“Upright” container transportation charge, “distorted” enterprise

Is there a situation of taking advantage of pushing container prices up?

As a representative of an enterprise specializing in exporting processed agricultural products such as cucumber, tomato, pineapple, mango …, Mr. Nguyen Truong Nghia, Director of Viet Xanh Agricultural Processing Joint Stock Company exchanged with the reporter of Customs Magazine about the pressing and difficulties of the business. Accordingly, from 3 to 4 months now, businesses are facing the situation of “galloping” container shipping rates and there is a risk of higher prices in the coming time.

According to Mr. Nghia, currently, enterprises are subject to the freight rate of a 20-foot container moving from Hai Phong port to Saint Petersburg port (Russia) ranging from USD 4,700 to USD 5,300, depending on the shipping line. While before that the shipping price only fell between 1,000 – 1,200 USD. For a 40-foot container, the situation is even higher, up to nearly 10,000 USD / container, while previously, the cost of transporting a 40-foot container from Hai Phong port to Saint Petersburg port was 1,800 USD / container / 40 feet. With the constant price increase and not knowing where to stop as at present, many agricultural export enterprises are facing bankruptcy because agricultural products are low-value and low-interest products. . If the business sells the FOB price, the buyer has to pay the freight himself, the buyer cannot bear it, but if the business sells the CIF price, it will be bankrupt. In particular, despite such a high price, it is not always possible for businesses to order containers, many shipping lines have arranged for businesses’ goods, but no empty containers have to be postponed.

“We are facing a situation where freight rates increase” galloping “, but that does not mean there will be an empty container for shipping, but shipping lines continuously” delay “from day to day, from Week after week because there is space on board but empty containers are not available. From the beginning of the year until now, we have had to accept to share shipping costs with our partners, even now our export containers have to break even and even lose money just to keep customers and If the goods have been produced, processed but cannot be exported, we also… die. Therefore, although at present, the price of agricultural products is very cheap, but not all businesses dare to process because they cannot be exported after processing. The closest port we used to travel was 500 USD / container / 20 feet, but now it is 1,800 USD / container / 20 feet. Just prolonged, our agricultural export business only went bankrupt.

Also according to the Director of Viet Xanh Agricultural Processing Joint Stock Company, in the face of the shortage of empty containers, many shipping lines also “slap water with the rain”, pushing prices up. Our company, after working with 4 shipping lines, 4 shipping lines also sent 4 different prices. If you want the goods to go immediately, the price will be 5,300 USD / container, if you wait, it will be 3,700 USD / container, the other company will quote from 3,700 – 4,000 USD / container. Price bracket is negotiated by businesses with shipping lines. Therefore, I am concerned that there is a shortage of containers but not to the extent that the current shipping lines are taking advantage of this situation to push prices.

Efficient transfer avoids local shortage

According to the survey results of the Vietnam Logistics Business Association (VLA), the difficulty of businesses about the shortage of empty containers at each link in operations with shipping lines. Specifically, the sales department accounts for 17%, the delivery of containers in depot accounts for 40% and the booking department accounts for 43%. In addition, many businesses believe that the difficulty in transporting goods is mainly through the Inner Asia and the Americas.

To solve the above situation, VLA also offers positive solutions so that businesses and stakeholders can find suitable remedial measures to improve the current shortage of empty containers. The VLA argues that there is a need to increase the movement of empty containers between ports and the role of business cooperation in moving empty containers from redundant to missing.

In addition, it is necessary to strengthen authorization to repair empty containers for Depots to effectively meet quality and reduce waiting times. Shipping lines need to accurately inform the location of empty containers so that businesses can reduce travel costs and time. Efficiently move empty containers to avoid local shortage. The owner of the goods (especially the VIP factory owner) needs to effectively use the empty container to return it to Depot for use by other shippers …

Facing the situation that businesses are in the peak season for export but facing difficulties due to the lack of empty containers to deliver to exporters for packing, causing sea freight rates to European routes to rise sharply, causing Directly affecting the export activities of enterprises, the Vietnam Maritime Administration (Ministry of Transport) issued Decision No. 194 / QD-CHHVN dated February 23, 2012 on the establishment of a working group. on the price, surcharge on the service of shipping container goods by sea.

Accordingly, the working group will be responsible for inspecting the compliance with regulations on listing prices and surcharges in addition to shipping container freight by sea in accordance with Decree No. 146/2017 / ND-CP. of the Government on the listing of prices and surcharges in addition to the service charge of shipping container goods by sea. And handle violations in accordance with the Government’s Decree No. 142/2017 on sanctioning of administrative violations in the maritime domain.

According to Customs Newspaper