Lach Huyen port will achieve 70% of year's target in worst-case scenario: exec

Lach Huyen deep-water port, the largest of its kind in northern Vietnam, would see its cargo volume decline by 30-50% if the U.S. maintains its 46% reciprocal tariff on Vietnam and the U.S.-China trade tensions escalate, said CEO of Port of Hai Phong JSC (Hai Phong Port) Nguyen Tuong Anh.

In the worst-case scenario, Lach Huyen port will fulfill only 70% of its full-year target, Anh told shareholders at the company’s 2025 AGM on Tuesday.

At the meeting, shareholders expressed their concern over the impact of the U.S. tariffs and the operation of Hai Phong Port that set up a joint venture with Global Terminal Limited S.À.R.L to operate international container terminals 3 and 4 at Lach Huyen port.

Anh said the tariff policies would impact the company, adding that during the 90-day tax pause, cargo owners and shipping companies are continuing their operations, port utilization, and service routes.

According to the CEO, the volume of imports and exports through the port has not been significantly affected so far.

With the 46% tariffs on Vietnamese goods, deep-water ports in the Lach Huyen area will be heavily impacted, as two-thirds of the service routes from there go directly to the U.S., he said.

However, he stressed Hai Phong Port will capitalize on opportunities in short trade routes.

Manufacturing and exporting companies can shift to countries not affected by U.S. tariff policies, he said, calling this an opportunity that Hai Phong Port can seize at Dinh Vu port and Tan Vu port, which are also part of its network.

U.S. President Donald Trump on April 2 said he would levy 46% tariffs on imports from Vietnam as part of a new wave of global impositions, effective from April 9. The 46% rate for Vietnam is among the highest, only after Laos (48%) and Madagascar (47%).

However, Trump on April 9 dropped his reciprocal tariffs for countries reaching out to the U.S. to negotiate to 10% for 90 days. The 90-day reprieve is applied to nearly 90 nations except for China.

For the annual target, Anh said Hai Phong Port is still striving to meet the projected revenue of VND2.27 trillion ($87.3 million) and pre-tax profit of VND967.5 billion ($37.2 million).

For member companies, some would feel the tax burden, he said, citing Dinh Vu port (51% owned by Hai Phong Port) as an example, which primarily serves Chinese clients and many companies exporting to the U.S.

For Lach Huyen, he said, the joint venture - Haiphong Port TIL International Terminal Company Limited (HTIT) - has been assigned a throughput target of over 300,000 TEUs, with revenue of approximately VND550-600 billion (19-23 million) and profit ranging from VND50-70 billion ($1.9-2.7 million) in 2025.

In the worst-case scenario, Lach Huyen Port will achieve 70% of the set target, he said.

Assessing the long-term effects on Lach Huyen port, Hai Phong Port chairman Pham Hong Minh said Lach Huyen port is located at a gateway area forming a major transportation route from the North to distant markets such as Europe and the U.S.

Many industrial zones have been established around this area, including the expanding project by Xuan Cau Group, which functions as a free-trade zone for industrial and service activities, he remarked.

Lach Huyen port also benefits from its convenient transportation connectivity, Minh continued, noting the government is boosting investments in the railway sector, with a full line expected to be launched in 2025, extending from China’s Yunnan, which will also help attract more goods to this area.

After the completion of the construction of terminals 3 and 4 at Lach Huyen port, the company's leadership plans to continue investing in other terminals in Hai Phong and areas with planned seaport developments over the next five years, he revealed.

The strategic focus in the near future will be on collaborating with customers to provide warehousing services and expanding the supply chain, the chairman added.

Regarding the progress of the Lach Huyen project, Minh informed shareholders that terminals 3 and 4 officially began operations on April 1 and 15, respectively.

After two trial voyages starting on April 16, the first commercial voyage has been launched. Currently, the company has largely completed the project’s components.

He said some warehouses have reached 50% of their area, and the remaining portion is expected to be completed within this year. Hai Phong Port will hold a grand opening for the project on May 13.

Under the business registration certificate issued by the municipal Department of Planning and Investment, the joint venture HTIT was set up on December 20, 2024, with Hai Phong Port holding a 51% stake and Global Terminal Limited S.À.R.L the remaining 49%.

On the unlisted public company market UPCoM, Hai Phong Port’s PHP closed Tuesday, the last trading day before Vietnam's five-day holiday, at 34,500 ($1.33) per share.