Uniforce Vietnam update: RED SEA SITUATION END OF YEAR 2023!

Due to tensions in the Red Sea affecting the safety and transportation of many shipping lines, they were forced to change itineraries on Asia-Europe routes, avoiding going through the Suez Canal (accounting for 80% of shore bound goods). Eastern US/Canada and EU) and the Red Sea region.

The fact that cargo ships are forced to go around the Cape of Good Hope (South Africa) makes the journey take an extra 7-10 days. This leads to longer ship turnaround times, leading to more shipping costs. Some shipping lines even have to cut some weekly shipments, leading to lack of space or putting more ships into operation, increasing costs.

With the announcement of additional surcharges from shipping lines, sea freight rates to the US, Canada and EU from January 2024 will increase significantly compared to December 2023. Specifically, going to the West Coast of the US (Los Angeles) increased from 800-1,250 USD/container, depending on the route, going to the East Coast of the US (New York) increased from 1,400-1,750 USD depending on the route.

Sea freight rates to the EU have increased even more. Specifically, the fare to Hamburg currently costs 4,350 USD-4,450 USD in the first half of January 2024, while the price in December 2023 ranges from 1,200-1,300 USD.

Due to fluctuations in REDSEA, Vietnam market is also affected. Freight prices fluctuate. Factories have planned to export goods to countries in Europe, but they are concerned about the risk of loss of labels, danger to goods and delivery time. There are even some factories that have to temporarily hibernate and have to reschedule shipments until the Lunar New Year holiday to wait for the war situation to calm down. However, the risk of delay and contract compensation for signed orders is very high.

Even some specific products of VIETNAM such as “RICE and Seafood” must be temporarily rescheduled to ensure that the risk of damage is reduced to a minimum for export.

MSC shipping line confirmed that on December 26, 2023, the container ship MSC UNITED VIII was attacked while passing through the Red Sea.