baltic States and Finland, President of Russian Railways Vladimir Yakunin proposed with his colleagues to discuss the opportunity of using Chinese railcars, because at that time the situation with rolling stock was unfavourable. Russian railcar builders set high prices because of increased demand for their products. In this situation, Chinese rolling stock seemed to be the most promising alternative. Talks about importing Chinese products, however, were never turned into an actual agreement. During the recession in 2008-2009, Vladimir Putin, Prime Minister of Russia, announced that the Russian Government prohibited the Ministry of Transport and RZD to buy any machinery in China in order to support the Russian industry.

A Railcar for Everyone

There are no Chinese railcars in free circulation in Russia. There are only some components, such as cast parts, on the Russian market.
Despite the fact that Russia did not give Chinese machine builders access to its market, adjacent states decided to try railway products made in China. For example, Turkmenistan has been actively using Chinese products since 2005. Last year, China South Locomotive & Rolling Stock Corporation Limited (CSR) delivered to Turkmenistan 154 passenger railcars.
Uzbekistan Railways JSC bought from Zhuzhou Electric Locomotive 15 electric locomotives in 2008-2010. Amangeldy Otarbekov, Director of the Technical Department at Kaztemirtrans JSC, said that during the period of an acute shortage of freight railcars in the CIS in 2007, senior managers of Kazakhstan Temir Zholy decided to purchase new freight railcars made in China with higher carrying capacity and improved technical specifications.
“Gondola cars of the 12-9920 and 12-9941 models are used on all routes inside the country. They showed good results, there were no fractures or defects of cast parts,” he says.
According to Eduard Kaplan, Chairman of the Board of ENRC Logistics LLC, the main advantage of Chinese-made railcars is the possibility of using modern bogies and wheel sets, equipped with cassette-type bearings, with a 500,000 km distance run between repairs. In his words, the drawbacks of the rolling stock are the need to create new repair facilities, different from the existing ones, for undercarriages, as well as the need to provide rolling stock inspection points and wagon repair companies with specific spare parts.
“When buying Chinese-made railcars, it became necessary to use spare parts specifically for a particular model of a railcar and, as a consequence, to create special reserves of expensive side frames and bolsters throughout the route where the rolling stock operates and at railcar repair depots,” says E. Kaplan. “In addition, when operating Chinese railcars, we had to develop and implement new technological processes of repair, and solve the railway administration issues of rolling stock acceptance after repair.”
All in all, Kazakh Railways purchased from China CNR Corporation (CNR) 2,000 railcars of the EM70 model in 2011. At that time, Estonian Railways (EVR) acquired 16 locomotives produced by the Chinese consortium CCOEC / BRE. It was the first time that a Chinese company had exported rolling stock to a country–member of the European Union.

Which Locomotive to Choose?

According to analysts, Estonia will stop buying Chinese rolling stock. Partly, because of the decision of Russia not to give access to Chinese locomotives to its railway network, which significantly reduces their application range. Other European railways prefer to develop their own production. For example, according to Stasis Gudvalis, Deputy CEO – Director for Cargo Transportation at Lithuanian Railways JSC, modernisation of shunting locomotives began in Lithuania in 2010, and 22 such locomotives were updated.
“In 2012, in cooperation with the Bryansk Locomotive Plant, we began to make shunting locomotives in Vilnius. A new locomotive consumes 30% less fuel. 60 of them work on our railway network now, and some were bought by RZD,” he says.
Unlike the Lithuanian, the Belarusian Railway is actively using locomotives made in China. It purchased the first batch of 12 Chinese electric locomotives in 2012. They were put into operation to service increasing transit flows. Chinese producers, however, failed to attract the interest of Belarusian railwaymen to their railcars, but an agreement about a supply of 18 single-section locomotives in 2015-2016 was signed recently. Vladimir Mikhailyuk, First Deputy Head of the Belarusian Railway, explains that they were purchased especially for express container trains.
“These are new locomotives on the Alstom platform. We used them in winter and in summer. There were no issues,” he added.
Products from Chinese railway machine builders are a remarkable phenomenon on the global market, but they will hardly increase sales because of the specifics of each country’s railways. A transfer to Chinese products in one sector will cause a similar transfer in other sectors, and the Baltic States and the CIS are not ready for it. Everyone, however, including Russian companies, use Chinese components from time to time.
By Tatyana Simonova

our reference
Machine building is an important industry for China. Proceeds from exports reach more than $2.5 billion. The largest machine building centers are Shanghai, Shenyang, Tianjin, Harbin, Beijing, Luoyang, Dalian, etc.
The product range exceeds 50,000 items of goods. The production of railway rolling stock is highly developed. China is the second in the world according to locomotive production volumes. On average, one diesel locomotive is produced in the country every 12 hours, one electric locomotive every 33 hours – electric, a passenger railcar - every 2.6 hours, and a cargo railcar – every 13 minutes.

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Low cost and large volumes are synonymous with Chinese products.
Chinese goods, however, are not popular in every sector. A correspondent of The RZD-Partner International tried to figure out what Chinese machine building products are in demand in the CIS and Baltic countries.

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Low cost and large volumes are synonymous with Chinese products.
Chinese goods, however, are not popular in every sector. A correspondent of The RZD-Partner International tried to figure out what Chinese machine building products are in demand in the CIS and Baltic countries.

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РЖД-Партнер

Will Pure Water Clear the Baltic Sea of Cargo?

Will Pure Water Clear the Baltic Sea of Cargo?

New environmental protection standards can change the situation in a region as well as in the transport and logistics scheme of cargo transportation.

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Point of No Return

New stringent sulphur oxide (SOx) emissions regulations set by the International Maritime Organisation (IMO) will be implemented in the Baltic Sea region from January 1, 2015. Less than a year from now, there must be no more than 0.1% of sulphur in maritime fuel (90% less than it is permitted now) in Sulphur Emission Control Areas (SECA's), including the Baltic and the North seas. The amount of sulphur in maritime fuel will be 0.5% for all ports in the European Union from 2020, and this limit will be set for the whole world from 2025.

Russia Searches for Ways Out

There is an opinion that Russia could be in a difficult situation because of these changes. Market players, however, see several possible ways out of the situation. One of them is to equip vessels with air pollution control devices (scrubbers) or to begin using more expensive liquid fuel with a smaller percentage of sulphur (marine gas oil).
According to Alexander Goloviznin. Director for Logistics and Analytical Research at Morstroytechnology, this will not dramatically change the situation. The expert thinks that it is impossible to escape a rise in prices. According to him, because of these changes, the cost of bunker fuel in the Baltic sea may increase by 65-85%, and charter rates – by 40-80%. “An increase in cost is inevitable, because there is no mass production of low-suphur fuel in Russia (with less than 0.1% sulphur content),” says the expert.
He adds, however, that there are alternative solutions to the problem. One of them is to equip the Russian fleet to use LNG as fuel.

Gas as the Resort

In the words of Svetlana Vorontsova, Vice President of the Transport Integration group of companies, implementation of these measures can slow down the development of Russia and increase the competitiveness of European ports and fleets.
“We have other opportunities: immense reserves of gas. Russia ranks first in coal extraction. The infrastructure in this direction is developing nowadays,” comments the expert.
Using liquefied natural gas (LNG) allows the reduction of emissions of particulates and nitrogen oxides into the air and contains no sulfur.
Supporters of the new regulations propose shipping using LNG fuel as an alternative. However, this has several drawbacks. For example, tanks with LNG are very big, which makes using LNG inefficient for container vessels, bulk carriers, and tankers. Additionally, there is no infrastructure in the country so far, and there is price volatility in the LNG market. Meanwhile, the basic cargoes handled by Russian ports in the Baltic sea are containers, bulk cargo, oil, and petrochemicals.
While Sweden, Finland, Germany, and the Baltics have begun using liquefied natural gas, Russia is still thinking over variants. According to experts, construction of gas liquefying facilities on the coast, linking them with gas pipelines, and construction of special bunkering vessels are needed for mass usage of LNG.
In the words of Vorontsova, there is a private initiative to launch terminals which will use gas. Additionally, Gazprom Export plans to build two plants producing LNG in Vladivostok and St Petersburg by 2020. Their capacity will be approximately 10 million tons. The project for the St Petersburg plant will be presented this year.  
Implementation of any environmental standards depends not only on natural necessity, but on the political and economic interests of different countries and companies – representatives of different sectors. In the opinion of analysts, some freight can be switched to road transport due to the new standards. According to A. Goloviznin, rearrangement of cargo flows is expected in Russia and the EU. Some experts point to the fact that restrictions on sulphur and nitrogen oxide emissions for sea vessels will contribute to switching freight flow to other transport modes, first of all to automobile transport, which can have an even worse impact on the environment because of the increase in carbon dioxide emissions.
By Tatiana Simonova

[~DETAIL_TEXT] =>

Point of No Return

New stringent sulphur oxide (SOx) emissions regulations set by the International Maritime Organisation (IMO) will be implemented in the Baltic Sea region from January 1, 2015. Less than a year from now, there must be no more than 0.1% of sulphur in maritime fuel (90% less than it is permitted now) in Sulphur Emission Control Areas (SECA's), including the Baltic and the North seas. The amount of sulphur in maritime fuel will be 0.5% for all ports in the European Union from 2020, and this limit will be set for the whole world from 2025.

Russia Searches for Ways Out

There is an opinion that Russia could be in a difficult situation because of these changes. Market players, however, see several possible ways out of the situation. One of them is to equip vessels with air pollution control devices (scrubbers) or to begin using more expensive liquid fuel with a smaller percentage of sulphur (marine gas oil).
According to Alexander Goloviznin. Director for Logistics and Analytical Research at Morstroytechnology, this will not dramatically change the situation. The expert thinks that it is impossible to escape a rise in prices. According to him, because of these changes, the cost of bunker fuel in the Baltic sea may increase by 65-85%, and charter rates – by 40-80%. “An increase in cost is inevitable, because there is no mass production of low-suphur fuel in Russia (with less than 0.1% sulphur content),” says the expert.
He adds, however, that there are alternative solutions to the problem. One of them is to equip the Russian fleet to use LNG as fuel.

Gas as the Resort

In the words of Svetlana Vorontsova, Vice President of the Transport Integration group of companies, implementation of these measures can slow down the development of Russia and increase the competitiveness of European ports and fleets.
“We have other opportunities: immense reserves of gas. Russia ranks first in coal extraction. The infrastructure in this direction is developing nowadays,” comments the expert.
Using liquefied natural gas (LNG) allows the reduction of emissions of particulates and nitrogen oxides into the air and contains no sulfur.
Supporters of the new regulations propose shipping using LNG fuel as an alternative. However, this has several drawbacks. For example, tanks with LNG are very big, which makes using LNG inefficient for container vessels, bulk carriers, and tankers. Additionally, there is no infrastructure in the country so far, and there is price volatility in the LNG market. Meanwhile, the basic cargoes handled by Russian ports in the Baltic sea are containers, bulk cargo, oil, and petrochemicals.
While Sweden, Finland, Germany, and the Baltics have begun using liquefied natural gas, Russia is still thinking over variants. According to experts, construction of gas liquefying facilities on the coast, linking them with gas pipelines, and construction of special bunkering vessels are needed for mass usage of LNG.
In the words of Vorontsova, there is a private initiative to launch terminals which will use gas. Additionally, Gazprom Export plans to build two plants producing LNG in Vladivostok and St Petersburg by 2020. Their capacity will be approximately 10 million tons. The project for the St Petersburg plant will be presented this year.  
Implementation of any environmental standards depends not only on natural necessity, but on the political and economic interests of different countries and companies – representatives of different sectors. In the opinion of analysts, some freight can be switched to road transport due to the new standards. According to A. Goloviznin, rearrangement of cargo flows is expected in Russia and the EU. Some experts point to the fact that restrictions on sulphur and nitrogen oxide emissions for sea vessels will contribute to switching freight flow to other transport modes, first of all to automobile transport, which can have an even worse impact on the environment because of the increase in carbon dioxide emissions.
By Tatiana Simonova

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New environmental protection standards can change the situation in a region as well as in the transport and logistics scheme of cargo transportation.

[~PREVIEW_TEXT] =>

New environmental protection standards can change the situation in a region as well as in the transport and logistics scheme of cargo transportation.

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    [DETAIL_TEXT] => 

Point of No Return

New stringent sulphur oxide (SOx) emissions regulations set by the International Maritime Organisation (IMO) will be implemented in the Baltic Sea region from January 1, 2015. Less than a year from now, there must be no more than 0.1% of sulphur in maritime fuel (90% less than it is permitted now) in Sulphur Emission Control Areas (SECA's), including the Baltic and the North seas. The amount of sulphur in maritime fuel will be 0.5% for all ports in the European Union from 2020, and this limit will be set for the whole world from 2025.

Russia Searches for Ways Out

There is an opinion that Russia could be in a difficult situation because of these changes. Market players, however, see several possible ways out of the situation. One of them is to equip vessels with air pollution control devices (scrubbers) or to begin using more expensive liquid fuel with a smaller percentage of sulphur (marine gas oil).
According to Alexander Goloviznin. Director for Logistics and Analytical Research at Morstroytechnology, this will not dramatically change the situation. The expert thinks that it is impossible to escape a rise in prices. According to him, because of these changes, the cost of bunker fuel in the Baltic sea may increase by 65-85%, and charter rates – by 40-80%. “An increase in cost is inevitable, because there is no mass production of low-suphur fuel in Russia (with less than 0.1% sulphur content),” says the expert.
He adds, however, that there are alternative solutions to the problem. One of them is to equip the Russian fleet to use LNG as fuel.

Gas as the Resort

In the words of Svetlana Vorontsova, Vice President of the Transport Integration group of companies, implementation of these measures can slow down the development of Russia and increase the competitiveness of European ports and fleets.
“We have other opportunities: immense reserves of gas. Russia ranks first in coal extraction. The infrastructure in this direction is developing nowadays,” comments the expert.
Using liquefied natural gas (LNG) allows the reduction of emissions of particulates and nitrogen oxides into the air and contains no sulfur.
Supporters of the new regulations propose shipping using LNG fuel as an alternative. However, this has several drawbacks. For example, tanks with LNG are very big, which makes using LNG inefficient for container vessels, bulk carriers, and tankers. Additionally, there is no infrastructure in the country so far, and there is price volatility in the LNG market. Meanwhile, the basic cargoes handled by Russian ports in the Baltic sea are containers, bulk cargo, oil, and petrochemicals.
While Sweden, Finland, Germany, and the Baltics have begun using liquefied natural gas, Russia is still thinking over variants. According to experts, construction of gas liquefying facilities on the coast, linking them with gas pipelines, and construction of special bunkering vessels are needed for mass usage of LNG.
In the words of Vorontsova, there is a private initiative to launch terminals which will use gas. Additionally, Gazprom Export plans to build two plants producing LNG in Vladivostok and St Petersburg by 2020. Their capacity will be approximately 10 million tons. The project for the St Petersburg plant will be presented this year.  
Implementation of any environmental standards depends not only on natural necessity, but on the political and economic interests of different countries and companies – representatives of different sectors. In the opinion of analysts, some freight can be switched to road transport due to the new standards. According to A. Goloviznin, rearrangement of cargo flows is expected in Russia and the EU. Some experts point to the fact that restrictions on sulphur and nitrogen oxide emissions for sea vessels will contribute to switching freight flow to other transport modes, first of all to automobile transport, which can have an even worse impact on the environment because of the increase in carbon dioxide emissions.
By Tatiana Simonova

[~DETAIL_TEXT] =>

Point of No Return

New stringent sulphur oxide (SOx) emissions regulations set by the International Maritime Organisation (IMO) will be implemented in the Baltic Sea region from January 1, 2015. Less than a year from now, there must be no more than 0.1% of sulphur in maritime fuel (90% less than it is permitted now) in Sulphur Emission Control Areas (SECA's), including the Baltic and the North seas. The amount of sulphur in maritime fuel will be 0.5% for all ports in the European Union from 2020, and this limit will be set for the whole world from 2025.

Russia Searches for Ways Out

There is an opinion that Russia could be in a difficult situation because of these changes. Market players, however, see several possible ways out of the situation. One of them is to equip vessels with air pollution control devices (scrubbers) or to begin using more expensive liquid fuel with a smaller percentage of sulphur (marine gas oil).
According to Alexander Goloviznin. Director for Logistics and Analytical Research at Morstroytechnology, this will not dramatically change the situation. The expert thinks that it is impossible to escape a rise in prices. According to him, because of these changes, the cost of bunker fuel in the Baltic sea may increase by 65-85%, and charter rates – by 40-80%. “An increase in cost is inevitable, because there is no mass production of low-suphur fuel in Russia (with less than 0.1% sulphur content),” says the expert.
He adds, however, that there are alternative solutions to the problem. One of them is to equip the Russian fleet to use LNG as fuel.

Gas as the Resort

In the words of Svetlana Vorontsova, Vice President of the Transport Integration group of companies, implementation of these measures can slow down the development of Russia and increase the competitiveness of European ports and fleets.
“We have other opportunities: immense reserves of gas. Russia ranks first in coal extraction. The infrastructure in this direction is developing nowadays,” comments the expert.
Using liquefied natural gas (LNG) allows the reduction of emissions of particulates and nitrogen oxides into the air and contains no sulfur.
Supporters of the new regulations propose shipping using LNG fuel as an alternative. However, this has several drawbacks. For example, tanks with LNG are very big, which makes using LNG inefficient for container vessels, bulk carriers, and tankers. Additionally, there is no infrastructure in the country so far, and there is price volatility in the LNG market. Meanwhile, the basic cargoes handled by Russian ports in the Baltic sea are containers, bulk cargo, oil, and petrochemicals.
While Sweden, Finland, Germany, and the Baltics have begun using liquefied natural gas, Russia is still thinking over variants. According to experts, construction of gas liquefying facilities on the coast, linking them with gas pipelines, and construction of special bunkering vessels are needed for mass usage of LNG.
In the words of Vorontsova, there is a private initiative to launch terminals which will use gas. Additionally, Gazprom Export plans to build two plants producing LNG in Vladivostok and St Petersburg by 2020. Their capacity will be approximately 10 million tons. The project for the St Petersburg plant will be presented this year.  
Implementation of any environmental standards depends not only on natural necessity, but on the political and economic interests of different countries and companies – representatives of different sectors. In the opinion of analysts, some freight can be switched to road transport due to the new standards. According to A. Goloviznin, rearrangement of cargo flows is expected in Russia and the EU. Some experts point to the fact that restrictions on sulphur and nitrogen oxide emissions for sea vessels will contribute to switching freight flow to other transport modes, first of all to automobile transport, which can have an even worse impact on the environment because of the increase in carbon dioxide emissions.
By Tatiana Simonova

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New environmental protection standards can change the situation in a region as well as in the transport and logistics scheme of cargo transportation.

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РЖД-Партнер

To Save on Packaging, to Save on Logistics

To Save on Packaging, to Save on Logistics

The costs of separate components of the logistics chain are closely interrelated. For example, saving on transport costs may lead to a significant increase in costs caused by a growth of stock reserves, and saving on packaging can lead to damaged cargo. There are so many options and schemes in the logistics market today that modern types and methods of packaging allow delivery of goods in good order and condition, and also to pay special attention to the environment.

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    [DETAIL_TEXT] => 

New Life in Old Packing

Producing packing, the MoloPak company uses cartons made by Blue Ridge Paper Products Inc. (USA). As they say in the company, one one-litre carton pack weighs just 29 grams, and a half-litre pack – only 18 grams. Packs are compactly put in corrugated boxes, then placed on STAND pallets and crated.
“Therefore, 95% of the total weight of the cargo is the packing (net weight), and the other 5% is boxes, pallets, and crate. “Compact” transportation allows reduced fuel consumption and air pollution. We also recycle used packs,” say specialists at MoloPak.
“Wastelessness is achieved through recycling all process waste. Our Belarusian partners produce toilet paper, egg cells, paper plates, and a lot of other household products out of cardboard.”
Perhaps the most extensive work on the environment is carried out by IKEA. In addition to the production of furniture from all parts of the wood, IKEA transforms old plastic bottles into Tpepas chests of drawers. They are made of 100% recycled PET bottles. Moreover, collection points for recycling of electrical and electronic equipment, packaging waste, batteries and energy-saving lamps are organised in most of IKEA’s stores.
“Developing product packaging, we think of its appearance least of all. Our goal is not to increase sales, but to reduce costs. Flat packages allow optimum use of transport resources and, therefore, reduce harmful emissions into the air. We strive at making packages from recycled products. Unbleached cardboard is one of the findings allowing us to not only save money but also reduce the negative impact on the environment,” explains the press-service of the company.
Also, IKEA has patented special loading platforms, which are an alternative to conventional wooden pallets. They use flexible tires, so the final size of the unit load is defined by the size of goods, which is impossible with a rigid pallet. The tires are made from polypropylene, which can be endlessly reused. The size and shape of such cargo units can be changed to match the size of a container. These loading platforms can be easily moved by a forklift truck. The weight of the platform is small, so its capacity is two tons more than that of an ordinary pallet.

The Right Package Is the Basis of Success

“Today, amid economic development, there are tougher requirements for the efficiency of internal logistics management at plants. That’s why GEFCO Group has developed a comprehensive solution for customers to manage reusable packaging through the GefboxSystem service. It is an innovative, reliable, environmentally friendly and economical way to support producers in their ambition for sustainable development”, says Andrey Anufriev, Head of the GEFCO separate subdivision in Kaluga.
According to him, this service is based on an extensive range of boxes, containers and pallets made of standardised plastic in an ergonomic design. These reduce the number of cargoes requiring special attention and simplify transportation.
“Today, this system is used in 1,500 industrial enterprises in Europe. In Russia, this service is provided to PSMA Rus LLC plant, a joint venture between PSA Peugeot Citroën and Mitsubishi. With this decision, the company manages to provide optimal protection for components, reduce expenses for the plant, and protect the environment, simultaneously optimising the total logistics budget,” adds A. Anufriev.
Both industrial and logistics companies are focusing on the development of optimal schemes for container loading, minimisation of the cost of transportation and storage of goods. A similar project was launched by the company’s subdivision in the UK. An individual packaging solution was developed for a producer of engines for vehicles made by Jaguar Land Rover Ltd. The producer of car components was provided with large plastic Magnum Optimum containers for transportation of goods.
“We are delighted to be afforded this exciting opportunity to build on our relationship with Jaguar Land Rover Limited, and to achieve further growth and development of our GefBox solution, which is already used by 1,500 manufacturers across 22 international markets,” said Philippe Doyer, GEFCO’s Director for Warehousing and Reusable Packaging.
Through the use of Magnum Optimum plastic containers the company will be able to ensure the safety of components and the environment, while reducing costs and optimising its total logistics budget. According to specialists of the company, supplies of reusable packaging will be controlled by a unique NetBox3 system, developed by GEFCO, which ensures real time visibility of packaging stock at the supplier and JLR production plants. Based on the integration and reuse of industrial packaging, the system allows a significant reduction in the number of vehicles on the road and the amount of waste. The integrity and strength of containers are checked regularly. When developing the packaging, ergonomic issues and protection of fragile components are carefully worked through.
“Also, we are talking about the search for optimal solutions that take into account restrictions on weight and dimensions of the cargo, stacking, safety, ergonomics, storage conditions, and so on,” he adds.
According to the expert, a one-sided approach, which takes into account only the requirement of the maximum load of each packaging unit may be counterproductive.
“In the framework of joint projects with our customers, we get information about the specifics of the cargo, requirements for its transportation and storage, in order to develop and implement the most efficient logistic solutions. In some cases, if required, GEFCO designs, orders for production, and then provides a customer with specific types of reusable containers matching his cargo,” he notes.
In the words of Konstantin Sokolov, Director General of Commercial Port of Vladivostok (VMTP), there have appeared folding 20 foot containers made of a special plastic that can withstand the load of a standard container. Folded empty containers need fivefold less place than standard metal boxes, which significantly reduces logistics expenses. Moreover, less time and money is spent on repair, because damaged panels can be quickly replaced.
However, according to the expert, use of traditional containers as well as plastic ones is economically sound.
“The use of containers allowed implementation of door-to-door delivery technology. Thanks to modern technologies, almost any type of cargo can be transported in containers: bulk, packaged, large, heavy, but certainly within the scope and capacity of the container,” he adds.
Today, there are large-capacity Pallet Wide containers on the market.
“It allowed placing up to 5 euro pallets additionally (in comparison with the standard 40-foot container),” explains K. Sokolov.
Alexander Sivertsev, Head of the Design Department at Russian Railways Logistics JSC, believes that special attention should be paid to packaging and the security of cargo.
“For example, we transport grain cargoes from Siberia to the Asia-Pacific Region, including China, in universal containers using an insert. The dimensions of this Pallet Wide polypropylene bag are the same as those of a universal container. The design of the insert allows loading up to 95% of the usable volume of the container and up to 26 tons of cargo. The weight of the package is only 10-15 kg. The use of modern materials, protecting goods from dirt and moisture, and the special design provide for the complete safety of the goods during transportation. After unloading, the packaging is 100% recyclable, which makes a minimal impact on the environment,” he says.
Note that the container insert can be used for carrying foodstuffs (cereals, sugar, malt, animal feed, etc.) and chemicals (sulfur, fertilizers, pellets of polypropylene, PVC, etc.).
Another relatively new type of packaging is Flexitanks. They are used for bulk liquid transportation.
“It’s a flexible polymeric reservoir for bulk liquid transportation in reinforced 20-foot containers by all transport modes. With its help, up to 24,000 liters of food and non-hazardous chemical cargoes can be transported in a universal container,” says A. Sivertsev.
Originally, flexitanks were used mainly to supply wine materials. Today, they carry vegetable oil and palm oil, molasses, industrial oils, and other goods. Specialised equipment for heating is used in winter for transportation of viscous cargoes.
“When unloaded, the packaging is sent for recycling, and the container can be used for a return shipment of finished products. Therefore, there is neither an empty run nor the need to wash the equipment. As a result, expenses on logistics are reduced,” concludes the expert.
Market participants note that today companies are trying to make the most of the working volume of a container and its carrying capacity to increase their competitive advantage. And new types of packaging are helping with this.
By Tatyana Simonova

[~DETAIL_TEXT] =>

New Life in Old Packing

Producing packing, the MoloPak company uses cartons made by Blue Ridge Paper Products Inc. (USA). As they say in the company, one one-litre carton pack weighs just 29 grams, and a half-litre pack – only 18 grams. Packs are compactly put in corrugated boxes, then placed on STAND pallets and crated.
“Therefore, 95% of the total weight of the cargo is the packing (net weight), and the other 5% is boxes, pallets, and crate. “Compact” transportation allows reduced fuel consumption and air pollution. We also recycle used packs,” say specialists at MoloPak.
“Wastelessness is achieved through recycling all process waste. Our Belarusian partners produce toilet paper, egg cells, paper plates, and a lot of other household products out of cardboard.”
Perhaps the most extensive work on the environment is carried out by IKEA. In addition to the production of furniture from all parts of the wood, IKEA transforms old plastic bottles into Tpepas chests of drawers. They are made of 100% recycled PET bottles. Moreover, collection points for recycling of electrical and electronic equipment, packaging waste, batteries and energy-saving lamps are organised in most of IKEA’s stores.
“Developing product packaging, we think of its appearance least of all. Our goal is not to increase sales, but to reduce costs. Flat packages allow optimum use of transport resources and, therefore, reduce harmful emissions into the air. We strive at making packages from recycled products. Unbleached cardboard is one of the findings allowing us to not only save money but also reduce the negative impact on the environment,” explains the press-service of the company.
Also, IKEA has patented special loading platforms, which are an alternative to conventional wooden pallets. They use flexible tires, so the final size of the unit load is defined by the size of goods, which is impossible with a rigid pallet. The tires are made from polypropylene, which can be endlessly reused. The size and shape of such cargo units can be changed to match the size of a container. These loading platforms can be easily moved by a forklift truck. The weight of the platform is small, so its capacity is two tons more than that of an ordinary pallet.

The Right Package Is the Basis of Success

“Today, amid economic development, there are tougher requirements for the efficiency of internal logistics management at plants. That’s why GEFCO Group has developed a comprehensive solution for customers to manage reusable packaging through the GefboxSystem service. It is an innovative, reliable, environmentally friendly and economical way to support producers in their ambition for sustainable development”, says Andrey Anufriev, Head of the GEFCO separate subdivision in Kaluga.
According to him, this service is based on an extensive range of boxes, containers and pallets made of standardised plastic in an ergonomic design. These reduce the number of cargoes requiring special attention and simplify transportation.
“Today, this system is used in 1,500 industrial enterprises in Europe. In Russia, this service is provided to PSMA Rus LLC plant, a joint venture between PSA Peugeot Citroën and Mitsubishi. With this decision, the company manages to provide optimal protection for components, reduce expenses for the plant, and protect the environment, simultaneously optimising the total logistics budget,” adds A. Anufriev.
Both industrial and logistics companies are focusing on the development of optimal schemes for container loading, minimisation of the cost of transportation and storage of goods. A similar project was launched by the company’s subdivision in the UK. An individual packaging solution was developed for a producer of engines for vehicles made by Jaguar Land Rover Ltd. The producer of car components was provided with large plastic Magnum Optimum containers for transportation of goods.
“We are delighted to be afforded this exciting opportunity to build on our relationship with Jaguar Land Rover Limited, and to achieve further growth and development of our GefBox solution, which is already used by 1,500 manufacturers across 22 international markets,” said Philippe Doyer, GEFCO’s Director for Warehousing and Reusable Packaging.
Through the use of Magnum Optimum plastic containers the company will be able to ensure the safety of components and the environment, while reducing costs and optimising its total logistics budget. According to specialists of the company, supplies of reusable packaging will be controlled by a unique NetBox3 system, developed by GEFCO, which ensures real time visibility of packaging stock at the supplier and JLR production plants. Based on the integration and reuse of industrial packaging, the system allows a significant reduction in the number of vehicles on the road and the amount of waste. The integrity and strength of containers are checked regularly. When developing the packaging, ergonomic issues and protection of fragile components are carefully worked through.
“Also, we are talking about the search for optimal solutions that take into account restrictions on weight and dimensions of the cargo, stacking, safety, ergonomics, storage conditions, and so on,” he adds.
According to the expert, a one-sided approach, which takes into account only the requirement of the maximum load of each packaging unit may be counterproductive.
“In the framework of joint projects with our customers, we get information about the specifics of the cargo, requirements for its transportation and storage, in order to develop and implement the most efficient logistic solutions. In some cases, if required, GEFCO designs, orders for production, and then provides a customer with specific types of reusable containers matching his cargo,” he notes.
In the words of Konstantin Sokolov, Director General of Commercial Port of Vladivostok (VMTP), there have appeared folding 20 foot containers made of a special plastic that can withstand the load of a standard container. Folded empty containers need fivefold less place than standard metal boxes, which significantly reduces logistics expenses. Moreover, less time and money is spent on repair, because damaged panels can be quickly replaced.
However, according to the expert, use of traditional containers as well as plastic ones is economically sound.
“The use of containers allowed implementation of door-to-door delivery technology. Thanks to modern technologies, almost any type of cargo can be transported in containers: bulk, packaged, large, heavy, but certainly within the scope and capacity of the container,” he adds.
Today, there are large-capacity Pallet Wide containers on the market.
“It allowed placing up to 5 euro pallets additionally (in comparison with the standard 40-foot container),” explains K. Sokolov.
Alexander Sivertsev, Head of the Design Department at Russian Railways Logistics JSC, believes that special attention should be paid to packaging and the security of cargo.
“For example, we transport grain cargoes from Siberia to the Asia-Pacific Region, including China, in universal containers using an insert. The dimensions of this Pallet Wide polypropylene bag are the same as those of a universal container. The design of the insert allows loading up to 95% of the usable volume of the container and up to 26 tons of cargo. The weight of the package is only 10-15 kg. The use of modern materials, protecting goods from dirt and moisture, and the special design provide for the complete safety of the goods during transportation. After unloading, the packaging is 100% recyclable, which makes a minimal impact on the environment,” he says.
Note that the container insert can be used for carrying foodstuffs (cereals, sugar, malt, animal feed, etc.) and chemicals (sulfur, fertilizers, pellets of polypropylene, PVC, etc.).
Another relatively new type of packaging is Flexitanks. They are used for bulk liquid transportation.
“It’s a flexible polymeric reservoir for bulk liquid transportation in reinforced 20-foot containers by all transport modes. With its help, up to 24,000 liters of food and non-hazardous chemical cargoes can be transported in a universal container,” says A. Sivertsev.
Originally, flexitanks were used mainly to supply wine materials. Today, they carry vegetable oil and palm oil, molasses, industrial oils, and other goods. Specialised equipment for heating is used in winter for transportation of viscous cargoes.
“When unloaded, the packaging is sent for recycling, and the container can be used for a return shipment of finished products. Therefore, there is neither an empty run nor the need to wash the equipment. As a result, expenses on logistics are reduced,” concludes the expert.
Market participants note that today companies are trying to make the most of the working volume of a container and its carrying capacity to increase their competitive advantage. And new types of packaging are helping with this.
By Tatyana Simonova

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The costs of separate components of the logistics chain are closely interrelated. For example, saving on transport costs may lead to a significant increase in costs caused by a growth of stock reserves, and saving on packaging can lead to damaged cargo. There are so many options and schemes in the logistics market today that modern types and methods of packaging allow delivery of goods in good order and condition, and also to pay special attention to the environment.

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The costs of separate components of the logistics chain are closely interrelated. For example, saving on transport costs may lead to a significant increase in costs caused by a growth of stock reserves, and saving on packaging can lead to damaged cargo. There are so many options and schemes in the logistics market today that modern types and methods of packaging allow delivery of goods in good order and condition, and also to pay special attention to the environment.

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New Life in Old Packing

Producing packing, the MoloPak company uses cartons made by Blue Ridge Paper Products Inc. (USA). As they say in the company, one one-litre carton pack weighs just 29 grams, and a half-litre pack – only 18 grams. Packs are compactly put in corrugated boxes, then placed on STAND pallets and crated.
“Therefore, 95% of the total weight of the cargo is the packing (net weight), and the other 5% is boxes, pallets, and crate. “Compact” transportation allows reduced fuel consumption and air pollution. We also recycle used packs,” say specialists at MoloPak.
“Wastelessness is achieved through recycling all process waste. Our Belarusian partners produce toilet paper, egg cells, paper plates, and a lot of other household products out of cardboard.”
Perhaps the most extensive work on the environment is carried out by IKEA. In addition to the production of furniture from all parts of the wood, IKEA transforms old plastic bottles into Tpepas chests of drawers. They are made of 100% recycled PET bottles. Moreover, collection points for recycling of electrical and electronic equipment, packaging waste, batteries and energy-saving lamps are organised in most of IKEA’s stores.
“Developing product packaging, we think of its appearance least of all. Our goal is not to increase sales, but to reduce costs. Flat packages allow optimum use of transport resources and, therefore, reduce harmful emissions into the air. We strive at making packages from recycled products. Unbleached cardboard is one of the findings allowing us to not only save money but also reduce the negative impact on the environment,” explains the press-service of the company.
Also, IKEA has patented special loading platforms, which are an alternative to conventional wooden pallets. They use flexible tires, so the final size of the unit load is defined by the size of goods, which is impossible with a rigid pallet. The tires are made from polypropylene, which can be endlessly reused. The size and shape of such cargo units can be changed to match the size of a container. These loading platforms can be easily moved by a forklift truck. The weight of the platform is small, so its capacity is two tons more than that of an ordinary pallet.

The Right Package Is the Basis of Success

“Today, amid economic development, there are tougher requirements for the efficiency of internal logistics management at plants. That’s why GEFCO Group has developed a comprehensive solution for customers to manage reusable packaging through the GefboxSystem service. It is an innovative, reliable, environmentally friendly and economical way to support producers in their ambition for sustainable development”, says Andrey Anufriev, Head of the GEFCO separate subdivision in Kaluga.
According to him, this service is based on an extensive range of boxes, containers and pallets made of standardised plastic in an ergonomic design. These reduce the number of cargoes requiring special attention and simplify transportation.
“Today, this system is used in 1,500 industrial enterprises in Europe. In Russia, this service is provided to PSMA Rus LLC plant, a joint venture between PSA Peugeot Citroën and Mitsubishi. With this decision, the company manages to provide optimal protection for components, reduce expenses for the plant, and protect the environment, simultaneously optimising the total logistics budget,” adds A. Anufriev.
Both industrial and logistics companies are focusing on the development of optimal schemes for container loading, minimisation of the cost of transportation and storage of goods. A similar project was launched by the company’s subdivision in the UK. An individual packaging solution was developed for a producer of engines for vehicles made by Jaguar Land Rover Ltd. The producer of car components was provided with large plastic Magnum Optimum containers for transportation of goods.
“We are delighted to be afforded this exciting opportunity to build on our relationship with Jaguar Land Rover Limited, and to achieve further growth and development of our GefBox solution, which is already used by 1,500 manufacturers across 22 international markets,” said Philippe Doyer, GEFCO’s Director for Warehousing and Reusable Packaging.
Through the use of Magnum Optimum plastic containers the company will be able to ensure the safety of components and the environment, while reducing costs and optimising its total logistics budget. According to specialists of the company, supplies of reusable packaging will be controlled by a unique NetBox3 system, developed by GEFCO, which ensures real time visibility of packaging stock at the supplier and JLR production plants. Based on the integration and reuse of industrial packaging, the system allows a significant reduction in the number of vehicles on the road and the amount of waste. The integrity and strength of containers are checked regularly. When developing the packaging, ergonomic issues and protection of fragile components are carefully worked through.
“Also, we are talking about the search for optimal solutions that take into account restrictions on weight and dimensions of the cargo, stacking, safety, ergonomics, storage conditions, and so on,” he adds.
According to the expert, a one-sided approach, which takes into account only the requirement of the maximum load of each packaging unit may be counterproductive.
“In the framework of joint projects with our customers, we get information about the specifics of the cargo, requirements for its transportation and storage, in order to develop and implement the most efficient logistic solutions. In some cases, if required, GEFCO designs, orders for production, and then provides a customer with specific types of reusable containers matching his cargo,” he notes.
In the words of Konstantin Sokolov, Director General of Commercial Port of Vladivostok (VMTP), there have appeared folding 20 foot containers made of a special plastic that can withstand the load of a standard container. Folded empty containers need fivefold less place than standard metal boxes, which significantly reduces logistics expenses. Moreover, less time and money is spent on repair, because damaged panels can be quickly replaced.
However, according to the expert, use of traditional containers as well as plastic ones is economically sound.
“The use of containers allowed implementation of door-to-door delivery technology. Thanks to modern technologies, almost any type of cargo can be transported in containers: bulk, packaged, large, heavy, but certainly within the scope and capacity of the container,” he adds.
Today, there are large-capacity Pallet Wide containers on the market.
“It allowed placing up to 5 euro pallets additionally (in comparison with the standard 40-foot container),” explains K. Sokolov.
Alexander Sivertsev, Head of the Design Department at Russian Railways Logistics JSC, believes that special attention should be paid to packaging and the security of cargo.
“For example, we transport grain cargoes from Siberia to the Asia-Pacific Region, including China, in universal containers using an insert. The dimensions of this Pallet Wide polypropylene bag are the same as those of a universal container. The design of the insert allows loading up to 95% of the usable volume of the container and up to 26 tons of cargo. The weight of the package is only 10-15 kg. The use of modern materials, protecting goods from dirt and moisture, and the special design provide for the complete safety of the goods during transportation. After unloading, the packaging is 100% recyclable, which makes a minimal impact on the environment,” he says.
Note that the container insert can be used for carrying foodstuffs (cereals, sugar, malt, animal feed, etc.) and chemicals (sulfur, fertilizers, pellets of polypropylene, PVC, etc.).
Another relatively new type of packaging is Flexitanks. They are used for bulk liquid transportation.
“It’s a flexible polymeric reservoir for bulk liquid transportation in reinforced 20-foot containers by all transport modes. With its help, up to 24,000 liters of food and non-hazardous chemical cargoes can be transported in a universal container,” says A. Sivertsev.
Originally, flexitanks were used mainly to supply wine materials. Today, they carry vegetable oil and palm oil, molasses, industrial oils, and other goods. Specialised equipment for heating is used in winter for transportation of viscous cargoes.
“When unloaded, the packaging is sent for recycling, and the container can be used for a return shipment of finished products. Therefore, there is neither an empty run nor the need to wash the equipment. As a result, expenses on logistics are reduced,” concludes the expert.
Market participants note that today companies are trying to make the most of the working volume of a container and its carrying capacity to increase their competitive advantage. And new types of packaging are helping with this.
By Tatyana Simonova

[~DETAIL_TEXT] =>

New Life in Old Packing

Producing packing, the MoloPak company uses cartons made by Blue Ridge Paper Products Inc. (USA). As they say in the company, one one-litre carton pack weighs just 29 grams, and a half-litre pack – only 18 grams. Packs are compactly put in corrugated boxes, then placed on STAND pallets and crated.
“Therefore, 95% of the total weight of the cargo is the packing (net weight), and the other 5% is boxes, pallets, and crate. “Compact” transportation allows reduced fuel consumption and air pollution. We also recycle used packs,” say specialists at MoloPak.
“Wastelessness is achieved through recycling all process waste. Our Belarusian partners produce toilet paper, egg cells, paper plates, and a lot of other household products out of cardboard.”
Perhaps the most extensive work on the environment is carried out by IKEA. In addition to the production of furniture from all parts of the wood, IKEA transforms old plastic bottles into Tpepas chests of drawers. They are made of 100% recycled PET bottles. Moreover, collection points for recycling of electrical and electronic equipment, packaging waste, batteries and energy-saving lamps are organised in most of IKEA’s stores.
“Developing product packaging, we think of its appearance least of all. Our goal is not to increase sales, but to reduce costs. Flat packages allow optimum use of transport resources and, therefore, reduce harmful emissions into the air. We strive at making packages from recycled products. Unbleached cardboard is one of the findings allowing us to not only save money but also reduce the negative impact on the environment,” explains the press-service of the company.
Also, IKEA has patented special loading platforms, which are an alternative to conventional wooden pallets. They use flexible tires, so the final size of the unit load is defined by the size of goods, which is impossible with a rigid pallet. The tires are made from polypropylene, which can be endlessly reused. The size and shape of such cargo units can be changed to match the size of a container. These loading platforms can be easily moved by a forklift truck. The weight of the platform is small, so its capacity is two tons more than that of an ordinary pallet.

The Right Package Is the Basis of Success

“Today, amid economic development, there are tougher requirements for the efficiency of internal logistics management at plants. That’s why GEFCO Group has developed a comprehensive solution for customers to manage reusable packaging through the GefboxSystem service. It is an innovative, reliable, environmentally friendly and economical way to support producers in their ambition for sustainable development”, says Andrey Anufriev, Head of the GEFCO separate subdivision in Kaluga.
According to him, this service is based on an extensive range of boxes, containers and pallets made of standardised plastic in an ergonomic design. These reduce the number of cargoes requiring special attention and simplify transportation.
“Today, this system is used in 1,500 industrial enterprises in Europe. In Russia, this service is provided to PSMA Rus LLC plant, a joint venture between PSA Peugeot Citroën and Mitsubishi. With this decision, the company manages to provide optimal protection for components, reduce expenses for the plant, and protect the environment, simultaneously optimising the total logistics budget,” adds A. Anufriev.
Both industrial and logistics companies are focusing on the development of optimal schemes for container loading, minimisation of the cost of transportation and storage of goods. A similar project was launched by the company’s subdivision in the UK. An individual packaging solution was developed for a producer of engines for vehicles made by Jaguar Land Rover Ltd. The producer of car components was provided with large plastic Magnum Optimum containers for transportation of goods.
“We are delighted to be afforded this exciting opportunity to build on our relationship with Jaguar Land Rover Limited, and to achieve further growth and development of our GefBox solution, which is already used by 1,500 manufacturers across 22 international markets,” said Philippe Doyer, GEFCO’s Director for Warehousing and Reusable Packaging.
Through the use of Magnum Optimum plastic containers the company will be able to ensure the safety of components and the environment, while reducing costs and optimising its total logistics budget. According to specialists of the company, supplies of reusable packaging will be controlled by a unique NetBox3 system, developed by GEFCO, which ensures real time visibility of packaging stock at the supplier and JLR production plants. Based on the integration and reuse of industrial packaging, the system allows a significant reduction in the number of vehicles on the road and the amount of waste. The integrity and strength of containers are checked regularly. When developing the packaging, ergonomic issues and protection of fragile components are carefully worked through.
“Also, we are talking about the search for optimal solutions that take into account restrictions on weight and dimensions of the cargo, stacking, safety, ergonomics, storage conditions, and so on,” he adds.
According to the expert, a one-sided approach, which takes into account only the requirement of the maximum load of each packaging unit may be counterproductive.
“In the framework of joint projects with our customers, we get information about the specifics of the cargo, requirements for its transportation and storage, in order to develop and implement the most efficient logistic solutions. In some cases, if required, GEFCO designs, orders for production, and then provides a customer with specific types of reusable containers matching his cargo,” he notes.
In the words of Konstantin Sokolov, Director General of Commercial Port of Vladivostok (VMTP), there have appeared folding 20 foot containers made of a special plastic that can withstand the load of a standard container. Folded empty containers need fivefold less place than standard metal boxes, which significantly reduces logistics expenses. Moreover, less time and money is spent on repair, because damaged panels can be quickly replaced.
However, according to the expert, use of traditional containers as well as plastic ones is economically sound.
“The use of containers allowed implementation of door-to-door delivery technology. Thanks to modern technologies, almost any type of cargo can be transported in containers: bulk, packaged, large, heavy, but certainly within the scope and capacity of the container,” he adds.
Today, there are large-capacity Pallet Wide containers on the market.
“It allowed placing up to 5 euro pallets additionally (in comparison with the standard 40-foot container),” explains K. Sokolov.
Alexander Sivertsev, Head of the Design Department at Russian Railways Logistics JSC, believes that special attention should be paid to packaging and the security of cargo.
“For example, we transport grain cargoes from Siberia to the Asia-Pacific Region, including China, in universal containers using an insert. The dimensions of this Pallet Wide polypropylene bag are the same as those of a universal container. The design of the insert allows loading up to 95% of the usable volume of the container and up to 26 tons of cargo. The weight of the package is only 10-15 kg. The use of modern materials, protecting goods from dirt and moisture, and the special design provide for the complete safety of the goods during transportation. After unloading, the packaging is 100% recyclable, which makes a minimal impact on the environment,” he says.
Note that the container insert can be used for carrying foodstuffs (cereals, sugar, malt, animal feed, etc.) and chemicals (sulfur, fertilizers, pellets of polypropylene, PVC, etc.).
Another relatively new type of packaging is Flexitanks. They are used for bulk liquid transportation.
“It’s a flexible polymeric reservoir for bulk liquid transportation in reinforced 20-foot containers by all transport modes. With its help, up to 24,000 liters of food and non-hazardous chemical cargoes can be transported in a universal container,” says A. Sivertsev.
Originally, flexitanks were used mainly to supply wine materials. Today, they carry vegetable oil and palm oil, molasses, industrial oils, and other goods. Specialised equipment for heating is used in winter for transportation of viscous cargoes.
“When unloaded, the packaging is sent for recycling, and the container can be used for a return shipment of finished products. Therefore, there is neither an empty run nor the need to wash the equipment. As a result, expenses on logistics are reduced,” concludes the expert.
Market participants note that today companies are trying to make the most of the working volume of a container and its carrying capacity to increase their competitive advantage. And new types of packaging are helping with this.
By Tatyana Simonova

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The costs of separate components of the logistics chain are closely interrelated. For example, saving on transport costs may lead to a significant increase in costs caused by a growth of stock reserves, and saving on packaging can lead to damaged cargo. There are so many options and schemes in the logistics market today that modern types and methods of packaging allow delivery of goods in good order and condition, and also to pay special attention to the environment.

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The costs of separate components of the logistics chain are closely interrelated. For example, saving on transport costs may lead to a significant increase in costs caused by a growth of stock reserves, and saving on packaging can lead to damaged cargo. There are so many options and schemes in the logistics market today that modern types and methods of packaging allow delivery of goods in good order and condition, and also to pay special attention to the environment.

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РЖД-Партнер

Finland: “Green” Components of Success

Finland:  “Green” Components of Success

According to the development strategy of Finland, the country's transport system will be one of the most developed in terms of the application of environmental technologies in the world by 2020. How did this small
Nordic country manage to implement such technologies as eco-mobiles and “reverse logistics”, and what other forthcoming innovations will make Finland the “green” leader?

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Test Site

Finland was one of the first 15 countries of the European Union, which in 2002, ratified the Kyoto Protocol that provides a system of quotas of greenhouse gas emissions. This is the first global agreement on the protection of the environment. If a country produces fewer harmful emissions than spelled out in the Protocol, then the rest of the quota can be sold to another State. If a country produces far more than its quota, then it has to pay.
Since then, Finland has committed itself to creating a “low-carbon society.” In addition, in 2011, the emissions of harmful substances into the atmosphere on its territory were even lower than envisaged in the Kyoto Protocol. Each year, they have continued to decline. The introduction of new modes of transport and logistics played an important role here.
There are two Finnish companies – Outotec, the global leader in technologies for processing of minerals and metals, and oil company Neste among the top-ranked companies based on sustainable development, presented by Corporate Knights in January this year. Both companies comprehensively implement the concept of sustainable development, including their “green” supply chains.
At the national level, there are three Institutes in Finland – Sitra, Tekes and VTT, who today are responsible for the development of “green” solutions. In addition, lots of regional universities and engineering centers take part in this work. “Our main supplier of eco-technologies is our Technical University,” says the Mayor of Lappeenranta Kimmo Jarva. “And the task of the Administration is to test and introduce all the research and the experience that makes the University. In addition, it is important to involve not only business, but also ordinary people. We have built the world's largest windfarm, which uses the energy of the wind. Another interesting novelty is that soon we will buy special water pumps, which will facilitate the circulation of stagnated water in Lake Saimaa, which will keep it weed-free. The city plans to put a new form of transportation – hybrid buses – into operation. If we talk about the contribution of private business, the biggest investment of 150 million euros was made by UPM, a leader in the pulp and paper industry. The company is currently building a plant for the production of bio-diesel in Lappeenranta. Thus, we will be able to implement cleaner fuels.”
According to K. Jarva, the switch to environmentally friendly technologies can only happen if both the State and private companies, and the people themselves would like to do it. There are no special subsidies for companies that want to introduce environmentally friendly production, but it is no secret that the tenders organized by the administrations of cities, usually choose those with «green» credentials. In this case, as noted by K. Jarva, his city does not mind becoming a test site for all the novelties, and then offer them in other regions.

Image is Everything!

Why do Finnish companies choose a path of sustainable development? The researchers from BearingPoint tried to answer this question and interviewed nearly 600 members; they found that most of them decided to stick to this strategy because of the EU directives that simply cannot be avoided. In the second place the answer was image.
This option is a major catalyst for new solutions in Finland. For example, such concepts as the EcoHub. This special place will connect all modes of transport. In addition, there will be warehousing and housing facilities for the workers organized there. All – in line with the concept of sustainable development.
According to Jyrki Luukonlahti, Director of the project, Finnish companies have a positive attitude to this idea, but they are skeptical that it really will help them cut costs. However, the project's developers say that in 5-10 years EU laws on the environment will become even tougher, so in any case, companies will have to consider the possibility of connections to the eco-park.
Many infrastructural companies will provide customers with all the necessary services, security, cleaning and waste treatment. The concept also implies that the client company is able to provide its services to other parties in exchange for their service, according to developers. This mutually beneficial partnership, according to the authors, will reduce costs.
Finland is focused on the future. The Minister for the environment of Finland Ville Niinisto said that in the future, about 80% of the world's population would live in cities. It means that now you need to create the appropriate environment and preserve natural resources for future generations. “It is necessary to actively invest in the development of green technology, especially in the regions where you can experiment and test new sources of energy, recycling systems and environmentally friendly transport,” said V.Niinisto.
Sanna Vaalgamaa, a consultant from the company Ecobio, supports this point of view. “It is important to start cooperation with stakeholders in the early stages of the project, taking into account the environmental aspects - impacts on flora and fauna, noise levels, traffic density.” According to her, when planning a new logistics facility, such as a port, it is important to make an analysis of the terrain for the future and, therefore, impact upon the environment. For example, to be sure that animals will not suffer or their migration routes will not be violated. 

Switching to Rails

Riku Siren, head of the Finnish company Megahub believes that the environment and logistics are in conflict when it comes to their reconciliation. In general, the construction of the right terminals can make the logistics chain more “green”, because you can't completely avoid road transportation. His company develops storage facilities. He says that they are completely environmentally friendly for 30 years. Inside there is a special system of temperature control, allowing you to reduce or increase its level in different parts of the terminal.
In Finland, companies are doing their best to make supply chains environmentally friendly, and so they have introduced eco-transport. Some cities already have eco-mobiles and eco-buses, as well as the corresponding infrastructure being built for them, but still railways are the leaders of green transport.
In Finland, the rail operator VR Group is a company which adopted five commitments to be eco-friendlier between 2013-2020. Thus, the Company undertakes to improve energy efficiency by 20%, use more renewable sources, focus on recycling, etc. VR Group also wants to increase the ratio of clients who see the company as “the greenest choice.” In 2013 only 69% of the passengers agreed with this statement. It means that the image is also important for Finnish companies.
Today the Finnish authorities regard their country as a “testing ground” for new technologies. According to K. Jarva, it doesn't matter, whether the idea will prompt a major industrial company, or a small start-up. The administrations of cities are ready to test any innovation, and share it with other regions and other countries. With regard to the exchange of technology with Russia, the representatives of Finnish companies still say that in Russia their environmental technologies are not so important.
On the question of whether Russia has a chance to follow in the footsteps of Finland and turn their cities into eco-cities, the Mayor of Lappeenranta says that it is important to pay attention to regions. The first step here might be factories for reprocessing waste into biofuel at the Finnish border.
By Kristina Alexandrova

[~DETAIL_TEXT] =>

Test Site

Finland was one of the first 15 countries of the European Union, which in 2002, ratified the Kyoto Protocol that provides a system of quotas of greenhouse gas emissions. This is the first global agreement on the protection of the environment. If a country produces fewer harmful emissions than spelled out in the Protocol, then the rest of the quota can be sold to another State. If a country produces far more than its quota, then it has to pay.
Since then, Finland has committed itself to creating a “low-carbon society.” In addition, in 2011, the emissions of harmful substances into the atmosphere on its territory were even lower than envisaged in the Kyoto Protocol. Each year, they have continued to decline. The introduction of new modes of transport and logistics played an important role here.
There are two Finnish companies – Outotec, the global leader in technologies for processing of minerals and metals, and oil company Neste among the top-ranked companies based on sustainable development, presented by Corporate Knights in January this year. Both companies comprehensively implement the concept of sustainable development, including their “green” supply chains.
At the national level, there are three Institutes in Finland – Sitra, Tekes and VTT, who today are responsible for the development of “green” solutions. In addition, lots of regional universities and engineering centers take part in this work. “Our main supplier of eco-technologies is our Technical University,” says the Mayor of Lappeenranta Kimmo Jarva. “And the task of the Administration is to test and introduce all the research and the experience that makes the University. In addition, it is important to involve not only business, but also ordinary people. We have built the world's largest windfarm, which uses the energy of the wind. Another interesting novelty is that soon we will buy special water pumps, which will facilitate the circulation of stagnated water in Lake Saimaa, which will keep it weed-free. The city plans to put a new form of transportation – hybrid buses – into operation. If we talk about the contribution of private business, the biggest investment of 150 million euros was made by UPM, a leader in the pulp and paper industry. The company is currently building a plant for the production of bio-diesel in Lappeenranta. Thus, we will be able to implement cleaner fuels.”
According to K. Jarva, the switch to environmentally friendly technologies can only happen if both the State and private companies, and the people themselves would like to do it. There are no special subsidies for companies that want to introduce environmentally friendly production, but it is no secret that the tenders organized by the administrations of cities, usually choose those with «green» credentials. In this case, as noted by K. Jarva, his city does not mind becoming a test site for all the novelties, and then offer them in other regions.

Image is Everything!

Why do Finnish companies choose a path of sustainable development? The researchers from BearingPoint tried to answer this question and interviewed nearly 600 members; they found that most of them decided to stick to this strategy because of the EU directives that simply cannot be avoided. In the second place the answer was image.
This option is a major catalyst for new solutions in Finland. For example, such concepts as the EcoHub. This special place will connect all modes of transport. In addition, there will be warehousing and housing facilities for the workers organized there. All – in line with the concept of sustainable development.
According to Jyrki Luukonlahti, Director of the project, Finnish companies have a positive attitude to this idea, but they are skeptical that it really will help them cut costs. However, the project's developers say that in 5-10 years EU laws on the environment will become even tougher, so in any case, companies will have to consider the possibility of connections to the eco-park.
Many infrastructural companies will provide customers with all the necessary services, security, cleaning and waste treatment. The concept also implies that the client company is able to provide its services to other parties in exchange for their service, according to developers. This mutually beneficial partnership, according to the authors, will reduce costs.
Finland is focused on the future. The Minister for the environment of Finland Ville Niinisto said that in the future, about 80% of the world's population would live in cities. It means that now you need to create the appropriate environment and preserve natural resources for future generations. “It is necessary to actively invest in the development of green technology, especially in the regions where you can experiment and test new sources of energy, recycling systems and environmentally friendly transport,” said V.Niinisto.
Sanna Vaalgamaa, a consultant from the company Ecobio, supports this point of view. “It is important to start cooperation with stakeholders in the early stages of the project, taking into account the environmental aspects - impacts on flora and fauna, noise levels, traffic density.” According to her, when planning a new logistics facility, such as a port, it is important to make an analysis of the terrain for the future and, therefore, impact upon the environment. For example, to be sure that animals will not suffer or their migration routes will not be violated. 

Switching to Rails

Riku Siren, head of the Finnish company Megahub believes that the environment and logistics are in conflict when it comes to their reconciliation. In general, the construction of the right terminals can make the logistics chain more “green”, because you can't completely avoid road transportation. His company develops storage facilities. He says that they are completely environmentally friendly for 30 years. Inside there is a special system of temperature control, allowing you to reduce or increase its level in different parts of the terminal.
In Finland, companies are doing their best to make supply chains environmentally friendly, and so they have introduced eco-transport. Some cities already have eco-mobiles and eco-buses, as well as the corresponding infrastructure being built for them, but still railways are the leaders of green transport.
In Finland, the rail operator VR Group is a company which adopted five commitments to be eco-friendlier between 2013-2020. Thus, the Company undertakes to improve energy efficiency by 20%, use more renewable sources, focus on recycling, etc. VR Group also wants to increase the ratio of clients who see the company as “the greenest choice.” In 2013 only 69% of the passengers agreed with this statement. It means that the image is also important for Finnish companies.
Today the Finnish authorities regard their country as a “testing ground” for new technologies. According to K. Jarva, it doesn't matter, whether the idea will prompt a major industrial company, or a small start-up. The administrations of cities are ready to test any innovation, and share it with other regions and other countries. With regard to the exchange of technology with Russia, the representatives of Finnish companies still say that in Russia their environmental technologies are not so important.
On the question of whether Russia has a chance to follow in the footsteps of Finland and turn their cities into eco-cities, the Mayor of Lappeenranta says that it is important to pay attention to regions. The first step here might be factories for reprocessing waste into biofuel at the Finnish border.
By Kristina Alexandrova

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According to the development strategy of Finland, the country's transport system will be one of the most developed in terms of the application of environmental technologies in the world by 2020. How did this small
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According to the development strategy of Finland, the country's transport system will be one of the most developed in terms of the application of environmental technologies in the world by 2020. How did this small
Nordic country manage to implement such technologies as eco-mobiles and “reverse logistics”, and what other forthcoming innovations will make Finland the “green” leader?

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Test Site

Finland was one of the first 15 countries of the European Union, which in 2002, ratified the Kyoto Protocol that provides a system of quotas of greenhouse gas emissions. This is the first global agreement on the protection of the environment. If a country produces fewer harmful emissions than spelled out in the Protocol, then the rest of the quota can be sold to another State. If a country produces far more than its quota, then it has to pay.
Since then, Finland has committed itself to creating a “low-carbon society.” In addition, in 2011, the emissions of harmful substances into the atmosphere on its territory were even lower than envisaged in the Kyoto Protocol. Each year, they have continued to decline. The introduction of new modes of transport and logistics played an important role here.
There are two Finnish companies – Outotec, the global leader in technologies for processing of minerals and metals, and oil company Neste among the top-ranked companies based on sustainable development, presented by Corporate Knights in January this year. Both companies comprehensively implement the concept of sustainable development, including their “green” supply chains.
At the national level, there are three Institutes in Finland – Sitra, Tekes and VTT, who today are responsible for the development of “green” solutions. In addition, lots of regional universities and engineering centers take part in this work. “Our main supplier of eco-technologies is our Technical University,” says the Mayor of Lappeenranta Kimmo Jarva. “And the task of the Administration is to test and introduce all the research and the experience that makes the University. In addition, it is important to involve not only business, but also ordinary people. We have built the world's largest windfarm, which uses the energy of the wind. Another interesting novelty is that soon we will buy special water pumps, which will facilitate the circulation of stagnated water in Lake Saimaa, which will keep it weed-free. The city plans to put a new form of transportation – hybrid buses – into operation. If we talk about the contribution of private business, the biggest investment of 150 million euros was made by UPM, a leader in the pulp and paper industry. The company is currently building a plant for the production of bio-diesel in Lappeenranta. Thus, we will be able to implement cleaner fuels.”
According to K. Jarva, the switch to environmentally friendly technologies can only happen if both the State and private companies, and the people themselves would like to do it. There are no special subsidies for companies that want to introduce environmentally friendly production, but it is no secret that the tenders organized by the administrations of cities, usually choose those with «green» credentials. In this case, as noted by K. Jarva, his city does not mind becoming a test site for all the novelties, and then offer them in other regions.

Image is Everything!

Why do Finnish companies choose a path of sustainable development? The researchers from BearingPoint tried to answer this question and interviewed nearly 600 members; they found that most of them decided to stick to this strategy because of the EU directives that simply cannot be avoided. In the second place the answer was image.
This option is a major catalyst for new solutions in Finland. For example, such concepts as the EcoHub. This special place will connect all modes of transport. In addition, there will be warehousing and housing facilities for the workers organized there. All – in line with the concept of sustainable development.
According to Jyrki Luukonlahti, Director of the project, Finnish companies have a positive attitude to this idea, but they are skeptical that it really will help them cut costs. However, the project's developers say that in 5-10 years EU laws on the environment will become even tougher, so in any case, companies will have to consider the possibility of connections to the eco-park.
Many infrastructural companies will provide customers with all the necessary services, security, cleaning and waste treatment. The concept also implies that the client company is able to provide its services to other parties in exchange for their service, according to developers. This mutually beneficial partnership, according to the authors, will reduce costs.
Finland is focused on the future. The Minister for the environment of Finland Ville Niinisto said that in the future, about 80% of the world's population would live in cities. It means that now you need to create the appropriate environment and preserve natural resources for future generations. “It is necessary to actively invest in the development of green technology, especially in the regions where you can experiment and test new sources of energy, recycling systems and environmentally friendly transport,” said V.Niinisto.
Sanna Vaalgamaa, a consultant from the company Ecobio, supports this point of view. “It is important to start cooperation with stakeholders in the early stages of the project, taking into account the environmental aspects - impacts on flora and fauna, noise levels, traffic density.” According to her, when planning a new logistics facility, such as a port, it is important to make an analysis of the terrain for the future and, therefore, impact upon the environment. For example, to be sure that animals will not suffer or their migration routes will not be violated. 

Switching to Rails

Riku Siren, head of the Finnish company Megahub believes that the environment and logistics are in conflict when it comes to their reconciliation. In general, the construction of the right terminals can make the logistics chain more “green”, because you can't completely avoid road transportation. His company develops storage facilities. He says that they are completely environmentally friendly for 30 years. Inside there is a special system of temperature control, allowing you to reduce or increase its level in different parts of the terminal.
In Finland, companies are doing their best to make supply chains environmentally friendly, and so they have introduced eco-transport. Some cities already have eco-mobiles and eco-buses, as well as the corresponding infrastructure being built for them, but still railways are the leaders of green transport.
In Finland, the rail operator VR Group is a company which adopted five commitments to be eco-friendlier between 2013-2020. Thus, the Company undertakes to improve energy efficiency by 20%, use more renewable sources, focus on recycling, etc. VR Group also wants to increase the ratio of clients who see the company as “the greenest choice.” In 2013 only 69% of the passengers agreed with this statement. It means that the image is also important for Finnish companies.
Today the Finnish authorities regard their country as a “testing ground” for new technologies. According to K. Jarva, it doesn't matter, whether the idea will prompt a major industrial company, or a small start-up. The administrations of cities are ready to test any innovation, and share it with other regions and other countries. With regard to the exchange of technology with Russia, the representatives of Finnish companies still say that in Russia their environmental technologies are not so important.
On the question of whether Russia has a chance to follow in the footsteps of Finland and turn their cities into eco-cities, the Mayor of Lappeenranta says that it is important to pay attention to regions. The first step here might be factories for reprocessing waste into biofuel at the Finnish border.
By Kristina Alexandrova

[~DETAIL_TEXT] =>

Test Site

Finland was one of the first 15 countries of the European Union, which in 2002, ratified the Kyoto Protocol that provides a system of quotas of greenhouse gas emissions. This is the first global agreement on the protection of the environment. If a country produces fewer harmful emissions than spelled out in the Protocol, then the rest of the quota can be sold to another State. If a country produces far more than its quota, then it has to pay.
Since then, Finland has committed itself to creating a “low-carbon society.” In addition, in 2011, the emissions of harmful substances into the atmosphere on its territory were even lower than envisaged in the Kyoto Protocol. Each year, they have continued to decline. The introduction of new modes of transport and logistics played an important role here.
There are two Finnish companies – Outotec, the global leader in technologies for processing of minerals and metals, and oil company Neste among the top-ranked companies based on sustainable development, presented by Corporate Knights in January this year. Both companies comprehensively implement the concept of sustainable development, including their “green” supply chains.
At the national level, there are three Institutes in Finland – Sitra, Tekes and VTT, who today are responsible for the development of “green” solutions. In addition, lots of regional universities and engineering centers take part in this work. “Our main supplier of eco-technologies is our Technical University,” says the Mayor of Lappeenranta Kimmo Jarva. “And the task of the Administration is to test and introduce all the research and the experience that makes the University. In addition, it is important to involve not only business, but also ordinary people. We have built the world's largest windfarm, which uses the energy of the wind. Another interesting novelty is that soon we will buy special water pumps, which will facilitate the circulation of stagnated water in Lake Saimaa, which will keep it weed-free. The city plans to put a new form of transportation – hybrid buses – into operation. If we talk about the contribution of private business, the biggest investment of 150 million euros was made by UPM, a leader in the pulp and paper industry. The company is currently building a plant for the production of bio-diesel in Lappeenranta. Thus, we will be able to implement cleaner fuels.”
According to K. Jarva, the switch to environmentally friendly technologies can only happen if both the State and private companies, and the people themselves would like to do it. There are no special subsidies for companies that want to introduce environmentally friendly production, but it is no secret that the tenders organized by the administrations of cities, usually choose those with «green» credentials. In this case, as noted by K. Jarva, his city does not mind becoming a test site for all the novelties, and then offer them in other regions.

Image is Everything!

Why do Finnish companies choose a path of sustainable development? The researchers from BearingPoint tried to answer this question and interviewed nearly 600 members; they found that most of them decided to stick to this strategy because of the EU directives that simply cannot be avoided. In the second place the answer was image.
This option is a major catalyst for new solutions in Finland. For example, such concepts as the EcoHub. This special place will connect all modes of transport. In addition, there will be warehousing and housing facilities for the workers organized there. All – in line with the concept of sustainable development.
According to Jyrki Luukonlahti, Director of the project, Finnish companies have a positive attitude to this idea, but they are skeptical that it really will help them cut costs. However, the project's developers say that in 5-10 years EU laws on the environment will become even tougher, so in any case, companies will have to consider the possibility of connections to the eco-park.
Many infrastructural companies will provide customers with all the necessary services, security, cleaning and waste treatment. The concept also implies that the client company is able to provide its services to other parties in exchange for their service, according to developers. This mutually beneficial partnership, according to the authors, will reduce costs.
Finland is focused on the future. The Minister for the environment of Finland Ville Niinisto said that in the future, about 80% of the world's population would live in cities. It means that now you need to create the appropriate environment and preserve natural resources for future generations. “It is necessary to actively invest in the development of green technology, especially in the regions where you can experiment and test new sources of energy, recycling systems and environmentally friendly transport,” said V.Niinisto.
Sanna Vaalgamaa, a consultant from the company Ecobio, supports this point of view. “It is important to start cooperation with stakeholders in the early stages of the project, taking into account the environmental aspects - impacts on flora and fauna, noise levels, traffic density.” According to her, when planning a new logistics facility, such as a port, it is important to make an analysis of the terrain for the future and, therefore, impact upon the environment. For example, to be sure that animals will not suffer or their migration routes will not be violated. 

Switching to Rails

Riku Siren, head of the Finnish company Megahub believes that the environment and logistics are in conflict when it comes to their reconciliation. In general, the construction of the right terminals can make the logistics chain more “green”, because you can't completely avoid road transportation. His company develops storage facilities. He says that they are completely environmentally friendly for 30 years. Inside there is a special system of temperature control, allowing you to reduce or increase its level in different parts of the terminal.
In Finland, companies are doing their best to make supply chains environmentally friendly, and so they have introduced eco-transport. Some cities already have eco-mobiles and eco-buses, as well as the corresponding infrastructure being built for them, but still railways are the leaders of green transport.
In Finland, the rail operator VR Group is a company which adopted five commitments to be eco-friendlier between 2013-2020. Thus, the Company undertakes to improve energy efficiency by 20%, use more renewable sources, focus on recycling, etc. VR Group also wants to increase the ratio of clients who see the company as “the greenest choice.” In 2013 only 69% of the passengers agreed with this statement. It means that the image is also important for Finnish companies.
Today the Finnish authorities regard their country as a “testing ground” for new technologies. According to K. Jarva, it doesn't matter, whether the idea will prompt a major industrial company, or a small start-up. The administrations of cities are ready to test any innovation, and share it with other regions and other countries. With regard to the exchange of technology with Russia, the representatives of Finnish companies still say that in Russia their environmental technologies are not so important.
On the question of whether Russia has a chance to follow in the footsteps of Finland and turn their cities into eco-cities, the Mayor of Lappeenranta says that it is important to pay attention to regions. The first step here might be factories for reprocessing waste into biofuel at the Finnish border.
By Kristina Alexandrova

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According to the development strategy of Finland, the country's transport system will be one of the most developed in terms of the application of environmental technologies in the world by 2020. How did this small
Nordic country manage to implement such technologies as eco-mobiles and “reverse logistics”, and what other forthcoming innovations will make Finland the “green” leader?

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According to the development strategy of Finland, the country's transport system will be one of the most developed in terms of the application of environmental technologies in the world by 2020. How did this small
Nordic country manage to implement such technologies as eco-mobiles and “reverse logistics”, and what other forthcoming innovations will make Finland the “green” leader?

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РЖД-Партнер

Environmental Efficiency as an Advantage

Environmental Efficiency as an Advantage

The market has always considered the “green” logistics concept as something fashionable, but not profitable. But European countries are still sure that implementation of green technologies is an advantage.
The best illustration is Finnish railway company - VR Group. President and CEO of VR Group Mikael Aro speaks to us about the performance of his company and the latests innovations in this sector.

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Renewal Processes

– Mr Aro, could you please tell us about the results of VR Group’s operations for the current year? What important projects in the freight and passenger sector have been undertaken?

– Rail freight volumes grew in the second quarter by 7.6% and amounted to 2427 million tonne kilometres. The reason for the larger transport volume is the growth in transports in the metal and chemical industries. International rail freight volumes grew by 13.2 per cent. Total VR Logistics transport volumes grew over the reference period by 3.1 per cent. Our market share of rail freight services has been growing, and we have reached a record level of over 28 percent of the total logistics market in Finland.
VR Transpoint has opened a new combined rail and road Cargo East terminal in Kouvola, near the Russian border. It serves as a hub for eastbound transports. It provides a full range of services, including intermediate storing and customs clearance.
In the passenger services market special offer campaigns for long-distance services and cheaper advance tickets boosted sales. In general, the average price of domestic long-distance trips fell slightly in the second quarter. The general economic climate contributed to a drop in passenger volumes, and there were less people travelling between Russia and Finland due to the rouble’s rate falling.
We have had our new ticketing and pricing system in operation for three years. It has greatly improved both our ability to react in changes in demand and the overall image of the company as a modern, customer-orientated enterprise.

– What are the most urgent objectives for the development of rail transport in Finland?

– We are in the middle of a vast renewal of our fleet. Our investments in rolling stock and electric engines are of epic proportions. We have purchased modern double-decked passenger cars, sleeping cars, restaurant cars and steering cars. At the same time there is a modernisation of freight wagons going on. New series of more efficient, faster electric engines will be in operation in two years’ time.
VR Group aims to improve its efficiency in operations through restructuring,with additional big investments in new technology, such as RFID and IT systems.
Simultaneously, the maintenance of the rail network is lagging behind. Since 1995, it has been the Finnish Transport Agency which is responsible for the rail network, not the rail company. We are working closely together in order to achieve a rise in budget funds for the rail network.

– What can you tell us about competition between road and rail transport in Finland? What does VR Group do to attract more traffic?

– The demand for logistics services is highly dependent on industrial production in Finland as well as economic development in Russia. VR Transpoint is actively seeking growth in both the domestic and eastern transport markets.

Excellent Relations

– What is the current state of relations between Finnish Railways and Russian Railways? Are these relations somehow affected by sanctions?

– We have an outstanding tradition of very close co-operation, which has lasted for decades. Current relations are excellent. As railway companies, we concentrate on our daily work in serving our customers. Train operations between the countries have not been affected.

– What projects are you undertaking together with RZD?

– Our main achievement together is the high speed Allegro train connection between St Petersburg and Helsinki. In both passenger and freight services we co-operate very closely on a daily basis.

– Are you satisfied with the Allegro train’s performance? What new services were offered to passengers this year?

– VR is very satisfied with Allegro and its success. We have doubled the number of passengers on the route. It is an internationally acknowledged example of high speed services across borders.
VR and the Finnish airline Finnair have started a code share co-operation, which means that the passengers on international flights can combine the Allgero train trip with their flight. We are convinced that this will have a positive impact on Allegro passenger numbers.

– What is your opinion on the 4th railway package? Will its implementation somehow affect the transport market in Finland and VR Group’s operations?

– It is a vast European legislation package, with six EU directives to be amended. There are many proposals especially in the technical section which we fully support. However, proposals concerning opening up the market should be considered very carefully, as to which decisions are to be made by the EU, and which decisions the member states should take themselves. The circumstances vary greatly from country to country.

Purchasing Green Technologies

– What are VR Group’s main initiatives in the green logistics sector?

What has already been done in this area? What will be done in the near future?
– Our main targets are to improve energy efficiency and to increase the share of renewable energy sources. The transport sector is largely, almost fully, dependent on fossil fuels.  Since 2008, VR Group has been purchasing green electricity, hydropower. Two thirds of our train-kilometres are running on renewable energy. Further improvements include promoting efficient driving and increasing the average size of our trains.

– What barriers do you consider exist for companies applying green logistics?

– The challenge is mainly a commercial one: demand for green logistics by the customers may grow. This will probably happen, when the economic situation improves and on the other hand, when political pressure intensifies for new solutions to climate change and other environmental problems.
In Finland, 90 % of the rail network has only a single track. That is a big barrier to achieving an efficient traffic structure.
– Do you consider green logistics to be a cost saver or an unnecessary expense ?
– Improving environmental performance goes hand in hand with improving efficiency in logistics. The cost of energy is a big factor for each rail company, so it pays off to become greener.
– If you were advising organizations on green logistics, what are the main changes or improvements that you would recommend?
– Environmental efficiency can be an advantage in competition, because it increases overall efficiency. You should apply both a strong commitment from the management and new technology to your operations.
Interviewed by Kristina Alexandrova

[~DETAIL_TEXT] =>

Renewal Processes

– Mr Aro, could you please tell us about the results of VR Group’s operations for the current year? What important projects in the freight and passenger sector have been undertaken?

– Rail freight volumes grew in the second quarter by 7.6% and amounted to 2427 million tonne kilometres. The reason for the larger transport volume is the growth in transports in the metal and chemical industries. International rail freight volumes grew by 13.2 per cent. Total VR Logistics transport volumes grew over the reference period by 3.1 per cent. Our market share of rail freight services has been growing, and we have reached a record level of over 28 percent of the total logistics market in Finland.
VR Transpoint has opened a new combined rail and road Cargo East terminal in Kouvola, near the Russian border. It serves as a hub for eastbound transports. It provides a full range of services, including intermediate storing and customs clearance.
In the passenger services market special offer campaigns for long-distance services and cheaper advance tickets boosted sales. In general, the average price of domestic long-distance trips fell slightly in the second quarter. The general economic climate contributed to a drop in passenger volumes, and there were less people travelling between Russia and Finland due to the rouble’s rate falling.
We have had our new ticketing and pricing system in operation for three years. It has greatly improved both our ability to react in changes in demand and the overall image of the company as a modern, customer-orientated enterprise.

– What are the most urgent objectives for the development of rail transport in Finland?

– We are in the middle of a vast renewal of our fleet. Our investments in rolling stock and electric engines are of epic proportions. We have purchased modern double-decked passenger cars, sleeping cars, restaurant cars and steering cars. At the same time there is a modernisation of freight wagons going on. New series of more efficient, faster electric engines will be in operation in two years’ time.
VR Group aims to improve its efficiency in operations through restructuring,with additional big investments in new technology, such as RFID and IT systems.
Simultaneously, the maintenance of the rail network is lagging behind. Since 1995, it has been the Finnish Transport Agency which is responsible for the rail network, not the rail company. We are working closely together in order to achieve a rise in budget funds for the rail network.

– What can you tell us about competition between road and rail transport in Finland? What does VR Group do to attract more traffic?

– The demand for logistics services is highly dependent on industrial production in Finland as well as economic development in Russia. VR Transpoint is actively seeking growth in both the domestic and eastern transport markets.

Excellent Relations

– What is the current state of relations between Finnish Railways and Russian Railways? Are these relations somehow affected by sanctions?

– We have an outstanding tradition of very close co-operation, which has lasted for decades. Current relations are excellent. As railway companies, we concentrate on our daily work in serving our customers. Train operations between the countries have not been affected.

– What projects are you undertaking together with RZD?

– Our main achievement together is the high speed Allegro train connection between St Petersburg and Helsinki. In both passenger and freight services we co-operate very closely on a daily basis.

– Are you satisfied with the Allegro train’s performance? What new services were offered to passengers this year?

– VR is very satisfied with Allegro and its success. We have doubled the number of passengers on the route. It is an internationally acknowledged example of high speed services across borders.
VR and the Finnish airline Finnair have started a code share co-operation, which means that the passengers on international flights can combine the Allgero train trip with their flight. We are convinced that this will have a positive impact on Allegro passenger numbers.

– What is your opinion on the 4th railway package? Will its implementation somehow affect the transport market in Finland and VR Group’s operations?

– It is a vast European legislation package, with six EU directives to be amended. There are many proposals especially in the technical section which we fully support. However, proposals concerning opening up the market should be considered very carefully, as to which decisions are to be made by the EU, and which decisions the member states should take themselves. The circumstances vary greatly from country to country.

Purchasing Green Technologies

– What are VR Group’s main initiatives in the green logistics sector?

What has already been done in this area? What will be done in the near future?
– Our main targets are to improve energy efficiency and to increase the share of renewable energy sources. The transport sector is largely, almost fully, dependent on fossil fuels.  Since 2008, VR Group has been purchasing green electricity, hydropower. Two thirds of our train-kilometres are running on renewable energy. Further improvements include promoting efficient driving and increasing the average size of our trains.

– What barriers do you consider exist for companies applying green logistics?

– The challenge is mainly a commercial one: demand for green logistics by the customers may grow. This will probably happen, when the economic situation improves and on the other hand, when political pressure intensifies for new solutions to climate change and other environmental problems.
In Finland, 90 % of the rail network has only a single track. That is a big barrier to achieving an efficient traffic structure.
– Do you consider green logistics to be a cost saver or an unnecessary expense ?
– Improving environmental performance goes hand in hand with improving efficiency in logistics. The cost of energy is a big factor for each rail company, so it pays off to become greener.
– If you were advising organizations on green logistics, what are the main changes or improvements that you would recommend?
– Environmental efficiency can be an advantage in competition, because it increases overall efficiency. You should apply both a strong commitment from the management and new technology to your operations.
Interviewed by Kristina Alexandrova

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The market has always considered the “green” logistics concept as something fashionable, but not profitable. But European countries are still sure that implementation of green technologies is an advantage.
The best illustration is Finnish railway company - VR Group. President and CEO of VR Group Mikael Aro speaks to us about the performance of his company and the latests innovations in this sector.

[~PREVIEW_TEXT] =>

The market has always considered the “green” logistics concept as something fashionable, but not profitable. But European countries are still sure that implementation of green technologies is an advantage.
The best illustration is Finnish railway company - VR Group. President and CEO of VR Group Mikael Aro speaks to us about the performance of his company and the latests innovations in this sector.

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Renewal Processes

– Mr Aro, could you please tell us about the results of VR Group’s operations for the current year? What important projects in the freight and passenger sector have been undertaken?

– Rail freight volumes grew in the second quarter by 7.6% and amounted to 2427 million tonne kilometres. The reason for the larger transport volume is the growth in transports in the metal and chemical industries. International rail freight volumes grew by 13.2 per cent. Total VR Logistics transport volumes grew over the reference period by 3.1 per cent. Our market share of rail freight services has been growing, and we have reached a record level of over 28 percent of the total logistics market in Finland.
VR Transpoint has opened a new combined rail and road Cargo East terminal in Kouvola, near the Russian border. It serves as a hub for eastbound transports. It provides a full range of services, including intermediate storing and customs clearance.
In the passenger services market special offer campaigns for long-distance services and cheaper advance tickets boosted sales. In general, the average price of domestic long-distance trips fell slightly in the second quarter. The general economic climate contributed to a drop in passenger volumes, and there were less people travelling between Russia and Finland due to the rouble’s rate falling.
We have had our new ticketing and pricing system in operation for three years. It has greatly improved both our ability to react in changes in demand and the overall image of the company as a modern, customer-orientated enterprise.

– What are the most urgent objectives for the development of rail transport in Finland?

– We are in the middle of a vast renewal of our fleet. Our investments in rolling stock and electric engines are of epic proportions. We have purchased modern double-decked passenger cars, sleeping cars, restaurant cars and steering cars. At the same time there is a modernisation of freight wagons going on. New series of more efficient, faster electric engines will be in operation in two years’ time.
VR Group aims to improve its efficiency in operations through restructuring,with additional big investments in new technology, such as RFID and IT systems.
Simultaneously, the maintenance of the rail network is lagging behind. Since 1995, it has been the Finnish Transport Agency which is responsible for the rail network, not the rail company. We are working closely together in order to achieve a rise in budget funds for the rail network.

– What can you tell us about competition between road and rail transport in Finland? What does VR Group do to attract more traffic?

– The demand for logistics services is highly dependent on industrial production in Finland as well as economic development in Russia. VR Transpoint is actively seeking growth in both the domestic and eastern transport markets.

Excellent Relations

– What is the current state of relations between Finnish Railways and Russian Railways? Are these relations somehow affected by sanctions?

– We have an outstanding tradition of very close co-operation, which has lasted for decades. Current relations are excellent. As railway companies, we concentrate on our daily work in serving our customers. Train operations between the countries have not been affected.

– What projects are you undertaking together with RZD?

– Our main achievement together is the high speed Allegro train connection between St Petersburg and Helsinki. In both passenger and freight services we co-operate very closely on a daily basis.

– Are you satisfied with the Allegro train’s performance? What new services were offered to passengers this year?

– VR is very satisfied with Allegro and its success. We have doubled the number of passengers on the route. It is an internationally acknowledged example of high speed services across borders.
VR and the Finnish airline Finnair have started a code share co-operation, which means that the passengers on international flights can combine the Allgero train trip with their flight. We are convinced that this will have a positive impact on Allegro passenger numbers.

– What is your opinion on the 4th railway package? Will its implementation somehow affect the transport market in Finland and VR Group’s operations?

– It is a vast European legislation package, with six EU directives to be amended. There are many proposals especially in the technical section which we fully support. However, proposals concerning opening up the market should be considered very carefully, as to which decisions are to be made by the EU, and which decisions the member states should take themselves. The circumstances vary greatly from country to country.

Purchasing Green Technologies

– What are VR Group’s main initiatives in the green logistics sector?

What has already been done in this area? What will be done in the near future?
– Our main targets are to improve energy efficiency and to increase the share of renewable energy sources. The transport sector is largely, almost fully, dependent on fossil fuels.  Since 2008, VR Group has been purchasing green electricity, hydropower. Two thirds of our train-kilometres are running on renewable energy. Further improvements include promoting efficient driving and increasing the average size of our trains.

– What barriers do you consider exist for companies applying green logistics?

– The challenge is mainly a commercial one: demand for green logistics by the customers may grow. This will probably happen, when the economic situation improves and on the other hand, when political pressure intensifies for new solutions to climate change and other environmental problems.
In Finland, 90 % of the rail network has only a single track. That is a big barrier to achieving an efficient traffic structure.
– Do you consider green logistics to be a cost saver or an unnecessary expense ?
– Improving environmental performance goes hand in hand with improving efficiency in logistics. The cost of energy is a big factor for each rail company, so it pays off to become greener.
– If you were advising organizations on green logistics, what are the main changes or improvements that you would recommend?
– Environmental efficiency can be an advantage in competition, because it increases overall efficiency. You should apply both a strong commitment from the management and new technology to your operations.
Interviewed by Kristina Alexandrova

[~DETAIL_TEXT] =>

Renewal Processes

– Mr Aro, could you please tell us about the results of VR Group’s operations for the current year? What important projects in the freight and passenger sector have been undertaken?

– Rail freight volumes grew in the second quarter by 7.6% and amounted to 2427 million tonne kilometres. The reason for the larger transport volume is the growth in transports in the metal and chemical industries. International rail freight volumes grew by 13.2 per cent. Total VR Logistics transport volumes grew over the reference period by 3.1 per cent. Our market share of rail freight services has been growing, and we have reached a record level of over 28 percent of the total logistics market in Finland.
VR Transpoint has opened a new combined rail and road Cargo East terminal in Kouvola, near the Russian border. It serves as a hub for eastbound transports. It provides a full range of services, including intermediate storing and customs clearance.
In the passenger services market special offer campaigns for long-distance services and cheaper advance tickets boosted sales. In general, the average price of domestic long-distance trips fell slightly in the second quarter. The general economic climate contributed to a drop in passenger volumes, and there were less people travelling between Russia and Finland due to the rouble’s rate falling.
We have had our new ticketing and pricing system in operation for three years. It has greatly improved both our ability to react in changes in demand and the overall image of the company as a modern, customer-orientated enterprise.

– What are the most urgent objectives for the development of rail transport in Finland?

– We are in the middle of a vast renewal of our fleet. Our investments in rolling stock and electric engines are of epic proportions. We have purchased modern double-decked passenger cars, sleeping cars, restaurant cars and steering cars. At the same time there is a modernisation of freight wagons going on. New series of more efficient, faster electric engines will be in operation in two years’ time.
VR Group aims to improve its efficiency in operations through restructuring,with additional big investments in new technology, such as RFID and IT systems.
Simultaneously, the maintenance of the rail network is lagging behind. Since 1995, it has been the Finnish Transport Agency which is responsible for the rail network, not the rail company. We are working closely together in order to achieve a rise in budget funds for the rail network.

– What can you tell us about competition between road and rail transport in Finland? What does VR Group do to attract more traffic?

– The demand for logistics services is highly dependent on industrial production in Finland as well as economic development in Russia. VR Transpoint is actively seeking growth in both the domestic and eastern transport markets.

Excellent Relations

– What is the current state of relations between Finnish Railways and Russian Railways? Are these relations somehow affected by sanctions?

– We have an outstanding tradition of very close co-operation, which has lasted for decades. Current relations are excellent. As railway companies, we concentrate on our daily work in serving our customers. Train operations between the countries have not been affected.

– What projects are you undertaking together with RZD?

– Our main achievement together is the high speed Allegro train connection between St Petersburg and Helsinki. In both passenger and freight services we co-operate very closely on a daily basis.

– Are you satisfied with the Allegro train’s performance? What new services were offered to passengers this year?

– VR is very satisfied with Allegro and its success. We have doubled the number of passengers on the route. It is an internationally acknowledged example of high speed services across borders.
VR and the Finnish airline Finnair have started a code share co-operation, which means that the passengers on international flights can combine the Allgero train trip with their flight. We are convinced that this will have a positive impact on Allegro passenger numbers.

– What is your opinion on the 4th railway package? Will its implementation somehow affect the transport market in Finland and VR Group’s operations?

– It is a vast European legislation package, with six EU directives to be amended. There are many proposals especially in the technical section which we fully support. However, proposals concerning opening up the market should be considered very carefully, as to which decisions are to be made by the EU, and which decisions the member states should take themselves. The circumstances vary greatly from country to country.

Purchasing Green Technologies

– What are VR Group’s main initiatives in the green logistics sector?

What has already been done in this area? What will be done in the near future?
– Our main targets are to improve energy efficiency and to increase the share of renewable energy sources. The transport sector is largely, almost fully, dependent on fossil fuels.  Since 2008, VR Group has been purchasing green electricity, hydropower. Two thirds of our train-kilometres are running on renewable energy. Further improvements include promoting efficient driving and increasing the average size of our trains.

– What barriers do you consider exist for companies applying green logistics?

– The challenge is mainly a commercial one: demand for green logistics by the customers may grow. This will probably happen, when the economic situation improves and on the other hand, when political pressure intensifies for new solutions to climate change and other environmental problems.
In Finland, 90 % of the rail network has only a single track. That is a big barrier to achieving an efficient traffic structure.
– Do you consider green logistics to be a cost saver or an unnecessary expense ?
– Improving environmental performance goes hand in hand with improving efficiency in logistics. The cost of energy is a big factor for each rail company, so it pays off to become greener.
– If you were advising organizations on green logistics, what are the main changes or improvements that you would recommend?
– Environmental efficiency can be an advantage in competition, because it increases overall efficiency. You should apply both a strong commitment from the management and new technology to your operations.
Interviewed by Kristina Alexandrova

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The best illustration is Finnish railway company - VR Group. President and CEO of VR Group Mikael Aro speaks to us about the performance of his company and the latests innovations in this sector.

[~PREVIEW_TEXT] =>

The market has always considered the “green” logistics concept as something fashionable, but not profitable. But European countries are still sure that implementation of green technologies is an advantage.
The best illustration is Finnish railway company - VR Group. President and CEO of VR Group Mikael Aro speaks to us about the performance of his company and the latests innovations in this sector.

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РЖД-Партнер

Clean Port on Europe’s Front Doorstep

Clean Port on Europe’s Front Doorstep

The clean port status constitutes a trump card to attract food cargoes and develop value added logistics in this respect. The Port of Zeebrugge has this status and is going to share its experience.

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Platform for Food Logistics

The Port of Zeebrugge is the 8th busiest in the North Europe port range, with approximately 43 million tons handled in 2013, and is situated at the delta of the Rhine, Scheldt and Meuse Rivers.
The port of Zeebrugge is ideally located on the main shipping routes in Northwestern Europe with a natural deep draft which can accommodate the latest-generation ultra-large container vessels. Well-established intermodal connections, including rail access to Belgian and other European highway systems serve inland Europe.
Zeebrugge’s central location also makes it a natural transshipment port for the UK, Ireland, Scandinavia and Russia.
Zeebrugge is a non-industrial port acting as a distribution platform for all kinds of cargoes (roro, new cars, containers, breakbulk, natural gas etc.). Cargo flows transit into the port in order to be transshipped on another mode of transport. When transiting, a lot of goods receive value in the port. Zeebrugge concentrates its value added logistics in its inner port.
Zeebrugge is an important distribution port for food products such as fresh fruit, fruit juices, vegetables, potatoes, coffee, meat, fish and dairy products. The fruit cargo mainly consists of kiwifruit. Zeebrugge is in fact the official distribution point for the Zespri kiwifruit from New Zealand. The kiwifruit is distributed to the Western European markets via the terminal of Belgian New Fruit Wharf (BNFW Sea-Invest). In December lychees originating from Madagascar were distributed into Europe.
The American company Tropicana (Pepsico Group) has invested in a plant in the Zeebrugge inner port to pack fresh fruit juices from Florida and Brazil in cartons and plastic bottles prior to distribution to the UK and French markets.
The Flemish fish auction is situated in the inner port. In 2009 the European Fish Centre was expanded with the additional warehousing complex Zeebrugge Food Logistics. This is a gigantic reefer and cold store for the handling and storage of deepfrozen cargoes. Flanders Cold Center also offers the market warehouses for reefer storage.
In 2009 the first client became operational in the Maritime Logistic Zone. The Antwerp coffee trader Efico established in the MLZ a storage centre  named Seabridge Logistics for the handling and storage of unroasted or green coffee. Seabridge produces its own energy with 4.600 photovoltaic panels on the roof area, the equivalent of driving 2 million kilometers in a Volkswagen Polo.
In the last couple of years Zeebrugge has developed into a real European ‘food hub’. As a clean coastal port, Zeebrugge offers good air quality, ideal for precious cargo such as food products. Also the new Border Inspection Post constitutes a trump card in order to attract new precious food traffics. The transportation of food products with reefer containers is a growing trend, which is anticipated by the port.

The Marine Fuel of the Future

While the energy business is undergoing massive changes due to ecological and financial concerns, Zeebrugge, a gashub for over 27 years, aims to play a lead role in the evolution of LNG fuelling. LNG is believed to be the fuel of the future for the shipping industry.
With the LNG terminal in Zeebrugge’s outer port, the Zeepipe, an 814 kilometer long pipeline from Norway, and the Interconnector, a bidirectional pipeline between Bacton and Zeebrugge, our coastal port has grown into an authoritative gas crossroads that covers up to 15% of the Northwestern European market.
As from January 1, 2015 the Sulphur Emission Control Area (SECA) comes into effect. The International Maritime Organization (IMO) is imposing stringent limits on the emission of sulphur by the shipping industry (0.1%). The limits apply to all ships sailing in the North Sea, the Channel and the Baltic Sea.
LNG is recognized as the cleanest and most environmentally friendly choice of fuel suitable for marine transport. The choice of LNG as a fuel significantly reduces CO2 and NOx emissions, as well as almost eliminating sulpur oxide and particulate emissions.
On May 13, 2014 Mitsubishi Corporation, GDF SUEZ and NYK signed a framework agreement aiming to develop the LNG bunkering market worldwide, in the context of international regulations that seek to reduce the impact of shipping activities on the global environment (sulphur emissions in the SECA zone are to be reduced to 0.1% as from January 1, 2015).
This partnership resulted in two concrete contracts: a joint order for an LNG bunkering vessel: the world’s first seagoing LNG bunkering vessel with the aim of providing LNG to LNG-fueled vessels, and also an LNG bunkering contract between GDF SUEZ and United European Car Carriers (UECC), one of Zeebrugge’s leading providers of short sea transportation.
UECC signed a contract in March to construct two dual fuel LNG vessels to be deployed from 2016. The vessels will be capable of operating with LNG fuel or heavy fuel oil and marine gas oil, providing greater flexibility and efficiency. It will be the first PCTC of its kind to be fitted with an LNG fuel propulsion system and will be able to complete a 14 day round voyage in the Baltic using solely LNG fuel, including its main engine and auxiliary power generation.
In 2015, a second jetty will be operational and the port will then be able to handle almost all sizes of LNG vessels, including small bunkering vessels. This way, it will be possible to supply LNG ships in our port with fuel through these small  vessels.
The world’s first LNG driven tugboat, the M/T Borgoy, arrived in the port of Zeebrugge on February 17, 2014 for a bunkering operation. This ‘truck to ship’ bunkering operation was the first to be performed in the Flemish coastal port.
The tug M/T Borgoy is the first tugboat in the world driven by liquid natural gas, LNG. The maritime sector is confronted with strict emissions regulations, which results in greater interest in LNG as a maritime fuel. This tug boat emits nearly 30 percent less CO2 and up to 90 percent less NOx and fine dust than conventionally-powered tugs.
M/T Borgoy is the first of two identical tug boats ordered by the Norwegian BUBE (Buksér og Berging AS). The tug left the Sanmar shipyard in Turkey and set sail for Karsto in Norway to begin her long term operational contract for Statoil. To fuel up on LNG for her maiden trip, the ship made a stop in the port of Zeebrugge.

New Sources of Energy

Cooperation between Portfineco (a joint-venture between the Zeebrugge port authority and Finiwo) and Eneco, a sustainable energy supplier/producer, will result in the installation of four new windmills on the terminals of Wallenius Wilhelmsen Logistics Zeebrugge and Toyota Motor Europe. This sustainable project is an important step in the Port of Zeebrugge’s strategy to offer green solutions for the port’s economic activities.
Portfineco and Eneco Wind Belgium have joined forces for the building, financing and the running of four windmills in the inner port of Zeebrugge. Operational by the end of 2014, the installed windmills will produce about 30.000 MWh per year. The produced energy will be used by the terminals in Zeebrugge to support the activities the port.
Two windmills will be installed at the terminals of Toyota Motor Europe and Wallenius-Wilhelmsen Logistics. Both companies are known for their efforts in sustainability. Wallenius-Wilhelmsen reduces the fleet’s CO2-emissions each year by installing the latest technologies. Toyota Motor Europe’s achievements in hybrid and plug-in hybrid vehicles are the result of the company’s goal to produce the most eco-friendly cars.
“This project fits Zeebrugge perfectly, considering our port’s strategy in being a Clean Port, where clean air and sustainable solutions are a priority. Also, the cost price of energy is an important point of interest nowadays.” says Joachim Coens, CEO Port of Zeebrugge.
No less than 7 companies are building vast wind farms in the North Sea. The building of the parks started in 2009 and will be completed in 2020. In total of 450 windmills will be built, which will produce energy for almost 4 million Belgians.
All together the windmills will produce 2,145 megawatt. In addition, they will reduce CO2 emissions by 3 million tons.
The Elia group, which operates the high voltage electricity transmission system, intends to develop a meshed offshore grid to ensure that the wind farms in the North Sea are optimally integrated into its onshore grid. This project entails connecting future wind farms to high voltage substations. One high voltage substation will be constructed in the port of Bruges-Zeebrugge.

Railways for Green Logistics


Zeebrugge is a leading railway port. All its terminals are connected by rail. No less than 15 % of the goods leave or arrive by rail. In the container business no less than 40 % of the cargo reaches the hinterland by train. Rail connections are offered up to Lyon, Dijon, Bordeaux (France), Milan (Italy), Duisburg (Germany) and Curtici (Romania).
In view of the permanent rise in cargo volume and because rail is a valuable alternative for road transport, Infrabel is realizing an ambitious investment programme which includes the construction of a third rail between Zeebrugge and Bruges, the construction of a third and fourth rail between Bruges and Ghent and an extension of the marshalling station where the block trains with cargo from the different terminals are formed according to their destination.
For years, the Port of Zeebrugge has been trying to become a clean port. This project fits this ideology, where clean air and sustainable solutions are top priority. And other European ports can take it as an example of “port of the future”.
By Kristina Alexandrova

[~DETAIL_TEXT] =>

Platform for Food Logistics

The Port of Zeebrugge is the 8th busiest in the North Europe port range, with approximately 43 million tons handled in 2013, and is situated at the delta of the Rhine, Scheldt and Meuse Rivers.
The port of Zeebrugge is ideally located on the main shipping routes in Northwestern Europe with a natural deep draft which can accommodate the latest-generation ultra-large container vessels. Well-established intermodal connections, including rail access to Belgian and other European highway systems serve inland Europe.
Zeebrugge’s central location also makes it a natural transshipment port for the UK, Ireland, Scandinavia and Russia.
Zeebrugge is a non-industrial port acting as a distribution platform for all kinds of cargoes (roro, new cars, containers, breakbulk, natural gas etc.). Cargo flows transit into the port in order to be transshipped on another mode of transport. When transiting, a lot of goods receive value in the port. Zeebrugge concentrates its value added logistics in its inner port.
Zeebrugge is an important distribution port for food products such as fresh fruit, fruit juices, vegetables, potatoes, coffee, meat, fish and dairy products. The fruit cargo mainly consists of kiwifruit. Zeebrugge is in fact the official distribution point for the Zespri kiwifruit from New Zealand. The kiwifruit is distributed to the Western European markets via the terminal of Belgian New Fruit Wharf (BNFW Sea-Invest). In December lychees originating from Madagascar were distributed into Europe.
The American company Tropicana (Pepsico Group) has invested in a plant in the Zeebrugge inner port to pack fresh fruit juices from Florida and Brazil in cartons and plastic bottles prior to distribution to the UK and French markets.
The Flemish fish auction is situated in the inner port. In 2009 the European Fish Centre was expanded with the additional warehousing complex Zeebrugge Food Logistics. This is a gigantic reefer and cold store for the handling and storage of deepfrozen cargoes. Flanders Cold Center also offers the market warehouses for reefer storage.
In 2009 the first client became operational in the Maritime Logistic Zone. The Antwerp coffee trader Efico established in the MLZ a storage centre  named Seabridge Logistics for the handling and storage of unroasted or green coffee. Seabridge produces its own energy with 4.600 photovoltaic panels on the roof area, the equivalent of driving 2 million kilometers in a Volkswagen Polo.
In the last couple of years Zeebrugge has developed into a real European ‘food hub’. As a clean coastal port, Zeebrugge offers good air quality, ideal for precious cargo such as food products. Also the new Border Inspection Post constitutes a trump card in order to attract new precious food traffics. The transportation of food products with reefer containers is a growing trend, which is anticipated by the port.

The Marine Fuel of the Future

While the energy business is undergoing massive changes due to ecological and financial concerns, Zeebrugge, a gashub for over 27 years, aims to play a lead role in the evolution of LNG fuelling. LNG is believed to be the fuel of the future for the shipping industry.
With the LNG terminal in Zeebrugge’s outer port, the Zeepipe, an 814 kilometer long pipeline from Norway, and the Interconnector, a bidirectional pipeline between Bacton and Zeebrugge, our coastal port has grown into an authoritative gas crossroads that covers up to 15% of the Northwestern European market.
As from January 1, 2015 the Sulphur Emission Control Area (SECA) comes into effect. The International Maritime Organization (IMO) is imposing stringent limits on the emission of sulphur by the shipping industry (0.1%). The limits apply to all ships sailing in the North Sea, the Channel and the Baltic Sea.
LNG is recognized as the cleanest and most environmentally friendly choice of fuel suitable for marine transport. The choice of LNG as a fuel significantly reduces CO2 and NOx emissions, as well as almost eliminating sulpur oxide and particulate emissions.
On May 13, 2014 Mitsubishi Corporation, GDF SUEZ and NYK signed a framework agreement aiming to develop the LNG bunkering market worldwide, in the context of international regulations that seek to reduce the impact of shipping activities on the global environment (sulphur emissions in the SECA zone are to be reduced to 0.1% as from January 1, 2015).
This partnership resulted in two concrete contracts: a joint order for an LNG bunkering vessel: the world’s first seagoing LNG bunkering vessel with the aim of providing LNG to LNG-fueled vessels, and also an LNG bunkering contract between GDF SUEZ and United European Car Carriers (UECC), one of Zeebrugge’s leading providers of short sea transportation.
UECC signed a contract in March to construct two dual fuel LNG vessels to be deployed from 2016. The vessels will be capable of operating with LNG fuel or heavy fuel oil and marine gas oil, providing greater flexibility and efficiency. It will be the first PCTC of its kind to be fitted with an LNG fuel propulsion system and will be able to complete a 14 day round voyage in the Baltic using solely LNG fuel, including its main engine and auxiliary power generation.
In 2015, a second jetty will be operational and the port will then be able to handle almost all sizes of LNG vessels, including small bunkering vessels. This way, it will be possible to supply LNG ships in our port with fuel through these small  vessels.
The world’s first LNG driven tugboat, the M/T Borgoy, arrived in the port of Zeebrugge on February 17, 2014 for a bunkering operation. This ‘truck to ship’ bunkering operation was the first to be performed in the Flemish coastal port.
The tug M/T Borgoy is the first tugboat in the world driven by liquid natural gas, LNG. The maritime sector is confronted with strict emissions regulations, which results in greater interest in LNG as a maritime fuel. This tug boat emits nearly 30 percent less CO2 and up to 90 percent less NOx and fine dust than conventionally-powered tugs.
M/T Borgoy is the first of two identical tug boats ordered by the Norwegian BUBE (Buksér og Berging AS). The tug left the Sanmar shipyard in Turkey and set sail for Karsto in Norway to begin her long term operational contract for Statoil. To fuel up on LNG for her maiden trip, the ship made a stop in the port of Zeebrugge.

New Sources of Energy

Cooperation between Portfineco (a joint-venture between the Zeebrugge port authority and Finiwo) and Eneco, a sustainable energy supplier/producer, will result in the installation of four new windmills on the terminals of Wallenius Wilhelmsen Logistics Zeebrugge and Toyota Motor Europe. This sustainable project is an important step in the Port of Zeebrugge’s strategy to offer green solutions for the port’s economic activities.
Portfineco and Eneco Wind Belgium have joined forces for the building, financing and the running of four windmills in the inner port of Zeebrugge. Operational by the end of 2014, the installed windmills will produce about 30.000 MWh per year. The produced energy will be used by the terminals in Zeebrugge to support the activities the port.
Two windmills will be installed at the terminals of Toyota Motor Europe and Wallenius-Wilhelmsen Logistics. Both companies are known for their efforts in sustainability. Wallenius-Wilhelmsen reduces the fleet’s CO2-emissions each year by installing the latest technologies. Toyota Motor Europe’s achievements in hybrid and plug-in hybrid vehicles are the result of the company’s goal to produce the most eco-friendly cars.
“This project fits Zeebrugge perfectly, considering our port’s strategy in being a Clean Port, where clean air and sustainable solutions are a priority. Also, the cost price of energy is an important point of interest nowadays.” says Joachim Coens, CEO Port of Zeebrugge.
No less than 7 companies are building vast wind farms in the North Sea. The building of the parks started in 2009 and will be completed in 2020. In total of 450 windmills will be built, which will produce energy for almost 4 million Belgians.
All together the windmills will produce 2,145 megawatt. In addition, they will reduce CO2 emissions by 3 million tons.
The Elia group, which operates the high voltage electricity transmission system, intends to develop a meshed offshore grid to ensure that the wind farms in the North Sea are optimally integrated into its onshore grid. This project entails connecting future wind farms to high voltage substations. One high voltage substation will be constructed in the port of Bruges-Zeebrugge.

Railways for Green Logistics


Zeebrugge is a leading railway port. All its terminals are connected by rail. No less than 15 % of the goods leave or arrive by rail. In the container business no less than 40 % of the cargo reaches the hinterland by train. Rail connections are offered up to Lyon, Dijon, Bordeaux (France), Milan (Italy), Duisburg (Germany) and Curtici (Romania).
In view of the permanent rise in cargo volume and because rail is a valuable alternative for road transport, Infrabel is realizing an ambitious investment programme which includes the construction of a third rail between Zeebrugge and Bruges, the construction of a third and fourth rail between Bruges and Ghent and an extension of the marshalling station where the block trains with cargo from the different terminals are formed according to their destination.
For years, the Port of Zeebrugge has been trying to become a clean port. This project fits this ideology, where clean air and sustainable solutions are top priority. And other European ports can take it as an example of “port of the future”.
By Kristina Alexandrova

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The clean port status constitutes a trump card to attract food cargoes and develop value added logistics in this respect. The Port of Zeebrugge has this status and is going to share its experience.

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The clean port status constitutes a trump card to attract food cargoes and develop value added logistics in this respect. The Port of Zeebrugge has this status and is going to share its experience.

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Platform for Food Logistics

The Port of Zeebrugge is the 8th busiest in the North Europe port range, with approximately 43 million tons handled in 2013, and is situated at the delta of the Rhine, Scheldt and Meuse Rivers.
The port of Zeebrugge is ideally located on the main shipping routes in Northwestern Europe with a natural deep draft which can accommodate the latest-generation ultra-large container vessels. Well-established intermodal connections, including rail access to Belgian and other European highway systems serve inland Europe.
Zeebrugge’s central location also makes it a natural transshipment port for the UK, Ireland, Scandinavia and Russia.
Zeebrugge is a non-industrial port acting as a distribution platform for all kinds of cargoes (roro, new cars, containers, breakbulk, natural gas etc.). Cargo flows transit into the port in order to be transshipped on another mode of transport. When transiting, a lot of goods receive value in the port. Zeebrugge concentrates its value added logistics in its inner port.
Zeebrugge is an important distribution port for food products such as fresh fruit, fruit juices, vegetables, potatoes, coffee, meat, fish and dairy products. The fruit cargo mainly consists of kiwifruit. Zeebrugge is in fact the official distribution point for the Zespri kiwifruit from New Zealand. The kiwifruit is distributed to the Western European markets via the terminal of Belgian New Fruit Wharf (BNFW Sea-Invest). In December lychees originating from Madagascar were distributed into Europe.
The American company Tropicana (Pepsico Group) has invested in a plant in the Zeebrugge inner port to pack fresh fruit juices from Florida and Brazil in cartons and plastic bottles prior to distribution to the UK and French markets.
The Flemish fish auction is situated in the inner port. In 2009 the European Fish Centre was expanded with the additional warehousing complex Zeebrugge Food Logistics. This is a gigantic reefer and cold store for the handling and storage of deepfrozen cargoes. Flanders Cold Center also offers the market warehouses for reefer storage.
In 2009 the first client became operational in the Maritime Logistic Zone. The Antwerp coffee trader Efico established in the MLZ a storage centre  named Seabridge Logistics for the handling and storage of unroasted or green coffee. Seabridge produces its own energy with 4.600 photovoltaic panels on the roof area, the equivalent of driving 2 million kilometers in a Volkswagen Polo.
In the last couple of years Zeebrugge has developed into a real European ‘food hub’. As a clean coastal port, Zeebrugge offers good air quality, ideal for precious cargo such as food products. Also the new Border Inspection Post constitutes a trump card in order to attract new precious food traffics. The transportation of food products with reefer containers is a growing trend, which is anticipated by the port.

The Marine Fuel of the Future

While the energy business is undergoing massive changes due to ecological and financial concerns, Zeebrugge, a gashub for over 27 years, aims to play a lead role in the evolution of LNG fuelling. LNG is believed to be the fuel of the future for the shipping industry.
With the LNG terminal in Zeebrugge’s outer port, the Zeepipe, an 814 kilometer long pipeline from Norway, and the Interconnector, a bidirectional pipeline between Bacton and Zeebrugge, our coastal port has grown into an authoritative gas crossroads that covers up to 15% of the Northwestern European market.
As from January 1, 2015 the Sulphur Emission Control Area (SECA) comes into effect. The International Maritime Organization (IMO) is imposing stringent limits on the emission of sulphur by the shipping industry (0.1%). The limits apply to all ships sailing in the North Sea, the Channel and the Baltic Sea.
LNG is recognized as the cleanest and most environmentally friendly choice of fuel suitable for marine transport. The choice of LNG as a fuel significantly reduces CO2 and NOx emissions, as well as almost eliminating sulpur oxide and particulate emissions.
On May 13, 2014 Mitsubishi Corporation, GDF SUEZ and NYK signed a framework agreement aiming to develop the LNG bunkering market worldwide, in the context of international regulations that seek to reduce the impact of shipping activities on the global environment (sulphur emissions in the SECA zone are to be reduced to 0.1% as from January 1, 2015).
This partnership resulted in two concrete contracts: a joint order for an LNG bunkering vessel: the world’s first seagoing LNG bunkering vessel with the aim of providing LNG to LNG-fueled vessels, and also an LNG bunkering contract between GDF SUEZ and United European Car Carriers (UECC), one of Zeebrugge’s leading providers of short sea transportation.
UECC signed a contract in March to construct two dual fuel LNG vessels to be deployed from 2016. The vessels will be capable of operating with LNG fuel or heavy fuel oil and marine gas oil, providing greater flexibility and efficiency. It will be the first PCTC of its kind to be fitted with an LNG fuel propulsion system and will be able to complete a 14 day round voyage in the Baltic using solely LNG fuel, including its main engine and auxiliary power generation.
In 2015, a second jetty will be operational and the port will then be able to handle almost all sizes of LNG vessels, including small bunkering vessels. This way, it will be possible to supply LNG ships in our port with fuel through these small  vessels.
The world’s first LNG driven tugboat, the M/T Borgoy, arrived in the port of Zeebrugge on February 17, 2014 for a bunkering operation. This ‘truck to ship’ bunkering operation was the first to be performed in the Flemish coastal port.
The tug M/T Borgoy is the first tugboat in the world driven by liquid natural gas, LNG. The maritime sector is confronted with strict emissions regulations, which results in greater interest in LNG as a maritime fuel. This tug boat emits nearly 30 percent less CO2 and up to 90 percent less NOx and fine dust than conventionally-powered tugs.
M/T Borgoy is the first of two identical tug boats ordered by the Norwegian BUBE (Buksér og Berging AS). The tug left the Sanmar shipyard in Turkey and set sail for Karsto in Norway to begin her long term operational contract for Statoil. To fuel up on LNG for her maiden trip, the ship made a stop in the port of Zeebrugge.

New Sources of Energy

Cooperation between Portfineco (a joint-venture between the Zeebrugge port authority and Finiwo) and Eneco, a sustainable energy supplier/producer, will result in the installation of four new windmills on the terminals of Wallenius Wilhelmsen Logistics Zeebrugge and Toyota Motor Europe. This sustainable project is an important step in the Port of Zeebrugge’s strategy to offer green solutions for the port’s economic activities.
Portfineco and Eneco Wind Belgium have joined forces for the building, financing and the running of four windmills in the inner port of Zeebrugge. Operational by the end of 2014, the installed windmills will produce about 30.000 MWh per year. The produced energy will be used by the terminals in Zeebrugge to support the activities the port.
Two windmills will be installed at the terminals of Toyota Motor Europe and Wallenius-Wilhelmsen Logistics. Both companies are known for their efforts in sustainability. Wallenius-Wilhelmsen reduces the fleet’s CO2-emissions each year by installing the latest technologies. Toyota Motor Europe’s achievements in hybrid and plug-in hybrid vehicles are the result of the company’s goal to produce the most eco-friendly cars.
“This project fits Zeebrugge perfectly, considering our port’s strategy in being a Clean Port, where clean air and sustainable solutions are a priority. Also, the cost price of energy is an important point of interest nowadays.” says Joachim Coens, CEO Port of Zeebrugge.
No less than 7 companies are building vast wind farms in the North Sea. The building of the parks started in 2009 and will be completed in 2020. In total of 450 windmills will be built, which will produce energy for almost 4 million Belgians.
All together the windmills will produce 2,145 megawatt. In addition, they will reduce CO2 emissions by 3 million tons.
The Elia group, which operates the high voltage electricity transmission system, intends to develop a meshed offshore grid to ensure that the wind farms in the North Sea are optimally integrated into its onshore grid. This project entails connecting future wind farms to high voltage substations. One high voltage substation will be constructed in the port of Bruges-Zeebrugge.

Railways for Green Logistics


Zeebrugge is a leading railway port. All its terminals are connected by rail. No less than 15 % of the goods leave or arrive by rail. In the container business no less than 40 % of the cargo reaches the hinterland by train. Rail connections are offered up to Lyon, Dijon, Bordeaux (France), Milan (Italy), Duisburg (Germany) and Curtici (Romania).
In view of the permanent rise in cargo volume and because rail is a valuable alternative for road transport, Infrabel is realizing an ambitious investment programme which includes the construction of a third rail between Zeebrugge and Bruges, the construction of a third and fourth rail between Bruges and Ghent and an extension of the marshalling station where the block trains with cargo from the different terminals are formed according to their destination.
For years, the Port of Zeebrugge has been trying to become a clean port. This project fits this ideology, where clean air and sustainable solutions are top priority. And other European ports can take it as an example of “port of the future”.
By Kristina Alexandrova

[~DETAIL_TEXT] =>

Platform for Food Logistics

The Port of Zeebrugge is the 8th busiest in the North Europe port range, with approximately 43 million tons handled in 2013, and is situated at the delta of the Rhine, Scheldt and Meuse Rivers.
The port of Zeebrugge is ideally located on the main shipping routes in Northwestern Europe with a natural deep draft which can accommodate the latest-generation ultra-large container vessels. Well-established intermodal connections, including rail access to Belgian and other European highway systems serve inland Europe.
Zeebrugge’s central location also makes it a natural transshipment port for the UK, Ireland, Scandinavia and Russia.
Zeebrugge is a non-industrial port acting as a distribution platform for all kinds of cargoes (roro, new cars, containers, breakbulk, natural gas etc.). Cargo flows transit into the port in order to be transshipped on another mode of transport. When transiting, a lot of goods receive value in the port. Zeebrugge concentrates its value added logistics in its inner port.
Zeebrugge is an important distribution port for food products such as fresh fruit, fruit juices, vegetables, potatoes, coffee, meat, fish and dairy products. The fruit cargo mainly consists of kiwifruit. Zeebrugge is in fact the official distribution point for the Zespri kiwifruit from New Zealand. The kiwifruit is distributed to the Western European markets via the terminal of Belgian New Fruit Wharf (BNFW Sea-Invest). In December lychees originating from Madagascar were distributed into Europe.
The American company Tropicana (Pepsico Group) has invested in a plant in the Zeebrugge inner port to pack fresh fruit juices from Florida and Brazil in cartons and plastic bottles prior to distribution to the UK and French markets.
The Flemish fish auction is situated in the inner port. In 2009 the European Fish Centre was expanded with the additional warehousing complex Zeebrugge Food Logistics. This is a gigantic reefer and cold store for the handling and storage of deepfrozen cargoes. Flanders Cold Center also offers the market warehouses for reefer storage.
In 2009 the first client became operational in the Maritime Logistic Zone. The Antwerp coffee trader Efico established in the MLZ a storage centre  named Seabridge Logistics for the handling and storage of unroasted or green coffee. Seabridge produces its own energy with 4.600 photovoltaic panels on the roof area, the equivalent of driving 2 million kilometers in a Volkswagen Polo.
In the last couple of years Zeebrugge has developed into a real European ‘food hub’. As a clean coastal port, Zeebrugge offers good air quality, ideal for precious cargo such as food products. Also the new Border Inspection Post constitutes a trump card in order to attract new precious food traffics. The transportation of food products with reefer containers is a growing trend, which is anticipated by the port.

The Marine Fuel of the Future

While the energy business is undergoing massive changes due to ecological and financial concerns, Zeebrugge, a gashub for over 27 years, aims to play a lead role in the evolution of LNG fuelling. LNG is believed to be the fuel of the future for the shipping industry.
With the LNG terminal in Zeebrugge’s outer port, the Zeepipe, an 814 kilometer long pipeline from Norway, and the Interconnector, a bidirectional pipeline between Bacton and Zeebrugge, our coastal port has grown into an authoritative gas crossroads that covers up to 15% of the Northwestern European market.
As from January 1, 2015 the Sulphur Emission Control Area (SECA) comes into effect. The International Maritime Organization (IMO) is imposing stringent limits on the emission of sulphur by the shipping industry (0.1%). The limits apply to all ships sailing in the North Sea, the Channel and the Baltic Sea.
LNG is recognized as the cleanest and most environmentally friendly choice of fuel suitable for marine transport. The choice of LNG as a fuel significantly reduces CO2 and NOx emissions, as well as almost eliminating sulpur oxide and particulate emissions.
On May 13, 2014 Mitsubishi Corporation, GDF SUEZ and NYK signed a framework agreement aiming to develop the LNG bunkering market worldwide, in the context of international regulations that seek to reduce the impact of shipping activities on the global environment (sulphur emissions in the SECA zone are to be reduced to 0.1% as from January 1, 2015).
This partnership resulted in two concrete contracts: a joint order for an LNG bunkering vessel: the world’s first seagoing LNG bunkering vessel with the aim of providing LNG to LNG-fueled vessels, and also an LNG bunkering contract between GDF SUEZ and United European Car Carriers (UECC), one of Zeebrugge’s leading providers of short sea transportation.
UECC signed a contract in March to construct two dual fuel LNG vessels to be deployed from 2016. The vessels will be capable of operating with LNG fuel or heavy fuel oil and marine gas oil, providing greater flexibility and efficiency. It will be the first PCTC of its kind to be fitted with an LNG fuel propulsion system and will be able to complete a 14 day round voyage in the Baltic using solely LNG fuel, including its main engine and auxiliary power generation.
In 2015, a second jetty will be operational and the port will then be able to handle almost all sizes of LNG vessels, including small bunkering vessels. This way, it will be possible to supply LNG ships in our port with fuel through these small  vessels.
The world’s first LNG driven tugboat, the M/T Borgoy, arrived in the port of Zeebrugge on February 17, 2014 for a bunkering operation. This ‘truck to ship’ bunkering operation was the first to be performed in the Flemish coastal port.
The tug M/T Borgoy is the first tugboat in the world driven by liquid natural gas, LNG. The maritime sector is confronted with strict emissions regulations, which results in greater interest in LNG as a maritime fuel. This tug boat emits nearly 30 percent less CO2 and up to 90 percent less NOx and fine dust than conventionally-powered tugs.
M/T Borgoy is the first of two identical tug boats ordered by the Norwegian BUBE (Buksér og Berging AS). The tug left the Sanmar shipyard in Turkey and set sail for Karsto in Norway to begin her long term operational contract for Statoil. To fuel up on LNG for her maiden trip, the ship made a stop in the port of Zeebrugge.

New Sources of Energy

Cooperation between Portfineco (a joint-venture between the Zeebrugge port authority and Finiwo) and Eneco, a sustainable energy supplier/producer, will result in the installation of four new windmills on the terminals of Wallenius Wilhelmsen Logistics Zeebrugge and Toyota Motor Europe. This sustainable project is an important step in the Port of Zeebrugge’s strategy to offer green solutions for the port’s economic activities.
Portfineco and Eneco Wind Belgium have joined forces for the building, financing and the running of four windmills in the inner port of Zeebrugge. Operational by the end of 2014, the installed windmills will produce about 30.000 MWh per year. The produced energy will be used by the terminals in Zeebrugge to support the activities the port.
Two windmills will be installed at the terminals of Toyota Motor Europe and Wallenius-Wilhelmsen Logistics. Both companies are known for their efforts in sustainability. Wallenius-Wilhelmsen reduces the fleet’s CO2-emissions each year by installing the latest technologies. Toyota Motor Europe’s achievements in hybrid and plug-in hybrid vehicles are the result of the company’s goal to produce the most eco-friendly cars.
“This project fits Zeebrugge perfectly, considering our port’s strategy in being a Clean Port, where clean air and sustainable solutions are a priority. Also, the cost price of energy is an important point of interest nowadays.” says Joachim Coens, CEO Port of Zeebrugge.
No less than 7 companies are building vast wind farms in the North Sea. The building of the parks started in 2009 and will be completed in 2020. In total of 450 windmills will be built, which will produce energy for almost 4 million Belgians.
All together the windmills will produce 2,145 megawatt. In addition, they will reduce CO2 emissions by 3 million tons.
The Elia group, which operates the high voltage electricity transmission system, intends to develop a meshed offshore grid to ensure that the wind farms in the North Sea are optimally integrated into its onshore grid. This project entails connecting future wind farms to high voltage substations. One high voltage substation will be constructed in the port of Bruges-Zeebrugge.

Railways for Green Logistics


Zeebrugge is a leading railway port. All its terminals are connected by rail. No less than 15 % of the goods leave or arrive by rail. In the container business no less than 40 % of the cargo reaches the hinterland by train. Rail connections are offered up to Lyon, Dijon, Bordeaux (France), Milan (Italy), Duisburg (Germany) and Curtici (Romania).
In view of the permanent rise in cargo volume and because rail is a valuable alternative for road transport, Infrabel is realizing an ambitious investment programme which includes the construction of a third rail between Zeebrugge and Bruges, the construction of a third and fourth rail between Bruges and Ghent and an extension of the marshalling station where the block trains with cargo from the different terminals are formed according to their destination.
For years, the Port of Zeebrugge has been trying to become a clean port. This project fits this ideology, where clean air and sustainable solutions are top priority. And other European ports can take it as an example of “port of the future”.
By Kristina Alexandrova

[DETAIL_TEXT_TYPE] => html [~DETAIL_TEXT_TYPE] => html [PREVIEW_TEXT] =>

The clean port status constitutes a trump card to attract food cargoes and develop value added logistics in this respect. The Port of Zeebrugge has this status and is going to share its experience.

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The clean port status constitutes a trump card to attract food cargoes and develop value added logistics in this respect. The Port of Zeebrugge has this status and is going to share its experience.

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РЖД-Партнер

Beauty and Speed against Sanctions

Beauty and Speed against Sanctions

This year the international InnoTrans exhibition in Berlin was focused on the future. Participants discussed how to increase the speed of rolling stock, how to make trains even more comfortable and attractive to passengers, and whether the political crisis influences this market in general.

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Thinking about the Future

The future of passenger transport is high speed transportation. “My dream is to increase speed on the route from Moscow-St Petersburg up to 300-350 kph. I would like to take the train from the Leningradsky railway station in Moscow and go to St Petersburg: see the sights,  take a walk on the embankment of the Neva River, go to the theater, and then travel to Moscow spending only 1.5 hours onboard the train,” said President of Siemens in Russia and Central Asia Dietrich Moeller.
The design of trains will also be important, said the organizers of InnoTrans. Several designers tried to answer the question of what the interiors of trains would look like in a few years. The “WirtschaftsWoche” magazine asked three design bureaus. All of them were introduced in a special pavilion of the exhibition Future of Mobility.
Designer Mac Stopa from Massive Design Bureau said that the rolling stock of the future would be made of materials used in the aircraft industry. And in general trains would become more and more similar to aircraft – both in terms of design and technical characteristics. For ICE trains M.Stopa proposed a system of circular windows, framed with super strong material that can provide additional lighting and makes the walls of cars stronger.
According to the representative of the Gerhardt Kellerman bureau, such trains as ICE are not profitable for the operator, so the investment in improving their design has never been made. The company introduced small modern elements that can make the journey more comfortable, and can be easily implemented. For example, designers suggest the upgrade of the tables, incorporating a special charging platform for smartphones in each table, because it is usually hard to find a free socket in the train. In addition, there are several options for creating cars with panoramic windows.
The third company – Horizon Systems – unlike the first contestants, proposed a new form of transport – a combination of aircraft and railway station. Large aircraft move through the city, seizing several trains and lifting them from the ground. Inside this aircraft passengers are able to move and to change the trains. A giant plane puts trains on the ground, and passengers can get out.
The last idea seems too futuristic, but the first two ideas have aroused great interest among manufacturers of rolling stock. According to the representative of Gerhardt Kellerman, engineers asked designers, when Deutsche Bahn planned to introduce such technologies. However, as it turned out, the German railways had not implemented these developments, and so futuristic design will remain just a beautiful idea.

The Reality

In general, the participants of the exhibition looked at design fantasies with interest, but preferred to think about reality - the political crisis in Europe. That is why everybody was waiting for the delegation from Russia.
During the press conference before the exhibition, journalists asked organizers if the political situation would influence the world market for rail freight. “We do not make any political decisions, – said Finance Minister of Brandenburg Christian Gorke. – Our goal is to provide a neutral meeting place for discussion. Russia plays an important role in the global transport market, so we are all looking forward to the arrival of the President of Russian Railways Vladimir Yakunin.”
“Last year, 29 companies from Russia participated in the exhibition with their own stands, – said the Director of the Messe Berlin Matthias Shtekmann. – And we are interested in cooperation both with Russia and the Ukraine, but we know that this year some companies from the Ukraine had to cancel their participation.”
V.Yakunin actually visited InnoTrans, and made a very important statement: Russia does not plan to stop cooperation with Germany due to the sanctions. D. Moeller also said that his company would continue its work with Russia.
Bombardier Transportation is also not going to terminate contracts with Russia. “We are trying to produce more and more products for the Russian market, because we believe in this market. We have a joint venture with UVZ. We have good cooperation, we respect each other. We are sure that in the future we will be able to successfully continue this work,” said President of the Locomotive Division of Bombardier Transportation Ulrich Joham. Alstom is also still interested in the project for the construction of the Moscow-Kazan high-speed railway line.
But not only relations between Russia and the West were discussed this year. A number of issues caused the decision of the French railways (SNCF) to cancel its participation in the exhibition with a stand. People said that it happened due to the deterioration of relations with Deutsche Bahn (Germany). These companies have carried out cross-border transport within the Alleo joint venture since 2007. But InnoTrans reconciled the two parties. It was announced that Deutsche Bahn and SNCF would continue their cooperation in the field of high-speed traffic up to the year 2020. The agreement was signed by the heads of the companies Rudiger Grube (DB) and Guillaume Pepy (SNCF). The heads of Deutsche Bahn and SNCF have promised that by 2016 the service would become even more convenient for passengers traveling from Stuttgart to Paris. And the trip would take only 30 minutes.
As usual, a lot of agreements were signed during InnoTrans. “InnoTrans is the first step towards cooperation,” said Vice President of Evraz Ilya Shirokobrod. The company has a long history of visiting the exhibition, which I.Shirokobrod finds a very significant event, because he can meet a lot of producers and potential customers here from all over the world. In 2014, the company conducted several negotiations, both in terms of sales and in terms of interaction in the development of new ideas.
“The railway market is a conservative industry, and often a lot of steps must be taken in order to achieve visible results. For example, during this InnoTrans we chatted with customers on certification. Sometimes this process, as we know, can take several years. But the first steps are made here,” said I. Shirokobrod.
Alstom and Kazakhstan Temir Zholy agreed on the possibility of increasing the share of the French manufacturer in a joint venture for locomotive production (a joint venture between Alstom, KTZ and Transmashholding). Russian Railways, Alstom and TMH have entered into a memorandum of understanding concerning production systems' development with the use of lean manufacturing technology. The trading house of Russian Railways and Voestalpine Schienen GmbH signed a memorandum for rails supply. And this is only a small part of the documents signed at InnoTrans. They mark the beginning of the development of the transport system of the future.
This year, despite the tense political situation, InnoTrans became successful for Russia. The best rolling stock from Europe is no longer something awesome for Russian customers. Russia is ready to offer its own products to Western companies.  They, in turn, are thinking about entering the Russian market, but do not yet know how. Crisis and stereotypes scare them, but such international events as InnoTrans help to dispel many myths.
By Kristina Alexandrova

[~DETAIL_TEXT] =>

Thinking about the Future

The future of passenger transport is high speed transportation. “My dream is to increase speed on the route from Moscow-St Petersburg up to 300-350 kph. I would like to take the train from the Leningradsky railway station in Moscow and go to St Petersburg: see the sights,  take a walk on the embankment of the Neva River, go to the theater, and then travel to Moscow spending only 1.5 hours onboard the train,” said President of Siemens in Russia and Central Asia Dietrich Moeller.
The design of trains will also be important, said the organizers of InnoTrans. Several designers tried to answer the question of what the interiors of trains would look like in a few years. The “WirtschaftsWoche” magazine asked three design bureaus. All of them were introduced in a special pavilion of the exhibition Future of Mobility.
Designer Mac Stopa from Massive Design Bureau said that the rolling stock of the future would be made of materials used in the aircraft industry. And in general trains would become more and more similar to aircraft – both in terms of design and technical characteristics. For ICE trains M.Stopa proposed a system of circular windows, framed with super strong material that can provide additional lighting and makes the walls of cars stronger.
According to the representative of the Gerhardt Kellerman bureau, such trains as ICE are not profitable for the operator, so the investment in improving their design has never been made. The company introduced small modern elements that can make the journey more comfortable, and can be easily implemented. For example, designers suggest the upgrade of the tables, incorporating a special charging platform for smartphones in each table, because it is usually hard to find a free socket in the train. In addition, there are several options for creating cars with panoramic windows.
The third company – Horizon Systems – unlike the first contestants, proposed a new form of transport – a combination of aircraft and railway station. Large aircraft move through the city, seizing several trains and lifting them from the ground. Inside this aircraft passengers are able to move and to change the trains. A giant plane puts trains on the ground, and passengers can get out.
The last idea seems too futuristic, but the first two ideas have aroused great interest among manufacturers of rolling stock. According to the representative of Gerhardt Kellerman, engineers asked designers, when Deutsche Bahn planned to introduce such technologies. However, as it turned out, the German railways had not implemented these developments, and so futuristic design will remain just a beautiful idea.

The Reality

In general, the participants of the exhibition looked at design fantasies with interest, but preferred to think about reality - the political crisis in Europe. That is why everybody was waiting for the delegation from Russia.
During the press conference before the exhibition, journalists asked organizers if the political situation would influence the world market for rail freight. “We do not make any political decisions, – said Finance Minister of Brandenburg Christian Gorke. – Our goal is to provide a neutral meeting place for discussion. Russia plays an important role in the global transport market, so we are all looking forward to the arrival of the President of Russian Railways Vladimir Yakunin.”
“Last year, 29 companies from Russia participated in the exhibition with their own stands, – said the Director of the Messe Berlin Matthias Shtekmann. – And we are interested in cooperation both with Russia and the Ukraine, but we know that this year some companies from the Ukraine had to cancel their participation.”
V.Yakunin actually visited InnoTrans, and made a very important statement: Russia does not plan to stop cooperation with Germany due to the sanctions. D. Moeller also said that his company would continue its work with Russia.
Bombardier Transportation is also not going to terminate contracts with Russia. “We are trying to produce more and more products for the Russian market, because we believe in this market. We have a joint venture with UVZ. We have good cooperation, we respect each other. We are sure that in the future we will be able to successfully continue this work,” said President of the Locomotive Division of Bombardier Transportation Ulrich Joham. Alstom is also still interested in the project for the construction of the Moscow-Kazan high-speed railway line.
But not only relations between Russia and the West were discussed this year. A number of issues caused the decision of the French railways (SNCF) to cancel its participation in the exhibition with a stand. People said that it happened due to the deterioration of relations with Deutsche Bahn (Germany). These companies have carried out cross-border transport within the Alleo joint venture since 2007. But InnoTrans reconciled the two parties. It was announced that Deutsche Bahn and SNCF would continue their cooperation in the field of high-speed traffic up to the year 2020. The agreement was signed by the heads of the companies Rudiger Grube (DB) and Guillaume Pepy (SNCF). The heads of Deutsche Bahn and SNCF have promised that by 2016 the service would become even more convenient for passengers traveling from Stuttgart to Paris. And the trip would take only 30 minutes.
As usual, a lot of agreements were signed during InnoTrans. “InnoTrans is the first step towards cooperation,” said Vice President of Evraz Ilya Shirokobrod. The company has a long history of visiting the exhibition, which I.Shirokobrod finds a very significant event, because he can meet a lot of producers and potential customers here from all over the world. In 2014, the company conducted several negotiations, both in terms of sales and in terms of interaction in the development of new ideas.
“The railway market is a conservative industry, and often a lot of steps must be taken in order to achieve visible results. For example, during this InnoTrans we chatted with customers on certification. Sometimes this process, as we know, can take several years. But the first steps are made here,” said I. Shirokobrod.
Alstom and Kazakhstan Temir Zholy agreed on the possibility of increasing the share of the French manufacturer in a joint venture for locomotive production (a joint venture between Alstom, KTZ and Transmashholding). Russian Railways, Alstom and TMH have entered into a memorandum of understanding concerning production systems' development with the use of lean manufacturing technology. The trading house of Russian Railways and Voestalpine Schienen GmbH signed a memorandum for rails supply. And this is only a small part of the documents signed at InnoTrans. They mark the beginning of the development of the transport system of the future.
This year, despite the tense political situation, InnoTrans became successful for Russia. The best rolling stock from Europe is no longer something awesome for Russian customers. Russia is ready to offer its own products to Western companies.  They, in turn, are thinking about entering the Russian market, but do not yet know how. Crisis and stereotypes scare them, but such international events as InnoTrans help to dispel many myths.
By Kristina Alexandrova

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This year the international InnoTrans exhibition in Berlin was focused on the future. Participants discussed how to increase the speed of rolling stock, how to make trains even more comfortable and attractive to passengers, and whether the political crisis influences this market in general.

[~PREVIEW_TEXT] =>

This year the international InnoTrans exhibition in Berlin was focused on the future. Participants discussed how to increase the speed of rolling stock, how to make trains even more comfortable and attractive to passengers, and whether the political crisis influences this market in general.

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Thinking about the Future

The future of passenger transport is high speed transportation. “My dream is to increase speed on the route from Moscow-St Petersburg up to 300-350 kph. I would like to take the train from the Leningradsky railway station in Moscow and go to St Petersburg: see the sights,  take a walk on the embankment of the Neva River, go to the theater, and then travel to Moscow spending only 1.5 hours onboard the train,” said President of Siemens in Russia and Central Asia Dietrich Moeller.
The design of trains will also be important, said the organizers of InnoTrans. Several designers tried to answer the question of what the interiors of trains would look like in a few years. The “WirtschaftsWoche” magazine asked three design bureaus. All of them were introduced in a special pavilion of the exhibition Future of Mobility.
Designer Mac Stopa from Massive Design Bureau said that the rolling stock of the future would be made of materials used in the aircraft industry. And in general trains would become more and more similar to aircraft – both in terms of design and technical characteristics. For ICE trains M.Stopa proposed a system of circular windows, framed with super strong material that can provide additional lighting and makes the walls of cars stronger.
According to the representative of the Gerhardt Kellerman bureau, such trains as ICE are not profitable for the operator, so the investment in improving their design has never been made. The company introduced small modern elements that can make the journey more comfortable, and can be easily implemented. For example, designers suggest the upgrade of the tables, incorporating a special charging platform for smartphones in each table, because it is usually hard to find a free socket in the train. In addition, there are several options for creating cars with panoramic windows.
The third company – Horizon Systems – unlike the first contestants, proposed a new form of transport – a combination of aircraft and railway station. Large aircraft move through the city, seizing several trains and lifting them from the ground. Inside this aircraft passengers are able to move and to change the trains. A giant plane puts trains on the ground, and passengers can get out.
The last idea seems too futuristic, but the first two ideas have aroused great interest among manufacturers of rolling stock. According to the representative of Gerhardt Kellerman, engineers asked designers, when Deutsche Bahn planned to introduce such technologies. However, as it turned out, the German railways had not implemented these developments, and so futuristic design will remain just a beautiful idea.

The Reality

In general, the participants of the exhibition looked at design fantasies with interest, but preferred to think about reality - the political crisis in Europe. That is why everybody was waiting for the delegation from Russia.
During the press conference before the exhibition, journalists asked organizers if the political situation would influence the world market for rail freight. “We do not make any political decisions, – said Finance Minister of Brandenburg Christian Gorke. – Our goal is to provide a neutral meeting place for discussion. Russia plays an important role in the global transport market, so we are all looking forward to the arrival of the President of Russian Railways Vladimir Yakunin.”
“Last year, 29 companies from Russia participated in the exhibition with their own stands, – said the Director of the Messe Berlin Matthias Shtekmann. – And we are interested in cooperation both with Russia and the Ukraine, but we know that this year some companies from the Ukraine had to cancel their participation.”
V.Yakunin actually visited InnoTrans, and made a very important statement: Russia does not plan to stop cooperation with Germany due to the sanctions. D. Moeller also said that his company would continue its work with Russia.
Bombardier Transportation is also not going to terminate contracts with Russia. “We are trying to produce more and more products for the Russian market, because we believe in this market. We have a joint venture with UVZ. We have good cooperation, we respect each other. We are sure that in the future we will be able to successfully continue this work,” said President of the Locomotive Division of Bombardier Transportation Ulrich Joham. Alstom is also still interested in the project for the construction of the Moscow-Kazan high-speed railway line.
But not only relations between Russia and the West were discussed this year. A number of issues caused the decision of the French railways (SNCF) to cancel its participation in the exhibition with a stand. People said that it happened due to the deterioration of relations with Deutsche Bahn (Germany). These companies have carried out cross-border transport within the Alleo joint venture since 2007. But InnoTrans reconciled the two parties. It was announced that Deutsche Bahn and SNCF would continue their cooperation in the field of high-speed traffic up to the year 2020. The agreement was signed by the heads of the companies Rudiger Grube (DB) and Guillaume Pepy (SNCF). The heads of Deutsche Bahn and SNCF have promised that by 2016 the service would become even more convenient for passengers traveling from Stuttgart to Paris. And the trip would take only 30 minutes.
As usual, a lot of agreements were signed during InnoTrans. “InnoTrans is the first step towards cooperation,” said Vice President of Evraz Ilya Shirokobrod. The company has a long history of visiting the exhibition, which I.Shirokobrod finds a very significant event, because he can meet a lot of producers and potential customers here from all over the world. In 2014, the company conducted several negotiations, both in terms of sales and in terms of interaction in the development of new ideas.
“The railway market is a conservative industry, and often a lot of steps must be taken in order to achieve visible results. For example, during this InnoTrans we chatted with customers on certification. Sometimes this process, as we know, can take several years. But the first steps are made here,” said I. Shirokobrod.
Alstom and Kazakhstan Temir Zholy agreed on the possibility of increasing the share of the French manufacturer in a joint venture for locomotive production (a joint venture between Alstom, KTZ and Transmashholding). Russian Railways, Alstom and TMH have entered into a memorandum of understanding concerning production systems' development with the use of lean manufacturing technology. The trading house of Russian Railways and Voestalpine Schienen GmbH signed a memorandum for rails supply. And this is only a small part of the documents signed at InnoTrans. They mark the beginning of the development of the transport system of the future.
This year, despite the tense political situation, InnoTrans became successful for Russia. The best rolling stock from Europe is no longer something awesome for Russian customers. Russia is ready to offer its own products to Western companies.  They, in turn, are thinking about entering the Russian market, but do not yet know how. Crisis and stereotypes scare them, but such international events as InnoTrans help to dispel many myths.
By Kristina Alexandrova

[~DETAIL_TEXT] =>

Thinking about the Future

The future of passenger transport is high speed transportation. “My dream is to increase speed on the route from Moscow-St Petersburg up to 300-350 kph. I would like to take the train from the Leningradsky railway station in Moscow and go to St Petersburg: see the sights,  take a walk on the embankment of the Neva River, go to the theater, and then travel to Moscow spending only 1.5 hours onboard the train,” said President of Siemens in Russia and Central Asia Dietrich Moeller.
The design of trains will also be important, said the organizers of InnoTrans. Several designers tried to answer the question of what the interiors of trains would look like in a few years. The “WirtschaftsWoche” magazine asked three design bureaus. All of them were introduced in a special pavilion of the exhibition Future of Mobility.
Designer Mac Stopa from Massive Design Bureau said that the rolling stock of the future would be made of materials used in the aircraft industry. And in general trains would become more and more similar to aircraft – both in terms of design and technical characteristics. For ICE trains M.Stopa proposed a system of circular windows, framed with super strong material that can provide additional lighting and makes the walls of cars stronger.
According to the representative of the Gerhardt Kellerman bureau, such trains as ICE are not profitable for the operator, so the investment in improving their design has never been made. The company introduced small modern elements that can make the journey more comfortable, and can be easily implemented. For example, designers suggest the upgrade of the tables, incorporating a special charging platform for smartphones in each table, because it is usually hard to find a free socket in the train. In addition, there are several options for creating cars with panoramic windows.
The third company – Horizon Systems – unlike the first contestants, proposed a new form of transport – a combination of aircraft and railway station. Large aircraft move through the city, seizing several trains and lifting them from the ground. Inside this aircraft passengers are able to move and to change the trains. A giant plane puts trains on the ground, and passengers can get out.
The last idea seems too futuristic, but the first two ideas have aroused great interest among manufacturers of rolling stock. According to the representative of Gerhardt Kellerman, engineers asked designers, when Deutsche Bahn planned to introduce such technologies. However, as it turned out, the German railways had not implemented these developments, and so futuristic design will remain just a beautiful idea.

The Reality

In general, the participants of the exhibition looked at design fantasies with interest, but preferred to think about reality - the political crisis in Europe. That is why everybody was waiting for the delegation from Russia.
During the press conference before the exhibition, journalists asked organizers if the political situation would influence the world market for rail freight. “We do not make any political decisions, – said Finance Minister of Brandenburg Christian Gorke. – Our goal is to provide a neutral meeting place for discussion. Russia plays an important role in the global transport market, so we are all looking forward to the arrival of the President of Russian Railways Vladimir Yakunin.”
“Last year, 29 companies from Russia participated in the exhibition with their own stands, – said the Director of the Messe Berlin Matthias Shtekmann. – And we are interested in cooperation both with Russia and the Ukraine, but we know that this year some companies from the Ukraine had to cancel their participation.”
V.Yakunin actually visited InnoTrans, and made a very important statement: Russia does not plan to stop cooperation with Germany due to the sanctions. D. Moeller also said that his company would continue its work with Russia.
Bombardier Transportation is also not going to terminate contracts with Russia. “We are trying to produce more and more products for the Russian market, because we believe in this market. We have a joint venture with UVZ. We have good cooperation, we respect each other. We are sure that in the future we will be able to successfully continue this work,” said President of the Locomotive Division of Bombardier Transportation Ulrich Joham. Alstom is also still interested in the project for the construction of the Moscow-Kazan high-speed railway line.
But not only relations between Russia and the West were discussed this year. A number of issues caused the decision of the French railways (SNCF) to cancel its participation in the exhibition with a stand. People said that it happened due to the deterioration of relations with Deutsche Bahn (Germany). These companies have carried out cross-border transport within the Alleo joint venture since 2007. But InnoTrans reconciled the two parties. It was announced that Deutsche Bahn and SNCF would continue their cooperation in the field of high-speed traffic up to the year 2020. The agreement was signed by the heads of the companies Rudiger Grube (DB) and Guillaume Pepy (SNCF). The heads of Deutsche Bahn and SNCF have promised that by 2016 the service would become even more convenient for passengers traveling from Stuttgart to Paris. And the trip would take only 30 minutes.
As usual, a lot of agreements were signed during InnoTrans. “InnoTrans is the first step towards cooperation,” said Vice President of Evraz Ilya Shirokobrod. The company has a long history of visiting the exhibition, which I.Shirokobrod finds a very significant event, because he can meet a lot of producers and potential customers here from all over the world. In 2014, the company conducted several negotiations, both in terms of sales and in terms of interaction in the development of new ideas.
“The railway market is a conservative industry, and often a lot of steps must be taken in order to achieve visible results. For example, during this InnoTrans we chatted with customers on certification. Sometimes this process, as we know, can take several years. But the first steps are made here,” said I. Shirokobrod.
Alstom and Kazakhstan Temir Zholy agreed on the possibility of increasing the share of the French manufacturer in a joint venture for locomotive production (a joint venture between Alstom, KTZ and Transmashholding). Russian Railways, Alstom and TMH have entered into a memorandum of understanding concerning production systems' development with the use of lean manufacturing technology. The trading house of Russian Railways and Voestalpine Schienen GmbH signed a memorandum for rails supply. And this is only a small part of the documents signed at InnoTrans. They mark the beginning of the development of the transport system of the future.
This year, despite the tense political situation, InnoTrans became successful for Russia. The best rolling stock from Europe is no longer something awesome for Russian customers. Russia is ready to offer its own products to Western companies.  They, in turn, are thinking about entering the Russian market, but do not yet know how. Crisis and stereotypes scare them, but such international events as InnoTrans help to dispel many myths.
By Kristina Alexandrova

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This year the international InnoTrans exhibition in Berlin was focused on the future. Participants discussed how to increase the speed of rolling stock, how to make trains even more comfortable and attractive to passengers, and whether the political crisis influences this market in general.

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This year the international InnoTrans exhibition in Berlin was focused on the future. Participants discussed how to increase the speed of rolling stock, how to make trains even more comfortable and attractive to passengers, and whether the political crisis influences this market in general.

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РЖД-Партнер

Via North Korea and Mongolia to China

Via North Korea  and Mongolia to China

The modernisation of a universal loading terminal in the Rajin port, which was a response to the increasing volume of coal carried from Russia to countries of the Asia and Pacific region, is, in fact, an international project, and several countries are showing interest in it: Russia, North Korea, China, and South Korea. Pavel Sokolov, CEO of Russian Railways Logistics JSC, talks about services, which can be provided by this project.

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Companies are Interested in the Rajin Port

– Mr Sokolov, please, tell us about a new service connected with coal transportation to the Rajin port.

– After completing the modernisation of the infrastructure linking Russian and Korean railways, Russian Railways Logistics together with RasonConTrans developed a sophisticated service for coal transportation via the Korean port of Rajin. This service includes a dispatch of freight from any departure point on the RZD network and cargo transportation on the new route: Khasan (Russia) – Tumangan (N.Korea) – Rajin port (N.Korea), as well as railcar services, cargo handling in the port and its further delivery to Chinese water areas. During the first stage, this service was developed especially for the coal mining market allowing customers from the Asia and Pacific Region to buy coal, coke, and ore at prices comparable with the cost of transportation via Russian ports in the Far East. In the future, the route can be expanded to Europe.

– Due to what factors did the company manage to combine different transport modes in the framework of one service?

– It became possible due to the experience of Russian Railways Logistics in mixed transportation and the involvement of the Black Sea Ferry Investments railway-ferry operator, a subsidiary of Russian Railways Logistics which is responsible for the marine section of the way to/from South-East Asia and transshipment in the port. Russian Railways Logistics carries out operational activities on the railway section of the route from Russia to North Korea, and in the opposite direction (potentially including Europe in the future).

– What are the first results of the complex service?

– In March 2014, the company sent the first batch of Kuzbass coal in two trains consisting of 130 wagons with a total weight of about 9,000 tons. Russian Railways Logistics used the following scheme: at first, the cargo was carried to the Khasan station, where, in accordance with the carrying capacity of the Khasan-Tumangan border crossing, groups consisting of 21-23 railcars were formed to transport coal across North Korea. The first two trains with coal departed from the Prokopyevsk and the Novokuznetsk-Sortirovochny stations of the West-Siberian Railway. In May 2014, a train with 5,000 tons of coal for the Mechel company left the Neryungri station of the Far Eastern Railway. In July, Russian Railways Logistics organised for another customer transportation of more than 42,000 tons of coal from the Chelutai station on the East-Siberian Railway to China via the Rajin port.
In the future, if the Russia – China – Southeast Asia route operates efficiently, it will be possible to talk about expanding the geography of the service, as well as about diversification of the cargo base for handling in the Rason port, which may include containerised cargo carried to/from the Asian Pacific region. Russian Railways Logistics with its Austrian subsidiary FELB has been successfully providing container transportation from Europe to Asia via the Trans-Siberian transport corridor for more than two years already.

– How do Russian Railways Logistics and RasonConTrans interact in the framework of this complex service?

– RasonConTrans is the operator of the sea terminal in the Rajin port and a transport forwarder in North Korea, which is engaged in transferring transportation to the North Korean side, including document registration, while Russian Railways Logistics is responsible for the railway and sea forwarding, and cargo handling in the port. Additionally, RasonConTrans has rented the Khasan-Rajin railway section and the terminal in the Rason port for 49 years and is responsible for the modernisation of the railway infrastructure, the construction of a container terminal in the port and its operation in the future.

– Did you succeeded in attracting the interest of customers in the south and southeast of China to the project?

– During negotiations, several Chinese companies showed interest in coal transportation via Rajin. Amid a deficit of oil and natural gas, coal remains the most important energy sources in China. The target customers and major importers of coal carried via N. Korea are eastern and southeastern provinces of China, particularly regions with no access to the sea such as Heilongjiang, Jilin, and Liaoning. The Rajin port is more convenient for them than Chinese harbours because it is closer. The interest shown by Chinese southeastern provinces comes from the possibility of sea transportation from Rajin to the ports of Shanghai and Guanzhou.
Apart from China, South Korea also showed an interest in transportation via Rajin. It has estimated the benefits of the route – the ability to speed up transportation and to switch cargo traffic from South Korea to Europe from the sea to the short land route – via the Trans-Siberian Railway. South Korea will have new opportunities as soon as railway transportation is organised across the whole Trans-Korean Railway from the South Korean port of Busan.

– It turns out that despite the fact that the project is in its infancy, it already has a number of competitive advantages over alternative schemes for freight transportation to the Asian and Pacific region, doesn’t it?

– Yes, it has, therefore, these advantages allow Russian Railways Logistics to significantly diversify the geography of its customers in the east. The benefits of the service include a wide range of integrated logistics services, including optimised logistics solutions; the ratio between price and quality; existence of a single rate for a comprehensive service; only one set of transport documents; an extensive network of partners and successful pilot shipments. Not by chance, in spite of a complicated foreign political background in the region, Russian Railways Logistics is optimistic about the new scheme of transportation of goods on the Rajin port (N.Korea) – Tumangan (N.Korea) –
Khasan (Russia).

Customers’ Confidence in Rajin Port will Increase

– What organisational or technological problems did the company face when launching this comprehensive service?

– Starting from March 2014, the company dispatched several trains on the route, and now we are preparing to continue shipments. Some difficulties were revealed there. The main problem today is that the market does not consider Rason as a place for purchasing and selling coal. We are sure, however, that every new shipment will contribute to an increase in the customers’ confidence in the port.
Another challenge is to ensure that this transshipment point is quite specific due to geopolitical reasons. For example, European banks refuse to provide coal traders with loans for trading operations carried out in the region. This problem can be solved: some Russian banks are ready to cooperate with traders working in this direction.
Other factors restraining the development of this service are a wide range of proposals for the sale of Australian coal in China (which is cheaper) and the negative situation in the global coal market, due to the continuing fall in the price of coal.

– What railway rolling stock is used when providing this service?

– Cargo is transported by locomotives from the Far Eastern and North Korean railways in gondola cars that meet all the requirements for cargo transportation on the public infrastructure of the RZD network.

– Is the infrastructure capacity available at all stages of the service, including equipment at the port, sufficient?

– When the project was carried out, 54 km of combined railway track with a width of 1435 mm and 1520 mm was reconstructed, artificial structures were restored (18 bridges, including the Friendship Bridge across the Tumannaya river on the border, 12 pipe-culverts and three tunnels with a total length of more than 4.5 km were reconstructed. Additionally, modern signalling, interlocking, and communication equipment was installed.
The first phase of the RasonConTrans JV project was completed in the Rason port in June 2014: three 15 metre long inclined belt conveyors (mobile) were installed. The port was equipped with stationary cleaning equipment. The next step is the delivery and assembly of another two 40 metre mobile belt conveyors (stackers).
Construction work is under way at the terminal: related infrastructure, including the railway tracks from Russian Khasan station to the Rajin port, was modernised in 2013; the construction work at the terminal in the Rajin port was completed. A universal transloading terminal with the annual capacity of 400,000 TEU was put into operation in the port of Rajin on July 18, 2014. In the framework of this project, a range of works, including dredging, construction of a new quay wall, equipping storage areas, construction of industrial and office buildings, and railway tracks inside the terminal, were carried out.
Today, the ports handles coal without delays. Cargo is loaded by portal cranes. The port can receive and service vessels with a deadweight up to 40,000 tons; the total warehouse capacity is about 200,000 tons. The capacity of the terminal is at least 4 million tons of cargo per year.

The Port will be able to Service Any Cargo

– What are the prospects for further development of this service? Can the range of goods be expanded? Can the geography of transportation change?

– The demand for foreign trade cargo transportation via Russian sea ports requires precise coordination of the adjacent transport modes and improving the methods of organisation of transportation. Ports in this transport chain are the links that determine the efficiency and attractiveness of the whole intermodal transport system. Therefore, an additional corridor was developed for more convenient export of products made by the coal mining and metallurgical companies of Russia.
Coal was selected as the main cargo at the initial stage, and the business model of the Rason port development project envisaged that the handling capacity would reach 1.6 million tons of coal by the end of 2014. Services were developed specifically for the needs of mining companies and included a railway transit through the territory of Russia and North Korea, reloading and storage of goods at the port, sea freight to South-East Asia, including additional services in the form of consulting, document registration, and customs clearance.

– Will the terminal be able to service containerised and bulk cargoes in the future?

– Yes, of course. In addition to Russian coal, international container transportation with an entrance to the Trans-Siberian Railway will be organised. According to preliminary estimations, there are plans to attract at least 100,000 TEU of transit container cargo flow to the new route per annum. In the future, the traffic along the Trans-Korean Mainline as a part of the Eurasian railway corridor should grow.
Therefore, in line with the development of the technical opportunities of the updated terminal in the Rajin port, Russian Railways Logistics will be able to provide container transportation services on the route via Rason, including transit through Russia. In this case, we can talk about expanding the range of goods. The company has been providing transit container transportation services for more than two years – via the Transsib in cooperation with FELB (an Austrian joint venture), and via the Trans-Kazakhstan railway – with YuXinOu (Chinese joint venture).

– What are the company’s plans relating to new services in Siberia and the Russian Far East?

– In addition to the main activities of affiliates of the Russian Railways Logistics operating in the regions of Siberia and the Far East, the company has a number of promising new projects there, including transport and logistics servicing the largest Russian metallurgical and coal mining holding companies, particularly the transportation of their exports to Far Eastern ports and transshipment onto sea vessels in accordance with timetables agreed with the customers and ports.

– Could you comment on the development of new transit routes from China via Mongolia and back?

– We are talking about transportation of iron ore and coal to China’s largest steel producers and Chinese goods to Russia and Europe. As a part of this initiative, Mongolia and Russia initiated a project for the development of the railway infrastructure in the Republic of Mongolia, which envisaged a comprehensive modernisation of the existing railway line, as well as the construction of new railway links to large mineral deposits in Mongolia. Due to interest in exporting to China and other Southeast Asian countries, the transport infrastructure of Mongolia is being developed in the direction of the nearest sea port – Tianjin in China (a part of which is provided for the use of Mongolia). According to analysts’ estimates, the volume of transit cargo transportation via the Ulan Bator Railway could increase from the current 2.4 million tons to 6 million tons by 2020.
Both the projects – the route to Rajin, and the Trans-Mongolian project, target reducing the cargo flow moving to the Far Eastern ports and backwards, because the capacity of infrastructure is limited there.
Interviewed by Marina Ermolenko

our reference
In 2013, the volume of export and import cargo transportation by railway via Russian ports was the same as in 2012 and amounted to 250.4 million tons. In the first five months of 2014 it reached 115.6 million tons, 11.7 million tons or 11.3% more than in the same period of 2013. Far Eastern ports handle a quarter of all Russian port cargoes. Coastal trade cargo makes up 12.9% of the total throughput in the basin, but it is more than 50% of all Russian coastal trade cargoes handled by ports of the country. Moreover, the importance of transit transportation along the Northern Sea Route as an alternative to other routes between Europe and Asia is increasing.
The growth of cargo flows moving to Russian ports creates an additional burden on the railway and port infrastructure, therefore, its development is extremely important. Additionally, integrated services for transportation of goods by adjacent transport modes are very popular among transport forwarders. In this transport chain, ports are the link that to a significant degree determines the efficiency and attractiveness of the intermodal transport system.

[~DETAIL_TEXT] =>

Companies are Interested in the Rajin Port

– Mr Sokolov, please, tell us about a new service connected with coal transportation to the Rajin port.

– After completing the modernisation of the infrastructure linking Russian and Korean railways, Russian Railways Logistics together with RasonConTrans developed a sophisticated service for coal transportation via the Korean port of Rajin. This service includes a dispatch of freight from any departure point on the RZD network and cargo transportation on the new route: Khasan (Russia) – Tumangan (N.Korea) – Rajin port (N.Korea), as well as railcar services, cargo handling in the port and its further delivery to Chinese water areas. During the first stage, this service was developed especially for the coal mining market allowing customers from the Asia and Pacific Region to buy coal, coke, and ore at prices comparable with the cost of transportation via Russian ports in the Far East. In the future, the route can be expanded to Europe.

– Due to what factors did the company manage to combine different transport modes in the framework of one service?

– It became possible due to the experience of Russian Railways Logistics in mixed transportation and the involvement of the Black Sea Ferry Investments railway-ferry operator, a subsidiary of Russian Railways Logistics which is responsible for the marine section of the way to/from South-East Asia and transshipment in the port. Russian Railways Logistics carries out operational activities on the railway section of the route from Russia to North Korea, and in the opposite direction (potentially including Europe in the future).

– What are the first results of the complex service?

– In March 2014, the company sent the first batch of Kuzbass coal in two trains consisting of 130 wagons with a total weight of about 9,000 tons. Russian Railways Logistics used the following scheme: at first, the cargo was carried to the Khasan station, where, in accordance with the carrying capacity of the Khasan-Tumangan border crossing, groups consisting of 21-23 railcars were formed to transport coal across North Korea. The first two trains with coal departed from the Prokopyevsk and the Novokuznetsk-Sortirovochny stations of the West-Siberian Railway. In May 2014, a train with 5,000 tons of coal for the Mechel company left the Neryungri station of the Far Eastern Railway. In July, Russian Railways Logistics organised for another customer transportation of more than 42,000 tons of coal from the Chelutai station on the East-Siberian Railway to China via the Rajin port.
In the future, if the Russia – China – Southeast Asia route operates efficiently, it will be possible to talk about expanding the geography of the service, as well as about diversification of the cargo base for handling in the Rason port, which may include containerised cargo carried to/from the Asian Pacific region. Russian Railways Logistics with its Austrian subsidiary FELB has been successfully providing container transportation from Europe to Asia via the Trans-Siberian transport corridor for more than two years already.

– How do Russian Railways Logistics and RasonConTrans interact in the framework of this complex service?

– RasonConTrans is the operator of the sea terminal in the Rajin port and a transport forwarder in North Korea, which is engaged in transferring transportation to the North Korean side, including document registration, while Russian Railways Logistics is responsible for the railway and sea forwarding, and cargo handling in the port. Additionally, RasonConTrans has rented the Khasan-Rajin railway section and the terminal in the Rason port for 49 years and is responsible for the modernisation of the railway infrastructure, the construction of a container terminal in the port and its operation in the future.

– Did you succeeded in attracting the interest of customers in the south and southeast of China to the project?

– During negotiations, several Chinese companies showed interest in coal transportation via Rajin. Amid a deficit of oil and natural gas, coal remains the most important energy sources in China. The target customers and major importers of coal carried via N. Korea are eastern and southeastern provinces of China, particularly regions with no access to the sea such as Heilongjiang, Jilin, and Liaoning. The Rajin port is more convenient for them than Chinese harbours because it is closer. The interest shown by Chinese southeastern provinces comes from the possibility of sea transportation from Rajin to the ports of Shanghai and Guanzhou.
Apart from China, South Korea also showed an interest in transportation via Rajin. It has estimated the benefits of the route – the ability to speed up transportation and to switch cargo traffic from South Korea to Europe from the sea to the short land route – via the Trans-Siberian Railway. South Korea will have new opportunities as soon as railway transportation is organised across the whole Trans-Korean Railway from the South Korean port of Busan.

– It turns out that despite the fact that the project is in its infancy, it already has a number of competitive advantages over alternative schemes for freight transportation to the Asian and Pacific region, doesn’t it?

– Yes, it has, therefore, these advantages allow Russian Railways Logistics to significantly diversify the geography of its customers in the east. The benefits of the service include a wide range of integrated logistics services, including optimised logistics solutions; the ratio between price and quality; existence of a single rate for a comprehensive service; only one set of transport documents; an extensive network of partners and successful pilot shipments. Not by chance, in spite of a complicated foreign political background in the region, Russian Railways Logistics is optimistic about the new scheme of transportation of goods on the Rajin port (N.Korea) – Tumangan (N.Korea) –
Khasan (Russia).

Customers’ Confidence in Rajin Port will Increase

– What organisational or technological problems did the company face when launching this comprehensive service?

– Starting from March 2014, the company dispatched several trains on the route, and now we are preparing to continue shipments. Some difficulties were revealed there. The main problem today is that the market does not consider Rason as a place for purchasing and selling coal. We are sure, however, that every new shipment will contribute to an increase in the customers’ confidence in the port.
Another challenge is to ensure that this transshipment point is quite specific due to geopolitical reasons. For example, European banks refuse to provide coal traders with loans for trading operations carried out in the region. This problem can be solved: some Russian banks are ready to cooperate with traders working in this direction.
Other factors restraining the development of this service are a wide range of proposals for the sale of Australian coal in China (which is cheaper) and the negative situation in the global coal market, due to the continuing fall in the price of coal.

– What railway rolling stock is used when providing this service?

– Cargo is transported by locomotives from the Far Eastern and North Korean railways in gondola cars that meet all the requirements for cargo transportation on the public infrastructure of the RZD network.

– Is the infrastructure capacity available at all stages of the service, including equipment at the port, sufficient?

– When the project was carried out, 54 km of combined railway track with a width of 1435 mm and 1520 mm was reconstructed, artificial structures were restored (18 bridges, including the Friendship Bridge across the Tumannaya river on the border, 12 pipe-culverts and three tunnels with a total length of more than 4.5 km were reconstructed. Additionally, modern signalling, interlocking, and communication equipment was installed.
The first phase of the RasonConTrans JV project was completed in the Rason port in June 2014: three 15 metre long inclined belt conveyors (mobile) were installed. The port was equipped with stationary cleaning equipment. The next step is the delivery and assembly of another two 40 metre mobile belt conveyors (stackers).
Construction work is under way at the terminal: related infrastructure, including the railway tracks from Russian Khasan station to the Rajin port, was modernised in 2013; the construction work at the terminal in the Rajin port was completed. A universal transloading terminal with the annual capacity of 400,000 TEU was put into operation in the port of Rajin on July 18, 2014. In the framework of this project, a range of works, including dredging, construction of a new quay wall, equipping storage areas, construction of industrial and office buildings, and railway tracks inside the terminal, were carried out.
Today, the ports handles coal without delays. Cargo is loaded by portal cranes. The port can receive and service vessels with a deadweight up to 40,000 tons; the total warehouse capacity is about 200,000 tons. The capacity of the terminal is at least 4 million tons of cargo per year.

The Port will be able to Service Any Cargo

– What are the prospects for further development of this service? Can the range of goods be expanded? Can the geography of transportation change?

– The demand for foreign trade cargo transportation via Russian sea ports requires precise coordination of the adjacent transport modes and improving the methods of organisation of transportation. Ports in this transport chain are the links that determine the efficiency and attractiveness of the whole intermodal transport system. Therefore, an additional corridor was developed for more convenient export of products made by the coal mining and metallurgical companies of Russia.
Coal was selected as the main cargo at the initial stage, and the business model of the Rason port development project envisaged that the handling capacity would reach 1.6 million tons of coal by the end of 2014. Services were developed specifically for the needs of mining companies and included a railway transit through the territory of Russia and North Korea, reloading and storage of goods at the port, sea freight to South-East Asia, including additional services in the form of consulting, document registration, and customs clearance.

– Will the terminal be able to service containerised and bulk cargoes in the future?

– Yes, of course. In addition to Russian coal, international container transportation with an entrance to the Trans-Siberian Railway will be organised. According to preliminary estimations, there are plans to attract at least 100,000 TEU of transit container cargo flow to the new route per annum. In the future, the traffic along the Trans-Korean Mainline as a part of the Eurasian railway corridor should grow.
Therefore, in line with the development of the technical opportunities of the updated terminal in the Rajin port, Russian Railways Logistics will be able to provide container transportation services on the route via Rason, including transit through Russia. In this case, we can talk about expanding the range of goods. The company has been providing transit container transportation services for more than two years – via the Transsib in cooperation with FELB (an Austrian joint venture), and via the Trans-Kazakhstan railway – with YuXinOu (Chinese joint venture).

– What are the company’s plans relating to new services in Siberia and the Russian Far East?

– In addition to the main activities of affiliates of the Russian Railways Logistics operating in the regions of Siberia and the Far East, the company has a number of promising new projects there, including transport and logistics servicing the largest Russian metallurgical and coal mining holding companies, particularly the transportation of their exports to Far Eastern ports and transshipment onto sea vessels in accordance with timetables agreed with the customers and ports.

– Could you comment on the development of new transit routes from China via Mongolia and back?

– We are talking about transportation of iron ore and coal to China’s largest steel producers and Chinese goods to Russia and Europe. As a part of this initiative, Mongolia and Russia initiated a project for the development of the railway infrastructure in the Republic of Mongolia, which envisaged a comprehensive modernisation of the existing railway line, as well as the construction of new railway links to large mineral deposits in Mongolia. Due to interest in exporting to China and other Southeast Asian countries, the transport infrastructure of Mongolia is being developed in the direction of the nearest sea port – Tianjin in China (a part of which is provided for the use of Mongolia). According to analysts’ estimates, the volume of transit cargo transportation via the Ulan Bator Railway could increase from the current 2.4 million tons to 6 million tons by 2020.
Both the projects – the route to Rajin, and the Trans-Mongolian project, target reducing the cargo flow moving to the Far Eastern ports and backwards, because the capacity of infrastructure is limited there.
Interviewed by Marina Ermolenko

our reference
In 2013, the volume of export and import cargo transportation by railway via Russian ports was the same as in 2012 and amounted to 250.4 million tons. In the first five months of 2014 it reached 115.6 million tons, 11.7 million tons or 11.3% more than in the same period of 2013. Far Eastern ports handle a quarter of all Russian port cargoes. Coastal trade cargo makes up 12.9% of the total throughput in the basin, but it is more than 50% of all Russian coastal trade cargoes handled by ports of the country. Moreover, the importance of transit transportation along the Northern Sea Route as an alternative to other routes between Europe and Asia is increasing.
The growth of cargo flows moving to Russian ports creates an additional burden on the railway and port infrastructure, therefore, its development is extremely important. Additionally, integrated services for transportation of goods by adjacent transport modes are very popular among transport forwarders. In this transport chain, ports are the link that to a significant degree determines the efficiency and attractiveness of the intermodal transport system.

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The modernisation of a universal loading terminal in the Rajin port, which was a response to the increasing volume of coal carried from Russia to countries of the Asia and Pacific region, is, in fact, an international project, and several countries are showing interest in it: Russia, North Korea, China, and South Korea. Pavel Sokolov, CEO of Russian Railways Logistics JSC, talks about services, which can be provided by this project.

[~PREVIEW_TEXT] =>

The modernisation of a universal loading terminal in the Rajin port, which was a response to the increasing volume of coal carried from Russia to countries of the Asia and Pacific region, is, in fact, an international project, and several countries are showing interest in it: Russia, North Korea, China, and South Korea. Pavel Sokolov, CEO of Russian Railways Logistics JSC, talks about services, which can be provided by this project.

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Companies are Interested in the Rajin Port

– Mr Sokolov, please, tell us about a new service connected with coal transportation to the Rajin port.

– After completing the modernisation of the infrastructure linking Russian and Korean railways, Russian Railways Logistics together with RasonConTrans developed a sophisticated service for coal transportation via the Korean port of Rajin. This service includes a dispatch of freight from any departure point on the RZD network and cargo transportation on the new route: Khasan (Russia) – Tumangan (N.Korea) – Rajin port (N.Korea), as well as railcar services, cargo handling in the port and its further delivery to Chinese water areas. During the first stage, this service was developed especially for the coal mining market allowing customers from the Asia and Pacific Region to buy coal, coke, and ore at prices comparable with the cost of transportation via Russian ports in the Far East. In the future, the route can be expanded to Europe.

– Due to what factors did the company manage to combine different transport modes in the framework of one service?

– It became possible due to the experience of Russian Railways Logistics in mixed transportation and the involvement of the Black Sea Ferry Investments railway-ferry operator, a subsidiary of Russian Railways Logistics which is responsible for the marine section of the way to/from South-East Asia and transshipment in the port. Russian Railways Logistics carries out operational activities on the railway section of the route from Russia to North Korea, and in the opposite direction (potentially including Europe in the future).

– What are the first results of the complex service?

– In March 2014, the company sent the first batch of Kuzbass coal in two trains consisting of 130 wagons with a total weight of about 9,000 tons. Russian Railways Logistics used the following scheme: at first, the cargo was carried to the Khasan station, where, in accordance with the carrying capacity of the Khasan-Tumangan border crossing, groups consisting of 21-23 railcars were formed to transport coal across North Korea. The first two trains with coal departed from the Prokopyevsk and the Novokuznetsk-Sortirovochny stations of the West-Siberian Railway. In May 2014, a train with 5,000 tons of coal for the Mechel company left the Neryungri station of the Far Eastern Railway. In July, Russian Railways Logistics organised for another customer transportation of more than 42,000 tons of coal from the Chelutai station on the East-Siberian Railway to China via the Rajin port.
In the future, if the Russia – China – Southeast Asia route operates efficiently, it will be possible to talk about expanding the geography of the service, as well as about diversification of the cargo base for handling in the Rason port, which may include containerised cargo carried to/from the Asian Pacific region. Russian Railways Logistics with its Austrian subsidiary FELB has been successfully providing container transportation from Europe to Asia via the Trans-Siberian transport corridor for more than two years already.

– How do Russian Railways Logistics and RasonConTrans interact in the framework of this complex service?

– RasonConTrans is the operator of the sea terminal in the Rajin port and a transport forwarder in North Korea, which is engaged in transferring transportation to the North Korean side, including document registration, while Russian Railways Logistics is responsible for the railway and sea forwarding, and cargo handling in the port. Additionally, RasonConTrans has rented the Khasan-Rajin railway section and the terminal in the Rason port for 49 years and is responsible for the modernisation of the railway infrastructure, the construction of a container terminal in the port and its operation in the future.

– Did you succeeded in attracting the interest of customers in the south and southeast of China to the project?

– During negotiations, several Chinese companies showed interest in coal transportation via Rajin. Amid a deficit of oil and natural gas, coal remains the most important energy sources in China. The target customers and major importers of coal carried via N. Korea are eastern and southeastern provinces of China, particularly regions with no access to the sea such as Heilongjiang, Jilin, and Liaoning. The Rajin port is more convenient for them than Chinese harbours because it is closer. The interest shown by Chinese southeastern provinces comes from the possibility of sea transportation from Rajin to the ports of Shanghai and Guanzhou.
Apart from China, South Korea also showed an interest in transportation via Rajin. It has estimated the benefits of the route – the ability to speed up transportation and to switch cargo traffic from South Korea to Europe from the sea to the short land route – via the Trans-Siberian Railway. South Korea will have new opportunities as soon as railway transportation is organised across the whole Trans-Korean Railway from the South Korean port of Busan.

– It turns out that despite the fact that the project is in its infancy, it already has a number of competitive advantages over alternative schemes for freight transportation to the Asian and Pacific region, doesn’t it?

– Yes, it has, therefore, these advantages allow Russian Railways Logistics to significantly diversify the geography of its customers in the east. The benefits of the service include a wide range of integrated logistics services, including optimised logistics solutions; the ratio between price and quality; existence of a single rate for a comprehensive service; only one set of transport documents; an extensive network of partners and successful pilot shipments. Not by chance, in spite of a complicated foreign political background in the region, Russian Railways Logistics is optimistic about the new scheme of transportation of goods on the Rajin port (N.Korea) – Tumangan (N.Korea) –
Khasan (Russia).

Customers’ Confidence in Rajin Port will Increase

– What organisational or technological problems did the company face when launching this comprehensive service?

– Starting from March 2014, the company dispatched several trains on the route, and now we are preparing to continue shipments. Some difficulties were revealed there. The main problem today is that the market does not consider Rason as a place for purchasing and selling coal. We are sure, however, that every new shipment will contribute to an increase in the customers’ confidence in the port.
Another challenge is to ensure that this transshipment point is quite specific due to geopolitical reasons. For example, European banks refuse to provide coal traders with loans for trading operations carried out in the region. This problem can be solved: some Russian banks are ready to cooperate with traders working in this direction.
Other factors restraining the development of this service are a wide range of proposals for the sale of Australian coal in China (which is cheaper) and the negative situation in the global coal market, due to the continuing fall in the price of coal.

– What railway rolling stock is used when providing this service?

– Cargo is transported by locomotives from the Far Eastern and North Korean railways in gondola cars that meet all the requirements for cargo transportation on the public infrastructure of the RZD network.

– Is the infrastructure capacity available at all stages of the service, including equipment at the port, sufficient?

– When the project was carried out, 54 km of combined railway track with a width of 1435 mm and 1520 mm was reconstructed, artificial structures were restored (18 bridges, including the Friendship Bridge across the Tumannaya river on the border, 12 pipe-culverts and three tunnels with a total length of more than 4.5 km were reconstructed. Additionally, modern signalling, interlocking, and communication equipment was installed.
The first phase of the RasonConTrans JV project was completed in the Rason port in June 2014: three 15 metre long inclined belt conveyors (mobile) were installed. The port was equipped with stationary cleaning equipment. The next step is the delivery and assembly of another two 40 metre mobile belt conveyors (stackers).
Construction work is under way at the terminal: related infrastructure, including the railway tracks from Russian Khasan station to the Rajin port, was modernised in 2013; the construction work at the terminal in the Rajin port was completed. A universal transloading terminal with the annual capacity of 400,000 TEU was put into operation in the port of Rajin on July 18, 2014. In the framework of this project, a range of works, including dredging, construction of a new quay wall, equipping storage areas, construction of industrial and office buildings, and railway tracks inside the terminal, were carried out.
Today, the ports handles coal without delays. Cargo is loaded by portal cranes. The port can receive and service vessels with a deadweight up to 40,000 tons; the total warehouse capacity is about 200,000 tons. The capacity of the terminal is at least 4 million tons of cargo per year.

The Port will be able to Service Any Cargo

– What are the prospects for further development of this service? Can the range of goods be expanded? Can the geography of transportation change?

– The demand for foreign trade cargo transportation via Russian sea ports requires precise coordination of the adjacent transport modes and improving the methods of organisation of transportation. Ports in this transport chain are the links that determine the efficiency and attractiveness of the whole intermodal transport system. Therefore, an additional corridor was developed for more convenient export of products made by the coal mining and metallurgical companies of Russia.
Coal was selected as the main cargo at the initial stage, and the business model of the Rason port development project envisaged that the handling capacity would reach 1.6 million tons of coal by the end of 2014. Services were developed specifically for the needs of mining companies and included a railway transit through the territory of Russia and North Korea, reloading and storage of goods at the port, sea freight to South-East Asia, including additional services in the form of consulting, document registration, and customs clearance.

– Will the terminal be able to service containerised and bulk cargoes in the future?

– Yes, of course. In addition to Russian coal, international container transportation with an entrance to the Trans-Siberian Railway will be organised. According to preliminary estimations, there are plans to attract at least 100,000 TEU of transit container cargo flow to the new route per annum. In the future, the traffic along the Trans-Korean Mainline as a part of the Eurasian railway corridor should grow.
Therefore, in line with the development of the technical opportunities of the updated terminal in the Rajin port, Russian Railways Logistics will be able to provide container transportation services on the route via Rason, including transit through Russia. In this case, we can talk about expanding the range of goods. The company has been providing transit container transportation services for more than two years – via the Transsib in cooperation with FELB (an Austrian joint venture), and via the Trans-Kazakhstan railway – with YuXinOu (Chinese joint venture).

– What are the company’s plans relating to new services in Siberia and the Russian Far East?

– In addition to the main activities of affiliates of the Russian Railways Logistics operating in the regions of Siberia and the Far East, the company has a number of promising new projects there, including transport and logistics servicing the largest Russian metallurgical and coal mining holding companies, particularly the transportation of their exports to Far Eastern ports and transshipment onto sea vessels in accordance with timetables agreed with the customers and ports.

– Could you comment on the development of new transit routes from China via Mongolia and back?

– We are talking about transportation of iron ore and coal to China’s largest steel producers and Chinese goods to Russia and Europe. As a part of this initiative, Mongolia and Russia initiated a project for the development of the railway infrastructure in the Republic of Mongolia, which envisaged a comprehensive modernisation of the existing railway line, as well as the construction of new railway links to large mineral deposits in Mongolia. Due to interest in exporting to China and other Southeast Asian countries, the transport infrastructure of Mongolia is being developed in the direction of the nearest sea port – Tianjin in China (a part of which is provided for the use of Mongolia). According to analysts’ estimates, the volume of transit cargo transportation via the Ulan Bator Railway could increase from the current 2.4 million tons to 6 million tons by 2020.
Both the projects – the route to Rajin, and the Trans-Mongolian project, target reducing the cargo flow moving to the Far Eastern ports and backwards, because the capacity of infrastructure is limited there.
Interviewed by Marina Ermolenko

our reference
In 2013, the volume of export and import cargo transportation by railway via Russian ports was the same as in 2012 and amounted to 250.4 million tons. In the first five months of 2014 it reached 115.6 million tons, 11.7 million tons or 11.3% more than in the same period of 2013. Far Eastern ports handle a quarter of all Russian port cargoes. Coastal trade cargo makes up 12.9% of the total throughput in the basin, but it is more than 50% of all Russian coastal trade cargoes handled by ports of the country. Moreover, the importance of transit transportation along the Northern Sea Route as an alternative to other routes between Europe and Asia is increasing.
The growth of cargo flows moving to Russian ports creates an additional burden on the railway and port infrastructure, therefore, its development is extremely important. Additionally, integrated services for transportation of goods by adjacent transport modes are very popular among transport forwarders. In this transport chain, ports are the link that to a significant degree determines the efficiency and attractiveness of the intermodal transport system.

[~DETAIL_TEXT] =>

Companies are Interested in the Rajin Port

– Mr Sokolov, please, tell us about a new service connected with coal transportation to the Rajin port.

– After completing the modernisation of the infrastructure linking Russian and Korean railways, Russian Railways Logistics together with RasonConTrans developed a sophisticated service for coal transportation via the Korean port of Rajin. This service includes a dispatch of freight from any departure point on the RZD network and cargo transportation on the new route: Khasan (Russia) – Tumangan (N.Korea) – Rajin port (N.Korea), as well as railcar services, cargo handling in the port and its further delivery to Chinese water areas. During the first stage, this service was developed especially for the coal mining market allowing customers from the Asia and Pacific Region to buy coal, coke, and ore at prices comparable with the cost of transportation via Russian ports in the Far East. In the future, the route can be expanded to Europe.

– Due to what factors did the company manage to combine different transport modes in the framework of one service?

– It became possible due to the experience of Russian Railways Logistics in mixed transportation and the involvement of the Black Sea Ferry Investments railway-ferry operator, a subsidiary of Russian Railways Logistics which is responsible for the marine section of the way to/from South-East Asia and transshipment in the port. Russian Railways Logistics carries out operational activities on the railway section of the route from Russia to North Korea, and in the opposite direction (potentially including Europe in the future).

– What are the first results of the complex service?

– In March 2014, the company sent the first batch of Kuzbass coal in two trains consisting of 130 wagons with a total weight of about 9,000 tons. Russian Railways Logistics used the following scheme: at first, the cargo was carried to the Khasan station, where, in accordance with the carrying capacity of the Khasan-Tumangan border crossing, groups consisting of 21-23 railcars were formed to transport coal across North Korea. The first two trains with coal departed from the Prokopyevsk and the Novokuznetsk-Sortirovochny stations of the West-Siberian Railway. In May 2014, a train with 5,000 tons of coal for the Mechel company left the Neryungri station of the Far Eastern Railway. In July, Russian Railways Logistics organised for another customer transportation of more than 42,000 tons of coal from the Chelutai station on the East-Siberian Railway to China via the Rajin port.
In the future, if the Russia – China – Southeast Asia route operates efficiently, it will be possible to talk about expanding the geography of the service, as well as about diversification of the cargo base for handling in the Rason port, which may include containerised cargo carried to/from the Asian Pacific region. Russian Railways Logistics with its Austrian subsidiary FELB has been successfully providing container transportation from Europe to Asia via the Trans-Siberian transport corridor for more than two years already.

– How do Russian Railways Logistics and RasonConTrans interact in the framework of this complex service?

– RasonConTrans is the operator of the sea terminal in the Rajin port and a transport forwarder in North Korea, which is engaged in transferring transportation to the North Korean side, including document registration, while Russian Railways Logistics is responsible for the railway and sea forwarding, and cargo handling in the port. Additionally, RasonConTrans has rented the Khasan-Rajin railway section and the terminal in the Rason port for 49 years and is responsible for the modernisation of the railway infrastructure, the construction of a container terminal in the port and its operation in the future.

– Did you succeeded in attracting the interest of customers in the south and southeast of China to the project?

– During negotiations, several Chinese companies showed interest in coal transportation via Rajin. Amid a deficit of oil and natural gas, coal remains the most important energy sources in China. The target customers and major importers of coal carried via N. Korea are eastern and southeastern provinces of China, particularly regions with no access to the sea such as Heilongjiang, Jilin, and Liaoning. The Rajin port is more convenient for them than Chinese harbours because it is closer. The interest shown by Chinese southeastern provinces comes from the possibility of sea transportation from Rajin to the ports of Shanghai and Guanzhou.
Apart from China, South Korea also showed an interest in transportation via Rajin. It has estimated the benefits of the route – the ability to speed up transportation and to switch cargo traffic from South Korea to Europe from the sea to the short land route – via the Trans-Siberian Railway. South Korea will have new opportunities as soon as railway transportation is organised across the whole Trans-Korean Railway from the South Korean port of Busan.

– It turns out that despite the fact that the project is in its infancy, it already has a number of competitive advantages over alternative schemes for freight transportation to the Asian and Pacific region, doesn’t it?

– Yes, it has, therefore, these advantages allow Russian Railways Logistics to significantly diversify the geography of its customers in the east. The benefits of the service include a wide range of integrated logistics services, including optimised logistics solutions; the ratio between price and quality; existence of a single rate for a comprehensive service; only one set of transport documents; an extensive network of partners and successful pilot shipments. Not by chance, in spite of a complicated foreign political background in the region, Russian Railways Logistics is optimistic about the new scheme of transportation of goods on the Rajin port (N.Korea) – Tumangan (N.Korea) –
Khasan (Russia).

Customers’ Confidence in Rajin Port will Increase

– What organisational or technological problems did the company face when launching this comprehensive service?

– Starting from March 2014, the company dispatched several trains on the route, and now we are preparing to continue shipments. Some difficulties were revealed there. The main problem today is that the market does not consider Rason as a place for purchasing and selling coal. We are sure, however, that every new shipment will contribute to an increase in the customers’ confidence in the port.
Another challenge is to ensure that this transshipment point is quite specific due to geopolitical reasons. For example, European banks refuse to provide coal traders with loans for trading operations carried out in the region. This problem can be solved: some Russian banks are ready to cooperate with traders working in this direction.
Other factors restraining the development of this service are a wide range of proposals for the sale of Australian coal in China (which is cheaper) and the negative situation in the global coal market, due to the continuing fall in the price of coal.

– What railway rolling stock is used when providing this service?

– Cargo is transported by locomotives from the Far Eastern and North Korean railways in gondola cars that meet all the requirements for cargo transportation on the public infrastructure of the RZD network.

– Is the infrastructure capacity available at all stages of the service, including equipment at the port, sufficient?

– When the project was carried out, 54 km of combined railway track with a width of 1435 mm and 1520 mm was reconstructed, artificial structures were restored (18 bridges, including the Friendship Bridge across the Tumannaya river on the border, 12 pipe-culverts and three tunnels with a total length of more than 4.5 km were reconstructed. Additionally, modern signalling, interlocking, and communication equipment was installed.
The first phase of the RasonConTrans JV project was completed in the Rason port in June 2014: three 15 metre long inclined belt conveyors (mobile) were installed. The port was equipped with stationary cleaning equipment. The next step is the delivery and assembly of another two 40 metre mobile belt conveyors (stackers).
Construction work is under way at the terminal: related infrastructure, including the railway tracks from Russian Khasan station to the Rajin port, was modernised in 2013; the construction work at the terminal in the Rajin port was completed. A universal transloading terminal with the annual capacity of 400,000 TEU was put into operation in the port of Rajin on July 18, 2014. In the framework of this project, a range of works, including dredging, construction of a new quay wall, equipping storage areas, construction of industrial and office buildings, and railway tracks inside the terminal, were carried out.
Today, the ports handles coal without delays. Cargo is loaded by portal cranes. The port can receive and service vessels with a deadweight up to 40,000 tons; the total warehouse capacity is about 200,000 tons. The capacity of the terminal is at least 4 million tons of cargo per year.

The Port will be able to Service Any Cargo

– What are the prospects for further development of this service? Can the range of goods be expanded? Can the geography of transportation change?

– The demand for foreign trade cargo transportation via Russian sea ports requires precise coordination of the adjacent transport modes and improving the methods of organisation of transportation. Ports in this transport chain are the links that determine the efficiency and attractiveness of the whole intermodal transport system. Therefore, an additional corridor was developed for more convenient export of products made by the coal mining and metallurgical companies of Russia.
Coal was selected as the main cargo at the initial stage, and the business model of the Rason port development project envisaged that the handling capacity would reach 1.6 million tons of coal by the end of 2014. Services were developed specifically for the needs of mining companies and included a railway transit through the territory of Russia and North Korea, reloading and storage of goods at the port, sea freight to South-East Asia, including additional services in the form of consulting, document registration, and customs clearance.

– Will the terminal be able to service containerised and bulk cargoes in the future?

– Yes, of course. In addition to Russian coal, international container transportation with an entrance to the Trans-Siberian Railway will be organised. According to preliminary estimations, there are plans to attract at least 100,000 TEU of transit container cargo flow to the new route per annum. In the future, the traffic along the Trans-Korean Mainline as a part of the Eurasian railway corridor should grow.
Therefore, in line with the development of the technical opportunities of the updated terminal in the Rajin port, Russian Railways Logistics will be able to provide container transportation services on the route via Rason, including transit through Russia. In this case, we can talk about expanding the range of goods. The company has been providing transit container transportation services for more than two years – via the Transsib in cooperation with FELB (an Austrian joint venture), and via the Trans-Kazakhstan railway – with YuXinOu (Chinese joint venture).

– What are the company’s plans relating to new services in Siberia and the Russian Far East?

– In addition to the main activities of affiliates of the Russian Railways Logistics operating in the regions of Siberia and the Far East, the company has a number of promising new projects there, including transport and logistics servicing the largest Russian metallurgical and coal mining holding companies, particularly the transportation of their exports to Far Eastern ports and transshipment onto sea vessels in accordance with timetables agreed with the customers and ports.

– Could you comment on the development of new transit routes from China via Mongolia and back?

– We are talking about transportation of iron ore and coal to China’s largest steel producers and Chinese goods to Russia and Europe. As a part of this initiative, Mongolia and Russia initiated a project for the development of the railway infrastructure in the Republic of Mongolia, which envisaged a comprehensive modernisation of the existing railway line, as well as the construction of new railway links to large mineral deposits in Mongolia. Due to interest in exporting to China and other Southeast Asian countries, the transport infrastructure of Mongolia is being developed in the direction of the nearest sea port – Tianjin in China (a part of which is provided for the use of Mongolia). According to analysts’ estimates, the volume of transit cargo transportation via the Ulan Bator Railway could increase from the current 2.4 million tons to 6 million tons by 2020.
Both the projects – the route to Rajin, and the Trans-Mongolian project, target reducing the cargo flow moving to the Far Eastern ports and backwards, because the capacity of infrastructure is limited there.
Interviewed by Marina Ermolenko

our reference
In 2013, the volume of export and import cargo transportation by railway via Russian ports was the same as in 2012 and amounted to 250.4 million tons. In the first five months of 2014 it reached 115.6 million tons, 11.7 million tons or 11.3% more than in the same period of 2013. Far Eastern ports handle a quarter of all Russian port cargoes. Coastal trade cargo makes up 12.9% of the total throughput in the basin, but it is more than 50% of all Russian coastal trade cargoes handled by ports of the country. Moreover, the importance of transit transportation along the Northern Sea Route as an alternative to other routes between Europe and Asia is increasing.
The growth of cargo flows moving to Russian ports creates an additional burden on the railway and port infrastructure, therefore, its development is extremely important. Additionally, integrated services for transportation of goods by adjacent transport modes are very popular among transport forwarders. In this transport chain, ports are the link that to a significant degree determines the efficiency and attractiveness of the intermodal transport system.

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The modernisation of a universal loading terminal in the Rajin port, which was a response to the increasing volume of coal carried from Russia to countries of the Asia and Pacific region, is, in fact, an international project, and several countries are showing interest in it: Russia, North Korea, China, and South Korea. Pavel Sokolov, CEO of Russian Railways Logistics JSC, talks about services, which can be provided by this project.

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The modernisation of a universal loading terminal in the Rajin port, which was a response to the increasing volume of coal carried from Russia to countries of the Asia and Pacific region, is, in fact, an international project, and several countries are showing interest in it: Russia, North Korea, China, and South Korea. Pavel Sokolov, CEO of Russian Railways Logistics JSC, talks about services, which can be provided by this project.

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РЖД-Партнер

The Period of Industrial Parks

The Period of Industrial Parks

The first industrial park appeared in the late 19th century in the United Kingdom. Later they spread to the whole world. What does a modern European logistics park look like today?

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Under One Roof

“The creation of industrial parks has a direct impact on the economic well-being of the region. This is an important infrastructural element of the logistics chain, because it attracts trade and transport flows and provides opportunities for companies to optimize operational and time costs, bringing together warehouse and production facilities in one place,” said Managing Partner at Griffin Partners, Miles Jones.
It is also important to note that these parks provide a huge number of jobs. He notes that in many countries, there are government programs to attract young professionals, students and graduates to work in high-tech industries located in industrial parks.
Daniel Martin, Deputy General Director at TGC LLC, notes that the main target of the industrial park is a synergy of properties, which are located in one place and are similarly or vertically integrated, as well as related services and research centers. “Sometimes developers try to attract an anchor resident who can attract partners from his market to maintain the industrial orientation of the park,” he explains.
What is the basic concept of the industrial park? Mr Martin said that it is a placement of several large and small ancillary businesses at one site with a complete infrastructure.
Some of the industrial park is underneath industrial installations that are built especially for the customer (built-to-suit). In addition, there are warehouses, offices and other buildings, creating a comfortable business atmosphere for companies at the park. If necessary, customs post and hotels can be built there too.
The amount of storage space in industrial parks usually depends on the demand for warehouses in each particular case.
The availability of transport infrastructure is an important factor. “The effectiveness of the park depends on the transit potential of the region. The most famous and well-developed parks are located at the point of intersection of the maximum number of transports: air, rail, sea and river communications and major expressways,” says M. Jones.
“Industrial parks employ up to 120,000 people. It is important to understand how to solve the problems of travel to the place of work and how acceptable travel time is from places of residence,” he adds.
Another important element of the parks is communications. According to D. Martin, the best European markets for industrial parks are the United Kingdom, France and Germany.
For example, the industrial park Frankfurt-Hoechst in Germany is one of the main centers of European high technology. The park is located on both sides of the river Main covering 460 hectares. There are production facilities and laboratories for global chemical industry giant Sanofi-Aventis and companies in related industries. On its territory, there are over 90 scientific and production companies from the fields of pharmacology, biotechnology, chemicals and pharmaceuticals industries, among them there are both international companies and small startup firms.

Many Parks, One Target


Nikolay Tityukhin, President of the EurAsian Logistics Association (EALA), notes that all industrial parks have the same features: an area from 30 to 200 hectares, location near or directly in places far from residential areas and with good access to multimodal transport.
Boris Timofeev, Director of the Itella logistics company in Russia, believes that the main distinguishing feature of the European logistics park is the extensive use of green technology. “For example, a warehouse for Nike in Belgium uses wind turbines. It has its own wind park of six rechargeable alkaline turbines with 77 meters in diameter of the rotating part. One of the warehouses in an industrial park in Spain uses solar panels and can not only reduce the power consumption of the supplying organization, but also sell electricity to private households,” he explains.
Another feature of such parks in Europe is a more advanced process of automation and simplified workflow.
B. Timofeev explains that such a measure was enforced. In countries with expensive labor, scarcity and expensive land, for example, in Germany, logistics were forced to look for ways to reduce costs. Therefore, in the 1970’s in West Germany, there was zero unemployment. There was a big labor shortage; so the country reached an agreement with Italy to attract staff from its South European neighbor. The high cost of land has forced a rethink about new technical solutions – how to place 3-5 times more goods in storage on a single square meter. Automated warehouses appeared, their height could reach 40 metres (for comparison – a warehouse’s useable height in Russia is 12-14 metres). The automation of these stocks significantly reduces the number of serving staff.
An example of such a site could be a distribution center for frozen potatoes vendor “Lamb Weston” in Holland. There is a warehouse with 500,000 pallets, and only 20 people work there. Such projects require high investment – their return is not as fast as players would like.
D. Martin believes that storage and industrial facilities in Europe are in high demand from investors. Moreover, most importantly, one needs to rely on on-line trading, which continues to grow against the fall of traditional retail sales. Supply and demand can be expected, not only in countries with a steadily growing on-line trade, such as the United Kingdom and Germany, but also in developing markets.
By Tatyana Simonova

[~DETAIL_TEXT] =>

Under One Roof

“The creation of industrial parks has a direct impact on the economic well-being of the region. This is an important infrastructural element of the logistics chain, because it attracts trade and transport flows and provides opportunities for companies to optimize operational and time costs, bringing together warehouse and production facilities in one place,” said Managing Partner at Griffin Partners, Miles Jones.
It is also important to note that these parks provide a huge number of jobs. He notes that in many countries, there are government programs to attract young professionals, students and graduates to work in high-tech industries located in industrial parks.
Daniel Martin, Deputy General Director at TGC LLC, notes that the main target of the industrial park is a synergy of properties, which are located in one place and are similarly or vertically integrated, as well as related services and research centers. “Sometimes developers try to attract an anchor resident who can attract partners from his market to maintain the industrial orientation of the park,” he explains.
What is the basic concept of the industrial park? Mr Martin said that it is a placement of several large and small ancillary businesses at one site with a complete infrastructure.
Some of the industrial park is underneath industrial installations that are built especially for the customer (built-to-suit). In addition, there are warehouses, offices and other buildings, creating a comfortable business atmosphere for companies at the park. If necessary, customs post and hotels can be built there too.
The amount of storage space in industrial parks usually depends on the demand for warehouses in each particular case.
The availability of transport infrastructure is an important factor. “The effectiveness of the park depends on the transit potential of the region. The most famous and well-developed parks are located at the point of intersection of the maximum number of transports: air, rail, sea and river communications and major expressways,” says M. Jones.
“Industrial parks employ up to 120,000 people. It is important to understand how to solve the problems of travel to the place of work and how acceptable travel time is from places of residence,” he adds.
Another important element of the parks is communications. According to D. Martin, the best European markets for industrial parks are the United Kingdom, France and Germany.
For example, the industrial park Frankfurt-Hoechst in Germany is one of the main centers of European high technology. The park is located on both sides of the river Main covering 460 hectares. There are production facilities and laboratories for global chemical industry giant Sanofi-Aventis and companies in related industries. On its territory, there are over 90 scientific and production companies from the fields of pharmacology, biotechnology, chemicals and pharmaceuticals industries, among them there are both international companies and small startup firms.

Many Parks, One Target


Nikolay Tityukhin, President of the EurAsian Logistics Association (EALA), notes that all industrial parks have the same features: an area from 30 to 200 hectares, location near or directly in places far from residential areas and with good access to multimodal transport.
Boris Timofeev, Director of the Itella logistics company in Russia, believes that the main distinguishing feature of the European logistics park is the extensive use of green technology. “For example, a warehouse for Nike in Belgium uses wind turbines. It has its own wind park of six rechargeable alkaline turbines with 77 meters in diameter of the rotating part. One of the warehouses in an industrial park in Spain uses solar panels and can not only reduce the power consumption of the supplying organization, but also sell electricity to private households,” he explains.
Another feature of such parks in Europe is a more advanced process of automation and simplified workflow.
B. Timofeev explains that such a measure was enforced. In countries with expensive labor, scarcity and expensive land, for example, in Germany, logistics were forced to look for ways to reduce costs. Therefore, in the 1970’s in West Germany, there was zero unemployment. There was a big labor shortage; so the country reached an agreement with Italy to attract staff from its South European neighbor. The high cost of land has forced a rethink about new technical solutions – how to place 3-5 times more goods in storage on a single square meter. Automated warehouses appeared, their height could reach 40 metres (for comparison – a warehouse’s useable height in Russia is 12-14 metres). The automation of these stocks significantly reduces the number of serving staff.
An example of such a site could be a distribution center for frozen potatoes vendor “Lamb Weston” in Holland. There is a warehouse with 500,000 pallets, and only 20 people work there. Such projects require high investment – their return is not as fast as players would like.
D. Martin believes that storage and industrial facilities in Europe are in high demand from investors. Moreover, most importantly, one needs to rely on on-line trading, which continues to grow against the fall of traditional retail sales. Supply and demand can be expected, not only in countries with a steadily growing on-line trade, such as the United Kingdom and Germany, but also in developing markets.
By Tatyana Simonova

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The first industrial park appeared in the late 19th century in the United Kingdom. Later they spread to the whole world. What does a modern European logistics park look like today?

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Under One Roof

“The creation of industrial parks has a direct impact on the economic well-being of the region. This is an important infrastructural element of the logistics chain, because it attracts trade and transport flows and provides opportunities for companies to optimize operational and time costs, bringing together warehouse and production facilities in one place,” said Managing Partner at Griffin Partners, Miles Jones.
It is also important to note that these parks provide a huge number of jobs. He notes that in many countries, there are government programs to attract young professionals, students and graduates to work in high-tech industries located in industrial parks.
Daniel Martin, Deputy General Director at TGC LLC, notes that the main target of the industrial park is a synergy of properties, which are located in one place and are similarly or vertically integrated, as well as related services and research centers. “Sometimes developers try to attract an anchor resident who can attract partners from his market to maintain the industrial orientation of the park,” he explains.
What is the basic concept of the industrial park? Mr Martin said that it is a placement of several large and small ancillary businesses at one site with a complete infrastructure.
Some of the industrial park is underneath industrial installations that are built especially for the customer (built-to-suit). In addition, there are warehouses, offices and other buildings, creating a comfortable business atmosphere for companies at the park. If necessary, customs post and hotels can be built there too.
The amount of storage space in industrial parks usually depends on the demand for warehouses in each particular case.
The availability of transport infrastructure is an important factor. “The effectiveness of the park depends on the transit potential of the region. The most famous and well-developed parks are located at the point of intersection of the maximum number of transports: air, rail, sea and river communications and major expressways,” says M. Jones.
“Industrial parks employ up to 120,000 people. It is important to understand how to solve the problems of travel to the place of work and how acceptable travel time is from places of residence,” he adds.
Another important element of the parks is communications. According to D. Martin, the best European markets for industrial parks are the United Kingdom, France and Germany.
For example, the industrial park Frankfurt-Hoechst in Germany is one of the main centers of European high technology. The park is located on both sides of the river Main covering 460 hectares. There are production facilities and laboratories for global chemical industry giant Sanofi-Aventis and companies in related industries. On its territory, there are over 90 scientific and production companies from the fields of pharmacology, biotechnology, chemicals and pharmaceuticals industries, among them there are both international companies and small startup firms.

Many Parks, One Target


Nikolay Tityukhin, President of the EurAsian Logistics Association (EALA), notes that all industrial parks have the same features: an area from 30 to 200 hectares, location near or directly in places far from residential areas and with good access to multimodal transport.
Boris Timofeev, Director of the Itella logistics company in Russia, believes that the main distinguishing feature of the European logistics park is the extensive use of green technology. “For example, a warehouse for Nike in Belgium uses wind turbines. It has its own wind park of six rechargeable alkaline turbines with 77 meters in diameter of the rotating part. One of the warehouses in an industrial park in Spain uses solar panels and can not only reduce the power consumption of the supplying organization, but also sell electricity to private households,” he explains.
Another feature of such parks in Europe is a more advanced process of automation and simplified workflow.
B. Timofeev explains that such a measure was enforced. In countries with expensive labor, scarcity and expensive land, for example, in Germany, logistics were forced to look for ways to reduce costs. Therefore, in the 1970’s in West Germany, there was zero unemployment. There was a big labor shortage; so the country reached an agreement with Italy to attract staff from its South European neighbor. The high cost of land has forced a rethink about new technical solutions – how to place 3-5 times more goods in storage on a single square meter. Automated warehouses appeared, their height could reach 40 metres (for comparison – a warehouse’s useable height in Russia is 12-14 metres). The automation of these stocks significantly reduces the number of serving staff.
An example of such a site could be a distribution center for frozen potatoes vendor “Lamb Weston” in Holland. There is a warehouse with 500,000 pallets, and only 20 people work there. Such projects require high investment – their return is not as fast as players would like.
D. Martin believes that storage and industrial facilities in Europe are in high demand from investors. Moreover, most importantly, one needs to rely on on-line trading, which continues to grow against the fall of traditional retail sales. Supply and demand can be expected, not only in countries with a steadily growing on-line trade, such as the United Kingdom and Germany, but also in developing markets.
By Tatyana Simonova

[~DETAIL_TEXT] =>

Under One Roof

“The creation of industrial parks has a direct impact on the economic well-being of the region. This is an important infrastructural element of the logistics chain, because it attracts trade and transport flows and provides opportunities for companies to optimize operational and time costs, bringing together warehouse and production facilities in one place,” said Managing Partner at Griffin Partners, Miles Jones.
It is also important to note that these parks provide a huge number of jobs. He notes that in many countries, there are government programs to attract young professionals, students and graduates to work in high-tech industries located in industrial parks.
Daniel Martin, Deputy General Director at TGC LLC, notes that the main target of the industrial park is a synergy of properties, which are located in one place and are similarly or vertically integrated, as well as related services and research centers. “Sometimes developers try to attract an anchor resident who can attract partners from his market to maintain the industrial orientation of the park,” he explains.
What is the basic concept of the industrial park? Mr Martin said that it is a placement of several large and small ancillary businesses at one site with a complete infrastructure.
Some of the industrial park is underneath industrial installations that are built especially for the customer (built-to-suit). In addition, there are warehouses, offices and other buildings, creating a comfortable business atmosphere for companies at the park. If necessary, customs post and hotels can be built there too.
The amount of storage space in industrial parks usually depends on the demand for warehouses in each particular case.
The availability of transport infrastructure is an important factor. “The effectiveness of the park depends on the transit potential of the region. The most famous and well-developed parks are located at the point of intersection of the maximum number of transports: air, rail, sea and river communications and major expressways,” says M. Jones.
“Industrial parks employ up to 120,000 people. It is important to understand how to solve the problems of travel to the place of work and how acceptable travel time is from places of residence,” he adds.
Another important element of the parks is communications. According to D. Martin, the best European markets for industrial parks are the United Kingdom, France and Germany.
For example, the industrial park Frankfurt-Hoechst in Germany is one of the main centers of European high technology. The park is located on both sides of the river Main covering 460 hectares. There are production facilities and laboratories for global chemical industry giant Sanofi-Aventis and companies in related industries. On its territory, there are over 90 scientific and production companies from the fields of pharmacology, biotechnology, chemicals and pharmaceuticals industries, among them there are both international companies and small startup firms.

Many Parks, One Target


Nikolay Tityukhin, President of the EurAsian Logistics Association (EALA), notes that all industrial parks have the same features: an area from 30 to 200 hectares, location near or directly in places far from residential areas and with good access to multimodal transport.
Boris Timofeev, Director of the Itella logistics company in Russia, believes that the main distinguishing feature of the European logistics park is the extensive use of green technology. “For example, a warehouse for Nike in Belgium uses wind turbines. It has its own wind park of six rechargeable alkaline turbines with 77 meters in diameter of the rotating part. One of the warehouses in an industrial park in Spain uses solar panels and can not only reduce the power consumption of the supplying organization, but also sell electricity to private households,” he explains.
Another feature of such parks in Europe is a more advanced process of automation and simplified workflow.
B. Timofeev explains that such a measure was enforced. In countries with expensive labor, scarcity and expensive land, for example, in Germany, logistics were forced to look for ways to reduce costs. Therefore, in the 1970’s in West Germany, there was zero unemployment. There was a big labor shortage; so the country reached an agreement with Italy to attract staff from its South European neighbor. The high cost of land has forced a rethink about new technical solutions – how to place 3-5 times more goods in storage on a single square meter. Automated warehouses appeared, their height could reach 40 metres (for comparison – a warehouse’s useable height in Russia is 12-14 metres). The automation of these stocks significantly reduces the number of serving staff.
An example of such a site could be a distribution center for frozen potatoes vendor “Lamb Weston” in Holland. There is a warehouse with 500,000 pallets, and only 20 people work there. Such projects require high investment – their return is not as fast as players would like.
D. Martin believes that storage and industrial facilities in Europe are in high demand from investors. Moreover, most importantly, one needs to rely on on-line trading, which continues to grow against the fall of traditional retail sales. Supply and demand can be expected, not only in countries with a steadily growing on-line trade, such as the United Kingdom and Germany, but also in developing markets.
By Tatyana Simonova

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РЖД-Партнер

The Pillars of Growth

The Pillars of Growth

Niko Warbanoff, Head of International Business Development of Deutsche Bahn, talks about success factors in international projects and competition in Europe.

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Small Decisions Bring Big Success

– Mr Warbanoff, could you please tell us about your experience as Head of Business Deve­lopment of Deutsche Bahn? What was your most important decision for the development of the company?

– In my position as Head of International Business Development I take care of the further development of Deutsche Bahn in Non-European markets, like the trans-eurasian corridor and the Southeast-Europe corridor via Turkey. I experienced that many countries in those regions I mentioned have just started the process of railway reform. Deutsche Bahn started its railway reform in 1994 and transformed successfully from a national rail-carrier into an international logistics company. This transformation process did not happen overnight. I found that a lot of small but sound steps are necessary along the way to become a successful international player – always keeping in mind the demands of the customer and not to forget to involve your employees and to be reliable with business partners all the time.
With respect to your question about my most important decision, I have to say it is always a bundle of many small decisions in cooperation with colleagues and partners, which will bring success in the end.

– Deutsche Bahn offers transport services in more than 130 countries. Could you tell us about the most profitable and far reaching directions?

– With approximately 2,000 locations in almost 140 countries, DB Schenker is the leading provider of transport and logistics solutions in all of the world’s major economic regions, where it maintains a presence right where its customers need it – by their side. The Asia-Pacific region is without a doubt a market that will continue to see strong growth, making it extremely interesting for the transport industry. Crossborder traffic between Asian nations is gaining in importance, so DB Schenker also provides its main logistics customers with overland connections for the region stretching from China to Singapore. Due to their locations, countries such as Laos and Cambodia will see their roles in transit and warehousing services become increasingly prominent. In Europe, the rail connection between Germany and southeast Europe is showing very positive developments. We also expect Central America to generate additional momentum for international growth. As Panama will play a particularly important role in this context, we have founded a national subsidiary there. Africa will be another motor for the global economy, and we recently strengthened our presence on the continent by establishing a company in Angola.

– What are your main targets now?

– Beside my position as Head of International Business Development of DB AG I am Chairman of the Board of Managing Directors of DB International GmbH, a 100% subsidiary of DB AG. DB International is an engineering and consulting company, which designs, plans, constructs and manages rail infrastructure. For both positions my main targets are in alignment with the strategy of Deutsche Bahn “DB2020”. To ensure long-term business success, it is essential to adopt a harmonized approach to tackling economic, social and environmental issues. That is why DB AG aims to be a profitable market leader, a top employer and an ecopioneer at the same time until 2020. For instance a profitable market leader means to grow profitably by improving the customer satisfaction at the same time. The non-EU-region plays a major role in this growth. As I said before I see high potential in the corridor between Europe and Asia and between Germany and Turkey in the rail business, which can only be exploited in cooperation.
Transport infrastructure in Germany is underfunded. According to an independent Commission (Daehre Commission), it will take 15 years to catch up on investments for roads, railways and waterways at a cost of EUR 7.2 billion annually. At the same time, this underfunded and ageing infrastructure has to support a growing transport volume. In the case of the railway network, volumes are expected to reach 1.2 billion trainpath kilometres by 2030, a third more than in 1994, the year of the German Rail Reform. In order for further growth of rail transport to take place, increased investment in the existing rail network is essential. We are with the government in very positive discussions on the conclusion of a new service and financing agreement. As a major transit country, underfunding of German rail infrastructure also puts the development of European rail freight at risk.

– Does the DB International pay attention to environmenta­lism in cargo and passenger transportation?

– As mentioned before, Deutsche Bahn has set its strategy on three pillars: economic growth, top employer and ecology. Already this makes it clear that DB International is considering ecological factors and developing sustainable solutions for its traffic. It starts with the discharge of the roads and the reduction of emissions by intelligent transport concepts, beyond the development of “green” railway station buildings and depots to construction supervision services in waste management.

Competition is Fierce


– Are you satisfied with the level of competition in the sector of railway cargo transportation in Europe?

– On the one hand, yes – the level of competition in European rail freight markets is high, especially compared to rail passenger markets which are still closed to competition in most Member States. Competition has developed especially strongly in countries which were among the first to liberalize their markets in the 1990s such as the UK, Germany and the Netherlands. For example, the market share of competitors in Germany reached 33.2% in rail freight transport in 2013.
On the other hand, there is room for stronger competition. Although a comparable level of legislation guaranteeing non-discriminatory access to infrastructure and essential facilities such as tracks, marshalling yards, terminals and shunting yards has been reached across Member States, the practical implementation is still not equal across Europe.

– Currently, competition between railways and road transport is fierce. Do you think that a new political initiative should be implemented in the European market to establish equal conditions for railways and road transport?

– Creating a level playing field for rail and other transport modes is a political initiative which we have been supporting at European level for many years. European transport policy currently imposes excessively high burdens on rail, despite the fact that it is a climate-friendly transport mode. Just one example: electric rail transport is the only transport mode which has to pay in full for the CO2 certificates it requires under the emissions trading scheme. Other transport modes are either not affected by emissions trading or they receive most of the required certificates free of charge, as is the case with inner-European aviation. Further, European regulations intended to establish interoperability will lead to additional costs, for example as a result of the introduction of a standardised train safety system throughout Europe

More and More Mobile

– Investment in railways is one of the most important factors for the economic growth in Germany. How can investors be attracted?

– Investors are attracted by profitable, innovative and growing rail transport markets and economically efficient railway companies, flanked by stable and predictable regulatory framework conditions. Stopping the downward spiral of underinvestment, leading to deteriorating infrastructure and rendering rail as a transport mode unattractive, which in turn leads to lower financial sources for investments, is also essential.

– Russian Railways Company, the French SNCF and Deutsche Bahn have signed a memorandum on the development of the distant passenger connection in 2012. Can you tell us about the main results of this cooperation?

– DB Fernverkehr is operating trains EN452 and EN453 Moscow-Paris-Moscow within Germany under the commercial responsibility of Russian Railways Company. July 20th was the 500th run of the inter-national train Moscow – Berlin – Paris departing from Belorussia Station in Moscow. A special ceremony was held when the train arrived at the main station in Berlin on the morning on July 21st at 6:51am. For Deutsche Bahn it was a honour to welcome the train. Since its start on December 12th 2011 around 90 000 passenger have been transported. We are satisfied with this cooperation and will support Russian Railways Company in further development or changes to the deal.

– How do you view the prospects of high-speed railways in Russia?

– We live in a world where people are becoming more and more mobile and ask for appropriate services. This also applies to Russia. The combination of growing urban areas is of great importance - for each passenger as well as for the economic growth of different regions. Since environmental awareness is increasing worldwide, the train is an important alternative to air travel. In addition, a traveler is at the respective city’s main station immediately in the center and does not require a lengthy journey from the airport to the city center. Therefore, high-speed projects in Russia will also become increa-singly interesting and important for the development of the country.

– What is the payback period of an investment in high-speed railways?

– High-speed railways are worth it for the state. The construction of a high-speed railway is a huge investment. The payback of an investment depends on many conditions like the amount of the con-struction costs (e.g. what kind of subgrade) and passenger demand (high/low frequency). The German High Speed Lines have more than paid back their costs – from a political and business view. To evaluate, if investments have paid back their cost, it is necessary to calculate all kind of effects – not only the financial aspects. Other effects are for example: First, the shorter journey time. In Germany the High speed rail lines shortened the journey time by at least 20% – the HSL between Frankfurt/Main and Berlin even reduced the rail travel time by half. Second, safety. Traveling by train is the safest way with a relatively low number of accidents compared to other modes of transport. Third, environmental friendliness. In These days customers have greater awareness for the environ-mental and demand more and more ecofriendly products. Railway is one of the most ecofriendly modes of transport. Fourth, growth in importance. Smaller cities or far away regions grow in impor-tance when they have a station for high speed trains.
All these effects can and should be measured when comparing investments.

– Do you think the political crisis will influence the European railway sector?

– The political crisis due to the Ukrainian conflict has reduced some East-West traffic of DB Schenker. We hope that the crisis will not last long.

Interviewed by Kirill Kovalenko

[~DETAIL_TEXT] =>

Small Decisions Bring Big Success

– Mr Warbanoff, could you please tell us about your experience as Head of Business Deve­lopment of Deutsche Bahn? What was your most important decision for the development of the company?

– In my position as Head of International Business Development I take care of the further development of Deutsche Bahn in Non-European markets, like the trans-eurasian corridor and the Southeast-Europe corridor via Turkey. I experienced that many countries in those regions I mentioned have just started the process of railway reform. Deutsche Bahn started its railway reform in 1994 and transformed successfully from a national rail-carrier into an international logistics company. This transformation process did not happen overnight. I found that a lot of small but sound steps are necessary along the way to become a successful international player – always keeping in mind the demands of the customer and not to forget to involve your employees and to be reliable with business partners all the time.
With respect to your question about my most important decision, I have to say it is always a bundle of many small decisions in cooperation with colleagues and partners, which will bring success in the end.

– Deutsche Bahn offers transport services in more than 130 countries. Could you tell us about the most profitable and far reaching directions?

– With approximately 2,000 locations in almost 140 countries, DB Schenker is the leading provider of transport and logistics solutions in all of the world’s major economic regions, where it maintains a presence right where its customers need it – by their side. The Asia-Pacific region is without a doubt a market that will continue to see strong growth, making it extremely interesting for the transport industry. Crossborder traffic between Asian nations is gaining in importance, so DB Schenker also provides its main logistics customers with overland connections for the region stretching from China to Singapore. Due to their locations, countries such as Laos and Cambodia will see their roles in transit and warehousing services become increasingly prominent. In Europe, the rail connection between Germany and southeast Europe is showing very positive developments. We also expect Central America to generate additional momentum for international growth. As Panama will play a particularly important role in this context, we have founded a national subsidiary there. Africa will be another motor for the global economy, and we recently strengthened our presence on the continent by establishing a company in Angola.

– What are your main targets now?

– Beside my position as Head of International Business Development of DB AG I am Chairman of the Board of Managing Directors of DB International GmbH, a 100% subsidiary of DB AG. DB International is an engineering and consulting company, which designs, plans, constructs and manages rail infrastructure. For both positions my main targets are in alignment with the strategy of Deutsche Bahn “DB2020”. To ensure long-term business success, it is essential to adopt a harmonized approach to tackling economic, social and environmental issues. That is why DB AG aims to be a profitable market leader, a top employer and an ecopioneer at the same time until 2020. For instance a profitable market leader means to grow profitably by improving the customer satisfaction at the same time. The non-EU-region plays a major role in this growth. As I said before I see high potential in the corridor between Europe and Asia and between Germany and Turkey in the rail business, which can only be exploited in cooperation.
Transport infrastructure in Germany is underfunded. According to an independent Commission (Daehre Commission), it will take 15 years to catch up on investments for roads, railways and waterways at a cost of EUR 7.2 billion annually. At the same time, this underfunded and ageing infrastructure has to support a growing transport volume. In the case of the railway network, volumes are expected to reach 1.2 billion trainpath kilometres by 2030, a third more than in 1994, the year of the German Rail Reform. In order for further growth of rail transport to take place, increased investment in the existing rail network is essential. We are with the government in very positive discussions on the conclusion of a new service and financing agreement. As a major transit country, underfunding of German rail infrastructure also puts the development of European rail freight at risk.

– Does the DB International pay attention to environmenta­lism in cargo and passenger transportation?

– As mentioned before, Deutsche Bahn has set its strategy on three pillars: economic growth, top employer and ecology. Already this makes it clear that DB International is considering ecological factors and developing sustainable solutions for its traffic. It starts with the discharge of the roads and the reduction of emissions by intelligent transport concepts, beyond the development of “green” railway station buildings and depots to construction supervision services in waste management.

Competition is Fierce


– Are you satisfied with the level of competition in the sector of railway cargo transportation in Europe?

– On the one hand, yes – the level of competition in European rail freight markets is high, especially compared to rail passenger markets which are still closed to competition in most Member States. Competition has developed especially strongly in countries which were among the first to liberalize their markets in the 1990s such as the UK, Germany and the Netherlands. For example, the market share of competitors in Germany reached 33.2% in rail freight transport in 2013.
On the other hand, there is room for stronger competition. Although a comparable level of legislation guaranteeing non-discriminatory access to infrastructure and essential facilities such as tracks, marshalling yards, terminals and shunting yards has been reached across Member States, the practical implementation is still not equal across Europe.

– Currently, competition between railways and road transport is fierce. Do you think that a new political initiative should be implemented in the European market to establish equal conditions for railways and road transport?

– Creating a level playing field for rail and other transport modes is a political initiative which we have been supporting at European level for many years. European transport policy currently imposes excessively high burdens on rail, despite the fact that it is a climate-friendly transport mode. Just one example: electric rail transport is the only transport mode which has to pay in full for the CO2 certificates it requires under the emissions trading scheme. Other transport modes are either not affected by emissions trading or they receive most of the required certificates free of charge, as is the case with inner-European aviation. Further, European regulations intended to establish interoperability will lead to additional costs, for example as a result of the introduction of a standardised train safety system throughout Europe

More and More Mobile

– Investment in railways is one of the most important factors for the economic growth in Germany. How can investors be attracted?

– Investors are attracted by profitable, innovative and growing rail transport markets and economically efficient railway companies, flanked by stable and predictable regulatory framework conditions. Stopping the downward spiral of underinvestment, leading to deteriorating infrastructure and rendering rail as a transport mode unattractive, which in turn leads to lower financial sources for investments, is also essential.

– Russian Railways Company, the French SNCF and Deutsche Bahn have signed a memorandum on the development of the distant passenger connection in 2012. Can you tell us about the main results of this cooperation?

– DB Fernverkehr is operating trains EN452 and EN453 Moscow-Paris-Moscow within Germany under the commercial responsibility of Russian Railways Company. July 20th was the 500th run of the inter-national train Moscow – Berlin – Paris departing from Belorussia Station in Moscow. A special ceremony was held when the train arrived at the main station in Berlin on the morning on July 21st at 6:51am. For Deutsche Bahn it was a honour to welcome the train. Since its start on December 12th 2011 around 90 000 passenger have been transported. We are satisfied with this cooperation and will support Russian Railways Company in further development or changes to the deal.

– How do you view the prospects of high-speed railways in Russia?

– We live in a world where people are becoming more and more mobile and ask for appropriate services. This also applies to Russia. The combination of growing urban areas is of great importance - for each passenger as well as for the economic growth of different regions. Since environmental awareness is increasing worldwide, the train is an important alternative to air travel. In addition, a traveler is at the respective city’s main station immediately in the center and does not require a lengthy journey from the airport to the city center. Therefore, high-speed projects in Russia will also become increa-singly interesting and important for the development of the country.

– What is the payback period of an investment in high-speed railways?

– High-speed railways are worth it for the state. The construction of a high-speed railway is a huge investment. The payback of an investment depends on many conditions like the amount of the con-struction costs (e.g. what kind of subgrade) and passenger demand (high/low frequency). The German High Speed Lines have more than paid back their costs – from a political and business view. To evaluate, if investments have paid back their cost, it is necessary to calculate all kind of effects – not only the financial aspects. Other effects are for example: First, the shorter journey time. In Germany the High speed rail lines shortened the journey time by at least 20% – the HSL between Frankfurt/Main and Berlin even reduced the rail travel time by half. Second, safety. Traveling by train is the safest way with a relatively low number of accidents compared to other modes of transport. Third, environmental friendliness. In These days customers have greater awareness for the environ-mental and demand more and more ecofriendly products. Railway is one of the most ecofriendly modes of transport. Fourth, growth in importance. Smaller cities or far away regions grow in impor-tance when they have a station for high speed trains.
All these effects can and should be measured when comparing investments.

– Do you think the political crisis will influence the European railway sector?

– The political crisis due to the Ukrainian conflict has reduced some East-West traffic of DB Schenker. We hope that the crisis will not last long.

Interviewed by Kirill Kovalenko

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Small Decisions Bring Big Success

– Mr Warbanoff, could you please tell us about your experience as Head of Business Deve­lopment of Deutsche Bahn? What was your most important decision for the development of the company?

– In my position as Head of International Business Development I take care of the further development of Deutsche Bahn in Non-European markets, like the trans-eurasian corridor and the Southeast-Europe corridor via Turkey. I experienced that many countries in those regions I mentioned have just started the process of railway reform. Deutsche Bahn started its railway reform in 1994 and transformed successfully from a national rail-carrier into an international logistics company. This transformation process did not happen overnight. I found that a lot of small but sound steps are necessary along the way to become a successful international player – always keeping in mind the demands of the customer and not to forget to involve your employees and to be reliable with business partners all the time.
With respect to your question about my most important decision, I have to say it is always a bundle of many small decisions in cooperation with colleagues and partners, which will bring success in the end.

– Deutsche Bahn offers transport services in more than 130 countries. Could you tell us about the most profitable and far reaching directions?

– With approximately 2,000 locations in almost 140 countries, DB Schenker is the leading provider of transport and logistics solutions in all of the world’s major economic regions, where it maintains a presence right where its customers need it – by their side. The Asia-Pacific region is without a doubt a market that will continue to see strong growth, making it extremely interesting for the transport industry. Crossborder traffic between Asian nations is gaining in importance, so DB Schenker also provides its main logistics customers with overland connections for the region stretching from China to Singapore. Due to their locations, countries such as Laos and Cambodia will see their roles in transit and warehousing services become increasingly prominent. In Europe, the rail connection between Germany and southeast Europe is showing very positive developments. We also expect Central America to generate additional momentum for international growth. As Panama will play a particularly important role in this context, we have founded a national subsidiary there. Africa will be another motor for the global economy, and we recently strengthened our presence on the continent by establishing a company in Angola.

– What are your main targets now?

– Beside my position as Head of International Business Development of DB AG I am Chairman of the Board of Managing Directors of DB International GmbH, a 100% subsidiary of DB AG. DB International is an engineering and consulting company, which designs, plans, constructs and manages rail infrastructure. For both positions my main targets are in alignment with the strategy of Deutsche Bahn “DB2020”. To ensure long-term business success, it is essential to adopt a harmonized approach to tackling economic, social and environmental issues. That is why DB AG aims to be a profitable market leader, a top employer and an ecopioneer at the same time until 2020. For instance a profitable market leader means to grow profitably by improving the customer satisfaction at the same time. The non-EU-region plays a major role in this growth. As I said before I see high potential in the corridor between Europe and Asia and between Germany and Turkey in the rail business, which can only be exploited in cooperation.
Transport infrastructure in Germany is underfunded. According to an independent Commission (Daehre Commission), it will take 15 years to catch up on investments for roads, railways and waterways at a cost of EUR 7.2 billion annually. At the same time, this underfunded and ageing infrastructure has to support a growing transport volume. In the case of the railway network, volumes are expected to reach 1.2 billion trainpath kilometres by 2030, a third more than in 1994, the year of the German Rail Reform. In order for further growth of rail transport to take place, increased investment in the existing rail network is essential. We are with the government in very positive discussions on the conclusion of a new service and financing agreement. As a major transit country, underfunding of German rail infrastructure also puts the development of European rail freight at risk.

– Does the DB International pay attention to environmenta­lism in cargo and passenger transportation?

– As mentioned before, Deutsche Bahn has set its strategy on three pillars: economic growth, top employer and ecology. Already this makes it clear that DB International is considering ecological factors and developing sustainable solutions for its traffic. It starts with the discharge of the roads and the reduction of emissions by intelligent transport concepts, beyond the development of “green” railway station buildings and depots to construction supervision services in waste management.

Competition is Fierce


– Are you satisfied with the level of competition in the sector of railway cargo transportation in Europe?

– On the one hand, yes – the level of competition in European rail freight markets is high, especially compared to rail passenger markets which are still closed to competition in most Member States. Competition has developed especially strongly in countries which were among the first to liberalize their markets in the 1990s such as the UK, Germany and the Netherlands. For example, the market share of competitors in Germany reached 33.2% in rail freight transport in 2013.
On the other hand, there is room for stronger competition. Although a comparable level of legislation guaranteeing non-discriminatory access to infrastructure and essential facilities such as tracks, marshalling yards, terminals and shunting yards has been reached across Member States, the practical implementation is still not equal across Europe.

– Currently, competition between railways and road transport is fierce. Do you think that a new political initiative should be implemented in the European market to establish equal conditions for railways and road transport?

– Creating a level playing field for rail and other transport modes is a political initiative which we have been supporting at European level for many years. European transport policy currently imposes excessively high burdens on rail, despite the fact that it is a climate-friendly transport mode. Just one example: electric rail transport is the only transport mode which has to pay in full for the CO2 certificates it requires under the emissions trading scheme. Other transport modes are either not affected by emissions trading or they receive most of the required certificates free of charge, as is the case with inner-European aviation. Further, European regulations intended to establish interoperability will lead to additional costs, for example as a result of the introduction of a standardised train safety system throughout Europe

More and More Mobile

– Investment in railways is one of the most important factors for the economic growth in Germany. How can investors be attracted?

– Investors are attracted by profitable, innovative and growing rail transport markets and economically efficient railway companies, flanked by stable and predictable regulatory framework conditions. Stopping the downward spiral of underinvestment, leading to deteriorating infrastructure and rendering rail as a transport mode unattractive, which in turn leads to lower financial sources for investments, is also essential.

– Russian Railways Company, the French SNCF and Deutsche Bahn have signed a memorandum on the development of the distant passenger connection in 2012. Can you tell us about the main results of this cooperation?

– DB Fernverkehr is operating trains EN452 and EN453 Moscow-Paris-Moscow within Germany under the commercial responsibility of Russian Railways Company. July 20th was the 500th run of the inter-national train Moscow – Berlin – Paris departing from Belorussia Station in Moscow. A special ceremony was held when the train arrived at the main station in Berlin on the morning on July 21st at 6:51am. For Deutsche Bahn it was a honour to welcome the train. Since its start on December 12th 2011 around 90 000 passenger have been transported. We are satisfied with this cooperation and will support Russian Railways Company in further development or changes to the deal.

– How do you view the prospects of high-speed railways in Russia?

– We live in a world where people are becoming more and more mobile and ask for appropriate services. This also applies to Russia. The combination of growing urban areas is of great importance - for each passenger as well as for the economic growth of different regions. Since environmental awareness is increasing worldwide, the train is an important alternative to air travel. In addition, a traveler is at the respective city’s main station immediately in the center and does not require a lengthy journey from the airport to the city center. Therefore, high-speed projects in Russia will also become increa-singly interesting and important for the development of the country.

– What is the payback period of an investment in high-speed railways?

– High-speed railways are worth it for the state. The construction of a high-speed railway is a huge investment. The payback of an investment depends on many conditions like the amount of the con-struction costs (e.g. what kind of subgrade) and passenger demand (high/low frequency). The German High Speed Lines have more than paid back their costs – from a political and business view. To evaluate, if investments have paid back their cost, it is necessary to calculate all kind of effects – not only the financial aspects. Other effects are for example: First, the shorter journey time. In Germany the High speed rail lines shortened the journey time by at least 20% – the HSL between Frankfurt/Main and Berlin even reduced the rail travel time by half. Second, safety. Traveling by train is the safest way with a relatively low number of accidents compared to other modes of transport. Third, environmental friendliness. In These days customers have greater awareness for the environ-mental and demand more and more ecofriendly products. Railway is one of the most ecofriendly modes of transport. Fourth, growth in importance. Smaller cities or far away regions grow in impor-tance when they have a station for high speed trains.
All these effects can and should be measured when comparing investments.

– Do you think the political crisis will influence the European railway sector?

– The political crisis due to the Ukrainian conflict has reduced some East-West traffic of DB Schenker. We hope that the crisis will not last long.

Interviewed by Kirill Kovalenko

[~DETAIL_TEXT] =>

Small Decisions Bring Big Success

– Mr Warbanoff, could you please tell us about your experience as Head of Business Deve­lopment of Deutsche Bahn? What was your most important decision for the development of the company?

– In my position as Head of International Business Development I take care of the further development of Deutsche Bahn in Non-European markets, like the trans-eurasian corridor and the Southeast-Europe corridor via Turkey. I experienced that many countries in those regions I mentioned have just started the process of railway reform. Deutsche Bahn started its railway reform in 1994 and transformed successfully from a national rail-carrier into an international logistics company. This transformation process did not happen overnight. I found that a lot of small but sound steps are necessary along the way to become a successful international player – always keeping in mind the demands of the customer and not to forget to involve your employees and to be reliable with business partners all the time.
With respect to your question about my most important decision, I have to say it is always a bundle of many small decisions in cooperation with colleagues and partners, which will bring success in the end.

– Deutsche Bahn offers transport services in more than 130 countries. Could you tell us about the most profitable and far reaching directions?

– With approximately 2,000 locations in almost 140 countries, DB Schenker is the leading provider of transport and logistics solutions in all of the world’s major economic regions, where it maintains a presence right where its customers need it – by their side. The Asia-Pacific region is without a doubt a market that will continue to see strong growth, making it extremely interesting for the transport industry. Crossborder traffic between Asian nations is gaining in importance, so DB Schenker also provides its main logistics customers with overland connections for the region stretching from China to Singapore. Due to their locations, countries such as Laos and Cambodia will see their roles in transit and warehousing services become increasingly prominent. In Europe, the rail connection between Germany and southeast Europe is showing very positive developments. We also expect Central America to generate additional momentum for international growth. As Panama will play a particularly important role in this context, we have founded a national subsidiary there. Africa will be another motor for the global economy, and we recently strengthened our presence on the continent by establishing a company in Angola.

– What are your main targets now?

– Beside my position as Head of International Business Development of DB AG I am Chairman of the Board of Managing Directors of DB International GmbH, a 100% subsidiary of DB AG. DB International is an engineering and consulting company, which designs, plans, constructs and manages rail infrastructure. For both positions my main targets are in alignment with the strategy of Deutsche Bahn “DB2020”. To ensure long-term business success, it is essential to adopt a harmonized approach to tackling economic, social and environmental issues. That is why DB AG aims to be a profitable market leader, a top employer and an ecopioneer at the same time until 2020. For instance a profitable market leader means to grow profitably by improving the customer satisfaction at the same time. The non-EU-region plays a major role in this growth. As I said before I see high potential in the corridor between Europe and Asia and between Germany and Turkey in the rail business, which can only be exploited in cooperation.
Transport infrastructure in Germany is underfunded. According to an independent Commission (Daehre Commission), it will take 15 years to catch up on investments for roads, railways and waterways at a cost of EUR 7.2 billion annually. At the same time, this underfunded and ageing infrastructure has to support a growing transport volume. In the case of the railway network, volumes are expected to reach 1.2 billion trainpath kilometres by 2030, a third more than in 1994, the year of the German Rail Reform. In order for further growth of rail transport to take place, increased investment in the existing rail network is essential. We are with the government in very positive discussions on the conclusion of a new service and financing agreement. As a major transit country, underfunding of German rail infrastructure also puts the development of European rail freight at risk.

– Does the DB International pay attention to environmenta­lism in cargo and passenger transportation?

– As mentioned before, Deutsche Bahn has set its strategy on three pillars: economic growth, top employer and ecology. Already this makes it clear that DB International is considering ecological factors and developing sustainable solutions for its traffic. It starts with the discharge of the roads and the reduction of emissions by intelligent transport concepts, beyond the development of “green” railway station buildings and depots to construction supervision services in waste management.

Competition is Fierce


– Are you satisfied with the level of competition in the sector of railway cargo transportation in Europe?

– On the one hand, yes – the level of competition in European rail freight markets is high, especially compared to rail passenger markets which are still closed to competition in most Member States. Competition has developed especially strongly in countries which were among the first to liberalize their markets in the 1990s such as the UK, Germany and the Netherlands. For example, the market share of competitors in Germany reached 33.2% in rail freight transport in 2013.
On the other hand, there is room for stronger competition. Although a comparable level of legislation guaranteeing non-discriminatory access to infrastructure and essential facilities such as tracks, marshalling yards, terminals and shunting yards has been reached across Member States, the practical implementation is still not equal across Europe.

– Currently, competition between railways and road transport is fierce. Do you think that a new political initiative should be implemented in the European market to establish equal conditions for railways and road transport?

– Creating a level playing field for rail and other transport modes is a political initiative which we have been supporting at European level for many years. European transport policy currently imposes excessively high burdens on rail, despite the fact that it is a climate-friendly transport mode. Just one example: electric rail transport is the only transport mode which has to pay in full for the CO2 certificates it requires under the emissions trading scheme. Other transport modes are either not affected by emissions trading or they receive most of the required certificates free of charge, as is the case with inner-European aviation. Further, European regulations intended to establish interoperability will lead to additional costs, for example as a result of the introduction of a standardised train safety system throughout Europe

More and More Mobile

– Investment in railways is one of the most important factors for the economic growth in Germany. How can investors be attracted?

– Investors are attracted by profitable, innovative and growing rail transport markets and economically efficient railway companies, flanked by stable and predictable regulatory framework conditions. Stopping the downward spiral of underinvestment, leading to deteriorating infrastructure and rendering rail as a transport mode unattractive, which in turn leads to lower financial sources for investments, is also essential.

– Russian Railways Company, the French SNCF and Deutsche Bahn have signed a memorandum on the development of the distant passenger connection in 2012. Can you tell us about the main results of this cooperation?

– DB Fernverkehr is operating trains EN452 and EN453 Moscow-Paris-Moscow within Germany under the commercial responsibility of Russian Railways Company. July 20th was the 500th run of the inter-national train Moscow – Berlin – Paris departing from Belorussia Station in Moscow. A special ceremony was held when the train arrived at the main station in Berlin on the morning on July 21st at 6:51am. For Deutsche Bahn it was a honour to welcome the train. Since its start on December 12th 2011 around 90 000 passenger have been transported. We are satisfied with this cooperation and will support Russian Railways Company in further development or changes to the deal.

– How do you view the prospects of high-speed railways in Russia?

– We live in a world where people are becoming more and more mobile and ask for appropriate services. This also applies to Russia. The combination of growing urban areas is of great importance - for each passenger as well as for the economic growth of different regions. Since environmental awareness is increasing worldwide, the train is an important alternative to air travel. In addition, a traveler is at the respective city’s main station immediately in the center and does not require a lengthy journey from the airport to the city center. Therefore, high-speed projects in Russia will also become increa-singly interesting and important for the development of the country.

– What is the payback period of an investment in high-speed railways?

– High-speed railways are worth it for the state. The construction of a high-speed railway is a huge investment. The payback of an investment depends on many conditions like the amount of the con-struction costs (e.g. what kind of subgrade) and passenger demand (high/low frequency). The German High Speed Lines have more than paid back their costs – from a political and business view. To evaluate, if investments have paid back their cost, it is necessary to calculate all kind of effects – not only the financial aspects. Other effects are for example: First, the shorter journey time. In Germany the High speed rail lines shortened the journey time by at least 20% – the HSL between Frankfurt/Main and Berlin even reduced the rail travel time by half. Second, safety. Traveling by train is the safest way with a relatively low number of accidents compared to other modes of transport. Third, environmental friendliness. In These days customers have greater awareness for the environ-mental and demand more and more ecofriendly products. Railway is one of the most ecofriendly modes of transport. Fourth, growth in importance. Smaller cities or far away regions grow in impor-tance when they have a station for high speed trains.
All these effects can and should be measured when comparing investments.

– Do you think the political crisis will influence the European railway sector?

– The political crisis due to the Ukrainian conflict has reduced some East-West traffic of DB Schenker. We hope that the crisis will not last long.

Interviewed by Kirill Kovalenko

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Niko Warbanoff, Head of International Business Development of Deutsche Bahn, talks about success factors in international projects and competition in Europe.

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