A new horizon opens up

Europe is Bangladesh’s largest market for readymade garment products, with an estimated 60 per cent of the country’s exports going there. Local exporters send their products to Europe from Chattogram via ports in other regions, forcing them to wait for a more extended period to book ships from those ports, ultimately pushing up time and shipping costs. Direct shipping set to commence from today will significantly cut garment export costs and save shipment time.

Sending a container directly from Chittagong Port to Italy takes about 20 days and costs around $10,000. But if a container of the same size is shipped to Europe through mother vessels via transhipment port Singapore or Colombo, it takes around a month and the cost goes up to $14,000-15,000. Currently, Italy-bound container ships from Chittagong Port first have to reach a European base port via transshipment ports. From there, they can go to Italy. In some cases, goods are carried to Italy in mother vessels directly from the transhipment ports. But, most of the time, containers are unloaded at European base ports in the absence of the mother vessel’s schedule in Italy. From there, goods are shipped to Italy in feeder vessels. The exporters count losses due to extra shipping costs and time in the existing system. But a faster and cheaper delivery of goods from Bangladesh will make more European buyers interested in ordering readymade garments from here. Hopefully, this development will encourage countries in other regions, such as the US, to opt for direct shipping from Bangladesh.

Since the pandemic began in early 2020, the cost of transportation in the international shipping sector has risen several folds. Container fares on USA or European routes, which were $2,500 before the outbreak of Covid-19 in 2020, have risen to $8,000 to $10,000 in many areas. Due to the high cost and shipping disruption during the pandemic, major buyers of readymade garments in Italy jointly took an initiative to start direct shipping to Europe from Chattogram. As part of this initiative, the Chattogram-Italy route has been launched. With the help of Italian buyers, Calypso Company D Navigation, a ship operator in Chittagong Port, also an affiliate of RifLine Worldwide Logistics Ltd, a freight forwarder, has taken the initiative to operate direct ships from Chattogram to Italian Port Ravenna and Civitavecchia. Container ship MV Songa Cheetah from Europe arrived at Chittagong Port on Saturday noon with 953 Twenty Equivalent Unit (TEU) empty containers and a few containers of imported goods. It is scheduled to leave for Italy with 983 TEU containers, mostly readymade garments items today. Tanvir Ahamed, Regional Head of RifLine Worldwide Logistics Ltd, said that direct shipping to Europe will cut the cost by 30-35 per cent and save at least a week’s shipment time. The delivery duration of Chattogram-Ravenna port is 20 days.

Mohammad Rashed, Chairman of Reliance Shipping and Logistics, the local agent of MV Songa Cheetah, said the goods can reach the European market quickly without the help of the mother vessel of the transhipment ports, which will revolutionise RMG export and this route will open up massive potentials. We agree with Chittagong Port Authority Chairman Rear Admiral M Shahjahan that the real cost would go down further with direct shipping.

The development will have a massive impact on our export-oriented readymade garment sector which earns the lion’s share of our export. A bigger ship will save more. Foreign buyers will be benefitted as the cost of transporting goods will be significantly reduced. This will play a big role in creating new buyers. The latest development will reduce costs in export-import trade including the fixed operating cost of ships and strengthen Bangladesh’s position in the competitive market. But there’s no room for complacency. The authorities need to work on creating more routes for direct container ship movement to other ports in Europe and America from Bangladesh.