The shift of manufacturing from China to Vietnam has also put pressure on the country's container supply chain.
According to the forecast of the International Monetary Fund, Vietnam's gross domestic product (GDP) will grow by 2.4%. As many other countries fall into recession due to the epidemic blockade, Vietnam is expected to become one of the fastest growing economies in the world in 2020.
According to Simon Vandekerckove, general manager of freight logistics giant Geodis Vietnam, procurement in Vietnam is entering a new stage. The factory is overbooked. We see that overseas customers have high expectations for Vietnam, but Vietnam does not have the necessary legal or logistics basis. Facilities to achieve this.
"Vietnam needs a lot of investment to increase new productivity and infrastructure to cope with increasing demand, and because customers want to reduce the financial risk of sourcing from only one region, Vietnam is likely to become an outsourcing region for other ASEAN countries such as Thailand and Indonesia. one."
At the same time, the shortage of global capacity and container equipment is putting pressure on Vietnam's main container ports.
A local freight forwarder in Vietnam said that the inland river terminal in Ho Chi Minh City has been congested for a long time, and the current market conditions have increased the waiting time. The export container yard capacity is 120%, and ships need to wait two to three days to find a berth.
He added: “In Cat Lai, all shipping companies’ outbound volumes have increased dramatically, but due to lack of space, about 10%-20% of the cargo must be transferred to the next ship each time.”
Vietnam’s largest deep-water port, Cai Mep, is letting ships wait 50 kilometers away. In October, the Cai Mep International Terminal (CMIT) operated by APM Terminal received the 20,000 teu Margrethe Maersk call, which is 2M One of the direct trans-Pacific routes.
The port used to have very large container ships docked (temporarily docked), but the current demand trend may cause more and more ships to come here. Next year, CMA CGM will cooperate with local operator Gemadept to open the newest terminal in Cai Mep.
Nevertheless, the current shortage of space and container equipment and the sharp rise in costs are still a huge challenge.
Vandekerckove explained: "According to all types of freight FAK and spot freight rates, bookings from Vietnam require two to three weeks in advance to secure containers and space. To the west coast of the United States, freight rates have increased by 140%, and the Mediterranean area has increased by 70%. , The Nordic region rose by 15%."
Mr. Vandekerckove said that in most cases, air freight is not an option, but road freight provides flexible options for some customers.
Drewry's report shows that the revenue of container port operators dropped by nearly US$1.9 billion in the first half of 2020. In addition to the well-known global epidemic, the decline in freight volume and port congestion are also reasons.
Drewry Port Analyst Eleanor Hadland said in the webinar: "The profitability of container ports this year is not as good as that of container ships... Our cooperative operator's transaction volume in the first half of this year dropped by 4%, while Drewry estimates global port handling volume. A decline of 5.6%... In the first half of the year, 80% of companies reported a decline in revenue. In terms of profitability, 70% of the companies’ profit before interest, taxes, depreciation and amortization in 2020 Lower."
Prior to the outbreak, Drewry predicted that sales in the first half of 2020 will increase by 4.8%. This is equivalent to a global revenue growth of more than 7%.
"However, due to a nearly 6% drop in sales volume, the revised estimate is now 5% lower than in 2019 and 11% lower than the pre-epidemic forecast. For the entire industry, we forecast the interest, tax, depreciation and amortization in the first half of the year. Pre-sales profit will drop by about 16% from 2019 and 21% lower than the forecast before the epidemic."
Most operators have taken cost-cutting measures. During the epidemic, due to the adoption of new working methods, and due to illness or quarantine requirements for workers, the terminal must pay for absenteeism, so the actual labor cost has increased.
Turkey-based operator Yildirim announced today that it will add a surcharge to cover the additional expenses during the new crown epidemic . The company said: “Since the beginning of the epidemic, Yilport Holding has taken additional measures to ensure the continuity of all business partners. However, the increased cost of additional health protection and protective equipment has made it difficult for us to balance our expenses. Since January 1, 2021 Starting today, we will charge an emergency surcharge for each import and export container ."
Martin Dixon, a shipping analyst, said: " The most important factor in the surge in ship operating costs is labor costs. Due to the inconvenience of crew changes, labor costs have soared . According to forecasts in 2019, labor costs can only increase by 1.3%, but in fact, in 2020 Labor costs rose by 6.2%."
Regarding the concealment of import and export goods, let’s look at a case first:
On August 4, a violent explosion occurred in the port area of Beirut, the capital of Lebanon, on the evening of the 4th. Preliminary statistics showed that at least 100 people were killed and more than 4,000 were injured in the explosion. The Prime Minister of Lebanon confirmed that up to 2,750 tons of explosive chemical ammonium nitrate stored in a port warehouse had exploded.
These ammonium nitrates were piled up in Beirut's port area for six years "without the necessary safety measures"!
It is understood that ammonium nitrate may explode when it is shaken or close to the fire source. The conditions of the explosion are not difficult to achieve. Nitric acid will decompose at about 180°C.
Prior to this, ammonium nitrate has caused too many major explosion accidents. Developed countries such as the United States, Britain, and France have all experienced the horror of the ammonium nitrate explosion. Bloody events are disasters for every country encountered, even for humans.
Everyone must have learned about this explosion from the overwhelming reports. However, this major accident called Lebanon’s national disaster is only one of many port and cargo ship accidents. It is not difficult to find that there have been several foreign explosions in the past. It happened in ports or in cargo ships or trains.
This is bound to be reminiscent of the safety of imported and exported goods, and under-reporting is a thing most hated by various cross-border companies.
Customs declaration: This batch of goods are toothbrushes.
Glass: Who is your name?
Customs declaration: This box of goods is paper towels.
Bath towel: You insult people!
...
These are all concealment of ordinary goods, and may only involve smuggling and other issues, but a concealment of dangerous goods is like sending an untimely bomb to freight forwarders, shipping companies, and port workers. Once an accident occurs, the consequences are disastrous.
Consequences of concealment of general cargo:
In order to evade tax, deliberately concealing part of the taxable goods constitutes smuggling. The specific legal consequences should be determined in conjunction with the amount of tax evasion.
Consequences of under-reporting of dangerous goods:
Serious accidents caused by improper storage and stowage locations; damage to the safety of the crew and the vessel; use of water guns to extinguish water damage to other containers and cargo in the cabin; delays to the entire route; huge operating costs, investigation costs, etc. Etc.; fines required by local maritime customs; customs detaining boxes for several years; may be classified as criminal smuggling and other crimes; pollution to the environment...
Measures to prevent false reports
1. Strengthen professional and safety knowledge education
As a cross-border industry practitioner, we must strengthen the training and education of hazardous materials and safety knowledge, and improve our professional service capabilities.
2. Strengthen the credit review of shippers
Strengthen the credit review of the shipper, and find out the actual source of the goods for the goods whose factory address and name are relatively acceptable. In many foreign ports, concealment of goods is a criminal responsibility, so practitioners must take it seriously.
3. Ensure clear declaration of product name
Make sure that the shipper’s declaration of the cargo brand is clear. If the declaration of the cargo name is vague and general, you must ask clearly. Some chemicals are suspected of being dangerous goods, and the shipper must be required to provide chemical safety instructions and corresponding test reports.
4. New customer information is true
In addition, you need to pay attention to whether the information of new customers is true, especially those new customers who do not need to provide customs declaration, warehousing, and towing services.
5. The product name is inconsistent with the bill of lading
If the product name is inconsistent with the bill of lading, the freight forwarder Yaao will take the initiative to check the customs declaration product name to ensure that the three orders of this batch of goods are consistent.
The US Federal Maritime Commission (FMC) threatened to use all its possible powers to overturn the decision of international shipping companies to abandon the export of American agricultural products and relocate empty containers instead.
The shortage of containers and market forces have caused some shipping companies to cut the container quotas of traditional American exporters to alleviate some serious problems in the supply chain. This has had a huge impact on US agricultural exports. Reports say that some cargo owners’ quotas have been reduced from 300 containers per month to three.
Under the vigorous lobbying of the U.S. Agricultural Transportation Union and its partners, FMC announced that it would investigate these measures.
"Some shipping companies have already stated that they will no longer deploy empty containers to inland agricultural areas of the United States. Instead, they are speeding up the delivery of empty containers back to Asia." FMC Chairman Michael Khouri said at the Global Maritime Conference.
"This approach is to keep U.S. agricultural exports out of the global market. We are investigating and possible response measures, including reviewing whether the actions of these shipping companies are in full compliance with the Shipping Act, and more specifically, the Act. "Prohibited Acts" clauses in the "Prohibited Acts"," he said.
At the end of October, the shipping company Hapag-Lloyd has decided to suspend export bookings for soybeans and other agricultural products from the United States in order to return empty containers to Asia to load imported goods from the United States instead of shipping containers to the inland United States.
Earlier this month, the Special Soybean and Grain Alliance (SSGA), a US agricultural transportation organization, stated that the lack of containers and its members’ inability to load exported goods is prompting Asian customers to investigate other food buyers.
SSGA Executive Director Eric Wenberg said: "Our members have heard from Asian customers that they doubt that the United States and its agricultural exporters will continue to be reliable suppliers based on the difficulties of today's multimodal transportation."
"Marine shipping companies need to work with us to solve these transportation problems and ship our goods back to Asian ports. Otherwise, the United States has been a reputation for exporting high-quality food to foreign customers and we must take action." He added.
In international trade, the quality of imported or exported goods may also need to be exchanged. Recently, we have also received inquiries from multiple companies regarding exchange and customs clearance. Let’s take a look at the specific operations.
Supervision method
In view of the situation that the import and export goods of enterprises in international trade need to be exchanged due to quality problems, etc., the customs has set up a special supervision method "Compensation of Goods at No Cost" (code 3100).
Compensation of goods at no cost means that after customs clearance of imported and exported goods, due to damage, shortage, poor quality or inconsistency in specifications, the consignor, carrier or insurance company of the import and export goods will freely compensate or replace the same or replacement goods with the original goods. Goods conforming to the contract.
The original import and export goods related to the free compensation goods are returned to and from the country, and the supervision method is "other" (code 9900).
Reporting time limit
The taxpayer shall declare to the customs for the import and export formalities of the goods for no-cost compensation within the claim period stipulated in the original import and export contract and within 3 years from the date of import and export of the original goods.
Before making a formal declaration to the customs, the following preparations must be made:
For import and export goods without cost, the original import and export goods should be returned out and in the country first, and the supervision method should be filled in other (9900), and the original import and export goods declaration number should be noted in the remarks column of the declaration form. When declaring import and export goods without cost, the supervision method should be filled as free goods (3100), and the original import and export goods declaration number and the original import and export goods return and entry declaration number should be noted in the remarks column of the customs declaration form.
1 , imported free replacement of goods, shall submit the following documents when applying:
1. Customs declaration form for original imported goods;
2. The export declaration form for the return of the original imported goods out of the country (the remarks column of the declaration form should indicate the number of the original import goods declaration form) or the certificate of abandonment of the original imported goods for customs processing (the original imported goods are short and the imported goods are not Need to submit);
3. Original imported goods tax payment certificate or "Tax Levy and Exemption Certificate";
4. Claim agreement signed by buyer and seller;
5. When the customs considers it necessary, it shall also submit an inspection certificate or other relevant certification documents issued by a qualified commodity inspection agency that the original imported goods are damaged, short, poor in quality or inconsistent with specifications.
2. The following documents shall be submitted when declaring goods for export without cost compensation :
1. The original export goods declaration form;
2. The import declaration form for the return of the original export goods into the country (the remarks column of the declaration form should indicate the number of the original export goods declaration form, because the original export goods are short and the export free compensation goods do not need to be submitted);
3. Original export goods tax payment form;
4. Claim agreement signed by buyer and seller;
5. When the customs considers it necessary, it shall also submit an inspection certificate or other relevant certification documents issued by a qualified commodity inspection agency that the original exported goods are damaged, short, poor in quality or inconsistent with specifications.
Tax collection
Imports of goods that are compensated at no cost will not be levied import duties and customs levies on behalf of the customs; for goods that will be compensated at no cost, no export duties will be levied.
No export duties will be levied on the replaced original imported goods when they are returned out of China. When the replaced original export goods are returned into the country, import duties and import duties are not levied on behalf of the customs.
Magic 2020, the shipping industry has breaking news every day, and it always affects the hearts of foreign trade forwarders.
Today, the Moments of Friends screened the video of the driver grabbing the box. Truck drivers flocked to "queue" to pick up the cabinet. You earn and I grab one box, and they are almost "fighting".
This is a real response. Even if the shipping company normally releases the cabin, there is no guarantee that there will be boxes. It is difficult to find a box in China.
Another heavy news is that CMA CGM will directly stop accepting bookings from Asia to Europe in the next three weeks, and temporarily stop bookings on the Asia-Northern Europe route in the 49th, 50th and 51st weeks. The European route has basically ended this year. Booking.
In recent months, due to the uneven recovery of the global economy, the rebound of epidemics in many countries, and the arrival of traditional transportation seasons such as Christmas and New Year, congestion has occurred in many European and American ports, but many domestic ports are extremely short of containers.
Under such circumstances, many large shipping companies impose additional charges such as congestion surcharges, peak season surcharges, and shortage of containers.
Following the further surge in freight rates on the European and Mediterranean routes last week, data shows that this week, China’s export container shipping market performed stably, and transportation demand remained stable. The freight rates on most shipping routes rose, which led to a rise in the composite index.
The largest increase was the year-on-year growth rate in Northern Europe of 196.8%, the year-on-year growth rate in the Mediterranean Sea was 209.2%, and the year-on-year growth rates in the West and East of the United States were 161.6% and 78.2%, respectively. 390.5%.
Shanghai Export Container Freight Index
As Christmas approaches, shippers and their freight forwarders in Europe and North America continue to generally face the problems of container shortages, port congestion, declining capacity and soaring freight rates. Many people in the industry are talking about the current "peak season" in the container industry. "When will it end?
According to the latest analysis conducted by Lar Jensen, CEO of shipping analysis agency SeaIntelligence, on behalf of the Baltic Exchange, the answer is likely to be around the Lunar New Year holiday in February, because the options available to supply chain stakeholders are very limited.
Chinese New Year will mark the end of the "peak season" of the container industry
The root cause of the current problem is the unexpected demand for container cargo due to the global social blockade.
Jensen said that there are three key issues in meeting higher levels of demand: container, ship and port capacity constraints. He wrote: "If demand decreases, the problem will be resolved immediately."
"However, shipping companies may show their determination to reduce capacity again in order to cope with the downward trend in demand. This means that very high spot freight rates will drop, and new equipment available surcharges will disappear, but the interest rate will not It's too likely to crash." He added.
In these strange years, it is difficult for the industry to reach a consensus, but there are few signs that consumer demand will decline in the short term.
Jensen said that for many shippers and freight forwarders, the most pressing problem is the serious shortage of containers, but as China's container manufacturing plants are in full production, this problem may be alleviated before the Chinese New Year on February 12.
"This problem can be solved within a few months." He said: "The solution is that the empty containers are shipped back from Europe and North America faster, coupled with the full work of China's container factories... The current situation can be After the Spring Festival, it ended peacefully."
However, it will take longer to solve the problem of global ship and port capacity. When the capacity is insufficient, the traditional approach of shipping companies is to turn to the leasing market. However, due to the surge in demand, only a few boats are available for hire.
"As a result, the time scale for increasing capacity has changed from weeks to years now, because it will require the construction of new ships. Moreover, since the peak demand may be temporary, this solution will not help solve the problem." He wrote.
Another option for shipping companies is to increase their ship speed. Faster service can free up the structural capabilities of the shipping group, although this does increase costs.
"In general, considering the optimization of fuel, when modifying or building these ships, they cannot sail as fast as ten years ago, but there is still a certain degree of additional capacity that needs to be activated. However, this also comes at a cost. , Including the sharp increase in carbon emissions."
Finally, there is the issue of port inventory, which he admits is almost powerless in the short term.
"The surge in demand and the increase in ship arrivals have not only affected the number of containers that the port can handle, but also the number of ships that can be berthed and served."
"In addition, the surge in demand has caused larger ships to arrive with more cargo than originally planned, which means longer berth stays, a chain reaction, and subsequent ships will be delayed."
"The expansion of the port's capacity can only be measured in a few years at most. In some areas, large expansion projects can take up to 10 years."
The container throughput of global ports continued to increase in October, with a total volume of 15.2 million TEUs that month. So far in 2020, the container throughput has reached 137.7 million TEUs, which is only 2.7% lower than in 2019.
The off-season is not "light"
The latest data from Container Trades Statistics (CTS) shows that the traditional freight off-season in 2020 will not be "light", and the performance will exceed expectations, and the market demand will continue until the fourth quarter . In October, the trans-Pacific shipping volume dropped by 4% from September to 2 million TEUs, but it was still a quarter higher than the same period in 2019. The demand is so great that although operators have been increasing capacity, there is still a gap.
Demand on the Asia-Europe route has also recovered, although its performance is not as strong as the Pacific route. In October, the shipping volume of the Asia-Europe route was 1.4 million TEUs, an increase of 7% over 2019. However, from the perspective of the whole year, the 13.9 million TEUs so far in 2020 is still 7% lower than 2019.
Equipment gap is nearly 1 million TEU
The Asia-Europe route is currently facing the same problem as the Pacific route, that is, the shortage of container equipment and capacity keeps the freight rate at a high level. Sea-Intelligence analysts said that the problem of container shortages is very difficult. The imbalance of east-west traffic on the Pacific route has made the shortage of equipment worse . The current North American imports account for most of the global increase in shipping containers, while North American exports have Weakening. Under normal circumstances, the imbalance of east-west shipping volume will usually cause a monthly deficit of about 2.5 million TEUs in Asia. This gap is filled by empty containers from other regions . But in October 2020, this number soared to 3.4 million TEUs, which means that the equipment gap has reached nearly 1 million TEUs.
Sea intelligence believes that the lack of empty containers is the primary problem faced by shippers. However, this problem is currently difficult to solve, and there is no way to quickly mobilize 1 million additional empty containers, especially when many ports are currently facing congestion. Analysts predict that this situation will continue until at least early February 2021.
Long queues for Hong Kong citizens? The latest response from Shenzhen Bay Port!
The epidemic in Hong Kong has not been alleviated, and many Hong Kong citizens have gone northward to avoid the epidemic. What is the truth behind the online photo of a large number of people at Shenzhen Bay Port waiting to pass the customs? What are the current changes in Shenzhen's epidemic prevention policies and measures? Let us understand together!
Shenzhen Bay Port responded immediately and left immediately, not full
Regarding the long queue of Hong Kong citizens, the police at the Shenzhen Bay Border Checkpoint responded to the media saying that although the number of people entering the country has increased recently, the border check area remains unobstructed. They are all inspected immediately, leaving no waiting time Need a very long situation.
Latest policy: Shenzhen Bay Port will provide 24-hour cargo clearance service from the 10th
A spokesperson for the Hong Kong Special Administrative Region Government announced on the 7th that Shenzhen Bay Port will provide 24-hour cargo clearance services from 0:00 on December 10.
The original cargo clearance service time at Shenzhen Bay Port was from 6:30 to 24:00 daily. The spokesperson said that the Chief Executive of the Special Administrative Region announced in the 2019 policy address that the Special Administrative Region government plans to extend the clearance time of Shenzhen Bay Port to 24 hours in phases within 2020, but due to the impact of the epidemic, the Hong Kong and Shenzhen governments agreed to suspend the implementation of the relevant plan.
Under the mechanism of joint prevention and control, the governments of Hong Kong and Shenzhen have formulated effective quarantine measures for cross-border truck drivers. On the one hand, they ensure a stable supply of materials and food to Hong Kong, and on the other hand, they strictly prevent the cross-border spread of the new crown virus.
The spokesperson said that in order to further support the logistics between the two places, and to gradually implement the cross-border freight forwarding layout of “east in and east out, west in and west out”, the Hong Kong and Shenzhen sides decided after discussion to start Shenzhen at 0:00 on December 10. The cargo clearance service time at Bay Port has been extended to 24 hours.
The spokesperson emphasized that after extending the cargo clearance service time at Shenzhen Bay Port, Hong Kong and Shenzhen will continue to strictly implement quarantine measures for cross-border truck drivers to prevent the spread of the new crown virus.
At this stage, the passenger clearance service time at Shenzhen Bay Port is from 10 am to 20 pm daily. The spokesman said that the two governments will consider implementing 24-hour passenger clearance services based on the development of the epidemic situation in the two places.
Warm Reminder: Information for people entering Hong Kong via Shenzhen Bay Port
In order to properly respond to the recent changes in the new crown pneumonia epidemic in Hong Kong, to ensure the safety, health and customs clearance order of people entering Shenzhen Bay Port:
From 10:00 am on August 7, 2020, those entering from Hong Kong through Shenzhen Bay Port must have a qualified testing agency approved by the governments of Guangdong and Hong Kong when entering the country. The nucleic acid test is negative within 24 hours. As a result, the paper report, after entering the country, went to the designated hotel for 14 days of intensive medical observation in isolation at the expense of his own.
Businesses that engage in international transport most likely prefer freight forwarding, but it is also an applicable method of transport even for personal use. The freight forwarding companies facilitate the shipment of goods to the destinations by using various carriers such as road freight, air freight, railway freight, and ocean freight.
If you don’t have any idea about freight shipping, you’ll find freight forwarding intimidating. Thus, if you engage in a business that involves international transport, it makes sense to understand the facts about freight forwarding.
WHAT ARE FREIGHT FORWARDING FIRMS?
Transporting goods from its origin to another destination is one of the services of freight forwarding firms. The freight forwarder works as a middleman between the transportation services and the shipper. They are responsible for arranging the entire process including the storage and the shipment of the goods. Likewise, they also negotiate the cost of the transport and choose the most reliable, fastest, and economical route.
SERVICES OFFERED BY FREIGHT FORWARDERS
Hiring the services of freight forwarding companies is advantageous to your business. They can help you in transporting the goods to your customers. As they are knowledgeable and expert about shipping of goods, they ensure that the merchandise will be delivered on time and in good condition.
Some of the services that freight forwarders offer are the following:
Customs clearance
Insurance
Packing
International import and export documentation
Inventory management and
Storage
Through the services of freight forwarders, the entire process of importing and exporting of goods becomes less stressful. They can also assist you in the packing of goods, thus reducing the pressure from you.
CHOOSE A RELIABLE FREIGHT FORWARDING COMPANIES
If you’re thinking to hire a freight forwarder, make sure to choose well-established and reliable freight forwarding companies. This gives you the assurance that they have strong experience about the business and good network of contacts. Likewise, experienced freight forwarders can deal and solve any issues about the transport of your goods efficiently and quickly.
As you’ll entrust your goods or merchandise to a freight forwarder, it makes sense to work with them harmoniously. It’s not enough to seek the service of a company that you can rely on and trust, but also with outstanding customer service. This way, you’ll have peace of mind that your shipment will arrive on time and safely.
Before entrusting your goods to freight forwarding firms, make sure that all the documents for transporting the goods are completed.
In recent times, there have been frequent port ship collisions. Yesterday another "bumper boat" accident occurred in Bejaia Port, Algeria. One container crashed into another unloading container ship when it was parked, and another bulk carrier was collided. The implicated damage is serious.
It is understood that the vessel involved in the accident was the container ship "VEGA SIGMA" (IMO 9330240) with a carrying capacity of 1118 TEU and flying the Liberian flag. The container ship that was hit was the "Atlantic North" (IMO 9236597) with a carrying capacity of 1119 TEU and flying the Maltese flag. The bulk carrier that was hit was "OWL" (IMO: 9441386), with a deadweight of 57,809 tons and flying the Marshall flag.
According to local media reports, on Saturday night, the container ship "VEGA SIGMA" had an electrical failure while entering the port after completing its entry procedures. The ship lost control and ran into another container ship "Atlantic North" that was unloading at berth 24. "No., the collision produced a loud noise, and some residents in the surrounding communities were awakened. A port mobile crane that was unloading was knocked down. The crane driver was seriously injured and was taken to the hospital. Due to the violent collision, the bulk carrier "OWL" on the other side of the "Atlantic North" transporting sugar for local companies was also implicated. It is understood that no one was injured except the crane driver. The three ships were damaged to varying degrees. The ship damage chart is as follows.
This is only one week after the last bumper boat incident occurred in the port of Punta da Madeira, Brazil. On November 28, 2020, when the 400,000-ton ore carrier "NSU CARAJAS" entered Pier 4 of the Port of Punta da Madeira for berthing, due to a loss of power, it ran into two berths in succession. An 180,000-ton bulk carrier at the No. 3 pier of the port.
These two large-scale port collision accidents were caused by equipment failure. Before the ship entered the port, the crew should adjust and test various mechanical equipment to make them available at any time to ensure the safety of navigation operations. The two port accidents in a short period of time also reminded all parties concerned that safety in production is the most important as the new year is approaching!
