Russian Railways is facing critical congestion due to the grain export crisis

Russia’s transportation infrastructure proved unable to handle the flow of agricultural cargo due to the rerouting of export flows to the northwest and the Far East. 

Logistics problems intensified after a reduction in grain shipments through ports in the Azov-Black Sea basin. As a result, exporters shifted their focus to other destinations, particularly the Baltic region, where grain shipments increased sixfold in August. However, the rail network was unable to provide the necessary capacity, leading to widespread railcar delays and the cancellation of confirmed shipments.

The increase in freight volume has caused a sharp rise in the cost of rolling stock rentals and transportation, which is also affecting the oil, metallurgical, and chemical industries. As a result of the logistical collapse, a significant portion of the grain remains on the Russian domestic market, putting pressure on purchase prices and significantly reducing the income of local agricultural producers.

This was reported by the Foreign Intelligence Service of Ukraine.

Latvian Prime Minister Andris Kulbergs stated that the country currently cannot completely ban the transit of grain from the Russian Federation—an aggressor state — or implement the planned 300 percent increase in fees for the use of railway infrastructure for such cargo.

Global food inflation could accelerate in the coming months and remain high through the end of 2027. This could be caused by accumulated disruptions in food supplies, which could also affect prices in Ukraine.