According to a report by Vietnam’s “Saigon Economy” magazine on December 24, although export orders have resumed growth, due to soaring logistics costs and raw material prices, as well as the impact of the epidemic and insufficient labor, Vietnam has Companies have become more cautious when accepting orders. Shen Deyue, general manager of No. 10 Garment Company, said that as one of the largest garment companies in Vietnam, the company exports about 2,000 containers of clothing products every year. During the epidemic, companies often could not find empty containers or book shipping space, resulting in delays in delivery and losses. In addition, shipping charges, port fees, container imbalance surcharges (CIC), etc. have been rising, causing the company to face many difficulties. Nguyen Ngoc Luan, founder of Global Trade United Co., Ltd., said that the freight for shipping a 20-foot container from Vietnam to the United States before the epidemic was US$3,000, but now it is US$15,000, which has increased five times. Due to the scarcity of ships and space, freight rates will only rise but not fall in the coming period. Before the epidemic, shipping from Vietnam to the United States took less than one month, but now it takes at least three months; before the epidemic, it only took 25 days to ship to Russia, but now it takes more than three months. Rising freight costs make products less competitive, and longer shipping times shorten product lifespan.
Reports say that Vietnamese export companies generally face the problem of rising raw materials. Success Textile and Apparel and Investment Trading Company stated that its revenue in November was US$12.8 million, an increase of 10.4% compared with October. However, as export prices were not adjusted, profits basically remained unchanged. Agricultural products exports also face the same problem. Nguyen Ngoc Luan, founder of Global Trade United Co., Ltd., said that although export orders have rebounded, the company does not dare to accept orders easily because the prices of raw materials and packaging continue to rise. The company does not dare to make major adjustments to export prices for fear of losing customers. Take coffee as an example. The price of coffee beans has increased by 50% compared with before the epidemic, and packaging fees have increased by 30%. However, the increase in export prices has been very small, and profits have become very thin. In addition to rising prices, raw materials have become difficult to source. Ruan Dengxian, general manager of New Guangming Company, said that during the fourth round of the epidemic this year, the company consulted six companies in succession before finding the raw materials to buy.
Reports say that since Vietnam’s economy entered the new normal, export orders for textiles and clothing, footwear products, wood products, electronic products, etc. have gradually rebounded, but many companies said that they Becoming more careful when taking new orders.
