Understanding Ocean Shipping Delays: Insights from the Ocean Timeliness Indicator
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What is the Ocean Timeliness Indicator?
The Ocean Timeliness Indicator (OTI) is a proprietary measure developed by Flexport to quantify how long it takes to ship goods by sea from Asia to major markets in North America and Europe. Specifically, it tracks the end-to-end journey time from when cargo is ready at the origin to when it is picked up from the destination port.
The OTI provides separate indicators for two key trade lanes:
- Trans-Pacific Eastbound (TPEB): Shipments from Asia to North America
- Far East Westbound (FEWB): Shipments from Asia to Europe
By measuring actual transit times in days, the OTI offers an easily interpretable snapshot of current shipping conditions. Data is reported weekly, allowing for timely tracking of trends.
Key Features of the OTI
To properly interpret the Ocean Timeliness Indicator, it’s important to understand some of its key characteristics:
- Retrospective measure: The OTI reflects completed journeys from the previous week, not current or projected transit times.
- Broad average: Times are averaged across many containers, routes, carriers, and ports.
- Sample data: Based on Flexport’s platform data, representing a subset of overall ocean freight volumes.
While not a real-time predictor, the OTI’s weekly updates and broad sample make it a valuable barometer of ocean shipping conditions.
What the OTI Reveals About Recent Shipping Trends
Analysis of OTI data through January 2022 highlights several noteworthy trends:
- Transit times have more than doubled for Trans-Pacific routes and increased significantly for Asia-Europe routes since early 2020.
- The Trans-Pacific Eastbound route has seen larger percentage increases than Far East Westbound.
- Times have continued trending upward, with both indicators near all-time highs in early 2022.
- Brief periods of improvement have typically been followed by renewed increases.
While the data shows the dramatic impact of supply chain disruptions, it has yet to indicate a sustained turnaround in shipping delays.
The Stage 1 Index: An Early Warning System
To provide more timely insights, Flexport has introduced a Stage 1 Index focused on the initial leg of the journey from cargo-ready date to origin port departure. This indexed 4-week moving average aims to detect potential shifts earlier in the shipping process.
Recent Stage 1 Index data has shown concerning trends:
- A 13% increase from mid-January to late February 2022
- Times 38% higher than the same period in 2021
However, some seasonal patterns are typical in Q1, likely related to Lunar New Year shipping rushes. Multiple weeks of consistent declines would be needed to signal a potential easing of delays.
How FreightAmigo Can Help Navigate Shipping Challenges
As a Digital Logistics Platform, FreightAmigo is committed to helping our clients overcome supply chain hurdles through innovative solutions. While we can’t control global shipping conditions, we can provide the tools and expertise to adapt to them:
- Real-time tracking: Monitor your shipments across over 1000 airlines and shipping lines.
- Quote comparisons: Easily compare door-to-door freight quotes across multiple modes and carriers.
- Customs & insurance: Streamline customs clearance and protect your cargo with integrated solutions.
- Document automation: Reduce errors and speed up processes with automated shipping documents.
- 24/7 expert support: Get assistance from our logistics professionals whenever you need it.
By leveraging FreightAmigo’s Digital Logistics Platform, businesses can gain greater visibility, flexibility, and efficiency in their supply chains – critical advantages in today’s challenging shipping environment.
Looking Ahead: When Will Shipping Times Improve?
While the Ocean Timeliness Indicator and Stage 1 Index don’t yet show sustained improvement in transit times, they remain valuable tools for monitoring trends. At FreightAmigo, we’ll continue to track these and other logistics indicators to provide our clients with actionable insights.
As the global supply chain works to regain equilibrium, businesses should prepare for continued volatility in ocean shipping. Partnering with an agile Digital Logistics Platform like FreightAmigo can help you navigate these challenges and position your supply chain for success in 2022 and beyond.
Stay tuned to the FreightAmigo blog for more updates on shipping trends and logistics strategies to keep your business moving forward.
