Interesting but contradictory developments are taking place on the Kazakh rail freight market. As national rail operator Kazakh Railways (KTZ) is planning to go public on the stock market, revenues are up and volumes are down. And despite KTZ aiming for higher tariffs, Kazakhstan has instead decided to implement a 70% discount on the transportation of certain products.
The Kazakh rail freight market is going through a mix of hopeful and discouraging trends. For one, the deeply indebted national operator KTZ is planning to start an initial public offering (IPO) to improve its financial situation.
The IPO should have taken place earlier this year, but unfavourable market circumstances forced a postponement of the plan. On Tuesday 16 June, the operator’s head Talgat Aldybergenov said that KTZ is aiming to execute the IPO before the end of 2026.
It seems like those market circumstances have indeed been less than ideal. Between January and May 2026, Kazakhstan recorded a 1.7% decline in the overall rail freight volume (135.68 million tonnes). The country also saw an 11% drop in the freight turnover, amounting to 123.42 billion tonne-kilometres. That is still a high but unsurprising number for the world’s ninth largest country. By comparison, Germany recorded 135 billion tonne-kilometres across all of 2025.
Volumes down, revenue up
Despite the performance decline, revenues grew. They did so not just by a little bit: Kazakhstan’s rail freight sector recorded a 19.7% growth for a total equivalent of 2.11 billion US dollars.
It stands to note that these numbers apply to Kazakhstan’s rail freight industry as a whole, but KTZ holds a (near) monopoly on the local market.
Part of the revenue growth could be explained by strong performance along international corridors. For instance, the volume of rail freight traffic between Kazakhstan and China has grown by 9.3% since the start of 2026, driven by a 17% increase in Kazakh exports and an 8% rise in transit goods. KTZ did not provide data beyond the percentual changes. Container shipments from China via the Middle Corridor also saw a 34.4% increase in the first quarter for a total of 125 container trains.
To support the expanding transit business, KTZ recently completed the modernisation of the Altynkol–Zhetygen railway line. It runs from the border with China westward towards the centre of Kazakhstan. The project involved upgrading 293 kilometres of track and constructing five new passing loops to improve overall railway capacity and reliability.
Discounts where price hikes may be necessary
Despite KTZ’s 8.5-billion-dollar debt situation, Kazakhstan has gone ahead with a major rail tariff discount on particular products. The 70% price reduction applies to over 30 “socially significant” food items and wheat for milling. KTZ will miss out on income there, but Kazakhstan is hoping that it will reduce shipper costs by 40%. This should, in turn, lead to a stabilisation in food prices.
KTZ will likely not be too enthusiastic about the measure, since it has sought to increase its pricing in recent years. The company had long operated parts of its freight business below cost price.