Vietnam exporters struggle with rising shipping rates

By Lien Thuong, Minh Hue
Fri, June 14, 2024 | 11:58 am GMT+7

High sea freight rates are causing a headache for exporters in Vietnam as they have to recalculate costs and even accept losses to keep customers.

Data from Phaata, an international logistics exchange, showed that freight rates from Ho Chi Minh City to the U.S. are increasing sharply. Meanwhile, Drewry's world container index (WCI) increased 12% to $4,716 per 40-foot container in the week from May 30 to June 6, marking a surge of 181% over the same period last year.

Haiphong port cluster in Haiphong, northern Vietnam. Photo courtesy of Vietnam News Agency.

Haiphong port cluster in Haiphong, northern Vietnam. Photo courtesy of Vietnam News Agency.

Rates have increased 17% to $6,664 per 40-foot container from Shanghai to Genoa and to $7,214 from Shanghai to New York.

The rerouting of ships from the Red Sea via the Cape of Good Hope has caused capacity shortages, increased congestion at ports, and soaring demand. This is also the reason driving the sudden increase in spot rates on main routes. In addition, there is an imbalance between containers serving exports and imports.

Industry experts have said that the U.S plans to impose strong tariffs on many types of Chinese goods such as electric vehicles, battery components and solar cells from August, prompting Chinese exporters to ship their goods ahead of schedule.

Many Chinese exporters are paying higher rates to shipping lines to earn slots on ships going to the U.S. and Europe. They are willing to pay up to $1,000 for one, while exporters in Vietnam only pay $600. Therefore, shipping lines have given priority to China and reduced trips for other countries, including Vietnam, leading to the current huge rate hikes.

Businesses in difficulties

Normally, it takes about 40 days to ship goods from Vietnam to Europe and America through the Suez Canal. Currently, due to tensions in the area, the shipping time has increased to 60 days for one way, pushing up costs by an estimated $1,000-3,000 for each container, said an import-export specialist for a logistics company in HCMC, who declined to be named, .

According to him, prolonged delivery times will cause many import-export businesses to suffer losses, affecting the shipping of goods to other regions in the world such as Asia and Africa.

Vietnam's main exports to the E.U. and U.S., such as textiles, footwear, wooden furniture, and electronics, will be most affected. However, many businesses in Vietnam are delivering goods in the form of free on board (FOB) so the impact is not so great.

"The logistics industry is seeing a slight impact, but others are facing the risk of order disruption if the situation is not resolved,” he noted.

Sharing the same opinion, Nguyen Hoai Nam, deputy secretary general of the Vietnam Association of Seafood Exporters and Producers (VASEP), said that rising shipping rates are causing difficulties for the seafood industry as most businesses mainly operate in export activities, using more than 1 million containers each year. However, currently, it is very difficult to order containers.

Meanwhile, Phuc Sinh, a major pepper and coffee exporter in Vietnam, said that shipping lines now list prices weekly instead of 15-30 days as before. This can make businesses incur larger shipping costs, or even suffer losses. Some have had to switch to air delivery at extremely high rates.

According to the Vietnam Maritime Administration, since the beginning of June 2024, the rates for shipping containers to European countries and the U.S. have been trending up sharply, with the world container index climbing 12% to $4,716 per 40-foot container in the past week.

To cope with that situation, the administration asked port authorities to coordinate with provincial-level maritime sub-departments, relevant authorities, associations, and units to strengthen supervision of shipping businesses providing container freight services in listing rates and surcharges.

Comments (0)
  • Read More
Vietnam's agri major Hoang Anh Gia Lai fined for bond information disclosure failure

Vietnam's agri major Hoang Anh Gia Lai fined for bond information disclosure failure

Vietnam's agri major Hoang Anh Gia Lai JSC has been fined VND92.5 million ($3,528) for failing to disclose bond-related information as required by law.

Companies - Thu, August 7, 2025 | 4:31 pm GMT+7

Northern Vietnam province accelerates $2.2 bln LNG-to-power project

Northern Vietnam province accelerates $2.2 bln LNG-to-power project

Quang Ninh province will hand over 4.9 hectares of reclaimed land to the Quang Ninh LNG-fuelled power plant project before August 11, local authorities stated at a meeting on Wednesday.

Energy - Thu, August 7, 2025 | 4:17 pm GMT+7

Vietnam's seafood firms ride profit wave ahead of US tariff hike

Vietnam's seafood firms ride profit wave ahead of US tariff hike

Vietnam’s seafood companies reported surging profits in Q2/2025, driven by importers ramping up purchases ahead of new U.S. reciprocal tariffs.

Economy - Thu, August 7, 2025 | 2:21 pm GMT+7

Le Anh Tuan appointed new CEO of Dragon Capital Vietfund Management JSC

Le Anh Tuan appointed new CEO of Dragon Capital Vietfund Management JSC

Dragon Capital Group, Vietnam's largest asset manager, has appointed Le Anh Tuan as CEO of its arm Dragon Capital Vietfund Management Joint Stock Company (DCVFM), starting from October 1, 2025.

Companies - Thu, August 7, 2025 | 2:01 pm GMT+7

Indonesia, Malaysia, Thailand expand local currency transaction network

Indonesia, Malaysia, Thailand expand local currency transaction network

Bank Indonesia, Bank Negara Malaysia, and Bank of Thailand have added new Appointed Cross Currency Dealer (ACCD) participating banks to broaden services for bilateral transactions in local currencies across the three nations, Bank Indonesia said in a statement on Tuesday.

Southeast Asia - Thu, August 7, 2025 | 12:48 pm GMT+7

ASEAN to sign MoU on regional power grid implementation

ASEAN to sign MoU on regional power grid implementation

ASEAN member states are set to sign an MoU on the implementation of the ASEAN Power Grid during the bloc’s Energy Ministers’ Meeting this October.

Southeast Asia - Thu, August 7, 2025 | 12:43 pm GMT+7

Vietnam overtakes Thailand to become world's second-largest rice exporter

Vietnam overtakes Thailand to become world's second-largest rice exporter

Vietnam has outranked Thailand as the world’s second-largest rice exporter in the first half of 2025, Thai PBS reported on August 3, citing the Thai Rice Exporters Association.

Companies - Thu, August 7, 2025 | 12:41 pm GMT+7

Vietnam posts trade surplus of $10.18 bln in 7 months

Vietnam posts trade surplus of $10.18 bln in 7 months

Vietnam’s export earnings grew by 14.8% to $262.44 billion in the first seven months of this year, while its import turnover rose by 17.9% to $252.26 billion, resulting in a trade surplus of $10.18 billion.

Economy - Thu, August 7, 2025 | 12:19 pm GMT+7

Malaysia pledges big purchases, investments with US

Malaysia pledges big purchases, investments with US

Malaysia has agreed to buy and invest over $240 billion (MYR1.02 trillion) in the U.S. to help reduce the trade gap between the two countries.

Southeast Asia - Thu, August 7, 2025 | 12:08 pm GMT+7

Vietnam's leading property developer Novaland to issue 152 mln shares to settle $229 mln debt

Vietnam's leading property developer Novaland to issue 152 mln shares to settle $229 mln debt

Novaland, a major real estate developer in Vietnam, plans to issue nearly 152 million new shares to swap more than VND6 trillion ($228.8 million) worth of bond principal.

Companies - Thu, August 7, 2025 | 10:11 am GMT+7

Vietnam's FDI capital disbursement hits five-year record high despite US tariff turmoil

Vietnam's FDI capital disbursement hits five-year record high despite US tariff turmoil

Disbursed foreign direct investment (FDI) capital in Vietnam reached $13.6 billion in Jan-July, up 8.4% year-on-year, despite U.S. tariff concerns.

Economy - Thu, August 7, 2025 | 9:57 am GMT+7

Malaysia steps up efforts to explore nuclear energy potential

Malaysia steps up efforts to explore nuclear energy potential

Malaysia’s Minister of Science, Technology and Innovation Chang Lih Kang on Wednesday reaffirmed his ministry’s commitment to enhancing cooperation with the Ministry of Energy Transition and Water Transformation (PETRA) in exploring the potential of nuclear energy.

Southeast Asia - Thu, August 7, 2025 | 8:10 am GMT+7

Indonesia's economy grows faster than expected

Indonesia's economy grows faster than expected

Indonesia's economy expanded by 5.12% year-on-year in Q2/2025, up from 4.87% in the previous quarter, exceeding the forecasts of many economic organizations, which had previously projected a rate of less than 5%, according to Statistics Indonesia (BPS).

Southeast Asia - Thu, August 7, 2025 | 8:07 am GMT+7

Philippine energy group eyes investment in Vietnam’s power sector

Philippine energy group eyes investment in Vietnam’s power sector

AboitizPower wants to invest in Vietnam’s electricity industry, especially in transmission infrastructure, said Danel Aboitiz, executive director of the corporation.

Energy - Wed, August 6, 2025 | 11:11 pm GMT+7

Vietnam seeks 8.3-8.5% economic expansion for 2025

Vietnam seeks 8.3-8.5% economic expansion for 2025

The Government has requested the State Bank of Vietnam to proactively adjust the credit growth aim for this year in line with a GDP expansion target of 8.3-8.5%.

Economy - Wed, August 6, 2025 | 10:41 pm GMT+7

Japanese investment in Vietnam shifts toward service, trade, and technology: bank exec

Japanese investment in Vietnam shifts toward service, trade, and technology: bank exec

Japanese investment in Vietnam is seeing a notable shift, with sharp increases in the services, trade, and technology sectors, while investment in manufacturing has slowed, said Abe Ryota, a senior economist at Sumitomo Mitsui Banking Corporation (SMBC).

Economy - Wed, August 6, 2025 | 4:06 pm GMT+7