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Record Volumes and a Wartime Windfall
China-Europe rail freight registered its strongest start to a year in recent history, with train trips rising 31.7 percent year-on-year to 3,501 in the first two months of 2026, as the outbreak of armed conflict in the Middle East redirected cargo flows away from traditional sea and air routes toward the overland land bridge.
China State Railway Group reported that the network carried 352,100 TEUs of cargo in January and February, a 25.2 percent increase on the same period in 2025. The figures stand in sharp contrast to full-year 2025, when total trips grew just 3.2 percent to approximately 20,000 and overall cargo volume fell 1.3 percent to roughly 2.1 million TEUs.
The directional split tells an equally striking story. Outbound trips from China jumped 47.5 percent to 1,736, carrying 181,200 TEUs, while inbound traffic rose 19.2 percent to 1,765 trips and 170,900 TEUs. The rebound aligns with a 12 percent rise in China-Russia bilateral trade to approximately 39 billion dollars in early 2026, following a period of contraction.
The Iran Factor: A Supply Chain Shock That Rail Is Absorbing
Joint military strikes on Iran launched on February 28 by the United States and Israel have severely disrupted transit through the Strait of Hormuz, one of the world’s most critical energy and cargo chokepoints. Vessel traffic through the strait has fallen sharply, with more than 150 tankers reported waiting outside the Gulf. Maersk, CMA CGM, MSC, and Hapag-Lloyd have each suspended or restricted transits through affected Gulf routes.
Brent crude rose approximately 15 percent in the opening days of the conflict before climbing to around 120 dollars per barrel as markets began pricing in sustained disruption.
Air freight has been similarly affected. FedEx issued a service alert suspending flights to and from Bahrain, Iran, Iraq, Israel, Jordan, Kuwait, Lebanon, Oman, Qatar, the United Arab Emirates, and Saudi Arabia due to regional airspace closures.
With two of the three primary modes of international freight either disrupted or priced out of reach for many shippers, rail’s competitive position has improved materially. The China-Europe Railway Express offers transit times roughly one-third shorter than sea freight and costs approximately one-fifth those of air cargo under normal conditions, positioning it as what analysts describe as a credible middle-ground option for time-sensitive but budget-constrained cargo.
However, the route is not a wholesale substitute for ocean freight. Chris Clowes, associate director at supply chain and logistics consultancy SCALA, cautioned that while rail can serve as a viable alternative for certain goods, it will not displace ocean freight at scale. “Rail can be a credible middle option for some goods, but it won’t replace ocean freight,” Clowes said.
Infrastructure Racing to Keep Up
At the critical Horgos gateway in northwest China’s Xinjiang region, the pressure of rising volumes is already visible. On March 17, the Horgos railway port processed its 2,000th China-Europe freight train of 2026, a new record for the date. The port, which marked its 10th anniversary this month, has handled more than 54,000 such trains since opening in March 2016 and now operates around the clock with departures approximately every two hours, moving over 200 categories of goods.
Smart technology upgrades at Horgos have improved throughput efficiency by more than 20 percent, with a model combining automated train disassembly, transhipment, inspection, and customs release to keep dwell times down.
The eastern corridor has also seen accelerating volumes. As of February 26, the eastern network recorded more than 1,000 train trips for the year, reaching that milestone 26 days earlier than in 2025. The corridor now serves 27 routes connecting more than 60 Chinese cities with 14 European countries.
Industry observers note, however, that a structural bottleneck remains. Unlike ocean or air freight, capacity on China-Europe rail is largely preplanned rather than allocated in real time against market demand, creating entry barriers and limiting the network’s ability to scale rapidly in response to sudden demand spikes. Whether that constraint eases fast enough to absorb a sustained redirection of cargo from sea and air routes will be the defining operational question for the corridor in the months ahead.
