In its response to the relevant request of Agrocereale, the management of the State Enterprise “Railway of Moldova” indicated that even after a 7% increase in tariffs, “transportation of grain and oilseeds is carried out at the lowest possible tariffs”. It is noted that the state enterprise “has a fleet of rolling stock and the capacity to transport at least 100-120 thousand tons/month or 1 million tons of the above-mentioned cargoes per year”. That is, it has the potential, which is hardly half utilized.
In turn, the association’s management believes that “it is impossible to sell a low-cost service at a premium price. Tariffs for railroad transportation of agricultural products in Moldova are comparable to those in Germany. The difference is that the structure of Moldovan railway tariffs includes, among other things, depreciation of long-worn wagons, high consumption of diesel fuel by old locomotives, slow rotation of wagons, etc.
Taking this into account, Agrocereale believes that the natural reaction of the market will be the reorientation of traders to truck transportation by road and further reduction of the share of rail traffic in the structure of agro-food logistics. As a result, the cost of the service will increase and it will not be covered by even higher tariffs.
And the most unpleasant thing about this business model is that the increase in tariffs will be incorporated into the purchase prices of agricultural products – that is, it will be transferred to the shoulders of Moldovan farmers.
