In April last year, the prime ministers of Poland and Ukraine signed a memorandum on deepening cooperation in the railway sector. It was announced the creation of a railway company that will deal with transportation, incl. grain from a war-torn country. So far, no such organization has been created, but PKP SA assures that work is ongoing, Railway Supply magazine reports, quoting Rynek Kolejowy.

PL-UA JV

With the beginning of the Russian invasion of Ukraine, rail traffic across the border increased significantly. In the first period of hostilities, the priority was passenger transportation and the provision of transport for Ukrainians fleeing the war. Later, negotiations began on how to streamline traffic across the border and facilitate transportation, and the Ukrainian Railways constantly worked to modernize the railway lines to the border with Poland. Rail traffic from Ukraine, despite the difficulties, grew – mainly PKP LHS, operating on a wide gauge, and PKP Cargo benefited from this. After the grain agreement, which unblocked Ukrainian ports, the need to develop overland routes decreased significantly.

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Almost a year after the signing of the April memorandum, the company (the JV formula was discussed) was still not created, and the problem of importing Ukrainian grain to Poland and its sale became urgent.

PKP does not provide any dates or details of possible cooperation. There are suggestions that the Ukrainian side wants something more than just a forwarding company. This, in turn, means a desire to create a new enterprise in Poland, or, much easier, the acquisition by Ukrainian Railways of one of the national carriers.

According to the Center for Eastern Studies, the war doubled Ukrainian food imports to the EU. “In particular, this applies to cereals, sales of which increased from 7.8 million tons in 2021 to almost 16 million tons a year later. The export of agri-food products was of key importance for Ukraine before the Russian aggression, and then its role increased even more. In 2021, its volume was $27.7 billion, and in 2022 it was $23.4 billion, but then it already accounted for 53% of all goods sold,” OSW analysts write.

Before the war, 2/3 of Ukrainian exports were carried out through the ports of the Black and Azov Seas. About 90% of agricultural products were transported by sea. After the Russian invasion, they had to look for an alternative. In May 2022, the European Union created solidarity corridors to facilitate exports, with Poland (land transport) and Romania (ports on the Danube and Constanta) playing a key role. Both of these countries did not import agricultural products from Ukraine before the war, but imports have increased significantly in recent months.

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