Foreign shipping lines increase multiple types of fees: Businesses buckling

08/08/2021
Exporting enterprises are suffering from high shipping rates and many types of fees charged by foreign shipping lines.
Stagnation because freight rates continuously peaked

Data from the Vietnam Food Association (VFA) shows that, for nearly three weeks now, many rice exporters in the Mekong Delta have stood still when the rice output purchased by many enterprises has decreased. decline. They also face difficulties due to the lack of shipping containers, high domestic freight rates, and various costs incurred during circulation.

Director of Phuoc Thanh IV Production and Trading Co., Ltd (Vinh Long province), Mr. Nguyen Van Thanh, said that the company currently has about 2,600 tons of rice that have signed contracts to be delivered to partners, but negotiated to find ships and containers for packing. for timely delivery is having difficulty. Up to now, to maintain operations, all costs of the company have tripled.

Previously, renting a means of transport for a week was only about 1 million VND, now it has increased to 3 million VND. Not to mention the workers' wages are now doubled, but the factory's operating capacity is only 30% compared to normal times. In addition, the container rental fee, which is already at a very high level, now has a sharp increase in domestic freight, so businesses only buy rice in moderation.

Many rice exporters also said that they are trying to complete the contract and consider stopping signing a new one, because they cannot guarantee the cost. Enterprises are also worried that if the distance is prolonged, Vietnam will lose markets in the Middle East and Africa because import partners will look to other sources from India, China, and Pakistan.

Sharing at the forum "Connecting supply and demand of crop products in the context of COVID-19 prevention and control", last weekend organized by the Ministry of Agriculture and Rural Development, General Director of Vina T&T Import-Export Company Nguyen Dinh Tung said: It is known that the freight rate for shipping containers to the US has reached 9,600 USD/container (40 feet), an increase of 5 times compared to the time before the COVID-19 epidemic. Even logistics costs to New York (USA) have reached the highest level in the history of the industry with 18,000 - 19,000 USD/container, 10 times higher than before the epidemic.


Not only the US leg, the container freight from Vietnam to the EU also increased rapidly. Compared to April 2021, the container shipped to some seaports in Russia has increased to $5,000 - $6,000. Besides, it is increasingly difficult to book seats on ships, gathering containers for export is also a big challenge for businesses.


 
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Increasing in all kind of fees

Mr. Hoang Hong Giang, Deputy Director of the Maritime Administration (Ministry of Transport) said that the inspection results of the interdisciplinary working group with 9 foreign shipping lines (MSC, OOCL, CMA-CGM, Hapag-Lloyd, ONE, Evergreen, HMM, Maersk Lines, Yangming), shows that shipping lines all list freight rates on the website but do not show the time of listing. Therefore, it is not possible to know exactly whether these enterprises have complied with the regulations of listing 15 days before the price change.

In addition to increasing freight rates, each shipping line also imposes 3-5 types of surcharges such as loading and unloading fees at ports, container cleaning, documents, lead clamps... In which, loading and unloading surcharge accounts for the largest proportion, fluctuating. from 100 to 170 USD per container and is being collected by all 9 foreign shipping lines. According to the inspection team, these surcharges were introduced by the shipping company without an agreement with the customer, without stating the reason for collection and the end time. Businesses also have to pay some fees such as declaring the tonnage of goods (about 30-50 USD). The surcharge levels, shipping lines do not have to register and declare with state agencies, so it is difficult to monitor.

Faced with the above inadequacies, the Vietnam Maritime Administration has proposed the Ministry of Finance to consider amending regulations on freight rates and other types of surcharges in addition to freight lines of shipping lines for shippers at Vietnamese ports to suit the actual situation. This Department also recommends the Ministry of Transport to supplement regulations such as foreign shipping lines must register transport routes, schedules, and cargo volumes in Vietnam to avoid shipping lines voluntarily abandoning, delaying or canceling bookings causing damage. for export businesses. At the same time, the Ministry of Transport added to increase the level of penalties for cases of violating regulations on price declaration and listing.
 

100 billion VND/day lost per day

According to the information of the Ministry of Industry and Trade, at a meeting a few days ago with the Department of Industry, representatives of a series of manufacturing enterprises said that the very high increase in international freight costs over the past time has made it difficult to transport goods. towels for import and export enterprises. In addition, businesses have to spend many other expenses such as testing for COVID, so according to the Vietnam Association of Logistics Service Enterprises, the above situation has caused a loss of at least 100 billion VND per day to transport enterprises. .

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