The end of the year is typically the peak period for empty container shortages, especially in 2020 when the impact of the COVID-19 pandemic altered the balance of imports and exports, making the container shortage situation even more complex.
According to VLA survey statistics, difficulties faced by enterprises regarding empty container shortages at each link in operations with shipping lines are as follows: Sales department accounts for 17%, Container delivery at depots accounts for 40%, and Booking department accounts for 43%. In addition, many enterprises indicate that difficulties in cargo transportation routes are mainly through Intra-Asia and Americas regions.
VLA reports that the empty container shortage is due to the year-end being the peak export season, coupled with Vietnam being a trade surplus country. Not only is it affected by container delivery at depots, but the shipping lines' poor control of empty containers at depots has also caused container shortages in Vietnam.
Mr. Le Kim Cuong - Deputy Director of Tan Cang Logistics Service Center (SNPL) stated: "The main cause of the empty container shortage is the outbreak of the COVID-19 pandemic, especially during the peak periods in May and September. In addition, due to the impact of storms and fog, cargo exports to China, Japan, and South Korea had to be delayed. The capacity to receive empty containers from deep-sea ports transferred to ICD ports remains limited; specifically in Ho Chi Minh City, Dong Nai, and Binh Duong, there are currently about 50 empty depots, but only about 20% of them are ICDs capable of directly receiving empties from deep-sea ports."
Solutions
To address current difficulties, SNPL has implemented specific and timely solutions. Tan Cang has focused on infrastructure investment and enhancing resources to improve container transportation service quality and shorten container turnaround time. Also this past year, SNPL successfully implemented the renovation process at ICD Long Bình; from October 2019 to date, SNPL has transshipped over 3,000 import and export containers through ICD Tân Cảng - Long Bình to Cai Mep Port. In the coming period, SNPL will continue to actively promote the attraction and transportation of empties between Cai Mep Port and ICD Tân Cảng - Long Bình, as well as at other ICDs such as Song Than, Nhon Trach, and Hiep Phuoc.
Some recommendations to address the empty container shortage include increasing the use of new facilities, proactively obtaining containers from the region where they are needed to avoid congestion and shortages when concentrating on one location only. At the same time, enterprises need to strengthen incentive mechanisms for container delivery and reward-penalty mechanisms for container usage.
Source: VLA