We should not trivialise the prospect of a widening conflict in the Middle East. Yet it would be equally naïve to ignore the operational consequences for rail freight. From energy pricing to shipping disruption, the impacts are already beginning to register. What feels abstract today can become painfully concrete tomorrow, especially in a system as tightly balanced as Britain’s modern logistics chain.

Energy shock travels fast

Before anyone in the cab of an electric locomotive feels too comfortable, consider the source. Oil shock means energy shock. It ripples through every generation mix, every tariff, and every contract. Prices rise across the board, often faster than operators can react, hedge or recover.

We are reminded from cradle to grave that everything in the modern economy depends on oil. From baby wipes to coffins, from plastics to packaging, hydrocarbons underpin production and distribution. Those goods, or the materials that make them, arrive on our shores before moving inland by rail and road. When oil markets tighten, the entire system feels the strain.

Shipping disruption is the hidden threat

Global shipping routes are the second front. The Trades, as the industry calls them, are already shifting under pressure. Ultra Large Container Vessels (those behemoths with twenty-thousand TEU on board) are being forced out of position, creating imbalances that cascade through port rotations and inland schedules. British port managers remain highly adept, masking much of the disruption for now, but the pressure is building.

Rest uneasy. The disruption will come as surely as fuel prices climb. Delays and diversions at sea translate directly into delays and diversions on land. Containers arrive late, or not at all, and the carefully choreographed dance between quay cranes, rail terminals and inland hubs begins to falter. The rhythm of the network is disturbed, and recovery is rarely immediate.

There is only so much strain the freight system can absorb. Britain benefits from a high degree of intermodal interoperability. Scheduled services connect ports to inland terminals with near-metronomic regularity. But “near” is doing a lot of work here. Even small perturbations can propagate quickly when margins for error are thin, and capacity is tightly allocated.

A just-in-time system under pressure

Britain’s logistics model compounds the problem. The country has a chronic shortage of modern storage. For years, we borrowed from the Japanese concept of Kanban and just-in-time supply. In practice, we adapted it with a distinctly British mentality. We make do, mend, and hope that timing remains perfect. That approach works until it does not. Unfortunately, Britain is not so adept at adopting Kaizen, that other Japanese technique of continual improvement.

The result is a system with minimal slack. Warehousing capacity, particularly A-grade, rail-connected space, is in short supply. There is no shortage of planning applications for new facilities, but delivery lags demand. Much of the existing stock will fall out of compliance or become uneconomic within a decade. Unfortunately, the need is immediate, not theoretical.

When ships fail to arrive just in time, Britain finds itself in a bind. Delayed shipping means delayed inventory. Without adequate storage, there is nowhere to buffer the disruption. Goods either pile up in the wrong place or fail to arrive where needed. Rail freight sits in the middle of this imbalance, expected to respond but constrained by infrastructure and capacity.

We muddle through until things go wrong. Right now, things are going wrong on a scale that could yet deepen. War in the Middle East may feel distant, but its consequences are already reaching the Midlands and beyond. Supply chains do not respect geography in the way we might like to imagine.

What happens next for rail freight

Predicting the next phase is a hazardous exercise. If you can do it accurately, you are probably already profiting handsomely. For the rest of us, the outlook is uncertain. Freight trains will continue to run. Operators have tools to manage short-term cost shocks, including fuel hedging, which can soften the immediate impact of rising diesel prices (and electricity, you smug overhead wire-types).

The greater risk lies not in the trains themselves, but in what they carry. Volumes are vulnerable to sudden swings. Intermodal services may continue to operate according to the timetable, but with fewer containers on each consist. Frequency could also come under pressure if demand weakens or becomes erratic. Operators dislike volatility, and this is volatility writ large.

There is also the broader economic context to consider. If commodity prices drive inflation higher and suppress consumer spending, the downstream effects will be significant. Warehousing schemes may stall. Projects that look viable today could remain on the drawing board. And without goods to store, the rationale for new logistics infrastructure begins to weaken.

Railways as barometer and bellwether

We often talk about freight in abstract terms, much like the railway itself. Tonnage, paths, capacity, utilisation. Yet the railway is more than a set of metrics. It is an industrial barometer, an economic bellwether, and a national lookout. Changes in flow patterns, volumes and commodity mixes tell us a great deal about the health of the wider economy.

In times of stress, that role becomes even more pronounced. The rail freight sector is both resilient and exposed. It can adapt to disruption, but it cannot escape it. What happens in distant oil fields and contested shipping lanes will, sooner or later, be reflected in train loads, terminal activity and balance sheets across the UK.

Let us hope that the coming months do not force the railway into an even more ominous role. For now, it remains a vital indicator of how well the system is coping. But if the shocks intensify, it may also sound a warning signal. That is one alarm the industry, and the country, would rather not have to hear.

The proposed facility forms part of the remaining development capacity at DIRFT III. Recent occupier announcements, including retailer Marks & Spencer, XPO Logistics and e-commerce retailer Laura James, suggest the estate continues to attract businesses looking for central distribution sites with direct rail access and established infrastructure connections.

Further development proposed at DIRFT III

Real estate developer Prologis UK has submitted its proposals to West Northamptonshire Council for a new rail-served distribution centre at Daventry International Rail Freight Terminal. The building, known as DC762, would provide a significant 70,800 square metres (762,000 square feet) of warehouse space on the eastern side of the DIRFT III estate – the third and final phase of the logistics park.

The development forms part of three plots together providing around 98,800 square metres (1,063,000 square feet) of remaining consented floorspace at the logistics park. Two further units measuring 14,700 square metres (158,000 square feet) and 24,600 square metres (265,000 square feet) are expected to follow in separate planning submissions.

Growing customer demand for rail-connected logistics

The proposals follow increased enquiries from retailers, logistics providers and e-commerce operators seeking large distribution platforms with multimodal transport links. DIRFT’s rail connection has become an important feature for companies looking to move goods through the Midlands logistics corridor.

“Enquiries at DIRFT have increased as customers prioritise scale, connectivity and long-term certainty,” said James Hemstock, Capital Deployment Director at Prologis UK. “Progressing these developments now ensures that capacity is available to meet sustained demand in the Midlands. DIRFT continues to demonstrate the strength of rail-connected logistics infrastructure as a long-term platform for UK supply chains.”

Recent occupiers strengthen freight hub role

Over the past six months, several major occupiers have confirmed new facilities at the estate. Marks & Spencer is developing a national food distribution centre measuring about 120,800 square metres (1.3 million square feet), while XPO Logistics has established a national chilled palletised hub serving dairy producer Arla Foods.

More recently, e-commerce homeware brand Laura James confirmed plans for a 20,200 square metre (217,785 square foot) build-to-suit facility at DIRFT. These projects have reinforced the role of the terminal as one of the UK’s principal inland freight distribution hubs with direct rail access.

Daventry International Rail Freight Terminal sits at the heart of the UK’s Logistics Golden Triangle, the Midlands area from which most of the national population can be reached within four hours by road. Its strategic location on the rail network gives the site an additional advantage. The terminal’s intermodal facilities allow containers and palletised freight to move directly between rail and distribution warehouses, supporting long-distance trunk movements by train and helping operators reduce road congestion and emissions.

Germany could be reshaping its traditional wagonload freight, while the UK has all but abandoned the concept in favour of intermodal flows. DB Cargo’s wagonload restructuring aims to make the mode sustainable. In Britain, the equivalent has been replaced by point-to-point container services. However, in both those markets, and across Europe at large, is the railway surrendering a traditional mainstay in the face of modern logistics?

DB Cargo cuts complexity in wagonload

The cultural image of the “pick-up goods” lingers in the UK, but it is no longer a reality. The last vestiges of wagonload, such as short nuclear flask trains, are a specialised niche rather than part of a wider freight network. Britain does not have the large marshalling yards that are still common in mainland Europe – or rather, it does not use them for their intended 1960s purpose, of consolidating wagonload freight operations in large hubs. That intrinsically sensible idea was implemented just as the British network was backing out of the market completely.

In April, DB Cargo announced changes to its wagonload network with the same purpose as Beatles-era Britain. The (yet to be revealed) plan is designed to cut costs and improve reliability by reducing the number of long-distance connections and streaming runs between marshalling yards to serve key flows. British Railways Modernisation Plan all over again, say the cynics.

Losses mount despite higher volumes

Wagonload remains a significant part of DB Cargo’s business. Around fifteen per cent of rail traffic in Germany is wagonload, and DB Cargo handles around 90 per cent of that. It also generates most of the company’s losses. Even with subsidies, the operator says it must cut costs to survive. They have already warned that up to five thousand jobs could go by 2028. For tired old British eyes, it’s very much a case of history repeating itself.

There is government backing. In May, the European Commission approved a €1.7 billion German state aid scheme. This will channel €320 million a year into keeping wagonload and short block-trains on the rails. The figures are staggering when compared with Britain’s Swinging Sixties plans, but the impacts are potentially the same. Britain’s wagonload network was dismantled decades ago.

Lessons from history

The closure of British Rail’s Speedlink in 1991 ended the last generalised wagonload service. Local sidings, often beside passenger stations, are a thing of the past. The only surviving operation resembling wagonload is the nuclear flask traffic. These short, specialist trains carry spent fuel from nuclear facilities. They are highly regulated, irregular, and far removed from the old pick-up goods.

In the UK, rail freight has pivoted almost entirely to intermodal container traffic, as noted by WorldCargo News. These are point-to-point flows, linking major ports or inland terminals with large logistics parks. They do not serve multiple intermediate sidings along the way. This concentration has brought efficiency and volume, but it is a different model. Without a wagonload network, industries off the intermodal grid rely heavily on road haulage. Could Europe be following Britain’s lead?

The owners have wasted no time in moving ahead with expansion. After DP World was granted planning approval just a few weeks ago. The self-styled global logistics giant is pressing ahead with the £1bn project. They say it will help establish London Gateway as the UK’s biggest container port.

Shipping switch from Felixstowe

The news that DP World intends to build a second rail terminal at London Gateway comes on the back of recent significant wins in the shipping world. The port has been the winner in a deal called the Gemini Collaboration, between two of the world’s largest shipping companies, Hapag-Lloyd and Maersk.

The Gemini Collaboration partners had already announced that they were switching some port calls away from Felixstowe to London Gateway. That news precipitated a shakeup of inland services at Felixstowe, including rail freight consignments. Felixstowe itself is involved in the global sale of Hutchison Ports properties, as reported in depth by our sister service WorldCargo News.

Could Ely miss out?

The loss of Gemini port calls has already prompted a scaling back of rail services at Felixstowe, and casts a shadow over calls for infrastructure development there. There is renewed concern over the long-awaited Ely Area Capacity Enhancement project promoted by the UK infrastructure agency Network Rail. For now though, despite the ambitions of its rival on the Thames, Felixstowe remains both the UK’s busiest container port and the busiest rail freight terminal.

London Gateway, which sits within the Thames Freeport footprint, has been rapidly expanding. Construction work to expand the logistics handling capability is to begin within a month. The new logistics park will take four years to complete say DP World. Construction will support one thousand jobs, and operations will create 400 permanent posts.

Supporting national economic growth

DP World says it has worked at pace to gain regulatory approval for the investment, which was first announced by CEO and Group Chairman Sultan Ahmed bin Sulayem at the UK Government’s International Investment Summit in October 2024. Relations between the company and the UK government appear to be more cordial after that event. A since resigned minister had made public criticism of DP World over controversial employment practices at their subsidiary company P&O Ferries.

The expanded container port, part of the Thames Freeport, will be able to accommodate six of the world’s largest container ships, which will be served by Europe’s tallest quay cranes. Those ships can carry up to 24000TEU – potentially meaning up to 72,000 40-foot containers could be at the port simultaneously. However, it’s unlikely all that cargo would ever be destined for one destination. Global shipping works like the ‘pick-up goods’ trains of old – albeit on a vastly larger scale.

Global hub of operations

“This investment enhances London Gateway’s capacity and new connections between the UK and the global economy,” said Sultan Ahmed bin Sulayem, CEO and Group Chairman of DP World. Last week, he hosted the UK Minister of State for Investment, Baroness Poppy Gustafsson at London Gateway to discuss the project. “The UK is open for business and DP World’s major investment is the latest vote of confidence in our economy, delivering economic growth,” said Baroness Gustafsson. “DP World’s expansion in London Gateway will turbocharge the UK’s logistics sector and help deliver the long-term, stable growth that supports skilled jobs and raises living standards across the UK.”

Over 1,000 construction jobs will be created during the £1bn expansion. Approvals for DP World’s project were secured following close collaboration with the local administration at Thurrock Council and the UK Government’s Marine Management Organisation. The start of construction follows the agreement between DP World and the Gemini Cooperation (Maersk and Hapag-Lloyd) for Asia-Europe and Middle East-Europe shipping services to call at London Gateway. The first ship arrived earlier this month.

In the UK, DP World also operates a busy container terminal at Southampton, where an incentive scheme encourages shippers to move inbound containers by rail.

RailFreight Summit

Terminal operations  and the synergies between rail and ports will be one of the main highlights at the RailFreight Summit, taking place in Gdansk, Poland on 8 and 9 April 2025. Sessions will include panels with port authorities and terminal operators. You can find out more about the programme here and get your ticket here.

The association says its members are showing the robustness that the rest of the industry needs to display. Simpson stressed that the necessary forward planning, which drives operations in the rail freight sector, is also driving innovation and a positive outlook. This has helped overcome a short-term slowdown in activity, allowing the UK industry to keep and continue keeping its head above water.

Autumn is the busiest time

The change of seasons always means the railway faces some challenges. However, while the temperatures are falling along with the leaves, the heat is on for rail freight, along with a blossoming of seasonal flows. All those Christmas presents have to get from ship to shop somehow, and that journey begins, as often as not, on the rails, on the back of an intermodal train. “As the late summer heatwave starts to make way for more seasonal weather, thoughts turn to the months ahead and the run-up to Christmas”, says Maggie Simpson, writing to RFG members in their latest membership forum. “For many in the logistics sector, early autumn is the busiest time of the year.”

While talk of the demise of British manufacturing is somewhat exaggerated, it is certainly true to say that the majority of consumer goods are imported. That means that the movement of goods has shifted from factory origins to port origins, with the consequential redrawing of the logistics map of Britain. “Retail goods are imported and stockpiled ahead of the shopping rush later in the year”, explains Simpson. “For rail operators, this combines with a busy construction sector and the seasonal leaf fall service for Network Rail, making the next few months some of the busiest times for rail freight.”

Gift to rail freight operations

Nevertheless, global economic factors have disrupted the supply chain, and within the UK, the added pressures of the cost of living and inflation have suppressed demand for discretionary spending. However, if there is one sacrosanct in the British calendar – it’s Christmas shopping. The high street may feel the pinch, but the online retail warehouses are performing as strongly as ever. “This year, that peak remains somewhat suppressed by the cost-of-living crisis and overall economic pressures”, says Simpson. “The most recent economic figures from the ONS (Office of National Statistics) showed a 0.5 per cent reduction in GDP in July, albeit there was 0.2 per cent growth over the three months to July.”

The shift to online retail – which was underway before the pandemic – continues to grow. The logistics sector has recognised that. Developers are powering ahead with addressing the significant shortage of warehousing in the UK. That, in turn, is a gift to rail freight operations and Rail Freight Group members, with new purpose-built intermodal terminals frequently part of the development plans. “The economy is, at best, stagnant”, concludes Simpson. “I know this is a real concern for all our members across all sectors. However, rail freight has survived previous downturns and continues to show its adaptability and resilience again, with rail freight volumes ahead of last year at this stage and continued strong interest in growth.” All said and done, it may not be a bad Christmas for rail freight at all.

A series of weekend possessions were required to install the bridge and to stabilise the earthworks on the century-and-a-half-old railway cutting. Further possessions will be required to connect the rail freight terminal to the main line while works continue within the logistics park to construct an extensive layout that will eventually provide a stand-alone rail freight terminal, an aggregates terminal, and future provision of an express logistics siding.

Bridge to traverse loop line

The construction of a road link may not often find a platform in this forum, but the construction of this road, for the benefit of the residents of Roade, has significance for rail too. Northampton was left out in the cold by the original alignment of the West Coast Main Line. Having Europe’s busiest mixed traffic railway cut through their estates didn’t appeal to the nineteenth-century aristocratic land owners. However, seeing all that mixed traffic bypass their town soon changed their minds, and the Northampton Loop was soon commissioned. Now, only 150 years later, the town is getting the rail freight terminal those recalcitrant aristocrats declined. As a happy unintended consequence, Roade, a village hardly changed over the intervening decades, will get a very up-to-date bypass highway, which will carry all the road-based intermodal traffic away from its period-perfect streets.

SEGRO’s rail freight terminal and the logistics park play a crucial role in sustainable economic development, low-carbon logistics, both of which are deemed critical to the modernisation of the British economy. Winvic, the leading construction company responsible for the delivering the project, has already completed eleven net-zero industrial projects and is currently delivering an additional eight projects, including one recently constructed warehouse at the hugely successful SEGRO Logistics Park East Midlands Gateway rail freight terminal, managed by Maritime.

Network Rail working on connection

The warehouses at SEGRO Logistics Park Northampton, are expected to generate a significant portion of traffic for the rail terminal. They represent an example of Winvic’s and SEGRO’s low-carbon and net-zero aspirations, and the rail freight terminal is also proactively contributing to those objectives. All embankments within the logistics park, including the head shunt, have used earth moved from elsewhere on the undulating construction site, thereby eliminating landfill moves. Winvic say the terminal and logistics park already falls within the UK Green Building Council definition of net-zero, and is in the upper percentile for reduction in carbon emissions.

The integration of the logistics park with the rail network is still to be completed. Network Rail are working on the connection which will require further blockades of the Northampton Loop. Meanwhile Winvic is installing a 4.5km track layout to the terminal. Winvic aims to jointly commission the new line in the second quarter of 2024. By then, the Roade Road Bridge – as absolutely no one is calling it – will be carrying traffic over it, and passing trains under it, and it will be more than just the more enlightened descendants of those reluctant aristocrats that will benefit from the belated coming of the railways.

Proposals to turn back the clock

Almost all of London’s famous passenger terminals were also built with freight in mind. Today that might be called a premium logistics facility. Back when the Victorians were thinking ahead, these vaults were for the storage of high-value goods, delivered at a premium by the railways and stored directly under the passenger platforms. Most famously, the repurposed undercroft at St Pancras International has now become a significant London retail and leisure destination in its own right. However, back before Eurostar moved north of the Thames, Waterloo was the international destination of choice for everyone – except perhaps for French travellers with long memories and a grudge. Back then, there were goods stored under the station, and goods trains on the platforms.

Network Rail, the UK infrastructure management agency, has developed extensive proposals to reintroduce a modern equivalent of freight operations into major passenger terminals, including Waterloo. The possibility has been extensively researched by Network Rail, expanding on the current limited logistics operations undertaken by companies like InterCity RailFreight, who already have experience of working premium logistics into passenger terminals like Waterloo. ICRF run premium packages, using space on passenger trains, but stop short of operating their own services. Network Rail’s proposals include turning back the clock, and expanding the commercial use of passenger terminal facilities, generally in overnight periods.

From the macabre to the melodic

This week however, it’s all been about celebrating Waterloo’s 175th anniversary, and the varied history of this South Bank terminal. Passenger may have always been the mainstay, but they are not the only stock in trade. A famous painting, by renowned railway artist Terence Cuneo, has been on display as part of the celebrations. The canvas shows a busy scene from the mid-twentieth century, with steam and electric traction mixed in with parcels and goods operations on the busy concourse.

That scene (minus the steam trains) could be revived if redundant facilities are also brought back into the picture. “The basement area covers an extensive area”, says Network Rail’s appraisal. “Further work is required to ascertain how much of this could be made available. Combined with lifts linking platform, below-platform and mezzanine levels, the extra space could allow for goods.”

Waterloo’s goods activity has been truly varied, ranging from fresh produce and parcels to the most macabre. During the nineteenth century, Waterloo provided the terminus of the London Necropolis Company. From 1854 the station accommodated mourners and held funeral services before coffins and the deceased were transported for burial at Brookwood Cemetery in Surrey (London had long since run out of burial space). With other former facilities including a rifle range, a cinema, and even though tracks across the concourse to an adjacent station, there may seem little scope for something new at Waterloo.

However, a special birthday effort did add a new category to the station’s freight manifest: cheese. Well, actually, something … cheesy. A joint Network Rail and South Western Railway choir treated invited visitors to what they called a “memorable” melody of appropriately themed musical entertainment. ABBA’s “Waterloo” inevitably made the medley, but perhaps more appropriately it was the sixties hit by London’s own sons, The Kinks, that stole the show and closed the tribute with “Waterloo Sunset”.

Public attention not always welcoming

“The Future of Freight” outlines a comprehensive vision for a cost-efficient, reliable, resilient, and environmentally sustainable sector. The plan places a strong emphasis on the provision of net-zero energy infrastructure and supports modal shift by increasing the proportion of freight transported by rail. It also encourages the use of sustainable modes such as urban rail freight interchanges, cargo bikes, light rail, and inland waterways. Reading between the lines, that implies that the presumption is for the widespread development of distribution infrastructure in urban and nearby urban areas. Given the UK-wide shortage of warehousing, there is every likelihood that any new terminal will be accompanies by extensive warehouse development. It is the latter element that attracts the most public attention – and most of it is not welcoming.

The government says it recognises that national planning policies, local plans, and decisions play a crucial role in facilitating the transition to low-carbon transport modes, which includes rail freight interchanges in urban, suburban, and rural areas. Significantly, the consultation is being led by a collaboration between two government departments. Taking part are the Department for Transport (DfT) and the Department for Levelling Up, Housing and Communities (DLUHC). The latter is a department set up specifically to address economic imbalance between the historically affluent London and the South East, and other regions of the UK, notable the North of England, which has seen wealth creation eroded over time, as Britain has moved away from a predominantly manufacturing economy. It is in that part of the country that the greatest redesign of infrastructure is needed, and also where planning applications from the freight and logistics sectors are often submitted in the face of public opposition.

Beware of unintended consequences

According to the government paper, efficient supply chains rely on multiple modes of transport, including rail, road, air, and maritime, with transfers occurring at rail freight interchanges, ports, airports, distribution centres, and warehouses. They say the presence of suitable infrastructure in strategic locations is crucial for the effective functioning of the entire system. Now the government departments are expecting the evidence collected through this consultation to inform the development of new or amended planning policies regarding freight planning. It will also ensure that adequate land is allocated to meet the needs of the freight and logistics industry. That latter requirement is the principle cause of public opposition to almost every application for a new terminal. Look no further than the opposition to new logistics provision in almost every location nearby points of high demand – usually in the booming London and South East.

The government says it is particularly interested in receiving input on three key areas: local plan making and land availability; planning decision-making and the application process; and how the planning system can support specific policy priorities. These priorities include supporting supply chains, decarbonisation of freight, and strengthening the United Kingdom. The consultation provides an opportunity for industry stakeholders, experts, and the public to contribute their expertise and insights, ultimately shaping the future of freight and logistics planning in the UK. It may be worth pointing out to the government to be careful what you wish for.

Varamis focus for fast delivery

If they were given to bragging, Varamis Rail might well boast that their express logistics trains leave plodding passenger services in their dust. That would be stretching a point, but nevertheless, in a remarkable display of speed and efficiency, Varamis Rail has indeed been outpacing passenger services as they race their dedicated trains between Birmingham International and Mossend terminal in Bellshill, near Glasgow. With its non-stop express logistics trains, Varamis Rail has been breaking records and setting a whole new standard for swift transportation. It just so happens their trains are leased and carry the Swift livery too.

While the comparable passenger services glide sedately along between Birmingham New Street and Glasgow Central, Varamis Rail thunders through, bringing forth an amusing comparison. The passenger services are obliged to make those inevitable stops, to pick up the odd passenger along the way. Varamis Rail focuses solely on delivering light logistics and premium parcels, from terminal to terminal, non-stop, allowing them to maintain an uninterrupted journey.

Throwing down the gauntlet

Just last month, on the 13 June, Varamis Rail achieved a corporate record, completing a northbound journey in a breathtaking 3 hours and 55 minutes. The entire nation wasn’t quite out to line the tracks and applaud the crew across their Scottish finishing line, but in their own Race to the North, Varamis laid down a gauntlet to the rest of the West Coast operators. Varamis do point out that gauntlets are not advised for their train crew – as stainless steel garments and 25kV power supplies tend to interface in a manner likely to light up the sky on their overnight run.

Just last week, on Friday 30th of June, Varamis Rail narrowly missed setting a new “company best,” with a still impressive time of 3 hours and 58 minutes. The founder and managing director of Varamis Rail, Phil Read, couldn’t help but express his delight at the speed of the service, while maintaining a lighthearted perspective on the comparison with scheduled passenger trains. “We’re absolutely thrilled with the incredible speed of our express logistics trains. We seem to be giving the passenger services a run for their money”, said a grinning Read on the platform at Birmingham International. “Who would’ve thought our non-stop freight trains could outpace the Pendolinos. It just goes to show that when it comes to logistics, we’re not the ones tilting at windmills.”

Opposition run to catch up

The repurposed electric multiple units operated by Varamis don’t tilt like the specially-designed Pendolino trains into the sharp corners of the West Coast Main Line, but the parcels aren’t complaining, and nor are the customers. Apart from their impressive speed, Varamis Rail has also managed to achieve exceptional loading on their cross-border service, with capacity at a premium in both directions. “Our express logistics trains have become a shining example of fast, reliable, and well-loaded transportation”, said Read. “We’ve worked hard to optimise our loading capacity, and it’s paying off. We’re promoting the service both northbound and southbound, and I’m really happy with how the loadings are developing. The enforced suspension during the remodelling of Carstairs Junction, just south of our Glasgow terminal has not held back customers from using our service, and we’re now able to offer an even quicker timing, thanks to the realignment at the junction.”

Operating on the bustling West Coast Main Line, the busiest mixed-traffic route in Europe, Varamis Rail benefits from utilising overnight hours, taking advantage of available capacity and a clear run to achieve their Pendolino-beating times. “It may be the busiest route of its kind, but we’ve found capacity and its a niche that we can exploit to bring a new business sector to the railways”, said Read. “we’ve ambitions to expand and offer our service more widely. We’ve been promoting a return to the light logistics market for years, and it’s paying off for us. I’ve no doubt we’ll not be the only ones in future.”

That may be the case, but with Varamis Rail already showing a clean pair of heels on the tracks, their rivals will have to run to catch up if they’re going to take a tilt at their speedy records.

Still, they are both far behind the EU, which in 2022 was Kazakhstan’s largest trade and investment partner reaching 40 billion US dollars in turnover and a 27,6 per cent increase compared to 2021. All this happened in the first year of the Ukraine war, pushing Kazakhstan to rethink its political and transport role.

But there is more: the country’s stance on sanctions imposed on Russia, the statements of leading Kazakh politicians, and how the country looks to the West imply that it values its role as a Eurasian logistics hub and will avoid reducing its potential in regional links. Rail is not excluded from the equation since it can be one of the leading development pillars, as it has been for some years already.

Neutrality wins

Kazakhstan has never imposed sanctions on Russia. Yet, it has proclaimed that it adheres to the Western sanctions and does its utmost to avoid circumvention acts from occurring on its soil. Russia remains one of the country’s key economic and trade partners, and its officials have never denied it. Nevertheless, the neutral role it has acquired and its willingness to stay away from polarisation have helped it win points in a policy deemed very smart by many experts.

Diversification wins more points

An even stronger indication of Kazakhstan’s perspective on its logistical role came from the Kazakh deputy prime minister and minister of trade and integration, Serik Shumangarin. In an interview with Bloomberg a few days ago, he explicitly stated: “We are reviewing our potential as a transportation and logistical hub. We want to go beyond Russia and Belarus. There are more attractive markets. For example, South East Asia has huge potential in terms of export of different goods to Europe”.

Such a statement provides little space for interpretation. Kazakhstan seems willing to diversify its supply chains, look for new markets and always with its eyes turned to Europe, acknowledging its potential as an export market. If Shumangarin’s statement turns out to be implemented in practice, then Kazakhstan’s logistical role could shift in a way that it becomes a true international transport hub for East-West traffic and not just a transit partner of Russia or even China.

Keeping Europe close

Shumangarin’s statement concerning Europe is just one side of the coin. Because on the other side, apart from being a logistics hub for Europe, Kazakhstan is also actively strengthening direct transport ties with the EU. For instance, in an agreement with France in late 2022, railway transport was among the main pillars of bilateral development. Additionally, the two countries discussed the so far results of transport via the Middle Corridor and the possibility of further growth in the context of ​​the EU’s Global Gateway project, targeting infrastructure investments.

What is more, most of the Baltic states have turned to Kazakhstan to diversify their railway supply chains after cutting off Russia. One of the latest developments in this field came from Lithuania. Lithuanian Railways signed a memorandum to develop intermodal transport with Central Asian countries, including Kazakhstan, via the Middle Corridor.

Additionally, in recent months, some decisions of the Kazakh government have indicated that it is not willing to jeopardise EU supply chains for the sake of Russia. The country decided to stop transporting its oil products via rail to the Russian Black Sea port of Taman. Kazakh oil has been traditionally exported via Russia, but Kazakhstan is now looking for alternatives, for instance, via Azerbaijan. That is because Russia has shut down the flow of oil multiple times, either as a warning to Kazakhstan’s friendliness towards the EU or to add some pressure on EU countries which rely on Kazakh energy products.

A pragmatic role

All in all, Kazakhstan is following an, indeed, pragmatic policy when it comes to its logistical potential. An established node for China-Europe trains for years, it wants to maintain this position and strengthen it even more. It attempts to do so by keeping a distance from Russia without detaching and looking for new markets while strengthening links to the EU.

The Middle Corridor could assist the country in this mission since if it solely focuses on Central Asian volumes transiting to and from Europe could prove sufficient enough in terms of capacity. In any case, Kazakhstan sees that isolating itself from the Western supply chains is not a viable solution, and this will determine its logistical role in the future.

Also read:

• Can the port of Koper create new potential for the Middle Corridor?

• PSA and Kazakhstan Railways come together to boost Middle Corridor

• Kazakhstan keeps increasing volumes on the Middle Corridor