Co-operation is key to Kaliningrad and Klaipeda success /05 Jun 2001/

Port administrators from Russia’s Kaliningrad port and from Lithuania’s Klaipeda have decided that competition between the two ports will kill business for both of them, unless they work out a new form of co-operation. Negotiations between the two ports was held in April, and again this week. The next round of talks is planned for a month’s time.

“It is now understood by both the Russian and the Lithuanian sides,” said Anatoly Demenok, deputy marketing chief for the Kaliningrad maritime administration, “that the two ports are already showing the lowest growth among the Baltic ports, and suffering from competition from each other. “They realise they have to co-ordinate their policies. This is especially important for railway tariffs.”

Kaliningrad (German Koenigsberg before the Second World War) is an enclave on the Baltic, cut off from the Russian border and surrounded by Lithuanian territory. It is therefore dependent on the railway to cross two frontiers in and out of the port. This is raising costs, Mr Demenok said, to a level that makes Kaliningrad uncompetitive for shippers.

In response to please from the Kaliningrad region for help, the Russian rail system eliminated a discount rail tariff last October which had lowered delivery costs for Russian exports moving to Klaipeda. By equalising the freight rates to both ports, Mr Demenok told Lloyd’s List, the Russian rail system has pushed the two port administrations to consider how to co-operate, instead of compete.

In April, he added, a meeting of port officials in Kaliningrad had agreed to create “project 2K” (Kaliningrad and Klaipeda). “During this meeting we outlined the need for a common system of safety for the two ports, as well as joint ecological and rescue services,” Mr Demonok explained. Natalia Pozdnyakova, an assistant to the foreign relations director at the Kaliningrad port company, told Lloyd’s List that so far project 2K is is mainly about safety for the two ports. “We are waiting to see what co-operation will mean for cargo flows.”

In the past, officials told Lloyd’s List, Kaliningrad transported up to 10.5m tons of cargo per year. Last year the total was less than 3m tons. Klaipeda’s turnover is, however, much greater, and it recorded a figure of about 20m tons last year. According to freight statistics for the first quarter, Kaliningrad saw modest growth of about 13%. The rail tariff equalisation move has hurt Klaipeda, which saw a decline in turnover of almost 30%. Right now, Mr Demenok said, Kaliningrad’s biggest problem is “the absence of a deepsea port that enables us to attract large vessels.

“We aren’t able to deal with much larger volumes of cargo.” Alexander Filimonov, spokesman for the transport ministry in Moscow, told Lloyd’s List that the government has decided to transfer the former naval port of Baltysk from the ministry of defence to the transport ministry, as the first step in commercialisation of the deepwater facility. Sovfracht, the big Russian ship agency, is one of the leading bidders for the right to develop Baltysk. “The degree of interest is rather high in Baltysk,” Mr Filimonov said. “Preliminary estimates for investment in the first stage of the port conversion is in the range of $25m-$30m. “The current plan is to make Baltyisk a port that will deal predominantly with general cargoes, while there will also be some oil terminal facilities.”

For the present, Kaliningrad continues to specialise in metals, coal, grain, sugar and containers. “We expect there will be an increase in the flow of non-ferrous metals,” Mr Demenok said. “Due to recent measures by the Russian government assigning transportation of non-ferrous metals for export through Russian ports. “In the past we used to export 700,000 tons of non-ferrous metals. Now it is almost zero, while Riga exports about 400,000 tons. “This will change now.”

Source: LLoyd's List, 1st June 2001, John Helmer

Astros, part of Ahlers Logistic and Maritime Services, has some 11 offices in the CIS, Baltic states and Central Asia. In 1997 Astros opened its Klaipeda office. Already a major actor in the Lithuanian transport business scene, Astros Klaipeda is active as liner agent, forwarder and acts as a booking agent on major trade routes calling either directly or by transhipment via various ports.
For more information:
Mr Hans Christiaensen, Astros Klaipeda
Telephone: +370 6397239 or hch(at)germe.lt