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Home » Ocean Insights’ Report Warns of More Supply Chain Delays
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Ocean Insights’ Report Warns of More Supply Chain Delays

Ocean Insights’ Report Warns of More Supply Chain Delays
February 18, 2021
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The Chinese New Year is exacerbating COVID-19-related shipping delays outbound China. A new report from shipping technology firm Ocean Insights warns that a breakdown in intermodal connectivity between factories and ports could worsen global supply chain woes.

Metrics such as carriers’ schedule reliability are worsening and cargo rollover rates are still on the rise. By the former metric, the average delay for containers increased from one day in January 2020, to more than five days in January 2021. Ocean Insights is cautioning that it may take several more months for supply chains to return to some semblance of normality.

Ocean Insights points to internal travel restrictions imposed by Chinese authorities, requiring domestic travelers to quarantine for 14 days after traveling, as a new bottleneck for global shipping and supply chains.

Chinese governments are calling for citizens to stay put and “celebrate in place,” keeping factories open to offset the seasonal decline in factory output during the Chinese New Year.

However, even with new measures in place, getting those products to market will be a challenge. Most truckers have opted to go home for New Year — making them subject to mandatory quarantines and unable to drive. In some regions, up to 95% of truckers will be unavailable, with the worst-hit regions in the south.

These conditions will choke factory-port connectivity starting in about two weeks, with inventory backups lasting for months.

At ports, overall rollover percentages continued to climb as well, reaching 39%, a two percentage point increase on December numbers and a 9% year-over-year.

“The shipping lines have said that the backlog of cargo will be cleared after Chinese New Year, and that will likely occur as the levels of deliveries from factories drop off, but supply chains may take several more months to return to some semblance of normality as inventory, now trapped further up the supply chain will need to be cleared,” — Josh Brazil, Chief Operations Officer, Ocean Insights GmbH

Port Rollovers:

While overall rollover rates have increased, the major Asian ports in Singapore and Tanjung Pelepas saw no increase in rollovers, from December 2020 to January 2021, while Shanghai, Hong Kong increased by just 1 percentage point and Busan decreased 1 percentage point

Ocean Insights calculates the rollover ratio for carriers as the percentage of cargo carried by each line globally that left a transshipment port on a different vessel than originally scheduled.

Port Klang in Malaysia remains an outlier with an 11 percentage point increase in rollover cargo from 55-66% month-on-month.

In Europe, Antwerp and Rotterdam saw increases of 4 and 5 percentage points respectively within the Hamburg-Le Havre range.

Carriers’ Schedule Reliability

In terms of the number of changes to delivery dates (ETA), the Asia to US West Coast trade lanes showed the largest increase from an average of 1.67 ETA changes per shipment in January 2020 to 3.93 by January this year.

While Asia to Europe cargo ETA changes per shipment averaged 1.41 in January 2020, they increased to 3.13 a year later.

By these metrics, the average delay for containers increased from about one day in January 2020, to more than five days in January 2021. —Carriers’ Schedule Reliability is a measurement of delay from port to port.

Rollovers by Carrier

Vessel operators have so far had a mixed month with Maersk seeing a 5 percentage point increase in rollovers, reaching 38% while its alliance partner, MSC, has been static at 29% since November of last year.

CMA CGM, by way of contrast, has steadily increased its rollovers from 44% in October 2020 to 52% in January this year. While the biggest decrease month-on-month goes to CMA CGM’s subsidiary ANL whose rollover figures improved from 56% in December to 49% in January.

About Ocean Insights

Getting all the dots connected in ocean freight is not easy. After all, data are often unavailable and rarely comparable. At Ocean Insights, we consistently consolidate and evaluate container shipping data from multiple sources to help logistics teams all around the globe stay on top of their shipping operations – whether for day-to-day business or strategic decisions. We do that by delivering reliable data they can trust.

https://www.ocean-insights.com/business-news/report-warns-of-more-supply-chain-delays/
Submit your logistics, material handling, or supply chain related company news in DC VELOCITY's Industry Press Room section or New Products section
Transportation Special Coverage
KEYWORDS CHARLIE PESTI
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