Far-East Russia, Construction of the Trans-Baikal Grain Terminal will begin in March 2020 !!!

The construction of a grain railway terminal at the largest Russian-Chinese border crossing in the village of Zabaykalsk will begin in March 2020 and will last eight months, the press service of the governor of the Trans-Baikal Territory said. The total investment under the agreement concluded with the Far East Development Corporation will amount to 8.9 billion rubles. The terminal will be built by Vzryvprom, the investor and general contractor is the Chinese company Power China. The planned capacity of the terminal is estimated at 8 million tons of grain per year.

The construction project of the first grain railway terminal on the Russian-Chinese border has been discussed since 2015. Earlier, Karen Hovsepyan, general director of Zabaykalsky Grain Terminal, told TASS that the creation of the terminal is the first stage of a large project to export Siberian grain to China. Its commissioning will give the Siberian regions a competitive advantage over grain suppliers to China from Canada, Australia, and the USA.

The head of the Rusagrotrans analytical center Igor Pavensky believes that the start of construction of a terminal in the Trans-Baikal Territory is an important event for the industry, since there is no terminal border on the Russian side. “We have been waiting for a similar project for a long time,” Pavensky told Agroinvestor. According to him, at the first stages, the transshipment volume may be less than the declared 8 million tons per year, although, of course, in China there is a place for Russian wheat and barley from Siberia.

According to Pavensky, the commissioning of the terminal in the future can help increase export volumes: in this agricultural year (from July to December 2019), 86 thousand tons of grain were exported from the Far East and Siberia to China through border crossings, over the same period last season – 76 thousand tons. “Of course, the current values ​​of shipments can be increased, especially if Chinese buyers, including state-owned companies, are involved in this,” says Pavensky. He also believes that the terminal will increase the competitiveness of Russia in the Chinese market with the constant subsidies for transportation from Siberia, the Far East and the growth of grain production in the regions. In 2019, the gross harvest in Siberia was 200 thousand tons less than in 2018, in addition, the initial reserves decreased, the expert draws attention.

Oleg Sukhanov, head of the grain direction of the Institute for Agricultural Market Studies (IKAR), is sure that it is difficult to overestimate the importance of the grain terminal in Transbaikalia, since the Chinese market is very promising. “But the issue is transportation tariffs. Whether subsidies will be applied or part of the transportation costs will be compensated in some other way, ”he notes. Sukhanov also adds that while the issue of loading the terminal is open. “I believe that there will be no declared capacity of 8 million tons over the next couple of years,” he says.

According to the expert, in order to solve the issue of loading the terminal, administrative barriers must also be overcome. “Now far from all grain crops are allowed to be delivered to China, and only a few regions have the right to export grain to China. And these are not the southern regions with a surplus of grain, but Siberia, the Urals, the Far East, where the surplus is much lower than these 8 million tons, ”Sukhanov draws attention. “We need additional agreements between Russia and China on the range of goods, regions, and quality.”

Previously, “Agroinvestor” wrote that the government has changed the rules of subsidizing n erevozok agricultural products and foodstuffs . If transportation from 62 regions of the country was subsidized before, now there are no such restrictions. Also, according to the new version of the document, transportation by water, rail and road transport will be subsidized, whereas earlier only rail transportation and rail using road transport were subsidized. In addition, the new rules significantly expand the list of agricultural and food products subject to subsidization.

In November 2019, the Ministry of Agriculture reported that agricultural trade between Russia and China continued to grow steadily. In January-October of last year, agricultural trade turnover increased by 9.5% compared to the same period in 2018 and amounted to $ 3.93 billion. At the same time, Russian exports to China increased by 25% in value terms to $ 2.6 billion.