While LDz Cargo, the freight subsidiary of Latvian Railways (LDz), is carrying out large-scale layoffs due to declining cargo volumes, Russia’s state railway earned approximately EUR 287.4 million (USD 324.8 million) last year from transporting Belarusian fertiliser shipments alone.
That amount is 3.47 times greater than LDz Cargo’s total operating expenses in 2025 (EUR 82.77 million) and 12.5 times higher than the company’s total personnel costs, which amounted to EUR 22.95 million.
Before European Union sanctions came into force in early 2022, the Port of Klaipėda handled around 11 million tonnes of Belaruskali fertiliser annually. The port generated approximately EUR 8.74 per tonne, while Lithuanian Railways earned around EUR 5.45 per tonne, producing combined transit revenue of roughly EUR 14.2 per tonne. Lithuania’s rail and logistics sector generated an estimated EUR 156 million annually from these shipments.
In Latvia, the gross revenue generated by the transit corridor before port authority fees, shipping services, freight forwarding and other related services amounted to approximately EUR 10.6–12 per tonne in 2012. During that period, LDz Cargo charged approximately EUR 5.6–7 per tonne for transporting Belarusian potash fertiliser.
After Belarusian fertiliser exports through Baltic ports were halted, Russia became the only viable export route. Moscow subsequently took advantage of the situation by significantly increasing transport tariffs.
According to publicly available information, approximately 11.6 million tonnes of Belarusian potash fertiliser were exported through Russia’s logistics system in 2025. Total logistics costs amounted to approximately EUR 42 (USD 48) per tonne, generating around EUR 486 million (USD 557 million) annually.
Russian Railways alone received approximately EUR 25–26 (USD 28) per tonne, resulting in annual revenue of roughly EUR 287.4 million (USD 324.8 million). Those revenues also contribute to financing Russia’s war effort against Ukraine.
Industry representatives estimate that if these cargo flows were transported through Latvia instead of Russia, the Latvian economy could generate approximately EUR 125 million annually through taxes, railway services, logistics operations, cargo terminals and related industries.
Meanwhile, due to a sharp decline in freight volumes, LDz Cargo plans to lay off 300 employees across Latvia this autumn, including around 150 workers at its Daugavpils operations.
Overall, Daugavpils is expected to lose nearly 700 jobs, as the international outsourcing company Concentrix and Grīva Prison have also announced collective redundancies.
For the city, this represents a major socio-economic challenge. Daugavpils Mayor Andrejs Elksniņš has argued that the state is effectively “sending a clear signal that it is withdrawing from Daugavpils.”
Preserving even part of these jobs would provide significant support to the region. However, many of the jobs linked to freight transportation have disappeared because of sanctions that, according to critics, have ultimately benefited Russia rather than the Baltic economies.
Read also: Russia cashes in: Fertilizer exports generate billions for the aggressor state