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    1960-1980

     
    The 60-80s: keeping up with the times.

    Active development of transport in 1960-1970 was accompanied by intensification of reloading operations, containerization of transportations, growth of volumes of specialized tonnage, and international monopolization of navigation. The shipping monopolies proclaimed the abolition of forwarding intermediation in the organization of the transportation process in mixed communication lines, which met with discontent and opposition from medium and small businesses and even state organizations. These contradictions allowed JSC “Sovfracht” to overcome the consequences of the "Cuban blockade", the "Oytra" forest association and other speeches against the activity of Soviet shipping companies and foreign trade associations on the international market.

    More than a half of the foreign trade turnover of the USSR fell to the share of the socialist countries. At this time,in the JSC “Sovfracht”  there were some new directions - for example, transportation of sugar and oil products from Cuba. JSC "Sovfracht" had to work in the conditions of a difficult foreign policy situation, an economic blockade, organized by Anglo-American monopolies. For example, the company “Standard Oil Of New Jersey” announced a boycott to ship owners, who chartered ships in JSC “Sovfracht” to transport cargo to Cuba.  Employees of JSC “Sovfracht” sometimes had to call themselves citizens of other countries or  employees of foreign companies, however, despite all the difficulties, JSC “Sovfracht” provided all the transportation with the necessary amount of tonnage. After the deployment of missiles in Cuba in 1962 by the Soviet Union, the United States established a naval blockade of the island. Being exposed to considerable risk, our ships, overcoming the blockade, delivered important cargoes to Cuba.

    The period of 1960-1970 – is the time of the technological revolution in transport. Transportations became more technological, the role of information exchange between all participants of the logistics chain increased. Containerization of transportation required to pay increased attention to ensuring the stability, reliability and regularity of the service, because our container building base differed from the shipbuilding base. The ships, coming out of the building, were needed for special container equipment, and the shippers were waiting for the containers for loading on demand, which was strictly observed by JSC “Sovfracht”. In 1976, in Hamburg, JSC "Sovfracht" was established the company "Transglob", which assumed the functions of centralized tracking of the movement of each Morflot’s container in a foreign communication and providing a centralized organization of repair and monitoring of the technical condition of containers in accordance with the international requirements. Moreover, an agreement with the Ministry of Railways of the USSR on the equal exchange of containers between shipping companies and railways was concluded. 

    Technological progress, economic and political situation, the level of development of the world transport system required transportation organization that would maximize the use of the available material resources. Here employees of JSC “Sovfracht” were on top, offering bold and unconventional solutions that had not previously been encountered in the world. For example, in 1962 A. Zimmerman, an engineer of the Odessa department of JSC “Sovfracht”, offered to transport cars simultaneously with other cargoes, which made it possible to ensure the full loading of the ship. Only in 1962 this offering allowed saving 862 thousand rubles on the transport of cars on eighteen ships from Odessa to the ports of Indonesia.

    Since 1972, the fulfillment of the government mission to provide tonnage for the transport of bulk cargoes from the USA and Canada was very important. As a result of adverse climatic conditions in 1972, the Ministry of Foreign Trade concluded a contract for the purchase of grain in the USA, but an obligatory condition was the participation of the American fleet in these carriages. In the autumn of 1972, for the first time in many years, Soviet ships visited the ports in USA. The first 9 American tankers were chartered for the transportation of grain to the USSR and in early 1973 arrived in the ports of the Black Sea. In the American freight market and among representatives of the American business community, there was a growing interest in increasing share of the Soviet merchant marine fleet in the freight of foreign charterers and in activating of activity of the JSC “Sovfracht”. In January 1976, JSC “Sovfracht (USA) Inc.” was registered in New York, all shares of which were belonged to JSC “Sovfracht”.

    “Sovfracht (USA) Inc.” worked with 140 American companies and received the main income mainly from American ship owners. The professionalism and business interest of employees of “Sovfracht” allowed to charter the necessary tonnage for mass transportation, without raising rates on the global freight market (later in the West appeared a book called “The Great Grain Robbery”). The Western press noted the following: “The question remains whether the events that took place in the last 18 months were planned by the Soviets, or whether their activities were the result of an unrivaled ability to adapt to the constantly changing market conditios… ” («Seatrade», 1974).  Nevertheless, with the help of ships, leased by JSC “Sovfrakht”, with the right to further transfer of these ships to the ownership, the merchant fleet of our state has significantly increased. In 1978, four Soviet cargo lines operated on cargo transportation between the ports of Europe and the ports of the East Coast of the USA and the Gulf of Mexico: “Gulfmed”, “Baltgulf”, “Baltatlantic”, and “Medatlantic”. In addition, freight lines "Fesco" (Far Eastern Shipping Company) served the linear transportation between the ports of the West Coast of the United States and the countries of the Far East.

    In the end of 1979 relations with USA deteriorated, and in 1980, after the entry of Soviet troops into Afghanistan, America declared an embargo on the supply of grain to the USSR. The leadership of the trade union of dockers of the East Coast and the Gulf of Mexico announced a boycott of Soviet ships and cargoes. At that time, 236 foreign ships were on lease at JSC “Sovfracht”, which were supposed to transport about 14 million tons of grain. Such actions were aimed at inflicting maximum damage on the Soviet side, however, due to the professionalism of Sovfracht's employees, the damage turned out to be significant, but not at all that was expected in the USA. "After the excitement in the market in January, connected with the US embargo on the supply of grain in the USSR, in February the impact of the embargo on the market weakened. It was not expected that Russians will avoid the direct effect, which was announced embargo on the provision of cargoes with a large number of ships already sent for loading into US ports. The redirection of ships to other ports of loading, such as the ports of Argentina, was not surprising and logical, but few charterers foresaw the rapid chartering of a large number of ships chartered into other charterers (an English edition " Shipping World and Shipbuilder "). In the 1970-1980's JSC “Sovfracht”  had 26 mixed freight and agency companies (in the UK, USA, France, Germany, Italy, Belgium, Greece, Finland, Japan and other countries) with 57 subsidiaries in 24 countries. These companies accounted for about a half of the volume of chartering of Soviet tonnage, 2/3 of the volume of chartered inotonnage and more than 60% of calls by Soviet ships to foreign ports. JSC ”Sovfracht” also had representative offices in 90 countries around the world, through which, in particular, the agency service of Soviet ships abroad was organized and controlled. Business contacts of JSC “Sovfracht” consisted of more than 1500 brokerage, ship-owning, freight-forwarding, agency and other firms.

    JSC “Sovfracht” also succeeded in securing the establishment of a linear fleet in shipping companies in the Department of Specialized Economic Operational Units (linear self-supporting operational groups of ships). The management of linear navigation was carried out according to the scheme "Sovfracht - linear HEGS of the shipping company - agent network". The division of the property and economic function carried out by the shipping company, from the technological and operational functions, performed by the linear HEGS, the leadership of the Ministry of the Navy was soon extended to the regular and special fleet (refrigerators, timber trucks).  This practice provoked interest in the West. There was a new form of fleet operation - ship management. Since 1988, the contractual form of relations between the PJSC “Sovfracht” and the ship owners in the field of agency of Soviet and foreign ships in foreign ports has begun to apply: PJSC “Sovfracht” concludes economic contracts with all river and sea shipping companies that confirm the right of the Association to act on their behalf as a broker.