Understanding Ocean Shipping Timelines: Insights from the Ocean Timeliness Indicator

What is the Ocean Timeliness Indicator?

The Ocean Timeliness Indicator (OTI) is a proprietary measure developed by Flexport to gauge the stress on global ocean shipping. It tracks the journey of a container from the moment it's ready to leave the factory (Cargo Ready Date) to when it's picked up from its destination port (Destination Port Departure). This comprehensive timeline provides a holistic view of the entire shipping process.

The OTI focuses on the world's two largest trade lanes:

• Trans-Pacific Eastbound (TPEB): From Asia to North America
• Far East Westbound (FEWB): From Asia to Europe

Each of these routes is measured in days, allowing for easy interpretation, with data updated on a weekly basis.

Key Features of the OTI

To better understand the OTI and its implications, let's examine some of its key features:

1. Weekly Updates

The OTI is released at the beginning of each week, describing the journey length of containers picked up from the destination port in the preceding week. This regular update schedule allows for timely tracking of shipping trends.

2. Retrospective Measure

The OTI is a retrospective measure, meaning it reflects completed journeys. This approach can result in a discrepancy between the expected journey time for a container that is cargo-ready today and the current week's OTI.

3. Averaged Data

For each trade lane, the OTI averages across many containers with different types of goods, origin ports, and destination ports. This composition can shift from week to week, providing a broad overview of shipping conditions.

4. Sample Size

While the OTI uses platform data from a single company, it covers a significant sample of ocean shipping. The containers move on multiple routes and carriers, passing through various ports, thus providing a representative snapshot of the ocean shipping network's performance.

Current Trends in Ocean Shipping

Recent OTI data has revealed several striking trends in ocean shipping:

1. Significant Increases in Journey Length

The length of the journey has more than doubled on the Trans-Pacific Eastbound route and increased significantly on the Far East Westbound route. This dramatic increase underscores the severity of the current shipping crisis.

2. Greater Impact on Trans-Pacific Routes

While both routes have seen significant increases, the Trans-Pacific Eastbound route has experienced a more substantial percentage increase compared to the Far East Westbound route.

3. Fluctuating Patterns

The data series are not smooth, with periods of shortened times followed by continued increases. This pattern suggests that several weeks of declining numbers may not necessarily indicate the end of the shipping crisis.

4. Recent Peak Times

The most recent data shows journey times at or near their high points, indicating that the shipping crisis is ongoing.

The Stage 1 Index: An Early Indicator

To provide more timely insights, a Stage 1 Index has been introduced. This index focuses on the first stage of the journey, from Cargo Ready Date to Origin Port Departure. Key points about the Stage 1 Index include:

• It's an indexed 4-week moving average of times for the first stage of the journey.
• Data is registered sooner than the full OTI, potentially providing earlier indications of changes in shipping conditions.
• Recent data shows an increase in shipping times through stage 1, with a 13% increase from mid-January and a 38% increase compared to the same point a year earlier.
• The index typically shows seasonal patterns, with increases in the first 8 to 12 weeks of the year, likely related to shipments timed around the lunar new year holidays.

How FreightAmigo Can Help Navigate Shipping Challenges

At FreightAmigo, we understand the complexities of today's global supply chains. Our Digital Logistics Platform is designed to help businesses and individuals navigate these challenges effectively. Here's how we can support you:

1. Comprehensive Quote Comparison

Our platform allows you to compare door-to-door freight quotes for various shipping methods, including international courier, airfreight, sea freight, rail freight, and trucking solutions. This comprehensive view helps you make informed decisions based on your specific needs and timelines.

2. Real-Time Shipment Tracking

With connections to over 1000 reputable airlines and shipping lines, we provide real-time tracking of your shipments. This feature allows you to stay informed about your cargo's location and estimated arrival time, helping you plan accordingly.

3. One-Stop Solution for Logistics Needs

From customs clearance to cargo insurance and trade finance, our platform offers a range of services to streamline your logistics process. This integrated approach can help mitigate some of the challenges highlighted by the OTI data.

4. Automated Documentation

Our system automates shipment documents, reducing the potential for errors and delays that can contribute to longer shipping times.

5. Expert Support

Our 24/7 logistics expert support ensures that you have access to professional assistance whenever you need it, helping you navigate complex shipping situations effectively.

Conclusion

The Ocean Timeliness Indicator provides valuable insights into the current state of global ocean shipping. While the data indicates ongoing challenges, tools like the OTI and the Stage 1 Index can help businesses better understand and prepare for potential shipping delays.

At FreightAmigo, we're committed to helping our clients navigate these challenges. Our Digital Logistics Platform offers comprehensive solutions to streamline your shipping process, from quote comparison to real-time tracking and expert support. By leveraging these tools and insights, businesses can better manage their supply chains in these complex times.

Stay informed, stay prepared, and let FreightAmigo be your partner in navigating the ever-changing landscape of global logistics.