Bangladeshi exporters lose their Singapore bypass service to China

2012 03 05

THE low volume of goods to China from Bangladesh has resulted in the country's exporters losing out on a direct shipping service to China with the suspension first such link five months after it started.

"The ships which were coming from China directly to Bangladesh were going back with almost empty containers," said Rafiqul Islam, Bangladesh country representative of Singapore-based Pacific International Lines (PIL).

Each 1,200- to 1,500-TEU ship carried 400 - 500 TEU from China, only move 100 TEU on the backhaul, he said, adding that even a reduction in container rent from US$1,000 to $600 failed to boost business.

The service loss is also a blow to the Bangladeshi government, keen to boost exports to rein in a trade deficit that widened more than 25 per cent in the five months to November compared with a year earlier.

The direct link meant goods took between 12 and 15 days, saving nearly a week compared with other routes, which stopover in Singapore, reports Hong Kong's Asia Times. The blow to Bangladeshi exporters comes at a time when shipping companies are raising rates as fuel prices rise after incurring losses last year as international global trade growth slowed just when a large number of new vessels were coming into service.

"This is happening due to the global economic situation," said an official of one Singapore-based shipping company. "The demand for goods in the US and in Europe has reduced a lot and this is leading to severe losses for shippers, who are coming up with effective solutions to cut losses."

"During March, we will continue to carry cargo between Bangladesh and China through transhipment via Singapore. Three ships will carry containers from China to Singapore and then they will be brought to Chittagong port through a feeder service. This will take maximum 15 days, compared with 12 days with the direct route," said Mr Islam.

Source Shipping Gazette - Daily Shipping News

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