Russian Railways wants to know all the prices and tariffs of counterparties

“Russian Railways” (Russian Railways) proposes to create a state system for monitoring commodity and transport markets. Monopoly itself, as suggested Russian Railways, at the first stage of operation of such a system, will receive the authority to collect information on the cost of providing railway wagons by operators “at the time of application or transfer of cargo.” On July 22, Russian Railways sent a letter with the relevant proposals to Deputy Minister of Transport Valentin Ivanov, and it was sent to industry associations to collect feedback. Vedomosti got acquainted with the document, its receipt was confirmed by the addressees.

Representative Russian Railways explained to Vedomosti that the carrier’s tariffs (Russian Railways) are set by the state and are “completely public”. At the same time, according to him, other participants in the transportation market – operators of wagons, sea terminals and shipping companies – set the cost of services, “focusing solely on their own profits, often not taking into account the interests of the state and the social significance of transporting individual goods.” “Information about the cost of their services is closed. This enables various manipulations, including price differentiation for different clients,” the interlocutor emphasized. In addition, according to him, there is no possibility of an objective assessment of the profitability of deliveries of Russian products to international markets.

Previously, when assessing the profitability of export deliveries Russian Railways used data from the international pricing agency Argus Media and the Ukrainian Metal Courier LLC (Promyshlennye Gruzy magazine). But in the context of negative international rhetoric and attitudes towards Russia, information from foreign publications is published “in a limited form”, and may also turn out to be unreliable, according to a letter from Russian Railways to the Ministry of Transport.

The Ministry of Transport and Rosmorrechflot did not respond to Vedomosti’s requests.

FAS idea Russian Railways received critically. A representative of the service told Vedomosti that “it is inappropriate to provide a natural monopoly entity (a market participant providing services within the supply chain) with information about the activities and conditions for the provision of services by other market participants – ports, operators and owners of rolling stock, and others.” At the same time, the proposal to create a single institution for monitoring and publishing cost information on commodity and transport markets, according to the FAS, “requires a discussion of mechanisms” for involving wagon and seaport operators in its work.

With great apprehension for offers Russian Railways the participants of the transportation market reacted as well. A Vedomosti source in a large operator company noted that even if the decision “on mass data collection” is made, it is better to transfer these functions to an independent and uninterested government agency or organization. “By making tariffs transparent, it is possible to show what they are formed from, how it affects the efficiency of the carrier. On the other hand, this kind of analytics, being at the disposal of one of the market participants before its publication, can disrupt competition,” he says.

Deputy Chairman of the Association of Railway Rolling Stock Operators (AOZhDPS) Denis Semenkin believes that, coming out with such an initiative, Russian Railways pursues its own interests, and not shippers or the state as a whole. He recalled that from July 2022 Russian Railways raised the transportation tariff, arguing that, given the fall in the rates of freight wagon operators, the transport component for shippers will remain the same. “Russian Railways is apparently going to use this experience in the future,” he said. Also, according to Semenkin, the availability of accurate information on operator rates will help Russian Railways assess the profitability of a particular transportation segment and, at a good time for a monopoly, buy or sell rolling stock, attract investors, create new divisions, developing its own business.

The interlocutor of Vedomosti in the river shipping company recalled that for many years the industry has been trying to get Russian Railways to refuse additional discounts during the high season of summer transportation, which coincides with the time of river and sea navigation. He considers such discounts to be dumping, which “takes the last crumbs from the downtrodden river fleet”

The representative of the Eurasian Union of Participants in Rail Freight Transportation (ESP) noted that the provision of price information on a mandatory basis can be carried out by commercial companies “only at the request of government agencies.” “Participants in the market for operating wagons already regularly provide the FAS with information on rates, which Russian Railways can use,” adds a source in the operator company.

The representative of the FAS recalls that since April 2022, the agency has been monitoring the transport component in the cost of the main types of cargo (coal, metals, ore, and others) transported along the main routes, “in order to assess the impact of various factors on market conditions.” At the same time, seaport operators, recalls Vedomosti’s source in the stevedoring company, are subjects of natural monopolies and are obliged to publish on their websites and provide, upon request, information regarding tariffs and fees.

Semenkin also considers the argument about the absence of alternatives to Metal Courier untenable, since in Russia the magazine “Russian Railways partner”, which, by analogy with the Ukrainian edition, provides information on wagon rental rates, daily profitability, etc.

Mikhail Burmistrov, CEO of Infoline-analytics, considers the fears of business that Russian Railways wants to get unreasonable competitive advantages, logical. He recalls that the “daughters” of Russian Railways are themselves participants in the transportation market, these are a number of operating companies – the Federal Freight Company, RZD Logistics, RZD Business Asset. Burmistrov added that if an operator concludes, for example, a long-term contract with a large consignor, then he is not obliged to disclose its details (directions and volumes of deliveries, the cost of renting wagons, etc.).

The expert added that Russian Railways also has non-public individual agreements on tariff discounts for large cargo owners. “The demand for greater transparency of operators than a monopolist looks strange,” Burmistrov said.

Guided by the federal law “On Commercial Secrets” to protect information that is directly related to customers, operators have the right to establish a commercial secret regime and take measures to protect the confidentiality of such information, explains a source in the operator company.

Sergey Grishunin, managing director of the NRA rating service, adds that the collection of information on rates is needed Russian Railways including to substantiate disputes about the cost of transportation. “Consumers often complain to the authorities about Russian Railways because of the cost of transportation by rail. At the same time, Russian Railways is only responsible for the infrastructure component and does not have reliable information on the total cost of transportation,” he explained.

“The situation is similar with ports: tariffs for “friendly” and “unfriendly” companies may differ by multiples, but for complex transportation it is Russian Railways is facing accusations that cargo from Russia is losing competition in the global market due to the transport and loading component,” Grishunin added.

At the same time, Grishunin and Burmistrov consider the idea of ​​creating a Russian price and tariff agency, such as Argus Media, to be correct. The creation of such an agency, according to Grishunin, could cost from 500 million to 1.5 billion rubles. “In the absence of a comprehensive and reliable assessment of the transport and commodity markets, Russian exports may be seriously affected, and it is now unsafe to rely only on data from foreign sources,” he notes.