24


Issue 1 2012


Delamode gets to grips with bureaucracy


Business to Russia has picked up and is making steady if not spectacular progress, says Delamode International Logistics’ operations manager, John Fleming. He says: “We’ve found that business has remained remarkably steady, despite the recession.” As far as Russia is concerned , Delamode specialises mainly in groupage, part- and full-load trailers though it will use sea containers for lower value, less urgent shipments. (The company also has extensive interests in Romania, eastern Europe and the Baltics.) The various hassles with


customs and paperwork have at the same time reduced, he continues: “In the past there were a lot of rather illogical requirements but they tend now to be a lot more regular and predictable – although the regulations are still formidable by most standards.” UK exporters should note, for instance, that Russia customs will oſten demand to see an EX1 form (page three of the SAD document) to prove the value of the goods and to ensure that nothing has been altered. The decentralisation of


Russian customs continues and increasingly Delamode finds that it is routing cargoes for clearance on the outer fringes of Moscow, as well as further afield. However, small shipments still tend to be cleared in Moscow as the cost of moving under bond from Moscow to final destination cannot be justified. High value goods are also subject to ‘convoy’ charges to cover the cost of police escorts. The central clearance stations in Moscow are thus no less busy than they were. “But we are doing a bit more


business to outlying regions. Volumes are not large at the


weeks until conditions improve,” says Fleming. So far, there is little sign of a trade


bonanza on the back of Russia’s membership of the World Trade Organisation (WTO), which


is


moment but it is being looked at more.” The former Soviet Union tended to build whole cities, oſten hundreds of miles in the interior to serve specific industries – many of them defence-related. Being off- limits to foreigners, very little was known about them – in some cases not even the name – but they were home to anything from of anything from 100,000 to 1m people. Since the break-up of the Soviet Union, many of them have however developed industries in their own right and Delamode gets to occasional request for shipments. Problems with theſt of cargo in


Russia have reduced, not because the criminals have reformed, but because the industry has got more adept at dealing with them. “We come across theſt quite rarely now, but that’s mainly because we’re not complacent about it,” explains John Fleming. “If you do something stupid, there are still people about who will steal your load.” Drivers are constantly reminded of the risks and instructed to use one of the many secure truck parks now available. Other sensible precautions are to


try to disguise valuable or vulnerable cargo as much as possible, perhaps using plain or different packaging. There is generally a ready supply of trucks available to Russia, apart


from odd occasions when the number of truck permits from Germany has run out – as happened earlier in 2011 - and permits and vehicles have had to be pulled from other countries, including the UK. Getting good domestic hauliers for the long runs inside Russia has never been an issue, adds Fleming. “It’s a lucrative business for the trucker and you have got some old hands who know what they need to do – for example, to take specific spare parts with them in case something goes wrong with the truck hundreds of miles from the nearest service station.” Roads are not too much of


an issue, even in the winter. The military generally does a good job of keeping the trunk routes open and while there can be problems on the minor routes, oſten the large factories and other industries will make efforts themselves to clear the road between their own premises and the nearest main road. The Spring thaw can bring its


own problems, particularly when trying to reach oil and gasfields over unmade roads. While these may be passable with winter tyres in the cold period, when the ice starts to melt they can become impassable quagmires. “All you can do is either avoid the area or leave it a couple of


expected to be concluded soon, he adds. “If anything, there has been a bit of a slowdown. Russia is an expensive place to travel to, so there haven’t been as many salespeople going there. And as for the WTO, people are waiting to see if it will make a big difference to tariffs – it’s not cut and dried that they will in fact change very much.” Russia is still overwhelmingly


an export market as far as the UK is concerned; very little Russian-made goods find their way back here. In practice though, the truckers do find return loads to take back as far as the Baltic, from where they can again reload with UK-destined goods. Delamode


serves many of


the other countries of the former Soviet Union. Kazakhstan with its oil industry had long been a steady performer but lately Ukraine has developed into a major market. “As the borders of the EU have pushed out towards Ukraine, there has been a lot more interest. We are getting a lot more enquiries – and unlike Russia, Ukraine is a much more balanced trade.” The country is a major agricultural producer and it has several major cities and ports on the Black Sea. Red tape is still a big issue


– export licences used to be impossible to obtain but the situation has eased to the extent that “you can get one if you really want one” - but there is a growing realisation


that the country


cannot rely only on exports to Russia, still by far its major trading partner.


///RUSSIA


Big loads can equal major headaches


Russia may seem a country of wide-open spaces, but moving outsize loads there can sometimes be difficult, reports GAC. Matthew Towse, regional logistics manager for Caspian & Central Asia, says that the main problem are bridges which can be hard to bypass. Off the main transit routes, many are in poor condition and in any case were often not originally designed for heavy loads. However, most of the main cities have a bypass road so urban areas are generally not a major obstacle.


for this need not be a problem for an experienced operator. On the plus side, heavy transport


convoys are generally allowed to bypass border queues. In 2012, the authorities will


adopt new regulations which will introduce European standards for the maximum weight of cargo allowed for transport by road. They will also bring facilitated procedures for permits. “Until then, local project logistics experts like GAC can help work around the challenges,” says


Russia is a challenging environment, says GAC


Alexander Bazhan, business


development manager at GAC Russia, adds: “The issue of permits by the authorities for transportation of heavy weight cargoes by road has been a major problem, as most of the roads were built a long time ago, are in poor shape and do not meet modern requirements with regards to maximum weight allowed.” Towse adds though that GAC finds obtaining permits


relatively straightforward:


“We have many years of experience and local expertise. However, even with all the documentation in order, the process takes longer than in some countries, although once allowed


Bazhan. Unlike many other parts of the


world, rail is a possibility for some outside loads. The rail gauge is bigger than the road gauge so what may be slightly out of gauge for standard size road transport can often still be in gauge for rail. But if loads are outside the normal rail gauge, especially by a significant amount, it becomes less cost effective than road, says GAC. Nevertheless, some locations in Russia however are not road connected and rail may be the only option. A significant amount of out of gauge freight also moves by river or inland waterways.


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