Delivery in Ukraine in the Context of War

Challenges for service delivery during the war

During the war and in occupied territories, Ukraine has faced service delivery issues. Since 2014, the country has implemented policies and laws to address these challenges. The main legislation, known as the Law on Temporarily Occupied Territories, regulates residency, property sales, business activities, and social welfare in these areas.

The major factors affecting Ukraine’s service delivery framework and infrastructure since the invasion are:

• Limited or lost governmental control over occupied territories
• Security risks to lives, equipment, and government systems
• Necessity to conceal valuable information from the aggressor
• Limited judicial oversight
• Reduced law enforcement capacity
• Decreased service provider capacity due to migration and mobilization
• Attempts to destroy data by Russian hackers.

As a result, the service delivery system in Ukraine has undergone significant changes. To mitigate these risks, the government has adapted the system to the new conditions. Service delivery is no longer unified and standardized nationwide, but varies based on territory, time, scope of services, and providers.

‘Нова пошта’ and the war: how the work of Ukraine’s largest delivery service has changed

The company, according to its operations director, despite the full-scale war, did not stop work for a minute, but reduced the network. On February 24, an operational plan for the week was created, in which the cargo turnover goal was predicted to be 12 times lower than in the pre-war period, at the level of 100,000 express waybills per day.

Before the war, the company had a daily turnover of 1.2 million shipments. Having experienced a sharp decline in the first days of the Russian invasion, in more than two months Nova Poshta reached the figure of 0.5 million express waybills.

Before the war, Novaya Poshta had 8 million customers and, according to the company’s operations director, all of them remained, but they began to send less.

In general, the behavior of Novaya Poshta customers during the last two months changed very quickly and in different directions. Immediately after the invasion of the aggressor – a colossal stop, 30,000-40,000 shipments per day, sent mainly by individuals to individuals. Then the shipment of bulky goods and large heavy shipments increased significantly.

How does Nova Poshta work now?

During the 10 months of the war, Nova Poshta evacuated 177 enterprises and made 846 flights for this purpose. They are among the first to enter newly liberated territories following military operations, recognizing the crucial role they play in these areas. These cities often lack accessible shops, leaving residents without means to purchase essential items like medicine and basic hygiene products. As a result, Nova Poshta facilitates the delivery of these necessities, ensuring that people can obtain them promptly.

After February 24, 2022, logistics operators are forced to urgently change cargo delivery routes, since the Ukrainian sky was closed. So in Ukraine, goods began to be delivered by road or railway, and air logistics was already used in neighboring countries.

Nova Poshta” developed general rules for resuming work in liberated territories. For this, mobile offices, generators, and Starlink are used. Although “Nova Poshta” is starting to work as a mobile branch for 3-4 hours a day in the liberated territories, at the same time the company is trying to repair or rent another premises in order to open a stationary point for issuing and receiving parcels. Also, power outages do not affect courier delivery. Couriers work in the usual mode: they deliver parcels, process shipments through the application, accept payment. They have cell phone boosters to ensure a stable connection for work.

How “Nova Poshta” suffered losses, but managed to scale the business

During the full-scale war, “Nova Poshta” began to actively expand its business abroad. The first post office in the Polish capital, Warsaw, was opened in October 2022. Currently, 19 points are operating in Poland:

• six branches — in Warsaw;
• two branches each — in Kraków, Poznan, Gdańsk, Wrocław, and Lublin;
• one each in Rzeszów, Łódź and Katowice.

During the full-scale war, Nova Poshta opened more than 1,000 new branches in Ukraine. These are 802 partner branches and 284 own branches. Franchise business is developing most actively in the Lviv, Kyiv, Cherkasy, and Vinnytsia regions.

At the end of 2022, the company officially employed 32,000 people. Another 11,000 specialists worked for partners.

The plans of “Nova Poshta” also include the development of its own cargo airline Supernova Airlines. In the spring, the logistics operator will start operating the first flights to the EU. For this purpose, the airline leased two AN-26 aircraft. In wartime, the fleet will be based at one of the EU airports located near the border with Ukraine. From there, the cargo will be delivered to our country by road transport.

Sources: ‘Administrative Service Delivery during War Time’, https://www.oecd.org/ukraine-hub/en/#resources, 04 October 2022

https://thepage.ua/ua/special-projects/yak-nova-poshta-perezhila-rik-velikoyi-vijni-i-vijshla-na-zahidnij-rinok

https://novaposhta.ua/warehouse_logistics

Outstanding Issues of Military Logistics in Ukraine

The logistics system in the Armed Forces today is not solely military, but also has an economic aspect. The term military logistics has a wide range of meanings that depend on the perspective of experts and scientists who highlight logistical issues in their research papers and articles. For example according to the approved NATO definition, military logistics is the science of planning and carrying out the movement and maintenance of forces. The development of military logistics involves finding the most optimal, fastest and most qualitative ways of delivering supplies.

Military logistics in Ukraine was not well developed until recently, and the escalation of military operations in the east of the country highlighted the inefficiency of the Ukrainian Armed Forces and defense complex in providing quality military operations. The lack of ammunition, supplies, weapons, and equipment in sufficient quantities posed a significant challenge, and high-tech devices and software were also in short supply. Procurement was dependent on volunteers, and the lack of logistics expertise led to a logistical crisis in the field.

The urgency of the situation led to the development of the Ukrainian logistics system, which aimed to establish timely and high-quality technical equipment, communication, logistical resources, and functional infrastructure to ensure the success of tactical and strategic operations. The development of this system marked the origin and formation of military economic logistics in Ukraine.

Several projects and reforms were initiated, including the Institutional Reform of Procurement Project, the Electronic Purchases Reform Project, and the Automation of Accounting and Logistics in the Field of Supply of the Armed Forces of Ukraine Pilot Project. These projects aimed to improve the procurement process and automate logistics and accounting to ensure timely and efficient delivery of resources to the Armed Forces of Ukraine.

The Institutional Procurement Reform Project

The reform was necessary due to poorly timed and provided provisioning of material and subsistence support to the Armed Forces of Ukraine and the dispersal of functions between various structural divisions. The implementation process includes three stages:

1. reorganization of the department of public procurement and supply of material resources;
2. creation of the Center for the organization of material support to the Armed Forces of Ukraine, which will develop new standards and norms and implement an automated logistics system;
3. establishment of the Procurement Agency for housing support to military personnel.

The Electronic Procurement Reform Project aims to create an open and transparent system of purchases in the Ministry of Defense of Ukraine by adjusting and creating a platform for electronic auctions, document flow, and the Department of Purchasing website.

The Automation of Accounting and Logistics in the Field of Supply of the Armed Forces of Ukraine Project aims to reduce the admissible surplus, create a quick delivery system of material support, and reduce the human factor in the accounting process. It also aims to reduce logistic lag interval, ensure timely information exchange about supplies, and obtain reliable information about supplies quarterly.

To solve logistical problems related to information, companies are using Blockchain technology. Blockchain is a publicly available and unchangeable digital register where information is stored in interconnected blocks, increasing reliability. Ukrainian companies are successfully using blockchain technology for projects such as Rentberry and Ambisafe. The Cabinet of Ministers of Ukraine approved a draft for a blockchain land registry in 2017. The technology provides high reliability and the ability to monitor deliveries in real time throughout the logistics chain, and significantly reduces the time spent on processing documents, and, as a result, increases efficiency. It is possible
to create both open and closed systems. The experience of using blockchain technology in civilian logistics entails the implementing
this technology in military logistics.

Sources: “The basic terminology of the modern military logistics“, Lesia Kostiuchenko Dmytri Solomon The electronic scientifically and practical journal “INTELLECTUALIZATION OF LOGISTICS AND SUPPLY CHAIN MANAGEMENT”, v.1 (2020), ISSN 2708-3195 https://smart-scm.org

Issues of Military Logistics in Ukraine, Systemy Logistyczne Wojsk nr 50/2019, Yurii KORNIICHUK, Oleksandr SHKATULA, Vladislav SMAGA

ROHANOV, С. (2018). Blockchain is a breakthrough and key to future supply chains. Logistics: problems and solutions, 3(76), 25-27.

Life-saving logistics in Ukraine

What is life-saving logistic?

Humanitarian logistics is the term used to describe the various processes and systems used to deploy individuals, resources, skills, and knowledge to assist vulnerable populations who have been impacted by natural disasters, war, and complex emergencies.

Situation in Ukraine

Before the war, the whole procurement and delivery process in Ukraine was quite easy. Cargo was transported to the airports, cleared at warehouses and transported to its destination. However, with the onset of the war, there was an urgent need to determine how to deliver medicines to the country and patients.

The Ukrainian Public Health Centre requested urgent assistance with the supply of antiretroviral therapy, and the United States President’s Emergency Plan for AIDS Relief (PEPFAR) agreed to provide support under the auspices of USAID and CDC. To secure the necessary supplies, PEPFAR’s purchasing agency, Chemonics, conducted a global search for spare stock and successfully obtained the crucial resources. With the assistance of the European Union, special transit procedures for humanitarian aid were promptly established to facilitate the delivery of aid to Ukraine. As a result, deliveries have commenced through neighbouring nations, particularly Poland and Romania.

Logistical process, challenges

Thanks to the support of the Railway Service, volunteers were able to arrange for the collection of the cargo from a separate station, which was away from the primary delivery point of most humanitarian aid entering Ukraine. This decision was made to facilitate immediate distribution to regions, as it can be challenging to obtain goods from the State Agency for Strategic Reserves of Poland due to the significant influx of humanitarian supplies from different countries. A logistics company was engaged to transport the goods to Ukraine under the humanitarian transit procedure, and they were delivered to a warehouse in Lviv from where immediate distribution could take place.

The delivery process throughout Ukraine, including the front-line zones, was the most challenging and crucial aspect of the operation. Volunteers noted that many logistics companies ceased operations during the war, while the few remaining ones increased their service fees by two or three times. Commercial organizations were unwilling to provide services to cities such as Kharkiv, Kherson, or Mykolaiv, but volunteer drivers, coordinated with local authorities, stepped in to transport people, medicines, and other items.

In areas where fighting was ongoing, the volunteer drivers would unload goods at regional administration headquarters, and communication would be established with the medical institutions that were the ultimate recipients. The medical institutions would then be informed about where to pick up the goods.

“The situation for people living with HIV in Ukraine is desperate. We are trying to deliver medicines, food, and other emergency assistance to people in need, but the work is dangerous and volunteer drivers are putting their lives at risk. If we don’t get more help, I am not sure how much longer we can continue, especially reaching people in the front-line zones,” said Dmytro Sherembey, the Head of the 100% LIFE Coordination Council.

Uber supported Ukraine relief effort

Uber created a specialized logistics platform for United Nations relief agencies in response to a crisis. The company delivered over 220 truckloads of emergency supplies free of charge. The platform enables relief agencies to dispatch vehicles to their central warehouses in Ukraine and coordinate deliveries with recipients. Real-time tracking and inventory updates are also available.

The most recent deliveries have concentrated on providing winter emergency shelter supplies, including blankets, stoves, and tarps to seal shattered windows, to the suburbs of Kyiv and the eastern frontline areas, which have been severely impacted by the crisis.

Sources: World Economic Forum – How flexible transport helped save lives and provide support in Ukraine, Mar 22, 2023

ФОРМУВАННЯ ЛОГІСТИКИ КРИЗОВИХ СИТУАЦІЙ
У КОНТЕКСТІ ВІЙСЬКОВОГО КОНФЛІКТУ РОСІЯ – УКРАЇНА, Ступницький О. І. УДК 327 (073:470+571)

UNAIDS – Life-saving logistics in Ukraine, 14 APRIL 2022

https://www.facebook.com/watch/?v=522031215940521

Why Russian logistics failed in Ukraine?

According to a recent study that analyzed the early months of the Ukrainian war through a logistical lens, inadequate preparation, poor logistics, and unrealistic planning are among the factors that led to the failure of Russia’s swift invasion of Ukraine.

MILITARY LOGISTICS: WESTERN LOGISTICS PRINCIPLES

The logistical planning at the operational level involves prioritizing and distributing resources to logistics hubs, which are then transferred to tactical logistics units to support combat units. The goal is to ensure that the right supplies are delivered to the right place and person at the right time, in the right quantity and condition. In military operations, logistical support can be provided in three ways: military units can bring supplies with them, logistics units can establish supply lines from safe areas to the combat units, or the deployed units can obtain resources from the local area. The logistics planning must take into account the demands forecasted in the operational plan or the actual demands from the fighting units. The availability of supplies depends on various factors such as safety, environment, weight or volume, risk, longevity, durability, and procurement principles. The logistics planning must also consider the four Ds: the demand, distance, destination, and duration of a specific demand.

MILITARY LOGISTICS: RUSSIAN LOGISTICS PRINCIPLES

In the Soviet era, the offensive operations concept was based on the “echelon principle,” which involved replacing exhausted echelons with fresh ones. This principle depended on army groups supported by Material Technical Support brigades, and the main means of transportation were railways and pipelines. However, modern Russia lacks the capability to mobilize and sustain a multi-echelon force for a prolonged war. After a major transformation in 2009, Russia modernized its operational concept and replaced the Soviet logistics system with a leaner one involving downsizing and outsourcing, which was largely untested in combat operations. Military planning in Russia follows a strict hierarchical, top-down structure, with the Force Commander choosing the course of action and the commander’s staff detailing how to proceed. The logistics planning follows predefined principles, well-exercised scenarios, and calculations of ammunition consumption and attrition. Logistics on the army group and brigade levels are standardized and largely follow the same principles as they did in the Soviet era. However, a recent assessment of the future development of Russian military capability asserts that the main restriction of the Russian Armed Forces will not be availability of forces, but logistics.

ZAPAD-2021: PLANNING AND PREPARING LOGISTICS FOR
A WAR?

The Russian military exercises before the war with Ukraine included logistics planning for supply, maintenance, medical services, and transportation. The Zapad-2021 exercise had a detailed logistics plan, but it was unclear if it covered the war. Reports suggest the exercises were preparations for an invasion, and the invasion plan was likely known beforehand. However, logistics planning may not have been involved. The Russian logistical problems in the early phase of the war had a negative impact on their military capability. The initial logistics plan for the invasion involved locating supply hubs at strategic railway junctions and distributing supplies by trucks.

Main Reasons

Inadequate preparation

According to Per Skoglund, Russia’s military equipment was in poor condition even before the Ukraine war. The recent Zapad 2021 exercise conducted along the Ukrainian border with Belarus may have worsened the situation as units probably did not have enough time to maintain and service their equipment and vehicles, resulting in a “supply debt.”

Railroad-based Russian logistics

These findings are based on assumptions about Russia’s logistics, which rely heavily on transportation by rail. Due to successful attacks on rail connections by Ukraine, it became challenging for Russian logistics brigades to support their units. Researchers estimate that most ground transport in Mariupol was used to carry artillery ammunition due to the extensive shelling. This shortage of resources reduced the intensity of the battle, delayed movement of units, and continued to be a problem for Russian forces, according to Per Skoglund. When Russia succeeded in eastern Ukraine, they faced logistical challenges due to the distance from railway hubs.

Failed attempt to seize the airfield

The Russian forces had prepared for a brief invasion and equipped their troops accordingly, intending to capture the Antonov Airfield near Kiev to establish a logistics base. The failure to capture the airport left the units outside Kiev without adequate supplies, and although they had enough for five days, they managed to stay longer in the area. This shortage of supplies is likely the reason for looting and a lack of food, water, and equipment for the Russian soldiers, according to Per Skoglund.

Hierarchical command and control system

The command and control structure of the Armed Forces played a significant role in their inflexibility. For instance, the truck convoy that was stalled outside Kiev highlights the hierarchical command system’s impact on logistics.

“This became apparent when the truck convoy came to a halt outside Kiev. Not knowing what to do, they asked for direction from the General Staff, who decided that they were to give up and redirect resources. The situation was handled at the highest level which took time.”

Sources: Russian Logistics in the Ukrainian War: Can Operational Failures be Attributed to logistics? Scandinavian Journal of Military Studies; Authors: PER SKOGLUND, TORE LISTOU, THOMAS EKSTRÖM

Swedish Defence University – The role of logistics in Russia’s setback in Ukraine.

Russian Military Logistics Russia’s War in Ukraine Series No. 3, International Center for Defence and Security.; Author: Ronald Ti

How are the West’s weapons getting to Ukraine?

The logistical challenges

Up until now, Western military aid has been transported to Ukraine either by land or air, depending on the weaponry involved. However, with Russian fighter jets controlling the airspace over Ukraine, there is a growing concern that these shipments could be intercepted through airstrikes or missile strikes.

Gustav Gressel, a defense policy expert on Eastern Europe with the European Council on Foreign Relations think tank, highlighted that the Russian forces could monitor the routes and transportation methods used by the aid shipments. This situation has now shifted the focus to Poland, which shares a 535-kilometer (332-mile) border with Ukraine and has been a key transit point for the US Army’s equipment and forces. Furthermore, with Hungary’s rejection to allow lethal arms to pass through its territory, the responsibility falls more heavily on Poland.

To ensure the smooth delivery of military aid to Ukraine, an efficient system is required. This system is managed from a control center located far from the conflict zones in eastern Ukraine. However, this control center is critical to the outcome of the war, as the side with superior weaponry and supplies is likely to emerge victorious.

The control center is situated in a large hall at Clay Kaserne, an American base near Wiesbaden in Germany. Military representatives from 17 countries work together daily to coordinate supply lists, inventories, transportation plans, and maps. Officers in military uniforms scurry past one another, conversing in a mixture of British, American, and continental European English, as well as some Ukrainian phrases.

The primary tool used in this control center is the computer. Military representatives sit behind their laptops on a multi-tiered grandstand, communicating securely with armed forces from 41 countries that provide military assistance to Ukraine. These countries include not only NATO member states, but also other partners like Australia, New Zealand, Sweden, and Finland.

The Logistic Center for Deliveries of Weapons into Ukraine

The first mile

U.S. military equipment needed by Ukraine is stored in bases across Europe. Once the weapons and equipment are retrieved from these U.S. stocks, they will be transported via air, truck, or rail across the “first mile.” This distance can range from 600 to 700 miles to NATO territory along the western or southwestern border of Ukraine, including countries like Poland, Slovakia, Hungary, and Romania.

In order to maximize security and prevent Russia from predicting the destination of the equipment, movements along the first mile within NATO territory must be concealed. This first destination is known as a “staging area” and will likely be an armory or ordnance depot located on a NATO base to ensure the security of the equipment before it is transported into Ukraine.

The decision to use a single staging area or multiple staging areas is a critical strategic decision that depends on various factors such as the location of the equipment within Ukraine, the condition of roads and bridges, enemy activity, the origin of the equipment, and operational security. A single staging area is simpler to plan and execute, but it creates significant risk as Russia can easily disrupt the resupply mission by attacking one area across the border inside Ukraine.

Alternatively, using multiple staging areas is more complex to plan and execute but reduces the risk of a Russian disruption on resupply as there would be many locations for the Russians to target.

The middle mile

After the decision for the staging area is made, plans are developed to transfer the material to Ukraine’s military. However, operational security becomes more critical during the middle mile. NATO’s refusal to establish a no-fly zone allows Russia to maintain air superiority over Ukraine, which means Ukraine cannot transport the supplies by air. This forces them to use vehicle convoys to travel from the western border to the next location in the supply chain. Deploying one large convoy is too risky, so instead, the weapons and equipment will likely need to be broken down into smaller shipments and transported in multiple convoys.

The final mile

The weapons and equipment will be transferred to the final staging areas within major cities once they reach the ultimate staging areas. These shipments will be separated into smaller quantities for further distribution to the soldiers fighting on the front lines. However, this last leg of transportation is more dangerous as it involves Russian aerial and ground attacks. To ensure safety, the logistics units traveling the final mile will require protection, including small arms and anti-tank weapons.

When the military equipment finally reaches the combat units at the front lines, it will be distributed to individual soldiers. Although the supply chain for military aid to Ukraine has some conceptual similarities to that of an e-commerce supply chain in the U.S., the stakes are much higher. Any missed delivery could mean that a sovereign nation may not be able to defend itself against an invading force in the long term.

References: Kiel Working Papers, 2218 – The Ukraine Support Tracker: Which countries help Ukraine and how?

FACTORS IMPACTING ON THE OPERATION
OF THE LOGISTICS SUPPLY SYSTEM OF THE UKRAINIAN
ARMED FORCES IN THE CONDITIONS OF WAR – Випуск # 42 / 2022 – Tesnikov Oleksandr – National Academy of the National Guard of Ukraine; Fursova Viktoriya – National Aerospace University named after M. Zhukovsky “Kharkiv Aviation Institute”

European Cousil Report – Think Tank Review 14 March 2023 consilium.europa.eu/en/documents-publications/library/library-blog/posts/think-tank-reports-on-the-invasion-of-ukraine/

Defence-ua.com https://defence-ua.com/army_and_war/jake_same_ozbrojennja_i_v_jakij_kilkosti_otrimuje_ukrajina_vid_sojuznikiv-8521.html

Global Impact on Logistics during the years 2022-2023

The ongoing war between Russia and Ukraine has had a significant impact on the global logistics market at every level. The pandemic-related challenges, such as limited warehouse capacity and container availability, had begun to subside when the war emerged, causing further disruptions. The hostilities have hindered the smooth flow of goods, leading to increased costs and product shortages, including food shortages on a catastrophic scale worldwide.

Russia’s destruction of Ukraine’s agricultural infrastructure has disrupted the entire supply chain, with the blockade of the Black Sea and Azov Sea further exacerbating the issue. Early, Ukraine’s grain shipments were hijacked, worsening the supply chain disruption. However, in July, the two countries signed a UN agreement to unblock Ukrainian grain exports from three Black Sea ports to alleviate the shortages. Nevertheless, shortly after signing the agreement, Russia launched a missile attack on Odesa’s seaport, adding to the uncertainty and turmoil.

As a result of these developments, the supply chains worldwide have experienced a snowball effect, with widespread disruptions and supply shortages.

Rise in Gas and Oil Prices

Following Russia’s invasion of Ukraine, oil, coal, and gas prices saw a significant surge and have since remained unstable. In December 2021, the possibility of a Russian invasion of Ukraine led to mounting volatility in energy commodity prices. Within the first two weeks of the invasion, the prices of oil, coal, and gas increased by approximately 40%, 130%, and 180% respectively. The rising gas prices also pushed up wholesale electricity prices in the euro area.

Since then, there has been a moderation in energy commodity prices, with oil and coal prices standing 27% and 50% higher than their levels before the invasion, while gas prices are currently 11% lower. However, oil prices have recently started to rise again, driven by the EU’s decision to embargo most Russian oil imports and increased global demand due to China’s easing of COVID-19 restrictions. Wholesale electricity prices are currently 8% higher than before the invasion and have remained highly volatile, impacted in particular by policy measures taken in response to the price increases.

Rise of Food Prices

Russia – Ukraine war has had a substantial impact on global food prices, with grains experiencing a particularly sharp increase. However, measures such as the EU’s solidarity lanes (routes created to aid Ukraine in exporting agricultural products) and the Black Sea Grain Initiative have helped to mitigate this effect, resulting in a decrease in prices.

• In Europe, natural gas prices increased by approximately 120-130% within the six months following the start of the war, while coal prices rose by 95-97% during the same period.
• The prices of soybean, corn, and crude oil – products of which Russia is the leading producer – have been steadily increasing since the start of the war.
• The pandemic has already led to a surge in demand for fertilizers, primarily for crops and animal feed. As a result, fertilizer prices were already high before the war. Additionally, household stockpiling of various products and the recent shipment crisis have further exacerbated the situation by causing shortages in several areas.
• Russia and Ukraine are key suppliers of fertilizers, and the destruction of farmland and commercial constraints due to the war have raised concerns regarding fertilizer exports, which in turn impacts food and grain supplies.

Logistical Problems: Port Congestion, Limited Container Availability, and Supplementary Costs

Russia – Ukraine war resulted in several ports being closed, which in turn led to an increase in ocean shipping costs. As a result, ships were rerouted, leading to congestion and delays in cargo flows, further exacerbating the already fragile global supply chain. Additionally, sanctions and restrictions prompted a shift from rail transport to ocean transport, adding more pressure and causing a more severe container shortage.

The shortage of containers and other logistical difficulties resulted in substantial price increases for many essential commodities, such as grains, which rose by roughly 60% from February to May 2022.

Container Shortage

The ongoing war has caused a significant surge in one-way pickup rates in India due to container shortages, creating chaos during the peak shipping season. The U.S. is also experiencing port congestion as a result of canceled orders and delayed shipments, which has led to an increase in container vessels anchored off Savannah and Houston, and a shift away from the U.S. West Coast. As a result of these issues, ocean carriers are canceling sailings, leading to significant productivity problems at the ports.

On the East and Gulf coasts, high container delivery volume is pushing prices up and resulting in fast-increasing warehousing costs. Warehousing costs rose by approximately 8% from January to August 2022. In contrast, container volume in China has decreased as manufacturing orders are being pulled back, which is impacting congestion conditions at the port.

Despite these challenges, various new projects are being launched to alleviate the situation in the logistics sector. For instance, Fuzhou, the capital of east China’s Fujian Province, launched the China-Europe long freight train named ‘Mindu’ in July 2022. The train is expected to travel 20 days faster than the sea route, providing some relief.

Sources: European Council Data: https://www.consilium.europa.eu/en/infographics/ukrainian-grain-exports-explained/.

International Journal of Mechanical Engineering, Russia-Ukraine war and risks to global supplychains, Vol. 7 No. 6 June, 2022.

United Nations Conference on Trade and Development, The War in Ukraine and its Effects on Maritime Trade Logistics, 28 June 2022: https://unctad.org/system/files/official-document/osginf2022d2_en.pdf