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Saturday, October 1, 2022

Many exporters hesitant about new orders over high logistics costs

By Viet Dung

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HCMC – Many food and woodwork exporters have been hesitant to receive new orders due to high logistics costs and protracted delivery times.

Ly Kim Chi, chairwoman of the HCMC Food and Foodstuff Association, said many firms active in the food and foodstuff industry have become cautious about receiving new orders or refused foreign buyers due to rising logistics fees.

The price of a 40-feet container for goods transport to the United States has risen to US$15,000 from the previous US$2,000, said Chi.

Similarly, the cost of container transport to Russia now hovers at US$9,000-US$10,000, a four-fold increase.

The extended delivery time has discouraged firms from receiving new orders, Chi said, adding that it took exporters 28 days to ship their goods to the United States a few months ago, but the firms now have to wait for empty containers for two to three months.

Echoing the view, Nguyen Chanh Phuong, vice chairman and secretary-general of the Handicraft and Wood Industry Association of HCMC, said the biggest difficulty facing the wood sector was logistics costs.

“The volume of woodwork and furniture is large, so exporters will need multiple containers to transport them. However, the price of a container has been revised up on the one hand, while on the other, the exporters are facing a lack of empty containers,” Phuong said.

“Many firms have not dared to take on new orders at this time,” he added.

Sea transport costs have increased ten-fold over the past two years, piling pressure on importers and exporters.

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