Recently, the Vietnam Maritime Administration has reported to the Ministry of Transport the results of an interdisciplinary inspection team on shipping rates and surcharges at 10 foreign shipping lines operating in Vietnam. Specifically include: MSC, OOCL, CMA – CGM, Hapag – Lloyd, ONE, Evergreen, HMM, Maersk Lines, Yangming.
Accordingly, the inspection was carried out in the late March and early May period, related to the “galloping” increase in sea freight rates over the past time. According to the Vietnam Maritime Administration, the freight rate for sea freight by container has increased sharply since October 2020, especially for routes to Europe and North America.
In December 2020, the freight rate from Vietnam to Europe is about 5,400 USD/container 20 feet and to the US is 5000 USD/container 20 feet. By April 2021, the freight rate from Vietnam to Europe is $6,500-8,000 per 40-foot container and to the Americas is $6,000-7,000 per 20-foot container, an increase of five to seven times last year.
The main reason is that the Chinese market recovered after the pandemic, from which a large amount of empty containers were sucked into China, causing demand to outstrip supply, pushing container shipping prices up gallop, affecting the whole Asia region, including Vietnam.
According to the inspection results of the Inter-sectoral Working Group, the shipping lines all listed the freight rates on the website, but did not show the listing time. Therefore, it is not possible to know exactly whether these enterprises have complied with the regulations of listing 15 days before the price change or not. Listed freight rates are ceiling prices, but contracts with customers are not disclosed by shipping lines. For small shippers without long-term contracts, the freight rates are floating according to the market.
In addition to the increase in freight rates, each shipping line also applies 3-5 types of surcharges, typically loading and unloading fees at the port, container cleaning, documents, lead clamps… In which, the loading and unloading surcharge accounts for billion the largest weight, in the range of 100 to 170 USD per container and is being imported by all 9 shipping lines. There are irregular fees applied by each shipping company such as fuel surcharges, service charges for import and export goods only applied by Maersk.
The inspection team said that these surcharges were introduced by the shipping company without an agreement with the customer, without stating the reason for collection and the time of termination. Some fees such as declaration of tonnage (VGM) cost 30-50 USD, while shipping lines do not charge for this service. The shipping lines’ surcharges do not have to register and declare with the state agency, so it is difficult to monitor.
In fact, the policies on freight rates and surcharges are decided by shipping lines themselves. Vietnamese shippers have a small scale, seasonal demand, so they do not have plans to sign long-term transport contracts, leading to many risks when the market fluctuates.
Regarding the route, the inspection team emphasized, “Vietnamese law does not have regulations on registration and management of transport routes, so shipping lines do not have to register transport routes. The addition or removal of ships is decided by them, so it is risky for exporters.
Accordingly, the Vietnam Maritime Administration has proposed to the Ministry of Finance to consider amending regulations on freight rates and other surcharges in addition to freight rates of shipping lines for shippers at Vietnamese ports to suit reality.
In addition, the Department also recommends the Ministry of Transport to supplement regulations, such as that foreign shipping lines must register transport routes, schedules, and cargo volumes in Vietnam to avoid the shipping lines voluntarily abandoning, delaying or delaying their flights. Booking cancellation causes damage to the exporter. Along with that, the Ministry of Transport added to increase the level of penalties for cases of violations of regulations on price declaration and listing.
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
