Sea freight rates increase gallop: Businesses are struggling, shipping companies are miserable

Sea freight rates increase gallop: Businesses are struggling, shipping companies are miserable
In Vietnam, shippers are standing still and facing many difficulties in terms of container freight rates, which have skyrocketed in price.
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Cargo containers at Lach Huyen International Port in Hai Phong. (Photo: Duc Nghia/VNA)
The complicated development of the COVID-19 pandemic on a global scale forced countries to simultaneously apply measures to control travel and trade, causing congestion in seaport operations, and speed of vehicle rotation. and the container is slow. This has caused the price of sea freight by container to increase rapidly in recent times.

In Vietnam, shippers are standing still and facing many difficulties in terms of container freight rates, which have skyrocketed in price.

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With the policy of freight rates constantly changing with an increasing trend, enterprises importing and exporting goods by sea in Vietnam are in the "cry" situation because they are completely dependent on the transportation of foreign shipping lines. outside.

Floating freight rates, galloping up

From the beginning of June 2021 up to now, container freight rates to the US have increased week by week. Currently, the shipping cost of a 40-feet container to the US has reached 20,000 USD. While before about 2 months, the freight rate was only 8,000 USD/container.

For refrigerated containers, if in April 2021 the freight is only about 7,500 USD, in early July 2021 it has almost doubled, to 13,000-14,000 USD/container.

Not only the US leg, container freight rates on service routes from Vietnam to Europe also increased rapidly. Compared to April 2021, the freight of a container to a number of seaports in Russia has increased to 5,000-6,000 USD, reaching 15,000 USD/40feet container.

Mr. Vu Hai Bang, Chairman of the Board of Directors of WOODSLAND Company, said that it is currently very difficult for manufacturers to export goods from Vietnam to the US and Europe due to a shortage of containers and very high shipping costs. Many orders delivered to partners from now on start to be canceled due to no shipping options.

Mr. Cao Huu Hieu, Deputy General Director of Vietnam National Textile and Garment Group (Vinatex) said that for exporters, the increase in logistics prices and the lack of empty containers leads to increased costs, prolonged delivery time, and a negative impact. to customers.

[Container freight from Asia to Europe exceeds 10,000 USD]

According to a report by the Association of Seafood Exporters and Producers (VASEP), foreign shipping lines increase freight rates by 2-3 times, even 6-7 times in some routes, but businesses still cannot book. ships and containers for export. Besides, enterprises supplying seafood materials from abroad cannot order ships to transport raw materials to Vietnam for export processing.

At an online meeting on raising import and export freight rates by sea and reviewing difficulties and obstacles in transporting import and export goods during the COVID-19 epidemic in early August, Recently, the presidents of the Pepper Associations, Fruit and Vegetable Associations, Textile and Garment Associations, Plastic Associations... all commented on the shortage of empty containers and rising freight rates of shipping lines, as well as the phenomenon of cancel the trip, board a new train for a quote; tariff policy is constantly changing; It is difficult for customers to book seats directly with shipping lines but must go through delivery agents ...

In particular, the above associations also recognized that the surcharge calculation mechanism of shipping lines is not clear, with many types of surcharges arising, causing frustration and difficulties for businesses, especially small and medium enterprises.

Meanwhile, shipping lines said that the current global impact of the COVID-19 pandemic has caused them to face many difficulties and are trying to ensure the stability of the cargo supply chain.

At the meeting, a number of shipping lines such as: CMA-CGM (France), Evergreen (Taiwan), COSCO (China)... all confirmed there was no shortage of empty containers; Surcharges are publicly listed on the website. The difference between the listed freight and the actual freight is due to supply and demand factors and depends on the negotiation between the goods owner and the delivery agent. Therefore, the carriers do not interfere in this agreement.

Can't interfere in the international transport chain

The reasons for the galloping increase in container freight rates are explained by shipping lines as due to the congestion of goods at seaports due to the impact of the COVID-19 epidemic; long turnaround time for a container due to quarantine policies in countries; Many loading and unloading workers at the port are on vacation due to disease infection, the productivity of goods release is not guaranteed, many ships have to wait more than 5 days to enter the port. The frequency of trips is reduced, so shipping lines may have to consider a plan to increase freight rates to offset costs ...

Mr. Hoang Hong Giang, Deputy Director of the Vietnam Maritime Administration (Ministry of Transport) said the inspection results of the interdisciplinary working group

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