Global rail freight tipped to increase significantly

Industry News | | MIC Customs Solutions |

More companies are sending their products by rail.

It has been predicted that global rail freight will increase rapidly in the coming years as businesses seek to take advantage of the opportunities railways can provide in moving goods.

According to the Global Rail Freight Transport Market report published by 360 Market, an increase in global trade is tipped as one of the major reasons for growth, having risen by 4.3 per cent in 2017 alone.

Rapidly growing markets in the developing world, urbanisation and rising disposable incomes were also highlighted as other reasons for anticipated rail freight growth by 2023.

The report also pointed out that developing infrastructure and the adoption of advanced technologies are more key factors in driving growth of rail freight transportation and services.

However, another major reason why rail freight is making a major comeback is efficiency. Moving goods by rail is significantly cheaper compared to other methods of transport because more can be sent at any one time, plus it reduces the use of fuel and therefore lowers emissions.

Indeed, rail transportation can reduce emissions by up to 70 per cent compared to moving products by road - and it is also more efficient than shipping by sea. This is particularly significant at present, when cargo providers are being required by law to reduce their carbon footprints.

Meanwhile, while road transport remains dominant in most countries, factors like congestion are increasingly shifting the focus towards rail freight movement. The report explained this is driving demand for services alongside the railways, such as warehousing, consolidation and customs clearance.

It was predicted that global rail freight transport will be boosted further by projects like China's One Belt One Road initiative connecting the east to the west, and by various bilateral and multilateral trade agreements resulting in transcontinental freight movement between countries.

Many businesses may already be thinking of making more use of rail freight, but it is worth remembering that regulations governing customs compliance must be adhered to when moving goods by rail just as they would when sending them by air or sea.

If products cross national borders, importers and exporters need to ensure they complete the relevant paperwork, including customs filing, origin calculation and other relevant information.

Should you be at all unsure about your own company's compliance, feel free to contact us. MIC is a specialist in global customs and trade compliance and offers tailored customs software solutions to support multinational and multiregional customers.

However you're transporting goods, we are sure to be able to help you.