High sea freight rates seriously affect Vietnamese goods

In a recent letter to the President of the International Federation of Freight Forwarders Associations (FIATA), Minister of Industry and Trade Nguyen Hong Dien said that over the years, FIATA has demonstrated its role as a leading international organization in the field of logistics, gathering 114 national logistics associations, operating in 150 countries and territories, with about 40,000 related businesses worldwide.

Vietnam highly appreciates the role of FIATA, as demonstrated by Prime Minister Pham Minh Chinh receiving FIATA Presidents who visited Vietnam for two consecutive years 2023-2024. Vietnam is also honored to be chosen by FIATA as the venue to host the FIATA Congress in October 2025.

In the letter, Mr. Nguyen Hong Dien stated that Vietnam is an export-oriented economy . In the first 6 months of 2024, the total import-export value of the country reached 369.62 billion USD, an increase of 16% over the same period last year.

Of which, export value reached 190.73 billion USD, up 14.9%; import value reached 178.88 billion USD, up 17.3%. The estimated trade balance surplus was 11.85 billion USD.

However, since the beginning of 2024, the increase in shipping rates, congestion at some Asian ports and lack of empty containers have had a serious impact, affecting the competitiveness of Vietnamese goods in the international market.

Red Sea tensions, many shipping lines increase freight rates. Photo: VASEP

With FIATA's role as an important bridge, contributing to promoting logistics cooperation and facilitating trade activities between countries, Mr. Nguyen Hong Dien hopes that the FIATA President will support and take practical measures to help Vietnamese enterprises overcome the difficulties caused by the above-mentioned increase in shipping rates, port congestion and shortage of empty containers.

It proposes FIATA's solution to this global problem. At the same time, it shares experiences and solutions that countries and FIATA member associations have been applying, especially in handling non-freight charges collected at ports.

Within its sphere of influence with other international organizations in the fields of import and export, logistics and supply chain management, it emphasizes Vietnam's position in the global value chain to have appropriate priorities in terms of means and equipment for transporting import and export goods for the Vietnamese market.

Support the Vietnamese Government in its strategy to position Vietnam as a center for goods production and a new international transit location in Asia in the global logistics business community.

Authorize Vietnamese organizations to participate in training and granting FIATA certificates to contribute to quickly training professional human resources with high ability to access international markets.

In fact, in recent times, businesses have seen their profits eroded due to skyrocketing sea freight rates.

Speaking with Lao Dong, Mr. Tran Van Linh - Chairman of the Board of Directors of Thuan Phuoc Seafood Company - said that the EU market accounts for about 25% of the export market share of Vietnamese enterprises and this is also the area with the highest increase in shipping costs.

Accordingly, the shipping freight from Vietnam to Europe is around 4,000 - 5,000 USD/container, 2 - 3 times higher than the end of last year. On average, a container exported to the US costs around 6,000 - 7,000 USD, double the previous price.

Freight rates to regions such as China, Japan, South Korea and Southeast Asia also increased, ranging from 1,000 - 2,000 USD/container.

"High sea freight rates along with difficulties in the market and orders have eroded the profits of businesses, especially seafood exporting businesses like us.

In addition to the increased freight rates, the shipping time also takes 7-10 days longer. This disrupts our delivery and production plans as well as our partners'," said Mr. Linh.

Source: https://laodong.vn/kinh-doanh/cuoc-van-tai-bien-tang-cao-anh-huong-nghiem-trong-den-hang-hoa-viet-nam-1366794.ldo