RLL Container Report - 23 November 2016
From: John Keir, Ross Learmont Ltd. Email: john.keir@telia.com Date: 23 November 2016
Flyover Country
During the recent US Presidential Election, the term “flyover country” was used to describe those states of the USA lying between the East and West Coasts. The term, which is often used pejoratively, refers to the vast interior regions of the country passed over by transcontinental flights between the two most populous urban agglomerations, the North-eastern Megalopolis and its counterpart in Southern California. Much to the surprise of the political pundits, voters in flyover country came out in force to secure the election of Donald Trump.
The lesson should not be lost on the container industry, which has for a long time ignored its own flyover country. This is the vast territory crossed every day by transcontinental flights from Japan, Korea, Taiwan and the major cities of the Chinese seaboard, as they make their way to the hub airports such as Frankfurt, Paris and London in Western Europe. As China moves more of its industry westwards, large population centres, such as Chongqing, Chengdu and Xi’an, lie some 1,400 km from the main Chinese container ports, which mark the start of the long sea voyage to Europe.
Rail lines in flyover country are being improved and block trains operated by Russian Railways are now averaging over 1,000 km per day on the main Transiberian trunk route. For their part, Chinese and Kazakh partners are investing heavily in the gauge changeover stations at Dostyk. The gauge change and the associated paperwork have long been the Achilles Heel of the overland routes. The main German rail hub and inland port based at Duisburg claims to receive some 20 trains a week to and from various destinations in China via a route that forms part of the Chinese Silk Road strategy. At the same time, the rail route gets shorter as the centre of industrial production and consumer consumption is moving east into Poland, Hungary and Romania.
An equally important factor in the sudden rise in importance of flyover country has been the growth in trade to and among the landlocked Central Asian states and the emergence of Iran as a major trading partner. China is already making extensive use of the broad gauge lines to export to the Central Asian republics and it will now use the same routes to supply Teheran and the cities of northern Iran with consumer goods from Chongqing, Chengdu and Xi’an.
The Iranian rail network is presently undergoing a major overhaul and will act as the southern hub of flyover country. Azeri Railway has just completed the broad gauge line extension into Iran, while the line from Turkmenistan is being upgraded. This month, Fesco started a container service via the Caspian ports using refrigerated containers to transport fresh food from Iran to Moscow. Wherever you look, flyover country is on the move.
John Keir, Ross Learmont Ltd.
23 November 2016
Copyright ©, 2016, John Keir