Eastward Bound Refrigerated Containers

For many years, Russia has exported dairy and meat products to post-Soviet and Asian countries. Last year, geopolitical factors were instrumental in changing the existing logistics chains reducing the shipment volumes for particular nomenclatures of goods. However, market experts have noted the emergence of more and more services pertaining to the transportation of dairy and meat products to friendly countries.

Dairy and meat products are perishable goods and are transported by rail in refrigerated containers on high-speed container trains. According to estimates provided by ASORPS Food Sector Organizations Association, by the end of 2022, the fleet of these specialized containers in Russia reached as high as 10.1 thousand units.

Meat Products Exports

“Today, refrigerated meat product containers can be sent by rail from Moscow, St. Petersburg, and Novosibirsk to ports in the Far East. There, the containers are reloaded for sea transport and sent to ports in China and Vietnam,” ASORPS board member Andrei Grechkin informed 1520 International.

Direct transportation of meat products by rail to China has become a market trend as well.

"From January to April 2023, more than 2.5 thousand meat product TEUs (analogs of 20-foot containers) were exported to Asia-Pacific region (APR) countries. These are primarily China and Vietnam. 60% of that volume was transported via an intermodal route through the port of the Far East," the expert said.

Of the declared 2.5 thousand meat product TEUs exported to the APR countries, 30% are meat offal, with another 30% poultry. The latter nomenclature is also an important product export from Russia to China. China imported 119,400 tons of chicken meat in 2021 and 126,600 tons in 2022.

"Frozen beef (with a share of about 15%) is also exported to China. Meanwhile, frozen pork is quite inferior, with no more than 3% going to Vietnam," Andrei Grechkin continued.

Demand for Dairy Products

“Another type of perishable goods that Russia actively exports to APR countries is dairy products. Last year, exports of this product category to other countries amounted to about 800,000 tons,” Konstantin Siparo, senior researcher at the Center for Post-Soviet Studies of the Russian Academy of Sciences told 1520 International.

Shipment declines included ice cream to China (-50%), whey to Belarus and Kazakhstan (-40%), milk, cream, and cottage cheese (-30%), butter (-25%), and cheese (-10%) to Ukraine, as well as dairy products to Kazakhstan (-15%),

The expert declares that the drop in dairy exports to China was not quite as pronounced as this country had not previously been a major importer of Russian dairy products, unlike Ukraine and Kazakhstan, which were among the three key buyers.

According to Andrei Grechkin, from January to April 2023, less than 100,000 TEUs of dairy products were exported from Russia to China via Far East ports. There were no direct railway exports.

"Volumes for this group of goods are still quite small, yet they have major potential," said the expert.

However, ASORPS does not see demand on the market enough to begin regular large-scale transportation of dairy products to China. Thus, it may be due to the weak marketing efforts of producers, which may be preventing the transportation volumes from rising. "On top of that, regional taste preferences must be taken into account as well," Andrey Grechkin added.

According to him, the core of the export shipments is ice cream, which was once presented to the Chinese consumer at the highest level.

"We all remember how Chairman Xi (Jinping - Ed. note) used to leave Vladivostok with a box of ice cream as a gift. Cross-border Far Easter producers of this tasty product have at least felt the impetus,” said Minister for the Development of the Far East and the Arctic Alexei Chekunkov in June during the "Russia-China" business dialogue at the St. Petersburg International Economic Forum.

“Today, it is important to promote Russian dairy products of a range nomenclatures in the Asia-Pacific and Southeast Asia countries. In turn, transport and logistics companies will support any budding demand,” Andrei Grechkin commented.

He continued, "Merely a few cheese containers have been sent to Vietnam. We’re just barely scratching the surface,” he said.

“China, Egypt, and the Persian Gulf countries are also promising markets to increase their domestic supplies of Russian dairy products,” Konstantin Siparo summed up.

Olga Shelkova