(Yicai Global) April 26 -- Freight traffic on the China-Europe Railway Express line has increased in the first quarter with more trains going to Russia, the most popular destination.

From January to March, almost 4,190 trips were made, up 15 percent from a year ago, China State Railway Group revealed recently. The trains carried 449,000 twenty-foot equivalent units of goods, up 28 percent.

In March, nearly 1,490 journeys were carried out, rising by 31 percent and a volume of 162,000 TEUs were delivered, up by 52 percent, marking the 35th straight month of over 1,000 journeys.

New Russian Clients

The Russia-Ukraine conflict has affected China-Europe Railway Express as freight volumes majorly declined last year, according to the commerce ministry. But as some European clients shift to ocean cargo, the route that links Chinese cities such as Chengdu and Chongqing with European ones such as Duisburg in Germany has been gaining new customers in Russia.

If the trips to and from Russia are excluded, the number of train trips between China and Europe in 2022 probably reduced by around 30 percent so Russia is behind the overall increase, an insider from Ningbo-based Tiedada Supply Chain Management said to Yicai Global. 

Tang Tingting, assistant general manager of Sichuan province-based New Silk Road Multimodal Transport, explained to Yicai Global that due to the requirements of global freight forwarders and logistics firms, the company tried to reach Europe by taking a different route through Kazakhstan and Georgia, but the results were not that good.

Hence, the client structure of New Silk Road Multimodal Transport has turned upside down as 80 percent of the firm's business is about Russia, and the remainder Europe, per Tang.

Affordable Shipping

European customers have alternatives. Ocean cargo rates have fallen to pre-pandemic levels, according to Tang. A container to Europe costs around USD1,000 plus the port handling fees so the total is about USD3,000. Meanwhile, a corresponding price on the China-Europe Railway Express ranges from USD6,000 to USD7,000, she added.

More clients are choosing ocean shipping due to the declining charges, Hao Panfeng, deputy secretary-general of the China Container Industry Association, said to Yicai Global. 

Since last year, 80 percent of all freight transported via the China-Europe Railway Express has traveled between China and Russia, Hao said, adding that the impact of the changing structure is limited as freight transport accounts for a small portion of total trade between China and Europe. Moreover, changes in maritime logistics do not majorly affect the train cargo market, the expert added.  

Editors: Shi Yi, Emmi Laine, Xiao Yi