Transport Ministry: Halting Grain Transit Could Cost the Sector About €290 Million a Year

Latvia's Transport Ministry has calculated in a report that halting grain shipments could cost the sector roughly €290 million a year. The figures matter as the government weighs how to handle Russian grain transit by rail.

Estimated losses

The state-owned railway company Latvijas dzelzceļš (LDz) would lose about €40 million annually, while port terminals, carriers and other related businesses would lose a further €250 million combined. The ministry stresses that LDz's lost revenue would have to be compensated from the state budget to maintain the company's financial balance required by law. In 2025, LDz received €75.4 million from the state budget.

In a hypothetical calculation, one million tonnes of grain brings about €3.3 million in revenue to the railway infrastructure. Carriers, ports, terminals, elevators and other firms earn additional income, which LDz estimates at €15–25 per tonne.

The report also warns that the disappearance of transit cargo could make domestic rail freight more expensive: costs could rise from about €10 to €25–30 per tonne, affecting the logistics of grain, wood pellets, fuel and other goods.

Government position

After a cabinet meeting on 13 October, Prime Minister Andris Kulbergs said Latvia currently cannot raise rail infrastructure charges for Russian grain transit by 300% or ban it outright. The matter will be discussed in Brussels. Last week Kulbergs, Estonian Prime Minister Kristen Michal and Lithuanian President Gitanas Nausėda sent a letter to European Council President António Costa and European Commission President Ursula von der Leyen, urging a ban on Russian grain transit through the European Union.

According to the prime minister, a ban would expose Latvia to litigation risk of €200–800 million, while Lithuania is involved in a similar case worth €12 billion.

Since 13 October, a decision by LatRailNet, an LDz group company that sets infrastructure fees and allocates capacity, has taken effect: charges for Russian grain transit rise by an average of 25% until the end of the year.