Ukrzaliznytsia reports increase in cargo transport as volumes approach 'break-even' point

In the first half of June, the state rail transport company Ukrzaliznytsia recorded an increase in cargo transportation by almost 46%. This gives reason to hope that in 2023, despite pessimistic forecasts, the company will break even, the carrier's press service reports.

"These figures give us the opportunity to get closer to break-even in 2023," said Yevhen Lyashchenko, chairman of the board of Ukrzaliznytsia.

He explained that the increase in cargo transportation occurred thanks to the unblocking of the grain corridor and the revival of transportation in the direction of the western borders.

According to operational data, freight transportation by rail in the period from June 1 to 15, 2023 increased by 45.7% compared to the same period last year and by 12% compared to the same period in May 2023.

The average daily load increased by 26.2% compared to June 2022 – up to 390,400 tons.

Transportation in domestic traffic for the first half of June 2023 increased by 47% compared to the same period last year and by 8.3% until May of this year – up to 3.72 million tons. Export shipments increased by 50.8% and 19.5%, respectively, to 2.19 million tons.

The leaders in terms of transportation volumes are construction materials (+100%), grain (+71%), coal (+29%), iron and manganese ore (+13%).

In 2022, Ukrzaliznytsia reported UAH 10.8 billion ($293 million) in losses. According to the company's 2023 financial plan, losses will double to UAH 20.2 billion ($547 million). In contrast, UZ had a profit of UAH 457 million ($12 million) in 2021, a loss of UAH 11.8 billion ($320 million) in 2020, and a profit of UAH 3 billion ($81 million) in 2019.

Before Russia's full-scale invasion, in September 2021 the Ministry of Finance predicted — based on UZ's information — that the company would be unprofitable up until 2024. Total projected losses for 2021-2024 were estimated at UAH 5 billion ($136 million).

In December, Ukrzaliznytsia proposed postponing all Eurobond payments for two years to bondholders.

From July 1, 2023, UZ decided to increase employee salaries for the first time since the full-scale war began.