UDS: Freight rates on the Danube increased, but stabilized

Freight rates on the Danube, although slightly increased, have stabilized at the current level. And rumors about their further growth are speculation.

Last week, UDS offered a service for the transportation of grain by barges on Prozorro.

The company offered a fleet not involved in transportation under long-term contracts. Agrarians could charter both one barge and a barge caravan of the UDS in full for October.

But the proposed starting price turned out to be too high for potential customers.

According to the deputy general director of the UDS, Vladyslav Belakh, the reaction of farmers shows that freight rates on the Danube, although slightly increased, have stabilized at the current level. Rumors about further growth and a jump in freight to 38-40 euros per ton and above are only a certain game with the aim of artificially warming up the market.

“The demand for Danube transportation is high, there is a desire, but at the current prices for agricultural products, the farmer is not ready for an increase in freight rates, because it will force him to work at a loss,” Bielach said.

He added that the bidding on Prozorro confirmed that shipping was working and is working at real market rates: “We do not hide that our priority is long-term contracts that enable the company to minimize downtime and plan production activities. But our pricing policy was and remains market-based and transparent. There is no secondary market for transportation services by the UDS fleet. We work directly with cargo owners, always fulfilling our obligations and at the same time adjusting the terms of cooperation in accordance with market indicators.”

The deputy general director of the UDS emphasized that the current level of freight rates is objective and suits both carriers and farmers. And this means that the volume of transportation through the Danube will continue to increase.