The past two years have witnessed a major shift in the structure of Russia’s foreign trade, with the east and south playing an increasingly important role in this sector. Russia’s EU-bound exports decreased for almost all the main groups of goods, while growing shipments from friendly and neutral countries have largely offset the decline in imports from unfriendly countries, including those from the European Union. The share of imports from China reached 53 percent.
Overall, shipments increased by 3.6 percent in 2023 to 7.9 billion tonnes. The fact that major international companies opted to leave the Russian market, coupled with the growing demand for domestic shipments and foreign trade, created new opportunities for Russian companies.
In 2023, domestic road cargo transport accounted for 82.5 percent of the market, up 4.5 percentage points compared to the previous year. In this segment, the main growth drivers included changes in logistics chains, limited throughput capacity for railway transport, infrastructure projects and the development of e-commerce. Railway transport mostly focused on long-distance shipments, with a 15.7 percent share, while shipments by river and sea accounted for 1.8 percent of the transported cargo.
Having declined in 2022, container logistics started to recover in 2023, with container shipments by sea increasing by 10.3 percent. The Far Eastern basin accounted for one half of all containers processed by Russian ports, followed by the Baltic Sea ports with a 26 percent share and the ports along the coasts of the Sea of Azov and the Black Sea at 21 percent.
The shifts in Russia’s foreign trade patterns affected cargo flows in terms of both their structure and destinations with Russia’s Far East, including the Eastern Operating Domain, having to handle a major share of this traffic while lacking adequate capacity. Efforts are underway to upgrade this sector and expand its throughput capacity.
Russia’s container market is expected to grow at an annual rate of 3.2 percent until 2035.
Most of the growth will come from exports, which is attributable to the growing number of Russian sea shipping lines, the effort to expand trade with the countries of the Global South, and the expectation that container shipments will play an increasingly important role in the shipping sector. Only the lack of capacity within the Eastern Operating Domain, as well as tighter sanctions, may prevent the market from generating positive momentum.
«Russia’s international trade may exceed $1 trillion by 2030, provided that the logistics infrastructure does not hold back this progress. The east will account for between 40 and 50 percent, while Russia’s trade with its countries, including India and China, could reach between $470 billion and $500 billion, an increase of 30 to 40 percent compared to 2023. To fully unlock the potential for trading with this region, Russia must develop comprehensive solutions to deal with the infrastructure and economic bottlenecks it is currently facing. All market players expect it to address the existing challenges within the Eastern Operating Domain and to offer alternative routes,» Strategy Partners Managing Partner, Valeria Plotnikova, pointed out.
«Considering the ongoing shifts within the logistics market, Russia can improve the performance of its transport and logistics sector by undertaking effective system-wide initiatives to develop the logistics infrastructure with a far-reaching planning horizon, especially in Russia’s Far East and in its south, while also creating international hubs, and offering quality logistics and digital solutions for competing in the global market,» Maxim Shishkov, Strategic Marketing Director at Delo, said.
