AzRusTrans, established by Azerbaijani Railways (ADY) and Rusagrotrans, started its activity on 10 October 2016.
It is unique experience of cooperation between the administration and the private sector and this experience has given quite positive results, as the Company was able to take the position as main supplier of grain and grain crops and position in the market of supply of forest products.
For the year of activity the Company has transported 415,000 tons of grain and cereals and 1,173 carload shipments for loading of timber.
The purpose of AzRusTrans’ establishment was first of all the strengthening of country’s transit potential and the increase in transit supply. Transportation is actively conducted not only between Azerbaijan and Russia. Besides, supplies to Georgia and Iran have been organized, and after the launch of railway corridor Baku-Tbilisi-Kars railway, which is scheduled for the end of October, deliveries to Turkey will activate.
Commissioning of railway corridor Baku-Tbilisi-Kars will ensure the flow of goods to Turkey, where there is a huge potential – every year this country is supplied from Russia up to 4 million tons of grain and cereals and up to 2 million tons of raw materials for recycling companies, factories and mills. AzRusTrans is already developing new projects for implementation in this direction, but those projects are not disclosed currently.
Currently, work is underway on a project of grain terminal, and immediately after its completion it will be launched the construction of a grain terminal in Astara that will allow supplying directly grain and cereals from Russia to Iran through Azerbaijan, thereby providing substantial reduction of costs. The alternative to this way is the Caspian Sea - through the ports of Astrakhan and Makhachkala, where today it is shipped up to 1.6 million tons annually and potentially, these goods can pass through Azerbaijan that can strengthen much the country's transit potential.
Although, mainly AzRusTrans supplies grain and cereals, the Company also cooperates with Transles LLC. The Company transports sawn timber both to Azerbaijan and through Azerbaijan to Iran and Georgia, and in the future supplies to Turkey will be provided.
For provision of supplies to Georgia, AzRusTrans collaborated with US’ Bunge Limited and Switzerland’s Glencore International AG. Given the fact that Bunge Limited closed in Russia, the Company is currently in talks with new potential partners for the resumption of supply in this area that became profitable after Azerbaijan Railways made tariffs subsidized.
The formed wagon park also provides the efficiency and profitability of AzRusTrans’ operations. Now the Company rents rail cars from Azerbaijan Railways, and having a partner in Russia, the Company became a major supplier of grain to Azerbaijan. Among AzRusTrans’ future plans is purchase of its own rail car fleet that will add profitability to the business and will allow gaining a foothold in the domestic market for imported goods. AzRusTrans will expand the kind of its activity and increase the number of partners. Now, the Company is forming 10% of all supplies of Azerbaijani Railways as the operator, and in the future this figure will be increased due to realization of set tasks and plans.
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