TRANSPORTATION TARIFF REVISIONS

Created: 3/5/1962

OCR scan of the original document, errors are possible

CIA/RRNo<

52

CURRENT SUPPORT BRIEF

TRANSPORTATION TARIFF REVISIONS

office of research and reports

CENTRAL INTELLIGENCE AGENCY

cia historical review program release as8

This report represent* the immediate views of the originoting intelligence components of the Office of Research and Reports. Comments are solicited.

wvtalns informationUnited States,Title 18

USC, Sectionsransmission or

hi any rnaiu*er*Toan unauthorized person is prohibited by law.

TRANSPORTATION TARIFF REVISIONS

Several major revisions of transportation tariffs are planned to accompany the general overhaul of wholesale prices which was announced recently. 1/ The newbe Introduced generally by theofintended bySoviets to influence the development of the transportation systemanner consistent with long-range objectives. 2/ The effectiveness of the revisions will be reduced by such factors as production and inventory requirements. In the past, the shippers pressing need to meet output goals has oftenore important consideration than the rate structure in determining the mode of transportation used.

Railroad freight rates are to be reduced by aboutercent.nitially, the new rates will considerably lower the industry'swhich has been increasing rapidly for several years as aof steady decreases ln operating costs and no Offsetting rate 5 operating costs per ton-kilometer have decreasedercent and last year profits represented nearly one-half of total revenue. 4/ On the average the reductions are to be greater forgoods than for raw materials, reflecting the intention of Soviet planners to encourage the movement of manufactured goods and to reduce the traditional discrimination against this form of freight.djustments will also be made in the rates per kilometer which varyaccording to distance and commodity and which have had the effect of inhibiting the movement of some traffic beyond certain distances.

Percentage decreases in the average railroad rates perhave been announced for the following commodities. 6/

Solidt4

Petroleum

(probably includes crude petroleum)

Chemical

Mineral Construction

Fabricated Construction

Fabricated

(both Ferrous and non-Ferrous)

Industrial and Agricultural

Automobiles (includes

Wire and

All Consumerwhich:

Grain, Bread and

Dairy and Meet

Vegetable

Products of

Inland water freight rates will be lowered an averageercent to stimulate the more efficient hauls. The rates of petroleum will decreaseercent and those on rafted timberercent.esult of these latter decreases inland water transportationhole will again operateeficit even though operating costs per ton-kilometer decreasedercent5 Such a

* There willecrease in the rates for clothing, yard goods,and soap which has not been announced.

reduction would normally be expected to accompany the railroad rate decreases, however,ecessary Inducement to shippers who are reluctant to use the less convenient inland water transport system.

On the first of2 new tariffs wore introduced lntransport designed to stlmulato limited distance intercity freight traffic--up toilometers. 8/ Less than one percent of highway transport is now Intercity in character, the remainder being extremely short haul, mainly local, traffic. The objective of this reform ls to relieve the railroads of short hauls, particularly those which are already mixed rail-highway and thus eliminate excessive handling costs.

Air passenger fares already competitive with rail fares over the longer distances are to beercent on internal routes "this/ This change is consistent with the announced policy of limiting rail passenger traffic growth by making air travel attractive over the longer routes and bus travel attractive over shorter routes. Rail passenger fares are being reviewed and some revisions may be announced later. If passenger fares, last reduced somewhatre not further reduced passenger operations will have become twice as profitable as freight operations.

2

0

3

Sources:

3he Development and Distribution of

Agrlculturc According to the Natural Farming Areas of tneP. H. "Zemskiy,'" Academy of Sciences USSR, , pp. U.

Khozyayetvo SSSR (Agriculture in,tiieoscow.

. U.

FBIS, Dally Report (USSR and Eastern6 Nov 61

p.n

FBIS, Dally Report (USSR and Eastern Europe), ec 61

pp.. U. Selskoyo Khozyaystvo SSSR, op.,. U.

JPRS:lt. , pp. , U.

Selskaya Zhlzn, p. 2. U.

IA. FBIS, Unpublished Economic Item,.. CIA. FBIS, Unpublished Economic Item,. U.

ebruary6

/

Original document.

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