Shorter trade route to China covered by Lloyd’s

6 May 2008

Beijing skyline
The Far East Land Bridge will link European cities and cities in north east China, such as Beijing.
An innovative new rail container service that links Europe with China opens this month, with cargo insurance provided by Lloyd’s.

Catlin Syndicate is leading the cargo insurance coverage for goods transported on the 11,000km Far East Land Bridge (FELB). Lloyd’s insurers Canopius and Ark are also on the slip. The insurance, which includes all risks of physical damage, is arranged by Ramon International Insurance Brokers, the specialist Lloyd’s broker.

The first trains operating on the FELB have already left Harbin in northeast China and Zebaykask in Southern Siberia. When fully operational later this year, the FELB will provide container transport via rail between countries such as Germany, Poland, Austria and the Czech Republic and cities in north east China, including Beijing and Harbin.

The FELB will cut in half the time it takes to ship goods between European cities and the Far East. Sea-based container shipments between Vienna and Beijing currently take up to 36 days to complete the 20,000km sea voyage. There may also be time lost to port delays.

In comparison, a rail shipment via FELB will take as little as 15 to 18 days.

FELB, which uses the Trans Siberian Railway and the Chinese rail network, has secured special customs and tariff arrangements to allow “block trains” to move in both directions non-stop.

Containers will be monitored at least twice a day at 37 checkpoints along the route. Containers will be transferred between the Russian broad gauge rail system and the standard gauge used in China and Europe at EU crossing points on the Ukraine border and the China/Russia border.

Howard Franks, deputy marine business group leader for the Catlin Syndicate, said the FELB offers an attractive alternative to traditional sea routes. “Over time, FELB should become one of the most important methods of shipping goods between Europe and China,” he noted. “The Catlin Syndicate is proud to have played a leading role in providing the necessary insurance coverage for this important new project.”

Every year the equivalent of around 12 million twenty foot containers are shipped by large container vessels to and from hub ports on each continent. Containers go by rail or by truck to the hub ports, or to a minor port from which a feeder vessel transports them to the hub.

So called multimodal transport is vulnerable to interruptions. Port congestion and the conflicting schedules of feeder vessels and ocean ships can cause delays and sometimes necessitates splitting of consignments.

On the Western side, FELB serves Central European countries like Austria, Hungary, Czech Republic, Slovakia, Poland and Germany. Northern Italy and France will come within its range once the proposed new Barcelona-Kiev rail corridor is operational.

On the Eastern side, FELB reaches Beijing and the provinces of North East China, in particular the cities of Shenyang, Fushun, Chanchun, Harbin, and Qiqihar, with container transfer at Manzouli/Zabaykalsk. In the near future, FELB will also use a Mongolian route via the terminals at Erenhot/Erdene.


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Last updated on 06 May 2008