As of May, the volume of RZD shipments dropped 9.4% compared with the same period last year. Nearly every cargo category saw a downturn, with some recording double-digit declines. Coal shipments dropped 3.4%, oil and oil products 5.8%, and container traffic 6.2%. Transport of building materials fell 20.7%, ferrous metals 16%, industrial raw materials 19.2%, and grain shipments plunged 34.8%.
Slowing economic growth, construction sector crisis, and international sanctions have all contributed to the degradation. Ukrainian drone attacks, however, have hit Russia’s rail infrastructure hard. A source with the industry publication Gudok (closely linked to RZD) said the strikes in 2025 reached unprecedented levels.
“Drone strikes directly affect rail operations; RZD doesn’t discuss it, but it clearly hampers the transport process: when a strike happens, rail traffic stops,” the source said.
Reuters sources close to the company said the war against Ukraine is behind many of RZD’s problems. Massive military shipments amid the conflict have thrown Russia’s rail network into chaos, with thousands of idle trains and significant delays.
“The system was working normally, but then everything changed—[commercial] cargo is headed east [to China and India instead of Europe], defense shipments now have priority, and the railways simply can’t cope,” one source said.
In addition, sanctions have led to a shortage of parts for rail transport, while mobilization and recruitment for the war have resulted in a severe labor shortage.
“Train drivers either left for what Russia calls its ‘special military operation’ or moved to the defense industry, nobody is left to drive the trains,” another source added.
With falling revenues and a sharp rise in borrowing costs, RZD was forced to trim its planned investment program by nearly 40%, cutting spending from RUB1.3 trillion ($17 billion) to RUB834 billion ($11 billion) for 2025. In May, the company approved an additional RUB32.5 billion ($421 million) budget cut to reduce spending on railway tracks, locomotives, and rail cars.