Thai Supply Chains affected by Container Shortages
Carriers are prioritising capacity in neighbouring countries as Thailand’s container shortage wreaks havoc.
The Loadstar reports that Thailand faced an overwhelming shortage of 1.5 million containers in 2020. Further, while such shortages have been felt globally, Thailand especially bore the brunt since shipping lines prioritised neighbouring countries like Vietnam and China.
Ghanyapad Tantipipatpong, head of the Thai National Shippers’ Council (TNSC), highlighted the problem, emphasizing on the way neighbouring countries like China and Vietnam have a competitive advantage since they take on increased freight prices from shipping lines. This trend not only impacts the amount of space Thailand has at its disposal but also its equipment handling capacity, notwithstanding the incrementally higher freight rates and surcharges it pays.
The problem is exacerbated by extra “peak season” and “imbalance in equipment” surcharges – such as a charge of $500 from China, levied on imports into Thailand. Substantially higher transpacific rates are only adding to Thailand’s woes; while these were $1,400 per feu in November 2019, they almost tripled to $4,000 per feu a year later.
Ultimately, heightened demand for transpacific cargo has had a cascading effect across businesses, especially since Thai shippers are also having to deal with vessel rollovers, delays, and cancellations.
