'Caught sick' the reason why shipping rates are increasing day by day
Container shipping costs have increased almost vertically, causing export businesses to worry about delivery schedules as well as shrinking profit margins.
Freight costs increased dramatically
Mr. Vincent Clerc - CEO of shipping giant Maersk (Denmark) - said that container shipping costs increased 'almost vertically' in the past month. Specifically, in the week ending June 6, Drewry's container freight index increased 12% to 4,716 USD per FEU (40ft container), an increase of 181% over the same period and 232% higher than the previous year. average level in 2019.
For example, freight rates on the Shanghai to Genoa route reached $6,664 per FEU, up 213% from a year ago. Additionally, freight rates on the Shanghai to New York route recently reached $6,463 per FEU, up about 142% over the same period, while rates on the Shanghai to Los Angeles route recently reached $5,975 per FEU, up about 215% over the same period last year.
According to Vietnam Maritime Administration, statistics from the beginning of June 2024, the price of shipping container goods by sea to European countries and the United States is trending up sharply, the world container index increased by 12% to 4,716. USD/40 feet container in the past week.
According to data from the international logistics exchange Phaata, freight rates for the City route. Ho Chi Minh trips to the United States are increasing sharply. Meanwhile, Drewry's world container index (WCI) increased 12% to $4,716 per 40-foot container in the week from May 30 to June 6 and increased 181% over the same period last year. From Shanghai to Genoa, rates increased 17% at $6,664 per 40-foot container. Freight rates from Shanghai to New York increased 6% to $7,214 per 40-foot container.
Mr. Truong Dinh Hoe - General Secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP) - informed that the world's vital shipping routes from the Red Sea to the Gulf of Aden are heavily affected by conflict. Geopolitics are escalating in the Middle East. For some time now, the Mandab Strait - one of the busiest maritime routes in the world with the capacity to handle about 15% of global maritime trade value - has been significantly disrupted due to attacks by Houthi rebels. on cargo ships in recent times. The majority of cargo ships still avoid moving into the Red Sea area, with the number of daily movements down by two-thirds compared to the same period last year.
Drought conditions in the Panama Canal – which handles 5% of global maritime trade – have gradually improved as the number of daily transits has increased. However, shipping capacity through the Panama Canal is still lower than the usual daily average of 34 - 40 transits and cargo traffic is expected to return by 2025. Recently, a situation occurred again. Congestion in Singapore leads to concerns about supply chain crises and rising commodity prices.
"Congestion in Singapore stems from many factors, from the tendency to change shipping routes when the Red Sea is unstable to the rush to transport goods before the new tariffs imposed by the United States on Chinese goods take effect." , Mr. Truong Dinh Hoe shared.
Many leading industry experts say that the United States plans to impose strong tariffs on many types of Chinese goods from August 2024, causing Chinese exporters to boost exports ahead of schedule. Therefore, many Chinese exporters are paying higher prices to shipping lines to ensure space on ships bound for the United States and Europe.
Chinese businesses are willing to pay up to 1,000 USD for 1 slot on the ship, while Vietnam only pays 600 USD. Therefore, shipping lines have almost given priority to China, reducing trips with countries including Vietnam, leading to the current situation of huge price increases.
Mr. Do Ngoc Tai - General Director of Tai Kim Anh Seafood Processing Joint Stock Company - informed that shipping rates have increased dramatically by 40% since May due to the war in the Middle East and China collecting empty containers to reserve for export. for the United States before the new tax deadline. Similarly, with the EU market, shipping rates increased dramatically by 60% due to detours and China collecting empty containers for export to the United States.
In the pepper and spice industry, Ms. Hoang Thi Lien - President of the Vietnam Pepper and Spice Association - informed that pepper export businesses are facing difficulties when pepper prices increase. Unable to buy goods, along with that, transportation costs increase. The reason may be because the Chinese side collects empty containers for export.
Narrowing business profit margins
Some export businesses reported that the cost of a container to the US market has increased from nearly 3,000 USD to nearly 7,400 USD; Peak season fees every year are the highest at about 300 USD/container, now the shipping company reported an increase to 1,000 USD/container... Shipping rates fluctuate every day. Shipping companies also quote prices weekly instead of 15 - 30 days as before.
Meanwhile, Vietnamese businesses have almost no choice because in terms of international shipping, Vietnam's shipping fleet is currently only responsible for transporting about 10% of the market share, mainly transporting the following routes: China, Japan, Korea and Southeast Asia. Vietnam's export activities to major markets such as the United States, EU... depend on foreign shipping lines.
Notably, according to Mr. Vincent Clerc, with the above sharp increase in prices, it may motivate more retailers in the West to find ways to transport goods for the Christmas shopping season in large volumes. earlier and earlier than usual. This could put additional pressure on the global supply chain. The sooner retailers replenish inventory, the more they will fall into a dilemma. The more they try to request early shipments to avoid late delivery, the more delays they see.
Mr. Nguyen Hoai Nam - Deputy General Secretary of VASEP - said that shipping costs are increasing again, causing difficulties for the fisheries industry. Because businesses in the industry mainly operate export activities, each year they use more than 1 million containers, but currently, it is very difficult to order containers.
Meanwhile, Mr. Ho Quoc Luc - Chairman of the Board of Directors of Sao Ta Food Joint Stock Company - said that sea freight rates to North America and Western Europe increased by 100% compared to the off-peak period, while other routes Going to Japan, Korea, Australia has more stable prices. Increasing fares will reduce business profits.
Faced with the above situation, the Vietnam Maritime Administration has just requested the Maritime Port Authorities to coordinate with the Maritime Sub-Departments and relevant authorities, associations and units to strengthen supervision of business enterprises. sea transport, providing container freight services by sea, listing prices and surcharges in addition to the price of container freight services by sea (prices and surcharges in addition to prices); Complying with the effectiveness of price postings and surcharges in addition to prices according to the provisions of Decree No. 146 of the Government.
Units are assigned to monitor and report to the Department when there is congestion at seaports, as well as when there is an imbalance in container containers serving import and export goods.
Vietnam Maritime Branch in City. Ho Chi Minh was assigned to preside over and coordinate with the Maritime Branch in Hai Phong and the Maritime Port Authorities in the city. Ho Chi Minh, Vung Tau, Hai Phong monitor statistics on price increases/decreases and surcharges in addition to prices for a number of shipping lines that provide container shipping services to Europe and the United States, including including: Maersk, MSC, CMA-CGM, ONE, Hapag-Lloyd, Evergreen, HMM, COSCO, Yang Ming, OOCL...
At the same time, proactively work with representatives of the above shipping lines in Vietnam and relevant units to grasp the causes of service price increases/decreases when there are signs of sharp increases/decreases and other related issues. to the shipping company.
According to Congthuong.vn
Posts
No comments:
Post a Comment