Fuel oil price hike reduces number of feeder vessels on int'l routes
Jasim Uddin Haroon | Sunday, 6 July 2008
The number of feeder vessels carrying import and export cargoes in the country is on the decline mainly due to price hike of fuel oil (bunker) in the international market, feeder operators told the FE Saturday.
Shipping sources said a total of 14 feeder vessels suspended their services to and from Chittagong port over the past few months saying that it was "not feasible" anymore to ply on this route mainly due to price hike of fuel.
Currently, only 32 feeder vessels are plying on Chittagong-Singapore route, the country's main international route to carry export and import goods.
The alarming situation is taking place at a time when the country's exports are peaking and imports rising.
The feeder operators said there was a large backlog of Bangladesh bound cargoes awaiting shipment from Singapore and Malaysian ports.
Feeder operators, however, said they are watching the situation of bunker prices, a composition of fuel oil, diesel oil, furnace oil and lubricant oil, and they might resume the services once the situation improved.
Jamaluddin Quader Chowdhury, director of QC container line, told the FE that the plying of vessels to and from Chittagong port is not possible any longer mainly because of high bunker prices.
"We cannot raise freight for export goods due to the pressure from different quarters. Then, how will we sustain in the trade," said Mr Jamal.
Currently, the freight for export cargoes up to Singapore ranges between US$ 240 and $ 260 for each 20-foot container.
QC container line, the country's leading feeder operator, suspended all of its four feeder services since mid-June this year.
The others who also suspended their services includes Prominent Shipping Lines, Columbia Shipping lines, government-owned Bangladesh Shipping Corporation, and Javasta.
Besides, a number of feeder operators reduced the number of vessels in the routes.
Currently, MCC, a sister concern of Maersk line, has six feeders, OEL three, PIL four, Samudra one, EP Carrier one, GSL one, Hanjn one, sea consortium four, APL three, HRC six and CMA-CGM two.
Mr Jamal said the feeder vessels, which are still plying on the route, have been continuing to do so only to keep their market share of the route.
"I think those that are still in service are compensating for their losses from other routes," Mr Jamal added.
Captain Rafiqul Islam, country director of PIL, a Singapore-based company, said their profit has come down adding: "We also reduced our vessels in the route recently."
Mr Rafique also said there is a huge gap between export and import cargoes which is also forcing many to be discouraged from operating in the route.
He said: "Our vessel Kota Harmanui sailed off Chittagong port today (Saturday) by loading only 290 containers although it had carried 950 import containers two days back."
Fazlul Hoque, senior general manager of Continental Trading, a feeder operator, said that the prices of bunker rose to US$ 700 each tonne, $ 200 up from a month before, forcing feeder and main line operators to abandon the Singapore- Chittagong route.
A voyage between Chittagong and Singapore needs around 15 days and each day the bunker requirement is around 30 tonnes.
He also said different charges slapped by Chittagong port also made it costly for the feeder operators.
Mr Hoque said the port is now realising $ 6.0 for storing an empty container each day claiming that the rate is one of highest in the world.
S K Ghosh, executive director of QC Shipping lines said not only the bunker prices but various orders issued at different times relating to port charges and uses were also responsible for the decline in feeder vessel operation.
"I think the port should discuss with the trade bodies before taking any decision," Mr Ghosh added.
Shipping sources said a total of 14 feeder vessels suspended their services to and from Chittagong port over the past few months saying that it was "not feasible" anymore to ply on this route mainly due to price hike of fuel.
Currently, only 32 feeder vessels are plying on Chittagong-Singapore route, the country's main international route to carry export and import goods.
The alarming situation is taking place at a time when the country's exports are peaking and imports rising.
The feeder operators said there was a large backlog of Bangladesh bound cargoes awaiting shipment from Singapore and Malaysian ports.
Feeder operators, however, said they are watching the situation of bunker prices, a composition of fuel oil, diesel oil, furnace oil and lubricant oil, and they might resume the services once the situation improved.
Jamaluddin Quader Chowdhury, director of QC container line, told the FE that the plying of vessels to and from Chittagong port is not possible any longer mainly because of high bunker prices.
"We cannot raise freight for export goods due to the pressure from different quarters. Then, how will we sustain in the trade," said Mr Jamal.
Currently, the freight for export cargoes up to Singapore ranges between US$ 240 and $ 260 for each 20-foot container.
QC container line, the country's leading feeder operator, suspended all of its four feeder services since mid-June this year.
The others who also suspended their services includes Prominent Shipping Lines, Columbia Shipping lines, government-owned Bangladesh Shipping Corporation, and Javasta.
Besides, a number of feeder operators reduced the number of vessels in the routes.
Currently, MCC, a sister concern of Maersk line, has six feeders, OEL three, PIL four, Samudra one, EP Carrier one, GSL one, Hanjn one, sea consortium four, APL three, HRC six and CMA-CGM two.
Mr Jamal said the feeder vessels, which are still plying on the route, have been continuing to do so only to keep their market share of the route.
"I think those that are still in service are compensating for their losses from other routes," Mr Jamal added.
Captain Rafiqul Islam, country director of PIL, a Singapore-based company, said their profit has come down adding: "We also reduced our vessels in the route recently."
Mr Rafique also said there is a huge gap between export and import cargoes which is also forcing many to be discouraged from operating in the route.
He said: "Our vessel Kota Harmanui sailed off Chittagong port today (Saturday) by loading only 290 containers although it had carried 950 import containers two days back."
Fazlul Hoque, senior general manager of Continental Trading, a feeder operator, said that the prices of bunker rose to US$ 700 each tonne, $ 200 up from a month before, forcing feeder and main line operators to abandon the Singapore- Chittagong route.
A voyage between Chittagong and Singapore needs around 15 days and each day the bunker requirement is around 30 tonnes.
He also said different charges slapped by Chittagong port also made it costly for the feeder operators.
Mr Hoque said the port is now realising $ 6.0 for storing an empty container each day claiming that the rate is one of highest in the world.
S K Ghosh, executive director of QC Shipping lines said not only the bunker prices but various orders issued at different times relating to port charges and uses were also responsible for the decline in feeder vessel operation.
"I think the port should discuss with the trade bodies before taking any decision," Mr Ghosh added.