Shipping times reduce in final quarter of 2022 as disruption, demand decrease
Ocean freight moving faster to open 2023 as port congestion clears and global demand for goods declines
In a sign that global trade lanes continue to clear, the time taken to ship container goods has fallen eight days Year-on-Year (YoY) in the fourth quarter of 2022.
The e2open Ocean Shipping Index Q4 2022 Report says that at as of the opening of 2023 the average journey time stood at 63 days. The Index measures the time from booking with an ocean carrier to the transition of goods onwards to truck or rail carriers.
The largest falls in average time taken were experienced in export routes from Asia-Pacific to North America and Europe. For these routes, shipping time declined by 12 days YoY in Q4 2022, with those gains largely coming in the last half of 2022. Asia-Pacific to North America routes became nine days shorter from Q3 to Q4 2022 and eight days in Europe.
While this is indicative of improving port conditions and reduced congestion, it also reflects falling demand for goods and declining volumes being handled within these key trade channels.
Already ocean freight rates have continuously trended downwards throughout 2022 and there has been little reversal in rates in the first months of 2023, reinforcing that there has been a swing in global demand since pandemic restrictions were lifted.
The research noted that there was a notable reduction in the booking-to-gate time for shipments out of Asia due to this softening demand picture. Even with this reduction, shipment times from Asia-Pacific to North America still stood at an average of 82 days in Q4 2022, indicating that booking continue to be made well in advance to increase reliability and capacity to react to disruptions.
The ports making the biggest strides in loading goods onto ships in the latest Index release were Tuticorin, India; Valparaiso, Chile; Los Angeles, U.S., Vancouver, Canada, and Jeddah, Saudi Arabia.