“Everything is changing before our eyes.” Head of Freeport Riga Shipping, penalties and opportunities

How might the shipping structure change? Can the port attract other goods?

I think there will be pills. The planting season begins slowly. Now the grain is in a wait-and-see mode: it’s in warehouses, waiting for prices to rise. We also have more and more new container routes, and new container product groups appear. In the spring of last year, we have already “written off” coal, not taking this into account in our budgets and plans, but since October of last year, coal is back: it is transported by rail, reloaded at the port. Now the share is not large but the volume has increased compared to last year.

Where do we get coal? Aren’t the goods subject to penalties?

From different places – something comes from Kazakhstan, something from Russia, which has not yet been subject to sanctions. Everyone is closely watching what happens to the sanctions. Because coal will become penalties not today, but in August. There are mountains of coal in Krivosala. Ship arrived, everything loaded.

In fact, railways are the busiest at the moment. They are looking for new ways, for the same coal: there are a lot of coal mines in Kazakhstan and they want to supply Europe, and this coal somehow needs to be delivered to Europe. One way to do this is through Riga. We don’t actually consume charcoal locally, nor do we use it as fuel at all. But Europe, especially France, Germany and Spain, is drowning in it.

The good thing about Krievusala is that there are wind barriers that prevent coal dust from entering the city. And at one of the stations, a modern system was built that allows you to unload coal from the wagon directly to the conveyor and onto a ship – you do not need to reload anything. There are also sprinklers, as in ski resorts, but they blow not snow, but water, because coal dust is scattered. Everything is done to ensure minimal impact on the environment.

Apart from this coal and mineral fertilizers, what shipments are Riga’s priority now?

Grain, wood, containers – these are our main whales. They made the whole role. Much wood is transported, both on the left and right bank of the port. We have large companies on the left bank – Latvijas Finieris, Kronospan … a lot of timber is exported. But there are many other companies that are already exporting the finished product from wood, with Latvijas finieris producing and removing plywood. Also there are molds, pallets. Two years ago, a lot of pallets came from Belarus. But due to its radioactivity, the supply was stopped. There are also those who bring in the roundwood, unload it at the port, process it into boards, put it back on the trucks, and take it away. Transportation methods are different.

Let’s get back to investments. What projects will you definitely not refuse?

One of them is called “Tvika Street Bridge” or the bridge to Kundzinsala. This is the project of the century. Well, well, the project of the century was Krievusala when we built the new terminal, but this is also an important project so that the trucks going to the port do not create congestion on the main city streets. It will also reduce the load on small streets. This will facilitate the work of the Kundziņsala stations by adjusting the entry speed of the truck, which will allow these stations to operate faster and more efficiently. Because Kundziņsala is a region where the port and private entrepreneurs are investing more and more money. And if Kundziņsala develops, the turnover of goods, trucks, trains and ships will be greater.

Does this mean any companies from other places will move there?

This could happen, but it’s not likely. In the context of Kundziņsala, we are talking about new and very large projects for international players who want to reside in the port of Riga, who need a berth, a certain square meters, connections with transport hubs, and are ready to invest money here.

What groups of goods will they be directed towards?

We look at the so-called complex cargo, when not only recharge is carried out, but there is also an added value – the cargo has arrived, some of it is collected, and then taken away. Now I can’t name these major players, but these are not local companies. And we don’t focus on grains or ammonia or anything like that. These goods will be in containers or non-standard shipments that must be transported on special vehicles. Non-standard products that do not fit on a single trolley or platform.

Is it planned to connect the Kundziņsala Bridge to the Eastern Highway and the Skulte Overpass? But, as far as we know, now the work on the Skultsky bridge has “slowed down” a little. Will it affect your plans?

This is another problem. Because of the crisis, the prices of all raw materials – metals, bitumen, etc. – have risen higher than they were due to higher prices during the epidemic. And already there are problems in Skulte bridge. The builders who build our houses also note that there is a risk of price hikes. The second problem is the risks of unavailability of materials. You can pay whatever you want, but it is impossible to get the materials, so the next problem looms – timing. We must complete the construction of the bridge by December 31, 2023, and if we delay delivery by 3-4 months or half a year, which no one can predict now, the question is not about money, but about the universe in time. We are trying to solve problems with the Riga City Council and the responsible ministries at several levels, so that in the end, as a country, we do not lose the EU funds that have already been received for the launch of these projects. If we stop them now, we can only end them in 20 years.

Will there be a benefit to the residents of the neighboring areas? Not many like that a noisy bridge is built under the windows.

The Kundziņsala Overpass will remove loads from smaller streets, such as Emmas and Meldru Streets in Vecmilgravis. Bicycle paths have also been planned on the bridge. The entrance to the port will be completely different – it will finally be European, with a modern customs office and a car park, where trucks can enter, which now pile up on Ulriekstes Street and overburden the rest of the infrastructure. Plus there will be noise barriers.

There were plans to modernize the sidewalks …

Several new berths are needed on the left bank – the stations are developing and planning to expand production. We go to meet them and build or help build docks where big ships can enter to make shipping operations faster. This is necessary in order to increase cargo turnover, accept large vessels and increase competitiveness.

For example, last year we deepened the berth in Krievusala, and now we can accept even larger ships, giants with a maximum draft of 17 meters. This automatically gives the port of Riga a greater advantage over Klaipeda and Tallinn. We are in a different league now. Last week, the largest ship in history, the size of three football fields, arrived.

The plan also talks about digitization. What does this mean for the port?

It is planned to invest about one million euros in this project. The system will help us receive information about the situation on the roads before the arrival of the ship, train or truck, about the speed of movement of goods. It may seem that making electric gates is easy. But this is a very complicated process, because when entering the port it is necessary to take into account that this is a special economic zone – that is, it is also a border crossing.

In order to raise the gate, it must interact with a number of different institutions: the port, the station, the border guard, the customs, etc. – all the systems must converge at one point so that we can see the vehicle as it arrives number, documents, cargo and driver. This is the basic building block of our progress towards the so-called digital twin, where we will have the entire port not only in physical form, but also in digital format, when we sit at a computer and see information from sensors, even about wind, runoff and water level in the Daugava.

We have started negotiations with the Riga City Council, this information will also allow Riga to plan more efficient traffic regulation, to understand how to direct public transport, where to install road signs and traffic lights. There are a lot of practical problems here. For example, when the grain season comes, classically in the second half of summer, there is a very large influx of trucks. They all start from the starting point, be it Gilgava, Liepaja, Valmira, but they are all here at ten in the morning, at the port gate. They stand in line burning fuel and creating problems for other vehicles and buses. That’s why we also think about indoor parking and notification systems so that each of these drivers arrives at a specific time when the station is ready to serve them. Then these drivers will be able to come twice a day.

The digitization of data and the transition to the digital twin will allow port operators (more than 200 companies, 36 of which are the largest) to use our data. And the country will eventually receive a full set of data on freight flows, which did not exist before. We can already start modeling: for example, if there is a breakdown or accident in one place, and traffic jams in another, then conclusions can be drawn not only at random, but from an evidence base.

As far as I understand, the port will not be associated with the Baltica railway. Is this some kind of miscalculation in planning?

We are studying the possibilities of connection: how much will it really cost, how much time will it take, because Rail Baltica is also the project of the century, but for passenger traffic growth. Someone must pay the costs associated with the transportation of passengers. In fact, the connection to the port where the shipments go is very important to the sustainability of Rail Baltica itself, because the state should not support this connection on its own. Freight compensates for the cost of transporting passengers.

We are moving in two directions. First of all, in order to reduce the number of trucks on the streets of Riga, we are trying to create a mechanism for switching to local transport. Those traveling with goods from Valmira, Reisken, Daugavpils, etc., transporting it on trains as often as possible so that they do not have to use trucks. The train takes up much less space.

Second, the shipment must somehow reach the port. In this sense, the train is the most economical mode of transportation. Of course, there are nuances, if you have to travel 200 km or there is not a lot of cargo to load the wagon, then it will be more profitable to come by car. But we work with Latvijas Dzelzceļš on a daily basis and see that such an inland transportation is suitable for us. There are challenges with wagons, couplings, and platforms, but now, due to the critical geopolitical situation, this is clearly one of the paths we must take.

Therefore, we are looking for ways to “extend” part of the Baltica railway to the left bank. The first step is to make sure that this new route isn’t built in such a way that the port can never connect to it. Our first idea was as follows: we can put parallel rails in Zasulauks, make two turns in the opposite direction and immediately go to Krievusala, change the scale to a narrower one … But there is another problem – a passenger train will go there to the center of Riga. This automatically makes things more difficult for us, so we think about alternatives. Our desire is not enough. The country also needs to understand: do they just want to transport passengers on the Baltica railroad and pay for this expensive infrastructure themselves, or can we join forces to make the project pay off?

Our proposal is to open new hubs and connections for the port, for the development of Riga and Latvia. So one of our plans in Spielva, the place where almost nothing happens now, is to build an industrial park. Spilva can become a platform for modern industries, workplaces and laboratories. This is a new way of showing that the ports are not only involved in transshipment, but also in the creation of added value, where, ideally, there is an additional flow that can be reloaded and transferred through the terminals, but there are also components that are brought into Latvia and something is produced here in place .

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