Why are exports through Cua Lo port low?

(Baonghean) - Every month, Nghe An has about 1,000 - 1,200 export containers, but the goods passing through the port are only 200 - 250 containers. This is a very modest number and not commensurate with the potential and expectations of a port that has been heavily invested in recently. How to attract the remaining 80% of the province's export goods to be exported through the port is a problem that needs a satisfactory solution.

Only 20/130 businesses export goods through the port

According to the Department of Industry and Trade, in the first 11 months of 2016, there were 130 enterprises in the province participating in goods export activities with a turnover of more than 491 million USD, an increase of nearly 19% over the same period. Enterprises mainly export goods by sea with about 100 enterprises, accounting for 77%. However, the number of enterprises participating in exporting goods through Cua Lo port accounts for only a small proportion, with only about 20 enterprises per year. The amount of goods exported through the port is still modest compared to the total export volume of the province, mainly stone, wood chips, and a little coal.

White stone is a commodity with a turnover accounting for a large proportion of the total export turnover of stone products of the province. In recent years, goods have been mainly exported through Cua Lo port, exported to markets of China, Taiwan, Hong Kong, Korea and Japan. However, recently, some stone exporting enterprises of Nghe An have transferred goods to Nghi Son port (Thanh Hoa) for export (Kieu Phat Company, Hoang Anh).

The reason is that these companies have previously exported stone through Cua Lo port, however, these businesses exported type B stone - a type of stone with many impurities, requiring pre-selection before export, causing dust and great environmental pollution for residents in the area around the port. Therefore, to ensure environmental issues, Cua Lo port refused to pre-select stone in the port. Therefore, this type B stone was transferred for export at Nghi Son port (Thanh Hoa).

Fishermen's fishing boats anchored encroaching on Cua Lo port.

Nghe Tinh Port General Director Le Doan Long said that the reason is because Cua Lo Port is located near a residential area, so its working hours are limited (from 10pm to 5am, it is closed to avoid noise affecting the people). The loading and unloading of goods by enterprises at the port cannot be carried out flexibly and promptly, so the slow release of ships directly affects the efficiency of export enterprises.

In addition, the Nghia Dan - Thai Hoa route has been cleared, so the transportation of goods by stone exporting enterprises to Nghi Son port is more convenient than transporting goods to Cua Lo port. Nghi Son port is a newly built and operational private port, so its exploitation capacity is very large. They offer low prices, even lower than the cost price, to encourage customers to transport through the port.

Regarding container exports including textiles, stone powder, fish powder, agricultural products (exports of these items account for about 70% of the province's total export turnover), container exports through Cua Lo port are still limited, most businesses transport goods by road and then export goods through Hai Phong port. Cua Lo port does not have international ships, so the transportation of international transit goods to Hai Phong still has to go through many stages of transit, lifting and lowering, lack of initiative in container shells, the amount of exported goods is small, fragmented and goes to many different shipping lines, so packing, loading and transiting at Hai Phong port is not yet convenient for both businesses and shipping lines... The shipping frequency is not high, only reaching 8-10 days/trip because the amount of goods is not enough to increase the shipping frequency.

Difficult problem to solve

Ms. Vo Thi An - Deputy Director of the Department of Industry and Trade said: "According to calculations, the total cost of loading, unloading, warehousing... at Cua Lo port is currently higher than exporting goods through Nghi Son port by about 8,000 VND/ton. When businesses export goods through Nghi Son port, the provincial budget will have its tax revenue from white stone exports reduced by 15% and VAT on port transportation services. Therefore, Cua Lo port, relevant departments and branches need to have solutions to avoid budget losses for the province."

To encourage the transportation of goods by container, Cua Lo port has a policy to reduce costs for businesses exporting goods through the port. Currently, the fee for lifting and lowering containers at Cua Lo port is only about 200,000 - 290,000 VND/container, while this cost at Hai Phong port is 430,000 - 580,000 VND/container (applied to 20-foot and 40-foot solid containers). For businesses with export goods in areas surrounding Vinh city, if they transport goods by container directly from Cua Lo port, ignoring the inconvenience of transit and waiting time for ships, businesses can save from 500,000 - 1,000,000 VND/container compared to transporting through Hai Phong port.

Unloading goods through Cua Lo port.

Sharing the difficulties of enterprises, Mr. Nguyen Duc Hiep - Director of Ha Duc Logistics Company Limited said: For bulk cargo, Hai Phong port can unload 10,000 tons of coal/day, Vung Ang port 5,000 - 6,000 tons/day but Cua Lo port only 1,500 tons/day. The amount of goods from Nghe An is not small, but not concentrated, goods through Cua Lo port take a long time, so enterprises still have to choose to export goods through Hai Phong port.

According to the Customs Department, Nghe An has 1,000 - 1,200 containers/month but Cua Lo port only attracts 200 - 250 containers/month, "losing" about 80% of the goods passing through the port. Mr. Tokey Chen - General Director of NLG Nghe An PP Joint Venture Company Limited said that due to low draft, Cua Lo port does not have international ships or large capacity ships entering. There are only small capacity ships (under 15,000 tons) so the loading and unloading time is long, leading to additional costs for businesses.

Concerned about attracting effective investment in the area and increasing the province's budget revenue, Vice Chairman of the Provincial People's Committee Le Ngoc Hoa shared that in order for Cua Lo port to operate professionally and effectively, meeting the growing demand for goods export of enterprises in the province, it requires the cooperative efforts of many related parties. He requested relevant departments, branches, and Cua Lo town to complete the fishing wharf, move all fishing boats anchored in the port to a new area to ensure convenience for wharf exploitation, maritime safety and security and order at the wharf. Nghe Tinh port needs to continue to improve the quality of management, service, reform the working staff, and improve competitiveness. On the side of the province, it will accompany the port, have support policies, and create conditions for enterprises to export goods through the port. Currently, goods exported through the port only account for 25%, striving to increase the number of exported goods through the port to 50% by the second quarter of 2017.

Viet Phuong