High container freight rates in 2021 will support the growth momentum of businesses providing transportation services and emptying containers, especially when many businesses increase capacity to take advantage of the “golden” period of the market. school.
Freight rates skyrocketed
According to Vietnam Joint Stock Commercial Bank for Foreign Trade (VCBS) Securities Company Limited (VCBS) in October, freight rates for the Shanghai – New York route fluctuated around $15,000 per 40-foot container, an increase of more than 2 times compared to January and an increase of 5 times compared to March 2020.
Source: VCBS.
Freight rates skyrocketed due to the Delta variant spreading in many countries, indirectly causing supply chain disruptions and congestion at many seaports in 2021.
This seriously affects the movement of goods and operations at seaports and fleets in the region.
Along with the increasing momentum of container freight, bulk freight rates begin to record a galloping uptrend in 2021.
At the peak in October, the bulk freight price index (BDI) fluctuated 5,000 points, up 2.5 times compared to the beginning of the year.
Source: VCBS.
Bulk freight rates “heat up” when major economies recover production, demand for goods and materials increases sharply.
However, the supply of suppliers is quite limited due to difficulties in production and circulation of goods.
In addition, inventory levels of agents and suppliers were at low levels after more than a year of stagnation due to the pandemic, thereby strongly boosting raw material prices and bulk freight rates.
On the other hand, some shippers switched to using bulk carriers to transport goods due to the scarcity of containers and high container freight rates.
However, in November, freight rates for the Shanghai – New York route cooled down, to only $12,800/40-foot container, down 15% compared to October.
Similarly, November BDI also plummeted to 2,800 points, down nearly 45% compared to October.
VCBS explains that freight rates have cooled down when the peak of shipping for the year-end shopping season ends. In addition, many countries are gradually turning to a strategy of living with the epidemic to help resume supply chains.
Businesses seize the opportunity, earn big profits
High container freight rates in 2021 support the growth momentum of businesses providing container transport services and emptying container leasing, especially when many businesses increase their capacity to take advantage of the “golden” period of Vietnam. market.
Typically, in the third quarter, Vietnam Shipping Joint Stock Company (Code: VOS) recorded a sudden increase in net revenue when reaching nearly 385 billion dong, up 31% over the same period last year.
In 9 months, VOS recorded 964 billion dong of net revenue, slightly down by nearly 8 billion dong compared to the same period last year. The three-quarter net profit was nearly 409 billion dong while last year’s net loss was more than 139 billion dong.
VCBS said that Vietnamese shipping enterprises focus on bulk cargo transportation. Therefore, revenue and profit prospered when freight rates increased sharply from the first quarter.
In addition, these enterprises are also restructuring and streamlining their apparatus, reducing financial debt and controlling costs while maintaining the efficiency of fleet operations, thereby improving profit margins.
T&G International Joint Stock Company
Address: 352 Hue Street, Le Dai Hanh Ward, Hai Ba Trung District, Hanoi
Hotline: 0345786803
Email: hrm@tginterjsc.com
Website: http://tginternationaljsc.com
