Vincent Clerc, head of AP Mller-Maersk (Denmark), said that after “an almost vertical” increase in shipping costs in the past month amid worsening congestion at ports in Asia and the Middle East, more customers could try to ship goods much earlier than normal. “At this stage, the thing that can really make things worse for the global supply chain is this rush for the door where everybody starts to order more than they need. You get this bullwhip effect,” he added.

Clerc warned that any move by retailers to get their goods earlier would be counter-productive. “In order to prevent delays, you have more delays.”

Drewry’s World Container Index increased by 12 percent to US$4,716 per 40ft container during the week ending on June 6, 181 percent higher than the same week last year. The latest Drewry WCI composite index of US$4,716 per 40ft container is 232 percent more than the average 2019 (pre-pandemic) rate of US$1,420.

The average composite index for the year-to-date is US$3,384 per 40ft container, which is US$654 higher than the 10-year average rate of US$2,730 (which was inflated by the exceptional 2020-2022 COVID-19 period). Freight rates from Shanghai to Genoa increased by 17 percent or US$971 to US$6,664 per 40ft container.

The freight rates from Shanghai to New York recently reached US$6,463 per 40ft container, an increase of about 142 percent year-on-year, while the rates from Shanghai to Los Angeles was around US$5,975 per 40ft container, up approximately 215 percent compared to the same period last year.

According to the Vietnam Maritime Administration (VINAMARINE), the cost of shipping to Europe and the US has increased sharply since June 2024.

Data from Phaata, the first global logistics marketplace in Vietnam, show that freight rates from Ho Chi Minh City to the US have been rising strongly.

Truong Dinh Hoe, General Secretary of the Vietnam Association of Seafood Exporters and Producers (VASEP), said the world’s vital shipping routes from the Red Sea to the Gulf of Aden have been severely impacted by the escalating geopolitical conflicts in the Middle East. The Bab el-Mandeb Strait - one of the busiest shipping lanes in the world, handling around 15 percent of the global maritime trade value - has been significantly disrupted due to attacks by Houthi rebels against cargo ships. Most cargo ships have been avoiding traveling into the Red Sea, with daily movements reduced by two-thirds compared to the same period last year.

The drought at Panama Canal, which handles five percent of the global maritime trade value, is gradually improving as the daily transit number has increased. However, the Panama Canal’s transportation capacity is still lower than the usual daily average of 34-40 transits, and the cargo volume is expected to return to normal by 2025. Recently, congestion has occurred in Singapore, leading to concerns about supply chain crises and rising commodity prices.

Some have said the fact that the US plans to impose higher tariffs on various Chinese goods starting in August 2024 has prompted Chinese exporters to accelerate their shipments before the deadline. As a result, many Chinese exporters are willing to pay higher rates to shipping lines to secure space on vessels bound for the US and Europe.

Chinese companies are willing to pay up to US$1,000 per container slot on ships, while Vietnamese ones pay only US$600. Therefore, shipping lines have prioritized a large portion for Chinese companies while reducing slots for those from other countries, including Vietnam.

Vietnam’s exports to major markets, such as the US and EU, rely heavily on foreign shipping companies, as Vietnamese ships mainly transport cargo to China, Japan, the Republic of Korea and Southeast Asia and handle just 10 percent of Vietnam’s sea-route-based export volume.

VINAMARINE has requested maritime port authorities to work with maritime authorities and relevant agencies and organizations to strengthen the supervision of shipping lines, including providers of container shipping services, to get them publicize service prices and surcharges in accordance with Government Decree No.146.

The maritime authority of Ho Chi Minh City has been assigned to working with maritime authorities of Hai Phong and seaport authorities in Ho Chi Minh City, Vung Tau, and Hai Phong, to monitor statistics on increases/decreases in prices and surcharges for some shipping lines providing container shipping services to Europe and the US, including Maersk, MSC, CMA-CGM, ONE, Hapag-Lloyd, Evergreen, HMM, COSCO, Yang Ming, and OOCL, among others.