Incomplete reform of railway transportation led to the crisis of the agricultural market – Advisor to the Minister of Agrarian Policy

What happened? Incomplete reform of railway transportation has led to a crisis in the agricultural market.

Source. Oleksiy Balesta, the participant of the round table “Agricultural sector + railways”, Advisor to the Minister of Agrarian Policy.

Details. He explained that the pause in the reform had created ideal conditions for maximising the profits of Ukrzaliznytsia JSC through the use of a monopoly position.

“Ukrzaliznytsia, when selling its cars at auction, guarantees their supply, and a private operator cannot guarantee this, since, unlike Ukrzaliznytsia, it is neither a carrier, nor the owner of the infrastructure, which in fact carries out transportation,” Mr. Balesta stated.

Advisor to the Chairman of the Board of Ukrzaliznytsia Yuriy Shchuklin added that the company had begun to accept much more cargoes than the throughput capacity could allow, so it has violated the basic principle of logistics – synchronisation of commodity and material flows at all links of the logistics chain.

“It would look like if an auction was held on the platform near the evacuation trains from the East, where there were not enough seats, who would get on that train. If the only goal of Ukrzaliznytsia is to sell cars, all its actions will be aimed at inventing ways to sell more cars in conditions of their surplus,” Mr. Shchuklin pointed out.