JSC Ukrzaliznytsia is planning to raise freight rates again, which will be a blow to industry and the economy. The Ukrmetallurgprom association of enterprises warns about this.
As noted in Ukrmetallurgprom, according to media reports, UZ plans another increase in freight rates – by 27% this year and another 11% from 2026.
The OP reminds that the key items of Ukrainian exports are traditionally MMC products. That is why it is important to preserve the export potential of the industrial sector, jobs and economic stability of the state.
Currently, metallurgical and iron ore enterprises located in the controlled territory of Ukraine are operating at only 40-85% of pre-war capacity. Ukrainian MMC products are losing competitiveness due to the simultaneous pressure of high logistics costs, the energy crisis, personnel shortages and rising tariffs for state monopolies – primarily in the field of railway transportation.
Further tariff increases will lead to a reduction in production at the MMC – the shutdown of budget-forming enterprises, exports, foreign exchange earnings and tax payments to the budget. The cost of rail transportation (tariff + wagon) for the 3rd class of cargo (metal) is already higher than road transportation, and the next increase will accelerate the outflow of cargo to motor vehicles, which will lead to additional destruction of roads.
Ukrmetallurgprom hopes that the Ministry of Development of Communities and Territories will not allow this decision to be made. They call on the government and the relevant department to refrain from increasing freight railway tariffs in 2025-2026.
Instead, the following steps are proposed:
to provide for targeted expenditures in the 2026 state budget to compensate for losses in passenger transportation and to stop cross-subsidization at the expense of freight transportation (EU practice) in the amount of about UAH 25 billion;
provide UZ with assistance in obtaining the necessary regulatory decisions from the government and parliament, which will reduce the financial burden on it and expand its revenue base;
assist UZ in bringing its network in line with the current volumes of transportation and the needs of the Defense Forces of Ukraine, determine the necessary amount of funding for this and provide the necessary funding in the state budget for 2027 and subsequent years.
“And the initiative to increase tariffs is not a solution to the problems, but another harmful temporary solution that postpones the solution of the systemic problems of Ukrzaliznytsia, reduces the competitiveness of Ukrainian industry and reduces state revenues,” Ukrmetallurgprom concludes.
Let us recall that the cost of railway transportation of iron ore through the territory of Ukraine turned out to be higher than along similar routes in the European Union countries. This was stated by the president of Ukrmetallurgprom, Oleksandr Kalenkov, during a specialized discussion organized by the Central Railways.
