| By Bruce Upbin

The northeastern Chinese city of Hunchun is like many of the country’s smaller boomtowns, continually fed by an influx of rural jobseekers looking for factory work. China is building a new six billion dollar passenger high-speed rail line to connect Hunchun with the provincial capital of Jilin to the east. That said, Hunchun is a bit off the beaten path, tucked into a nook between the borders with Russia and North Korea. Geography has enabled Hunchun to become the largest logistics terminal in the region, preparing textiles, electronics, grain, and automobiles for export.

Hunchun could become an even more influential export hub if it had better access to the Pacific. Currently, it is cut off from the coast by rugged mountains and Russia’s Primorsky Krai region to the west and south. In winter months, roads are often impassable.

China would like to see Hunchun connect to the sea and Russian economic planners have long had their eyes on developing better, faster links between China’s interior and Russia’s deep water, ice-free ports along the coast south of Vladivostok. Demand for the export of goods from Hunchun’s logistics center is projected to surpass 40 million tons per year by 2030. There happen to be a couple of optimal places to build a port. One of them is the seaside town of Zarubino, which had long been a fishing village until the Russian government began taking steps to develop a cargo export operation there several years ago. With a little vision, investment, and long-term planning, Zarubino has the potential to become an important stop on the global cargo circuit. All it needs is a direct, high-capacity link back to Hunchun and its surrounding region.

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That’s where the Hyperloop enters the picture. Hyperloop is a new mode of passenger and freight transportation that uses a custom electric motor to accelerate and decelerate a levitated pod through a low-pressure tube. It’s autonomous, energy-efficient, and safe. Since the vehicle is fully enclosed inside a steel tube, the system is immune to weather hazards and pilot error and runs continuously. Pods will glide silently at airline speeds for miles with no turbulence and very little energy use along the way. The idea of high-speed travel in vacuum tubes has been around for decades, but this particular concept was popularized by Elon Musk in a research paper in August 2013. Hyperloop One is the only company currently building a full-scale system and will be testing its prototype in 2017.

Hyperloop One began working with Russia’s transport ministry in 2016 to explore the feasibility of a commuter link in the Moscow area as well as a cargo route in Russia’s Far East. Last month, Hyperloop One and Russian investment firm Caspian Venture Capital (an investor in Hyperloop One) presented a preliminary feasibility study for the use of a Hyperloop One system to move cargo containers between Hunchun’s logistics center and the planned Zarubino port. The study, carried out by Russian transport institute MGTNIIP, confirmed that the system would generate a sizable operating profit at a throughput of six containers per minute, 20 hours a day, 365 days of the year.

The planned route calls for twin Hyperloop tubes on columns threading through 65 km of terrain between Hunchun and Zarubino. The route is short enough to be an affordable first investment and long enough to take advantage of the energy efficiency of Hyperloop cruising speeds. The project, as proposed, would be built in two stages commencing in 2020 and 2023 with a total estimated capital cost of $1.5-$2.3 billion. By the time both stages are completed and operational, the Zarubino Hyperloop will be capable of carrying 1.3 million TEUs per year, just shy of the current volume at the ports of Houston, Genoa, or Fuzhou. (A TEU, or twenty-foot equivalent unit, is a standard unit of measure in the container cargo business.) The system, when fully operational, would generate an estimated $250 million in operating income per year with $77 million in annual operating costs.

Hyperloop is often touted for its potential to reach speeds of 1,000 km/h, but speed is not the primary benefit in cargo applications. Shippers want availability, or system uptime, which is one of Hyperloop’s advantages over rail or roads. Being an autonomous system enclosed in a tube eliminates a lot of safety hazards such as grade crossings, but also takes weather and operator error out of the equation. The cargo will still be moving rapidly: average speeds attainable on the proposed line would be 540 km/h. Shippers also get flexibility. A Hyperloop can send a container when it is received instead of waiting for a mile-long train to be loaded with hundreds of other containers. Its magnetic non-contact traction allows it to climb grades three times steeper than the 5 percent for traditional freight rail, which will come in handy in the mountainous region between Zarubino and Hunchun.

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If the project gets the green light from Russian and Chinese authorities, it will take two or three years to prepare the detailed feasibility study and to work with regulators to update the operating framework before construction begins in earnest. Project co-developer Caspian VC is the venture arm of Summa Group, a diversified industrial firm based in Moscow with interests in logistics, oil pipelines, and port infrastructure. Its chairman Ziyavudin Magomedov has made it a goal to bring Hyperloop to Russia and envisions a day when cargo can zip overland at subsonic speeds from China to Europe across the vast Russian interior. It’s a wildly ambitious idea with world-changing potential, reducing the time it takes cargo to get from East to West from weeks to hours.

A millennium ago, the rise of the Silk Road opened Central Asia and the Far East to global trade. One hundred years ago, Russia opened its own frontier by completing the epic Trans-Siberian railway. A Hunchun-Zarubino Hyperloop would propel Russia to the forefront of transport innovation and could be the first step toward the twenty-first century Silk Road.

Bruce Upbin is Vice President, Strategic Communications at Hyperloop One.

This essay is part of our Big Question series.