Shippers ignore Vietnam ports on losses

Many international shipping companies have announced they will stop sending big bulk carriers to the Cai Mep Deep Water Port in southern Ba Ria-Vung Tau Province due falling container volumes since the beginning of this year.
Just last year they were eager to enter the port, which had then lacked wharves capable of handling them, Saigon Tiep Thi newspaper reported.

But the situation has since turned upside down as it has in other deep-water ports along the Thi Vai River.

Some of them with a capacity of six or seven container vessels a week receive just one, and others have begun to provide other services to remain in operation.

The CKYH Group, which includes Cosco, Kline, YangMing, and Hanjin, has not sent a vessel to Cai Mep since May.

CSAV has stopped its service between Cai Mep and the US west coast since June.

In October, the usual low season in the EU and US, some major carriers plan to cut at least two shipping lines from Cai Mep to Los Angeles and Seattle on the US west coast.

While some shipping companies have stopped operating container ships from East Asia to the US due to low demand, others continue to operate, but even they ignore Cai Mep.

Some said it was just a normal move to cut losses and they would return to Cai Mep when the world economy, especially the US and Europe, recovers.

Many shipping firms have reported losses of hundreds of millions dollars in the first half of this year.

In Vietnam, with exports growing slower than expected, shipping firms have been forced to cut rates to compete.

Charges to Europe and the US have fallen by 60 percent and 40 percent respectively.

Without bulk carriers coming to its ports, Vietnam’s exports now have to be routed through Singapore and Hong Kong, adding to exporters’ costs and transit times.

Vietnamese producers are also suffering due to piling up of unsold stocks.

Figures from more than 450 businesses listed on the stock market show that the value of their unsold stocks in the first half surged to 130 trillion dong (US$6.25), up 32 percent year-on-year.

The unsold inventory index of the processing and manufacturing sectors as of August 1 increased by 17.8 percent.

Bed, furniture, non-alcoholic beverages, footwear, clothing, and motorbikes topped the index, the General Statistics Office said.

Tags: Vietnam ports