Russia faces falling freight traffic and container shortages as shipping lines pull out

April 13 (Reuters) – Russia is bracing for a sharp drop in cargo flows and a container shortfall after major international container shipping companies halted operations in the country due to Moscow’s military campaign in Ukraine , said two Russian leaders.

The world’s three largest container shipping lines, Danish Maersk, French CMA CGM and Swiss MSC, suspended bookings to and from Russia after Moscow sent troops to Ukraine on February 24, triggering a wave of Western sanctions.

The exit of the main container shipping companies – which transport most of the world’s manufactured goods and are essential to international trade – should lead to a significant drop in shipments if no alternative to these companies is found soon, according to the chief of the Delo Group, Russia’s largest container operator.

“We expect the drop in shipments (to and from Russian ports) in the North West region to be around 90% to 95% from May if no alternative appears on the market,” said Delo Group CEO Dmitry Pankov. He was referring to container terminals at Russian ports, including those in St. Petersburg and Ust-Luga.

Delo Group owns Global Ports, which operates terminals in northwest Russia and the Russian Far East, as well as terminals in the Black Sea port of Novorossiysk. It also controls TransContainer, the country’s largest freight container operator.

Pankov said ports in the Russian Far East, the Black Sea and the Sea of ​​Azov would suffer less from the exit of major container shipping companies because their share of cargo traffic was lower than that of the northwest of Russia and because new players in these regions were beginning to emerge.

He did not name these companies, but said some were from Turkey.

Alexander Isurin, managing director of TransContainer, predicted that the exit of container shipping companies will lead to a shortage of containers in circulation in the Russian market.

“The market will have to find a replacement for some 300,000 twenty-foot equivalent units (TEU),” Isurin said. TransContainer expects around 30% of containers in the Russian market to be withdrawn from circulation.

“The Russian transport market will most likely not be able to compensate for everything and replace the largest container lines in the world that have suddenly decided not to work here anymore.”

Isurin suggested that Russia might have no choice but to work with smaller regional container shipping companies new to the Russian market.

“There are Chinese, Japanese and Korean companies that can choose their position,” he said. “I think a lot of them have taken a wait-and-see stance which will depend on how the situation develops.”

(Reporting by Reuters; editing by Guy Faulconbridge)

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