The shift of manufacturing from China to Vietnam has also put pressure on the country's container supply chain.

According to the International Monetary Fund's forecast, Vietnam's gross domestic product (GDP) will grow by 2.4%, and Vietnam is expected to become one of the world's fastest-growing economies in 2020 as many other countries fall into recession due to epidemic lockdowns.

According to Simon Vandekerckove, general manager of freight logistics giant Geodis Vietnam, sourcing from Vietnam is entering a new stage. Factories are overbooked. We see overseas customers have high expectations for Vietnam, but Vietnam does not have the necessary legal or logistics foundation.

facilities to achieve this.

“Vietnam needs significant investment in new productivity and infrastructure to cope with growing demand, and as customers look to mitigate the financial risks of sourcing from only one region, Vietnam is likely to become an outsourcing region for other ASEAN countries such as Thailand and Indonesia.

” Meanwhile, a global capacity crunch and a shortage of container equipment are putting pressure on Vietnam’s major container ports.

A local freight forwarder in Vietnam said that the inland river terminals in Ho Chi Minh City have been congested for a long time, and the current market conditions have intensified the waiting time. The export container yard capacity is 120%, and ships need to wait two to three days to find a berth.

"At Cat Lai, all shipping lines have seen a sharp increase in outbound volume, but due to insufficient space, about 10%-20% of cargo must be transferred to the next ship each time," he added. Vietnam's largest deep-water port

The port of Cai Mep is keeping ships waiting 50 kilometers away, and in October the Cai Mep International Terminal (CMIT), operated by APM Terminals, received a call for the 20,000 teu Margrethe Maersk on the 2M direct transpacific route

one.

The port has had very large container ships calling (temporarily) in the past, but current demand trends are likely to see larger and larger ships coming here.

Next year CMA CGM will open Cai Mep’s newest terminal in partnership with local operator Gemadept.

Nonetheless, the current shortage of space and container equipment and the sharp rise in costs remain a huge challenge.

Vandekerckove explained: “Based on FAK and spot rates for all types of freight, booking from Vietnam requires two to three weeks in advance to secure containers and space. To the US West Coast, rates have increased by 140% and the Mediterranean by 70%

, up 15% in the Nordic region. "In most cases, air freight is not an option, but road freight offers a flexible option for some customers," Mr Vandekerckove said.