Exporters struggle with shipment due to continued blockades

Infograph: TBS

The ongoing blockades, called by the opposition, has thrown the transportation of import and export goods into disarray, causing significant disruptions to the country's industrial sector.

Stakeholders have raised concerns about the decline in production as imported raw materials are not reaching factories on time. This disruption is affecting the production of all types of industrial goods, including ready-made garments, a major export earner for Bangladesh.

Exporters are facing immense challenges in meeting buyer deadlines due to the transportation delays. These complications are causing shipment disruptions and jeopardising export contracts.

Entrepreneurs say freight fares on all routes, including the crucial Dhaka-Chattogram corridor, have almost doubled, putting immense pressure on businesses.

Amid the escalating political tensions, the ready-made garment industry is witnessing a decline in orders, further compounding the challenges faced by exporters and manufacturers.

Mohammed Hatem, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), told The Business Standard that the ongoing blockades are hindering the timely delivery of imported fabrics to garment factories. As a result, it has been difficult to meet buyer deadlines.

He also highlighted the increase in transportation costs, stating that the freight fare for transporting goods from Narayanganj to Chattogram has more than doubled from Tk12,000 to Tk25,000 since the implementation of the blockades.

Chattogram C&F Agent Association Port Affairs Secretary Md Liakat Ali Howlader raised concerns about the transport crisis caused by the ongoing blockades. He said importers are now paying almost double the previous fare of Tk15,000 to transport goods from Chattogram port to Dhaka.

Main Uddin, vice president of the Central Committee of Bangladesh Truck Workers Federation, attributed the increased fares to the rampant arson attacks on vehicles during the blockades. This has led to a fear of driving on the roads among truck drivers, further worsening the situation, he said.

In recent weeks, the BNP and the Jamaat-e-Islami have imposed a series of nationwide blockades demanding the resignation of the incumbent Awami League government and the formation of a non-partisan caretaker government to oversee the next national elections.

RMG orders drop in Ctg port

Readymade garment factory owners have reported a significant decline in orders during the first ten days of November, with a drop of over 20% compared to the same period in October. They fear that the decline could reach 30% by the end of November.

Around 450 garment factories, including 350 BGMEA member factories in Chattogram, contribute to the export of ready-made garments. These companies typically receive orders worth $200 million per month. However, in October, orders fell to $113 million.

Rakibul Alam Chowdhury, vice president of the BGMEA, revealed that BGMEA member factories in Chattogram received orders worth around $44 million in the first ten days of October. This figure dropped to $35 million during the same period in November, representing a decline of 20.45%.

Container delivery dropped by 50% in Ctg port

Under normal circumstances, the Chattogram port typically delivers around 4,000 to 4,500 containers daily, with around 6,000 to 7,000 trucks, covered vans, and prime movers transporting these containers.

However, due to the ongoing blockades, container delivery has plummeted to a mere 2,000 per day. This represents a significant drop of almost 50% compared to the normal delivery rate.

Data from the Chattogram port reveals that container delivery has been consistently lower than the normal volume since 27 October. Between 27 October and 15 November, only 10 out of 19 days witnessed container deliveries falling within the range of 2,000 TEUs to 3,000 TEUs. For the remaining nine days, container deliveries ranged from 3,000 TEUs to 5,000 TEUs.

Meanwhile, importers are facing additional financial burdens due to the blockades, as they are forced to pay fines for not being able to take delivery of containers from the port on time.

Under normal circumstances, importers have a four-day grace period to clear their containers from the port yard without incurring any rent charges. However, after this initial grace period, importers must pay $6 per day for a 20-foot container during the first week.

The daily fine subsequently doubles to $12 for the second week and escalates to $24 from the 21st day. For 40-foot containers, the charges follow a similar doubling pattern.

As of 15 November, the Chattogram port had 27,665 TEUs of containers in the yard, exceeding half of its holding capacity of 53,518 TEUs.