Mother ships now refuse docking at Cai Mep port

As the exports have been increasing slowly, a lot of shipping firms have announced that their mother vessels would halt docking at the Cai Mep deep water port in the southern city of Vung Tau. This has made importers and exporters worried stiff, because the transportation costs would increase.

Unlike 2010, when a lot of shipping firms wanted to put mother vessels to Cai Mep port into exploitation as soon as possible for fear about the lack of piers, in 2011, the port developer fears about the possible lack of vessel ships.

Some deep water ports on the Thi Vai River have been operating at a moderate level. Some big ports have reported that they receive only one ship docking a week, while the designed capacity allows to receive 6-7 ships a week. Other ports, which have been designed to receive containers ships, now have to receive bulk goods to earn their living.

As mother vessels miss the port, containers will have to follow a more complicated way to the world: goods will be carried on feeders to Singapore and Hong Kong, where they will be loaded into mother vessels and carried to different places in the world.

Ports lack ships

Since the beginning of 2011, as the number of exported containers has been lower than expected, a lot of shipping firms have taken back their mother vessels from Vietnam. The CKYH group, which includes Cosco, Kline, Yangming, and Hanjin has not been docking at the Cai Mep port since May 2011 in their itinerary from Asia to Europe. Meanwhile, CSAV has stopped exploiting the route from Cai Mep to the West Coast of the US since June.

In October, in the low shipping season, some shipping firms may stop providing services on at least two routes from Cai Mep to Los Angeles and Seattle on the US West Coast.

Some of the above said shipping firms have given up the routes from the Far East to the US. Meanwhile, other shipping firms have stopped providing the shipping from Cai Mep port, while they still continue providing services from China and other countries. This has been explained by the ineffective mother vessel exploitation, partly because of the decreases in exports and the lower than expected growth rates

Some shipping agents have said that they have to miss Cai Mep port in a plan to restructure the sea routes to cut down expenses and minimize loss, and that their mother vessels would come back when the two big economies in the world – the US and the EU – recover, which pushes up the exports to the markets.

In 2009, a lot of foreign shipping firms once choose the deep water ports on the Cai Mep-Thi Vai area to carry goods directly to the US and EU, because they put high expectations on the recovery of the big economies in the world and the bright Vietnamese economic development. Now, as the situation has changed, it is understandable why the shipping firms have to cut down expenses.

Importers, exporters worried stiff

The gloomy situation is believed to last until the time when foreign trade prospers again. A series of shipping firms have reported the losses worth hundreds of millions of dollars in the first six months of the year.

In Vietnam, due to the appearance of more shipping firms and the slow export, shipping firms now have to compete fiercely with each other, which has led to the sharp fall of shipping fees. Experts have quoted statistics as saying that the shipping fees to the EU have dropped by 60 percent, while the fees to the US by 40 percent.

In the immediate time, the lack of mother vessels will make the container transportation fees increase. It now costs 200 dollars to carry a 20 foot container from HCM City to Singapore. This means that until mother vessels return to Cai Mep, Vietnamese goods would have disadvantages in comparison with Chinese goods which have lower transportation fees.

Besides this, Vietnamese exporters would also have disadvantages in delivery time, because it will take more time to reach the destination ports.

Source: SGTT

Tags: Cai Mep Port