The international rail freight transport market is much more advanced than the passenger transport market in terms of liberalisation. Rail freight transport is, by nature, more oriented towards cross-border traffic. As a result, the progress brought by the liberalisation of the railway market is more tangible in case of freight transport. Since the beginning of 2007, the rail freight transport market has been entirely liberalised in the European Union, in terms of national and international services.
This led to the emergence of new undertakings, lower prices and traffic volume increase. However, because of the economic recession, the transport volumes plummeted. The position and property structure of EU rail freight transport operators also went through serious changes. For instance, in 2007, Veolia Cargo took over Rail4Chem. Recently, however, VeoliaCargo (now called Captrain) has been taken over by SNCF-Eurotunnel. It would be very interesting to study the evolution of the liberalisation process throughout time, considering the fact that the liberalisation of the passenger transport market has somehow slowed down. That is why the liberalisation of the rail freight transport market would be a good example of best practice. Several European institutions elaborated a study in which they analyse the evolution of the international rail passenger transport market in EU-27, as well as between EU-27 and its neighbouring countries. The study also analyses the evolution of the international rail freight market between EU-27 and its neighbouring countries. The study was published in March 2010 on the official website of the European Commission. It was elaborated by the NEA Transport Research and Training Institute (Netherlands), the University of Leeds (UK), PriceWaterhouseCoopers and Significance. One of the largest chapters included in this study is dedicated to freight transport.
Unbalanced freight flows
The analysis is limited to the rail freight transport between EU-27 and third countries. The third countries included here are, in fact, all non-EU countries connected by rail. “The analysis did not include only EU’s neighbouring countries, such as Russia, Belarus, Ukraine, Turkey and the Balkan region, but also China and other countries involved in the TRACECA program, because the rail freight transport links between these countries are developing and the freight volumes carried along these long-distance transport corridors are increasing”, explained the developers of the study.
Considering the various stages of development in different parts of Europe, this analysis is structured around a four-area classification, so that the results could be applied on a large scale. The first area is EU-27-Switzerland and Norway. Here, the cross-border transport markets are well-developed and there are no major issues in terms of interoperability.
The second area is EU-27 (Baltic Region) – Eastern Europe. In this case, the study shows no issues in terms of interoperability due to the existing gauge system, Finland, Estonia, Latvia and Lithuania all use the 1,520 mm gauge. The third area includes the EU-27 Ukrainian border, Belarus and Moldova. Here, the transfer from a 1,435 mm gauge to the 1,520 mm gauge results in several interoperability issues. The fourth area includes all the EU-27 cross-border connections with the Balkan region and Turkey, which use the 1,435 mm gauge. Here, there are several issues in terms of interoperability, generated by the characteristics of the region, and not by the gauge system. This chapter analyses the cross-border freight traffic volume recorded during 2001-2007. In the first area, cross-border traffic recorded in 2001 a volume of 21,976 thousand tonnes, in 2005 – 25,506 thousand tonnes and in 2007 – 25,855 thousand tonnes, which represents an 18% increase in freight volumes. The second area recorded in 2001 a traffic volume of 82.803 thousand tonnes, in 2005 – 85,647 thousand tonnes and in 2007 only 77,280 thousand tonnes, resulting in a drop of 8% in freight volumes.
The third area recorded in 2001 a traffic volume of 31,500 thousand tonnes, in 2005 – 28,390 thousand tonnes and in 2007 – 33,874 thousand tonnes, which led to a 7% increase in the freight volumes carried.
The fourth area recorded in 2001 a traffic volume of 1,495 thousand tonnes, in 2005 – 10,001 thousand tonnes and in 2007 – 11,193 thousand tonnes, resulting in 649% increase. The study also analyses the freight volumes recorded during 2001-2007 between EU-27 and non-EU countries. In 2001, up to 137,824 thousand tonnes of freight were carried; in 2005 – 149,544 thousand tonnes. 2007 brought a slight decrease to 148,202 thousand tonnes, resulting in an 8% increase. The data is provided by TRANS-TOOLS and Eurostat.
The Baltic Region in competition with St Petersburg?
“The economic growth did not improve matters along the routes between the EU and Eastern Europe, especially between Russia and the Baltic Region, where the traffic flow decreased in recent years”, shows the study. The freight flows between Russia, Belarus and Kazakhstan handled in the Baltic Region are largely made up of raw materials, such as ore, oil and coal. The study outlines the fact that “the freight flows carried by rail are not well-balanced; East-West freight flows are significantly higher than West-East flows”.
The transit routes for the freight handled in the Baltic Region are based on port rail links. Russia is currently developing its port capacity in the St Petersburg region, which means that the freight flows coming from the Baltic Region could decrease in the future. Freight flow increase depends, however, on the Russian policy related to the export logistics. It is estimated that the demand for raw materials will increase and that the ports in the Baltic Region will develop in the long-term. The investment plans which focus on the Baltic ports are based on this fact. The landline cross-border route from Belarus, Ukraine and Moldova is beginning to depend more and more on the freight flows to and from Poland and on the intermodal transport with the rest of the EU countries. This cross-border transit is also characterised by the change in the gauge system: from 1,435 mm to 1,520 mm. There are, however, various solutions to interoperability issues. Technical solutions suppose the change in bogies, freight re-loading at the borderline or the extension of the 1,520 mm gauge network. Several solutions to expand the 1,520 mm gauge network in the EU have already been extended in recent years by former CMEA (Council for Mutual Economic Assistance) members, who already use this type of gauge.
Based on the statistical data provided by TRANS-TOOLS and Eurostat, the developers of this study estimate that the modal share of the transport sector will be influenced by the many competitive railway services belonging to various market segments and by the liberalisation of the market, which will lead to an increase in efficiency and a 10% drop in rail freight transport costs for 2020 (compared to 2005). Based on this forecast, railway transport will maintain its current modal share, while road transport will increase its share. On the other hand, inland and maritime transport will decrease their modal share.
These trends will be largely influenced by the changing nature of the freight transport sector, based on the constant economic growth, going from bulk to smaller freight, lots with higher value and co-modal transport growth.
by Elene Ilie
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