Rail Freight - The Times Of Central Asia

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Grain Trade

Kazakhstan’s Grain Exports to Europe Hit Russian Rail Bottleneck

Russian Railways (RZD) has rejected October requests to transport grain from Kazakhstan through Russia to Estonian ports, citing insufficient rail capacity. There is no formal ban on shipments, but without approval, exporters cannot move their cargo along the usual route. Zeynolla Abdumanapov, head of Kazakhstan's National Association of Exporters KazGrain, reported the problem. The affected rail border crossings are Ivangorod–Narva and Pechory–Koidula, through which Kazakhstan's shipments travel to the Estonian ports of Muuga and Sillamäe. The Baltic route is particularly important for shipments of Kazakhstan's durum and high-protein wheat, as well as oilseed flax, to Europe. These crops command higher prices than ordinary wheat. On October 8, Estonia banned the transit of grain originating in or exported from Russia and Belarus. The restrictions do not apply to grain from Kazakhstan passing through Russian territory, and exporters had hoped to take advantage of available capacity at Estonian ports, where Russian grain transit had already been virtually nonexistent. However, disruptions to shipping through the Black Sea, caused by Ukrainian attacks on Russian port infrastructure and vessels, have forced Russia to redirect much of its grain toward its own Baltic ports, including Ust-Luga and Vysotsk. St. Petersburg is another destination. Russian grain also continues to pass through Latvia and Lithuania, which have not imposed equivalent bans. The shift has increased pressure on the railway network serving the Baltic region. According to Reuters, RZD has given priority to grain shipments heading toward Baltic and Arctic ports. Russia has also raised freight tariffs for shipments to Baltic and Finnish border crossings. Gani Yessenbayev, a representative of Kazakhstan Temir Zholy (KTZ), the country's state railway operator, told the Eurasian AGRICOM 2026 conference that KTZ is negotiating with RZD and recommending that exporters resubmit their applications. The volume of cargo affected by the rejections has not yet been disclosed. Russia can be bypassed via the Trans-Caspian International Transport Route through Azerbaijan and Georgia. However, KazGrain estimates that shipping costs along this route are roughly twice as high, while transshipment capacity is constrained by the facilities at Georgia's Port of Poti. For large-scale wheat exports, the additional costs could prove too high. Kazakhstan's grain trade with Iran is also becoming more difficult. According to Abdumanapov, sea freight rates from Aktau have risen from $17 to $95 per metric ton. Suppliers from Kazakhstan must compete with cheaper Russian grain, while a stronger tenge further reduces their export earnings in local currency. Most of Kazakhstan's grain exports, however, go to neighboring countries rather than Europe. From January through September 2026, grain shipments by rail for export increased by 14% to 8.4 million metric tons. Of that total, 5.5 million tons went to Central Asia. Uzbekistan received 4.11 million tons and Tajikistan 1.18 million tons. Shipments to Afghanistan totaled 762,000 tons, while China received 750,000 tons. Kazakhstan increased its agricultural export revenue by more than a third in 2025. The restrictions on transit through Russia therefore primarily threaten sales of Kazakhstan's higher-value agricultural products to the European Union. Future shipments will...

Flaxseed Trade

Kazakhstan Flaxseed Exports Hit Record 1.3 Million Tons

Kazakhstan ended the 2025/2026 marketing year with record flaxseed exports of nearly 1.3 million metric tons, 2.5 times the previous season's volume. The country accounted for 72.5% of flaxseed imports into the European Union (EU) in the 12 months to June 2026, with European tariffs on Russian flaxseed helping Kazakhstan improve its position in the market. "Kazakhstan is the undisputed leader in flaxseed supplies to the EU and the second-largest exporter to China after Russia," said Yevgeny Karabanov, head of the Analytics Committee of the Grain Union of Kazakhstan. Flaxseed, also known as linseed, comes from the flax plant, which is grown for the fibers used to make linen. The seeds are eaten as food, added to animal feed, or pressed for oil used in cooking and industrial products such as paints and varnishes. According to Karabanov, the export total covers September 2025 to August 2026. European Commission data show that the EU imported 686,800 metric tons of flaxseed between July 2025 and June 2026, up 16.8% from the previous 12-month period. Kazakhstan supplied 497,800 metric tons of that total. Karabanov attributes the shift in the European market to higher tariffs on Russian flaxseed, which rose to 20% in 2025 and 50% in 2026. In January 2026, the value of Russian flaxseed exports to the EU fell to €96,500, its lowest level since July 2010. Belgium became the largest European buyer of Kazakhstan's flaxseed, increasing purchases 1.84-fold to 347,100 metric tons. Other European buyers, including Poland and Estonia, also increased their purchases. Outside the EU, China remains Kazakhstan's largest market. Exports there totaled 537,700 metric tons, 2.8 times the previous season's volume. Afghanistan increased its purchases 3.38-fold to 141,400 metric tons. Exports to Uzbekistan, Tajikistan, and Turkey also grew. China and Belgium together accounted for 68.1% of Kazakhstan's total flaxseed exports. Afghanistan, the third-largest buyer, accounted for another 10.9%. In the new season, exports to Europe could face logistical constraints. According to Karabanov, the redirection of Russian grain exports to Baltic ports could increase pressure on rail networks and complicate the transit of Kazakhstan's shipments through Russia. An alternative route through Belarus and Lithuania would be more expensive. Rising transportation costs are already affecting prices in Ghent, Belgium, a major European trading hub for agricultural commodities. Flaxseed prices there have been rising for the past six weeks, he said. Further increases in logistics costs could erode Kazakhstan's price advantage in the European market.

Rail Corridors

Kazakhstan Pursues Trans-Afghan Railway Routes to Indian Ocean

Kazakhstan wants a railway route to the Indian Ocean through Afghanistan and Pakistan. There is already freight that could use such a corridor: in the first seven months of 2026, Kazakhstan’s exports to Afghanistan approached $573 million. What does not yet exist is a continuous railway all the way to the sea. Several developments around this route took place in late September. Kazakhstan, Uzbekistan, and the United Arab Emirates agreed to study a corridor through Afghanistan to Pakistani ports. In western Afghanistan, a new section of a separate railway built with the participation of a company from Kazakhstan opened. Astana is also involved in plans for a railway from the Turkmen border through Herat and farther across Afghanistan. It is important not to treat all these projects as a single railway. The September 30 memorandum on the Central Asia-South Asia (CASA) project describes a route through Uzbekistan. The Khaf-Herat and Torghundi-Herat projects are separate schemes involving western Afghanistan. Official terminology has not always been consistent, with earlier government statements also using the CASA label for the Torghundi-Herat-Kandahar-Spin Boldak proposal. Afghanistan has already become a significant market for Kazakhstan’s food products. In January-July 2026, bilateral trade reached $581.1 million, compared with $541.6 million for the whole of 2025. Almost all of this year’s turnover, $572.9 million, consisted of exports from Kazakhstan. Flour accounted for $215.6 million, wheat for $122 million, and vegetable oil for $51.1 million. In the 2022-2023 season, Kazakhstan exported around 17,000 tons of sunflower oil to Afghanistan. The volume has risen to 75,000 tons in the current season, while the industry is targeting 110,000-120,000 tons next season. The two governments have set a target of increasing bilateral trade to $3 billion. For Kazakhstan, Afghanistan is currently primarily a market. The larger transport plans envisage a second role for the country: a transit territory through which Kazakh freight could eventually reach the sea. CASA: Across Afghanistan to the Sea The route now under consideration would run from Kazakhstan through Uzbekistan and Afghanistan to Pakistan, providing access to Pakistani ports on the Indian Ocean. Kazakh authorities say the corridor could eventually carry up to 10 million tons of freight a year. The three countries agreed to conduct technical and economic studies and examine financing options. No cost estimate, final route, or construction timetable has been announced. The infrastructure gap is clear on Afghanistan’s railway map. Short railway lines enter the country from Uzbekistan and Turkmenistan in the north and from Iran in the west. Pakistan’s rail network, in turn, does not extend into Afghanistan. Kazakhstan is also building ties with the Pakistani end of any future corridor. During President Kassym-Jomart Tokayev’s state visit to Pakistan in February, transport and railway organizations signed cooperation documents, while the ports of Aktau and Karachi agreed to exchange information. Talks also covered Gwadar and transit routes through Afghanistan. Why Herat Matters to Kazakhstan Herat lies in western Afghanistan, close to both Iran and Turkmenistan. That geography puts the city at the center of several...

Trade Logistics

World Bank Says Middle Corridor Needs More Than $55 Billion by 2040

Developing a transport corridor linking China and Central Asia with Europe across the Caspian Sea will require more than $55 billion in investment through 2040. But the World Bank’s recent report, Integration: World-Class Trade Logistics Along the Trans-Caspian Transport Corridor, argues that infrastructure alone will not resolve the difficulties of moving freight across borders and between rail and ships. The route is the Trans-Caspian Transport Corridor, better known as the Middle Corridor. Trains typically travel from China through Kazakhstan to the Caspian ports of Aktau and Kuryk, where containers are transferred to ships. In Azerbaijan, they return to rail and continue through Georgia and Turkey toward Europe. The report covers nine countries with a combined population of nearly 200 million. With targeted investment, the World Bank estimates that trade volumes along the corridor could more than triple and travel times could be halved. GDP across those countries could be around 3.3% higher by 2040, with about 2 million additional jobs. If infrastructure investment is combined with reforms to make trade and transport more efficient, corridor volumes could quadruple compared with 2023 and travel times could fall by about two-thirds. At least $25 billion would be needed to relieve bottlenecks on railways and at Caspian ports. Another estimated $30.5 billion would improve connections between the main corridor and local economies, including terminals and digital systems. In February, the World Bank approved an $846 million guarantee from the International Bank for Reconstruction and Development, alongside a $564 million co-guarantee from the Asian Infrastructure Investment Bank. The package is intended to help mobilize $1.41 billion in long-term commercial financing for rail infrastructure along Kazakhstan’s section of the Middle Corridor. One of the principal projects is the roughly 322-kilometer Mointy-Kyzylzhar railway. The new line is expected to shorten the route by 149 kilometers and relieve pressure on the existing rail network. But hours saved on the Kazakh rail leg could still be lost waiting for a ship or crossing a border. The World Bank proposes a single digital corridor system built around a Transport, Transit, and Trade (T3) document. A carrier would enter cargo information once, allowing transport and customs authorities in different countries to use the same data. The bank also proposes a joint venture between railway and Caspian shipping operators. It would allow customers to buy a single container freight service for the route rather than arranging rail and maritime transport separately. During a September visit to Kazakhstan, World Customs Organization Secretary General Ian Saunders called for common international data standards and closer coordination between neighboring customs administrations. The Middle Corridor is often described as an alternative route for Chinese goods traveling to Europe. Its railways and ports also need to carry goods produced by Central Asia’s own economies. The five Central Asian countries exported $8.1 billion worth of goods to one another in January-July 2026, up 25.4% from a year earlier. The World Bank expects cheaper and more predictable transport to help local producers sell to neighboring countries and more distant...

Trans-Afghan Rail Corridor

Kazakhstan, Uzbekistan, and UAE Study CASA Rail Route to Indian Ocean

Kazakhstan, Uzbekistan, and the United Arab Emirates have agreed to study a proposed railway corridor through Afghanistan to Pakistan’s seaports. The transport ministries of Kazakhstan and Uzbekistan and the UAE Ministry of Energy and Infrastructure signed a memorandum on the Central Asia-South Asia (CASA) project on September 30. They agreed to study its technical and economic feasibility and examine possible financing. The memorandum leaves the route and construction timetable open and provides no cost estimate. Kazakhstan and Uzbekistan are both landlocked, and Uzbekistan is one of only two countries worldwide that must cross at least two national borders to reach the open sea. Kazakh authorities estimate that CASA could eventually carry up to 10 million tons of freight a year toward Karachi and Gwadar. Uzbekistan is working with Afghanistan and Pakistan on a railway from Termez through central Afghanistan to Kharlachi on the Pakistani border. The three countries agreed in July 2025 to prepare a feasibility study. Estimates put the cost at around $7 billion, although some have been higher. Kazakhstan is involved in a separate proposal from Torghundi on the Turkmen border through Herat and Kandahar to Spin Boldak near Pakistan. In April 2025, Kazakhstan and Afghanistan signed a protocol of intent, with the Torghundi-Herat railway and a logistics center in Herat envisaged as an initial stage. A new 43-kilometer section of the Khaf-Herat railway connecting Afghanistan with Iran was inaugurated on September 28. Kazakhstan’s Integra Construction KZ helped build it, and Afghan authorities say work is under way on further links from Herat toward the Turkmen and Pakistani borders. A study by the Moscow-based Institute of World Economy and International Relations (IMEMO) found that Afghanistan’s Taliban-led authorities had signed more than 15 railway-related agreements by March 2026. By then, no new mainline track had entered service under those initiatives, and active projects represented less than 1% of the estimated cost of the announced plans. Dauren Ilesaliev, a professor at Tashkent State Transport University, points to the need for steady freight. “Having railway infrastructure does not guarantee that it will work,” Ilesaliev said. Countries along the route would also need to agree on a through-tariff. Kazakhstan’s trade with Afghanistan could provide some of that freight. Bilateral trade reached $581.1 million in January-July 2026, with Kazakh exports accounting for $572.9 million. Flour accounted for $215.6 million and wheat for $122 million of those exports. Kazakhstan has also explored prospective mineral deposits in Afghanistan’s Nuristan Province and is discussing exports of locally assembled vehicles. In an interview with Novastan, Uzbek analyst Aziza Mukhammedova said a corridor’s value to Afghanistan would depend on the jobs and investment it generates there, alongside transit freight. She also cited unresolved financing as a challenge. The UAE sits outside the proposed route, and the memorandum names neither an Emirati company nor a possible investment amount. If a trans-Afghan line is built, Uzbekistan’s China-Kyrgyzstan-Uzbekistan railway could form part of a rail route from China to Pakistan. For Kazakhstan, CASA would provide an Indian Ocean outlet alongside the...

Railway Digitalization

EBRD Provides €38.4 Million for Digital Transformation of Uzbekistan Railways

The European Bank for Reconstruction and Development (EBRD) will provide a loan of up to €38.4 million to O’zbekiston temir yo’llari (UTY), the country’s national railway operator, to digitalize transport management and improve cybersecurity. According to the EBRD, UTY owns and operates a 6,950-kilometer railway network and is responsible for up to 40% of freight transported in Uzbekistan. Some dispatching and scheduling work remains manual, as do parts of operational control. The financing will allow UTY to introduce modern digital traffic and transportation management systems and upgrade cybersecurity protections for its IT infrastructure. The EBRD said the changes should improve the safety and reliability of railway operations while allowing UTY to manage train movements and network capacity more efficiently and reduce costs. The planned cybersecurity measures will be aligned with international best practices. The Bank also links the project to the development of the Trans-Caspian Transport Corridor, also known as the Middle Corridor, which connects Central Asia with the South Caucasus and onward to Europe. Landlocked Uzbekistan connects to the corridor through neighboring countries before cargo crosses the Caspian Sea. The project is the EBRD’s first public-sector initiative of this kind in Uzbekistan and is specifically focused on the digital transformation of the national railway operator. As previously reported by The Times of Central Asia, the EBRD has also provided a loan of up to €20 million to Uzbek pharmaceutical manufacturers Samarkand England Eco-Medical and Bayan Medical to expand production. To date, the EBRD has invested almost $6.9 billion (€6 billion) in Uzbekistan through 210 projects, with most of the funds supporting private entrepreneurship. Uzbekistan has been the largest recipient of EBRD funding in Central Asia for each of the past six years.