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Turnkey Railway Logistic Solutions in Grain Transportation

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In addition to grain trade, attendees of the 9th Grain Partnership Meeting held on June 7 and 8, at Baja, Hungary, paid particular attention to transport related issues as well. All attending businesses in the value chain could inform themselves of the crop expectations, processing and delivery capacities, seller and buyer intentions, as well as the prices prior to launching the campaign works. This year's promising harvest and the dynamically growing grain export volumes of late have drawn attention to river and railway logistic solutions.

The conference featured round table sessions of grain operators and logistic providers, including rail carriers, where, besides talking about sales and logistic chores in detail, they could discuss quality expectations related to stowage, turnaround cycles, capacities and progressive pricing. Operating grain shuttle trains among other services, Head of Business Unit MACE (Mineral oil/Agriculture/Chemicals/Environmental waste), Severin Göbl of Rail Cargo Hungaria (RCH) has announced at the meeting that the Hungarian market-leader freight railway undertaking is prepared for the season and offers turnkey railway logistic solutions to its clients.

As a rule, Rail Cargo Hungaria accounts for approx. 70 percent of Hungarian grain exports by rail i.e. 600 to 800 thousand tons in volume. Additionally, Rail Cargo Group's dedicated forwarding company, Rail Cargo Logistics – Hungaria organizes several hundreds of thousands tons of freight per annum.

As Severin Göbl pointed out, the company is most ready to tackle this year's record tonnage challenge. To this end, RCH possesses approx. 800 TA-type grain wagons, supplemented, if need be, by chartered fleet. Not to mention Rail Cargo Group's 23,000-car wagon pool offering a plethora of means of transport.

Rail Cargo Hungaria uses the majority of agricultural loading stations in Hungary to conduct business; see red dots depicting the key grain traffic points on the map. These are the loading sites where customers enjoy advantageous feeder costs.

It is in the mutual interest of customers and carriers alike to address this season's challenges by improving efficiency. Reducing turnaround times can best contribute to optimizing transport costs and meeting delivery deadlines.

E.g. in case of traffic to Italian destinations, the optimal turnaround cycle would be 10 days, however, the fact, more often than not, is practically a single turnaround a month. One of the underlying reasons could be that transports starting off in Hungary, continuing in Croatia and Slovenia and terminating in Italy require train paths and performing cross border operations on the railway infrastructure of a total of four countries. Wherever there is a delay, the schedule becomes disrupted and the train fails to reach the loading station in time or misses the vessel at the seaport, which would ship the grain further.

These nuisances can best be eliminated by joining transport operation services in a single hand, emphasized Severin Göbl. Rail Cargo Group features forwarding enterprises and railway undertakings in all countries of the region, so they can take matters into their own hands, coordinate the participants and intervene immediately and efficiently in the process whenever and wherever most needed.

He also mentioned that the smooth rail delivery of this year's above-average export volumes is feasible with regularly scheduled quantities and pre-disclosed deadline expectations. Were the complex operation of transporting large volumes be joined in the hands of a single entity, e.g. Rail Cargo Hungaria, it could result in providing the most advantageous rail logistics solutions.

Rail Cargo Hungaria's Head of Business Unit MACE also dwelt on evaluating other approaches aimed at increasing efficiency. As he pointed out, even though applying wagons over 100 cubic meters capacity to improve freight effectiveness would seem to be rational when considering the cost factor, public loading sites are yet to be brought up to date to allow this. There are few terminals in Hungary whose loading technology and rail service prerequisites meet today's proficiency requirements. It should also be considered that the railroad tracks are not suitable for trains with the highest axle load in many sections, so running such trains requires a special permit. A further cost increasing factor is that heavy-laden trains demand two locomotives along several stretches. Though faced with such obstacles impeding transit efficiency, nevertheless, Rail Cargo Hungaria will fulfill the orders completely.

Severin Göbl has also disclosed that Rail Cargo Hungaria enjoys an AEO (Authorized Economic Operator) certificate issued by the National Tax and Customs Administration of Hungary, which facilitates grain traffic by simplifying customs clearance. In line with EU requirements, on customer request, the company issues a certificate attesting that following the transportation of genetically engineered produce, no wagons used for such deliveries are permitted to be loaded with non-GMO products without first being cleansed by washing. In conclusion, the head of the business unit added that, in knowledge of such advantages, an increasing number of businesses entrust Rail Cargo Hungaria and Rail Cargo Logistics – Hungaria with the entire range of railway logistic operations in grain transport.