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Soaring energy prices put burden on VN businesses

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Skyrocketing prices of petrol and coal in recent days have put great pressure on businesses whose inputs are mainly these products.

Soaring energy prices put burden on VN businesses
Coal mining dumps of Cua Ong Coal Selection Company, a member of Vietnam National Coal-Mineral Industries Holding Corporation Limited. Vietnam’s imported coal output accounts for about 20-25 per cent of coal supplied to power plants annually. —VNA/VNS Photo Minh Duc

Along with the price of oil, the price of gas in the global market is increasing rapidly. For the first time in history, the price of European gas has reached US$3,600 per 1,000cu.m, according to data from the ICE Commodity Exchange in London, UK, on March 7, 2022. The price of gas futures for April delivery at the TTF hub in the Netherlands also increased to $3,639.1 per 1,000cu.m.

According to SSI Research, for companies using oil and gas as input materials, an increase in oil and gas prices will increase product costs. Gas-fired power plants are less competitive and the current situation also negatively affects the share of output offered in the power generation market.

The profit margin of enterprises may narrow if the cost of gas does not decrease. For example, at Nhơn Trạch 2 Petroleum Power Joint Stock Company (NT2), although in 2021, net revenue reached VND5.47 trillion ($239 million), a slight increase compared to the previous year, but this growth rate was slower than the increase in cost price (gas price), so gross profit margin decreased by 24 per cent in the period. As a result, the company reported profit after tax of VND534 billion, down about 15 per cent compared to 2020.

Not only oil prices, gas and coal prices on the world market also increased sharply due to the influence of the conflict between Russia and Ukraine. Russia is an important coal exporter in the world, thus when the supply of coal and oil from Russia is blocked by sanctions from the US and EU, while demand increases, pressure rises on oil and coal prices.

On March 3, 2022, the FOB Newcastle price for 5,500 kcal/kg NAR thermalcoal with 20-per cent ash, according to FOB Newcastle, reached $205.25 per tonne, up $25.65 per tonne compared to the previous session.

Indonesia’s coal 5,900 GAR was quoted by S&P Global at $200 per tonne in the same session, up $45.1 per tonne, while thermal coal 5,750 NAR in Northeast Asia increased by $28.23 per tonne to $248.63 per tonne.

Vietnam’s imported coal output accounts for about 20-25 per cent of coal supplied to coal power plants annually. Therefore, coal price fluctuations will greatly affect domestic coal power plants.

Power Generation Corporation 1 (EVNGENCO1) said that coal supply in the first two months of the year encountered some difficulties, mainly due to the high prices of coal. The corporation has worked with major coal suppliers to find solutions to supplement coal sources to ensure enough coal for operation and closely follow the actual situation to develop an appropriate operating plan.

At the conference to review the work in 2021 and implement the 2022 plan of Power Generation Corporation 3 (EVNGENCO3) under Vietnam Electricity (EVN), Chairman of the Board of Directors of EVN Duong Quang Thanh asked the business to proactively take measures to ensure coal sources for power production in the current situation.

In 2021, coal prices saw continuous surges, causing the gross profits of coal-fired power enterprises to drop sharply. The gross profit margin of Hai Phong Thermal Power Joint Stock Company (HND) was only 7.1 per cent, down sharply from 17.5 per cent in 2020. Meanwhile, Pha Lai Thermal Power Joint Stock Company (PPC) suffered a gross loss of VND112.3 billion.

The sharp increase in input costs can be seen as a double difficulty for coal power enterprises when international organisations no longer support loans to develop coal power projects due to concerns about environmental pollution. This will hinder businesses that are planning to invest in new power plant projects. 

Difficult transport

Crude oil price remains at nearly $110 per barrel and is forecast to stay at a high level as the energy demand of the global economy continues to increase.

In the domestic market, the inter-Ministry of Finance-Industry and Trade has adjusted petrol prices from March 11, 2022 with an increase of nearly VND3,000 per litre of petrol and nearly VND4,000 per litre for kerosene and oil diesel. Accordingly, the price of RON 95 petrol has approached VND30,000 per litre, while the price of 0.05S diesel oil is VND25,268 per litre.

According to HCM City Goods Transport Association, the price of petrol has soared to the highest level in the past seven years and may increase further, causing transportation enterprises to face many difficulties. Fuel costs are accounting for about 35-40 per cent for container trucks and heavy trucks; and other vehicles account for about 25 per cent on average. Businesses also have to pay many other costs such as wharf, road maintenance and BOT fees.

Many businesses have overcome the damage caused by COVID-19 that has lasted for the past two years, and the whole industry now continued to face difficulties from the increase in petrol prices.

Hoang Ha Joint Stock Company (HHG) said that the COVID-19 pandemic has severely affected the business’s operations. From August to October 2021, all intercity vehicles of the company must stop working.

Last year, HHG recorded net revenue of VND94.3 billion, down 16 per cent compared to the previous year; and a post-tax loss of VND68.6 billion. HHG has suffered continuous losses since the third quarter of 2019.

Anh Duong Group Joint Stock Company-Vinasun Taxi (VNS) recorded net revenue in 2021 down 52 per cent compared to 2020, to VND485 billion and a net loss of nearly VND277.6 billion, in 2020 the loss was VND210.6 billion.

According to Ta Long Hy, Deputy General Director of VNS, from the beginning of 2022, the price of petrol has increased sharply, causing taxi businesses to choose between increasing fares or accepting losses. Vinasun had to increase freight rates to solve the problem. 

Source: Vietnam News 

Source: https://vietnamnet.vn/en/business/soaring-energy-prices-put-burden-on-businesses-823465.html

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330,000 visitors bring Hanoi $42.6mn on Tet

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Hanoi earned more than VND1 trillion (US$42.6 million) from 330,000 visitors in five days of the seven-day 2023 Tet (Lunar New Year) holiday, according to the city’s tourism department.

The number of visitors, calculated from January 21 to Thursday, is three-fold that of the same period last year.

That included 32,000 international visitors, most of whom came from South Korea, Japan, Singapore, Thailand, and Canada, and 300,000 domestic tourists.

The Van Mieu – Quoc Tu Giam (Temple of Literature – Imperial Academy) in Dong Da District welcomed 80,000 people, while the same number of visitors came to the Huong Pagoda in My Duc District.

The UNESCO-recognized Thang Long Imperial Citadel in Ba Dinh District received 19,680 visitors.

About 18,000 people visited the Co Loa relic site in Dong Anh District.

Duong Lam Village and the Son Tay ancient fortress citadel in Son Tay Town drew some 15,000 visitors, Hanoi Zoo in Ba Dinh District received 17,235 people.

The Hoa Lo Prison relic site in Hoan Kiem District, Hong Van ornamental creature village in Thuong Tin District, Bat Trang pottery village in Gia Lam District, and many temples in the capital city also recorded a sharp increase in visitors.

The city’s total tourism revenue during the five-day period is estimated at VND1 trillion.

The occupancy rate of hotel rooms reaches 40 percent during the same period, according to the Hanoi Department of Tourism, which expects the city to remain a favorite destination for tourists in the coming days, when many attractive festivals begin at famous spiritual tourist attractions.

The 2023 Tet break lasted seven days from January 20 to 26 in Vietnam.

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Hanoi earned more than VND1 trillion (US$42.6 million) from 330,000 visitors in five days of the seven-day 2023 Tet (Lunar New Year) holiday, according to the city’s tourism department.

The number of visitors, calculated from January 21 to Thursday, is three-fold that of the same period last year.

That included 32,000 international visitors, most of whom came from South Korea, Japan, Singapore, Thailand, and Canada, and 300,000 domestic tourists.

The Van Mieu – Quoc Tu Giam (Temple of Literature – Imperial Academy) in Dong Da District welcomed 80,000 people, while the same number of visitors came to the Huong Pagoda in My Duc District.

The UNESCO-recognized Thang Long Imperial Citadel in Ba Dinh District received 19,680 visitors.

About 18,000 people visited the Co Loa relic site in Dong Anh District.

Duong Lam Village and the Son Tay ancient fortress citadel in Son Tay Town drew some 15,000 visitors, Hanoi Zoo in Ba Dinh District received 17,235 people.

The Hoa Lo Prison relic site in Hoan Kiem District, Hong Van ornamental creature village in Thuong Tin District, Bat Trang pottery village in Gia Lam District, and many temples in the capital city also recorded a sharp increase in visitors.

The city’s total tourism revenue during the five-day period is estimated at VND1 trillion.

The occupancy rate of hotel rooms reaches 40 percent during the same period, according to the Hanoi Department of Tourism, which expects the city to remain a favorite destination for tourists in the coming days, when many attractive festivals begin at famous spiritual tourist attractions.

The 2023 Tet break lasted seven days from January 20 to 26 in Vietnam.

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Source: https://tuoitrenews.vn/news/business/20230127/330000-visitors-bring-hanoi-426mn-on-tet/71147.html

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Vietnamese firms secure orders to export durians to China during Tet

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Many Vietnamese enterprises have won orders to ship durians to China during this Lunar New Year (Tet) holiday after the first 100-metric-ton Vietnamese durian batch was exported to the northern neighbor via official channels in September last year.

A durian purchasing company in Binh Phuoc Province, southern Vietnam, informed that it had secured an order to export 500,000 metric tons of durians to China.

Although farms in the province fail to supply the sufficient volume, the company will collect durians from other eligible farms.

Meanwhile, Van Xuan Phat Import-Export Co. Ltd. based in Ho Chi Minh City on Thursday said that the company would monthly export 1,000 metric tons of durians.

Huynh Van Dung, a trader in Hanoi, said China has a plan to buy one million Vietnamese durians, which are preferred and quickly consumed in the most populous country in the world.

According to Nguyen Dinh Tung, general director of Vina T&T Group, which specializes in exporting fruits and is among the 25 Vietnamese enterprises being issued with a packaging unit code, Vina T&T and Hong Kong’s Sunwah Group had inked a contract to export Vietnamese durians to Hong Kong.

Vietnam expects to ship 90,000 metric tons, or some 4,500 containers, of fresh durians abroad this year.

Dang Phuc Nguyen, general secretary of the Vietnam Fruit and Vegetable Association, said that although Vietnam has just exported durians to China through official channels since September 2022, the country has generated some US$350 million from durian exports.

Therefore, Nguyen forecast that durians will help earn over $1 billion in export revenue in 2023.

“Durian growing areas issued with codes are entitled to higher export prices. Durians were priced at VND80,000-100,000 [$3.4-4.3] per kilogram in the Mekong Delta ahead of Tet.

“To buy durians from these areas, enterprises must put down deposits,” Nguyen added.

China imported 821,600 metric tons of fresh durians worth over $4.2 billion in 2021, surging 42.7 and 82.4 percent, respectively, year on year.

It is the largest buyer of durians in the world. Thailand is currently the largest supplier of durians to China, accounting for a 40 percent market share.

Local experts forecast that the country’s durian exports will depend on China in the future.

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Many Vietnamese enterprises have won orders to ship durians to China during this Lunar New Year (Tet) holiday after the first 100-metric-ton Vietnamese durian batch was exported to the northern neighbor via official channels in September last year.

A durian purchasing company in Binh Phuoc Province, southern Vietnam, informed that it had secured an order to export 500,000 metric tons of durians to China.

Although farms in the province fail to supply the sufficient volume, the company will collect durians from other eligible farms.

Meanwhile, Van Xuan Phat Import-Export Co. Ltd. based in Ho Chi Minh City on Thursday said that the company would monthly export 1,000 metric tons of durians.

Huynh Van Dung, a trader in Hanoi, said China has a plan to buy one million Vietnamese durians, which are preferred and quickly consumed in the most populous country in the world.

According to Nguyen Dinh Tung, general director of Vina T&T Group, which specializes in exporting fruits and is among the 25 Vietnamese enterprises being issued with a packaging unit code, Vina T&T and Hong Kong’s Sunwah Group had inked a contract to export Vietnamese durians to Hong Kong.

Vietnam expects to ship 90,000 metric tons, or some 4,500 containers, of fresh durians abroad this year.

Dang Phuc Nguyen, general secretary of the Vietnam Fruit and Vegetable Association, said that although Vietnam has just exported durians to China through official channels since September 2022, the country has generated some US$350 million from durian exports.

Therefore, Nguyen forecast that durians will help earn over $1 billion in export revenue in 2023.

“Durian growing areas issued with codes are entitled to higher export prices. Durians were priced at VND80,000-100,000 [$3.4-4.3] per kilogram in the Mekong Delta ahead of Tet.

“To buy durians from these areas, enterprises must put down deposits,” Nguyen added.

China imported 821,600 metric tons of fresh durians worth over $4.2 billion in 2021, surging 42.7 and 82.4 percent, respectively, year on year.

It is the largest buyer of durians in the world. Thailand is currently the largest supplier of durians to China, accounting for a 40 percent market share.

Local experts forecast that the country’s durian exports will depend on China in the future.

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Source: https://tuoitrenews.vn/news/business/20230126/vietnamese-firms-secure-orders-to-export-durians-to-china-during-tet/71137.html

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Int’l tourists to Vietnam’s Phu Quoc during Tet surge

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Phu Quoc Island off Kien Giang Province, southern Vietnam, welcomed some 70,000 tourist arrivals between January 20 and 24, or the 29th day of the 12th month of the last lunar year and the third day of this lunar year, including 4,400 international visitors, surging 64 percent year on year, according to the provincial Department of Tourism.

The city earned VND30.9 billion (US$1.3 million) in tourism revenue in the period.

Meanwhile, the entire Kien Giang Province served 134,160 tourist arrivals, with 4,800 of them being foreigners, soaring 75.9 percent over the same period last year.

On Wednesday, flights, ferries and high-speed vessels from Rach Gia and Ha Tien Cities to Phu Quoc were operated as normal.

Due to the high number of tourists to the island city, the occupancy rate of lodging facilities in the city reached some 85 percent on average.

Huynh Quang Hung, chairman of the People’s Committee of Phu Quoc City, said the city has advantages of beautiful beaches and the favorable climate.

The number of international visitors to Phu Quoc was forecast to surge this year if some air routes connecting the city with China and Russia are reopened.

“Tourists have come to Phu Quoc in droves this Tet. Lodging facilities in the city have reported an occupancy rate of 80, even 90 percent.

“Tourism service providers in Phu Quoc have launched promotion programs to attract tourists.

“In 2023, Hon (Kiss) Bridge in An Thoi Ward will be introduced to attract more local and foreign guests to Phu Quoc,” Hung added.

Earlier, Kien Giang Province expected to welcome more than 400 domestic and international flights to Phu Quoc and Rach Gia cities and over 230 ferry and vessel services to islands off the province during eight-day Lunar New Year holiday, from the 29th day of the 12th month of the last lunar year to the sixth day of this lunar year.

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Phu Quoc Island off Kien Giang Province, southern Vietnam, welcomed some 70,000 tourist arrivals between January 20 and 24, or the 29th day of the 12th month of the last lunar year and the third day of this lunar year, including 4,400 international visitors, surging 64 percent year on year, according to the provincial Department of Tourism.

The city earned VND30.9 billion (US$1.3 million) in tourism revenue in the period.

Meanwhile, the entire Kien Giang Province served 134,160 tourist arrivals, with 4,800 of them being foreigners, soaring 75.9 percent over the same period last year.

On Wednesday, flights, ferries and high-speed vessels from Rach Gia and Ha Tien Cities to Phu Quoc were operated as normal.

Due to the high number of tourists to the island city, the occupancy rate of lodging facilities in the city reached some 85 percent on average.

Huynh Quang Hung, chairman of the People’s Committee of Phu Quoc City, said the city has advantages of beautiful beaches and the favorable climate.

The number of international visitors to Phu Quoc was forecast to surge this year if some air routes connecting the city with China and Russia are reopened.

“Tourists have come to Phu Quoc in droves this Tet. Lodging facilities in the city have reported an occupancy rate of 80, even 90 percent.

“Tourism service providers in Phu Quoc have launched promotion programs to attract tourists.

“In 2023, Hon (Kiss) Bridge in An Thoi Ward will be introduced to attract more local and foreign guests to Phu Quoc,” Hung added.

Earlier, Kien Giang Province expected to welcome more than 400 domestic and international flights to Phu Quoc and Rach Gia cities and over 230 ferry and vessel services to islands off the province during eight-day Lunar New Year holiday, from the 29th day of the 12th month of the last lunar year to the sixth day of this lunar year.

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Source: https://tuoitrenews.vn/news/business/20230126/intl-tourists-to-vietnams-phu-quoc-during-tet-surge/71124.html

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