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Corisk Report No 8, 2024
Russia’s foreign trade and
trade costs 2019-2024
Erlend B Bjørtvedt
Oslo / Stockholm, October 2024
In today’s presentation
Background
Per-country commodity trade
Trends among trade partners
Relative losses from cost of trade
Conclusions
3
Background: Corisk sanctions data and analysis
Reports at ResearchGate.net
Corisk AS
Founded 2021 as country risk consultants
Increasing research and advocacy focus
Working with NHC , USAid, B4Ukraine
Publish reports at
ResearchGate
Erlend Bjørtvedt
25 years in the business community
C.Phil in economic history, economics (Oslo)
Courses in globalisation, finance, valuation, etc (Oxford, Stern)
Russia’s per-country commodity trade
Coverage
170 countries, all the 150+ largest trade partners
Assessed as more than 99.5 % of Russia’s trade
Total trade, no distinction between sanctioned and non-sanctioned goods
Iran, Venezuela, Syria, Cuba and North Korea: data are missing “in both ends”
Careful assembly of the trade with ex-Soviet and EAEU trade partners
Data sources
Preferring continuous, same-source time series
Maximum calibration and validation across sources.
Russia: Bank of Russia commodity trade data (balance of payments)
Partners: National commodity trade data (Eurostat, US Census, UNCT, TradeMap, customs, central banks)
When needed, applying Russian customs data (adding 2-10 % trade costs for Russian exports)
Russia’s per-country commodity trade
Sources used, shares of the total trade in 2022 + 2023
Russia’s exports Russia’s imports
(partner imports) (partner exports)
Only partner data 91.87 % 90 countries 92.56 % 79 countries
Partly Russian data 2.99 % 14 countries 4.70 % 19 countries
Only Russian data 5.14 % 66 countries 2,74 % 72 countries
Russia’s total commodity exports CIF and FOB
170 importing countries
Peaked early 2022
Good fit with CBR data
CBR data seem ‘correct’
Consistent with Bruegel
Russia’s total commodity exports CIF and FOB
Clear decline, continuing
Recent exports very low
H1 2024 FOB value is 0.5 %
lower than H1 2023 (net
export revenues)
H1 2024 CIF value is 3.8 %
lower than H1 2023 (gross
export value)
Recording only the first chain
Ignoring LCU values
420
334
494
592
207
436
344
530
634
234
474
424
Russia’s total commodity imports CIF and FOB
170 exporting countries
Peaked late 2021
Good fit with CBR data
2019-2021
CBR data seem ‘correct’
Increasing import cost
(loss) 2022-2024
Bruegel increasingly
under-estimate imports
Russia’s total commodity imports CIF and FOB
Apparent increase in 2023
masks declining trend due to
the fallout in spring 2022
So far, clear decline in 2024
H1 2024 CIF value is 9.2 %
lower than H1 2023 (gross
import payments)
H1 2024 FOB value is 25 %
lower than H1 2023 (net
import value)
Recording only the last chain
Ignoring LCU values
254 240
301
277
303
138
245 231
290
250
125
287
Declining net commodity export component to GDP
Assuming Bank of Russia data
are correct
Commodity trade surplus
peaked early 2022
Declining surplus last two years
Investment, consumption or
services exports must
compensate to uphold GDP
Ignoring LCU values
Changes to the shares of the importers in Russia’s CIF exports (2023 vs baseline)
Turkey + 96 %
Sub-Sah Africa + 43 %
Indonesia + 108 %
Malaysia + 146 %
Western -61 %
UAE + 165 %
India + 762 %
Brazil + 150 %
China + 96 %
Kazakhstan + 24 %
Belarus + 13 %
Ex-Soviet + 12 %
Changes to the shares of the net exporters in Russia’s FOB imports (2023 vs baseline)
Turkey + 119 %
Sub-Sah Africa -7 %
Indonesia -18 %
Malaysia -35 %
Western -36 %
UAE + 190 %
India + 37 %
Brazil -15 %
China + 96 %
Kazakhstan -31 %
Belarus + 54 %
Ex-Soviet + 12 %
Cost of trade
Conventional methodology:
•OECD CIF-FOB margin cost as share of CIF imports
Country-pair analysis
Commodity-level price comparison
Aggregate according to shares in trade
•CEPII Same as above, plus calibration against country-pair and commodity-level
volumes
Corisk methodology:
•No Russian country-level data available
•No Russian commodity-level data available
•Can only compare total levels
•Less accurate methodology
•Some recording errors remain undetected
•Errors will even out at the aggregate?
Russia’s relative losses from the cost of exports
Cost of trade is normally not
computed as share of exports.
Exports less directly impacted
by sanctions (few bans, less
needs of circumvention, little
extra profits to traders).
Oil and gas totally dominate,
possibilities of pipeline fraud.
Export cost in 2020 probably
under-estimated (cumulatively
negative over 9 months Q2-Q4).
Hike in 2021 puzzling, because
crude oil made up lower share of
total exports than in 2019.
Decline in 2022 despite high oil
tanker rates, maybe caused by
nearby European oil hoarding.
Hike in 2023 despite falling oil
tanker rates, Europe ended most
low-cost oil and gas imports.
Russia’s relative losses from the cost of imports
Cost of trade is normally
computed as share of imports.
More directly impacted by
sanctions (many explicit bans,
high need of circumvention).
Cost only in the last chain,
reasonably risk premia and
profits to intermediary traders.
No commodities dominate.
Import costs 2019-2021
remarkably constant.
Hike in 2022 consistent with
increase in circumvention.
Consistently high costs of
import in 2022-2024.
Conclusions
Russia’s foreign trade peaked 2021-2022, declining so far in 2024
From 2022, imports have somewhat larger relative decline than exports
From 2022, net exports still decline in absolute terms as a component to GDP
Bruegel Russia Trade Tracker
increasingly under-estimates Russian imports
Many non-Western markets absorb more of Russia’s exports
Few countries (China, Turkey, UAE, Egypt, Belarus) gain net market shares in Russia’s imports
Western total exports declines less than anticipated, at par with Malaysia or Kazakhstan
Russia’s trade cost of imports behaves as “expected”, sanction risk premia and profits to traders
Full effect of price increases through the whole supply chain are not captured in our analysis
Russia’s trade cost of exports less consistent, little sanction risk premia or extra profits to traders
Unclear if there is any reduction in the costs of exports from the “shadow fleet” (2023-2024)
Need better and more granular trade and price data to improve trade cost analysis