The Ukrainian Railways joint-stock company (Ukrzaliznytsia) has announced a 70% indexation of rail freight rates on 29 June 2022, the CFTS portal reports.

"This is the minimum possible rate indexation that will ensure that businesses, the state, and international partners jointly bear the burden of overcoming the effects of Russia's military aggression. At the same time, the increase will not become critical in the formation of export prices: the price of ferrous metals and grain will increase by only a few percentage points, which are fully offset by the positive price environment in foreign markets," the company said in a statement.

Ukrzaliznytsia noted that it earned a net profit of UAH 457 million in 2021. "Thanks to the indexation of freight tariffs, Ukrzaliznytsia will receive the UAH 11 billion needed to reach the current target by the end of the year," the company added.

Ukrzaliznytsia also stressed that the company and its partners are making joint efforts to maintain and increase freight transportation. According to the company, almost 8.3 million tons of cargo were transported in March 2022 and 9.6 million tons (16.2% more) in May.

As reported earlier, rail freight rates were raised in Ukraine on 29 June. The Ukrainian Ministry of Infrastructure earlier approved Ukrzaliznytsia's proposal to increase rail freight rates by 70%.

Market participants have already expressed concern that the sharp increase in rail freight rates could have catastrophic consequences for the sectors of the economy that continue to generate revenue for the state during the war. They have also noted that Ukrzaliznytsia did not hold proper consultations with businesses to reach a compromise on this issue.