Container depots in Viet Nam are filling up as empty containers were flocking here for lower storage fees.
Nguyen Duy Minh, general secretary of Viet Nam Association of Logistics Services Enterprises, said that the global shipping industry was facing a problem which is constrast to the shortage of containers at the height of the COVID-19 pandemic -- housing too many containers.
Notably, Viet Nam was becoming a destination for containers as the housing fees were among the cheapest in the world, with containers even stored for free, Minh said.
Tran Viet Manh, deputy director of Nam Dinh Vu Port Joint Stock Company, said consumption demand had slumped in China and Europe. China’s zero-COVID policy was also disrupting the supply chains, which together with the Russia – Ukraine conflict, seriously affected the global market.
Normally the end of the third quarter every year was the time import-export activities were the most robust to serve the increasing consumption demand during the Christmas season for products such as clothing, footwear, and electronic products, Manh said.
“This year, the market is almost frozen,” Manh said, adding that this led to a decrease in global demand for containers.
A large number of empty containers tended to move to Viet Nam in the long term for its cheap storage fees, Manh said, adding that most container depots in the northern and the southern regions were filling up.
However, the container storage fees which depots could collect were very modest, he said. An appropriate increase in container storage fees should be put into consideration to increase revenue for depots while disincentivising containers from staying for too long at depots, he added.
Cap Trong Cuong, director of VIP Greenport Joint Stock Company, said that container leasing rates also dropped and shipping lines tended to ship containers to Viet Nam for storage.
Online container logistics platform Container xChange pointed out that one of the glaring issues which would impact container repositioning and movement well into the year 2023 was insufficient depot space. — VNS