Nearly 2 year, world suffered served impacts from COVID-19 outbreak. Especially global transportation industry, there are three shipping crises due to COVID-19 outbreak. They are  a reason why the freight cost increases significantly.

First crisis is severe container shortage when the world’s economies start to recover with significantly fast speed. It leads to a lack of containers due to a wave of purchases. Its consequence is the transportation of goods from China to Europe and the US was delayed, businesses and consumers suffered from high prices.

Second crisis is biggest disruption event in Sues Cannel in recent day. One of the world’s largest container ships – the Ever Given – was stuck in the Suez Canal, blocking the world’s main trade route for nearly a week. As a result, the international flow of goods worth $9 billion a day is severely disrupted.

Latest crisis is disruption of seaport’s operation in Southern China due to re-emerges of COVID-19 outbreak. A spike in the number of Covid-19 infections is forcing Chinese authorities to implement lock-down policy. With this policy, number of workers in seaport is lacking and that make handling capacity of these ports decrease significantly. As a result, transportation costs – already high – are now even higher because of the length of time cargo ships wait at the port.

From three crises, the freight cost is in high rate and fluctuated. Most of businesses will be hard to overcome tough challenge of freight cost because the material resource is limited and their current sales is only better slightly than sales in outbreak period. Indeed, based on situation of freight cost in Vietnam currently, freight for all port over the world is also increased, especially freight for long distance such as European, America continent, Africa. Despite accepting to pay for this high cost, getting bookings is also a serious problem. Currently, getting booking for America and Canada is extremely hard, while bookings for European, other areas need to be reserved booking at least 2 – 4 weeks.

Frozen Containers are putting back behind

Dry containers are now in priority and frozen containers are putting back behind. Shipping lines are giving priority for dry container as they are more convenient and profitable compare to frozen ones. With the fast speed of recovering, logistics is running with the maximum capacity, lacking of spaces is the common problem for businesses. Finding a space for dry container is hard but seeking for frozen container’s spaces is even harder at the current situation.

By Sandy / Percy / Sha (Business Team).