The second quarter of 2024 sees a significant rise in global shipping times, with an average transit time of 66 days, marking a 14% increase from 2023. Disruptions in major international transportation routes and port congestion are key contributors to this surge.
Rising Transit Times and Their Causes
The e2open Ocean Shipping Index reveals a noticeable increase in shipping times in Q2 2024. The average global transit time has risen by five days YoY, primarily due to disruptions in major international transportation routes. The shipping lane running through the Bab al-Mandab Strait to the Suez Canal has been targeted by Houthi rebels, forcing many ships to reroute around the southern tip of Africa. Additionally, the Panama Canal has been operating on a reduced schedule due to low water levels throughout much of 2024, further contributing to the increased transit times. For more information on the surge in ocean imports amidst global tensions, you can read here.
Impact on Different Shipping Routes
These disruptions have significantly affected transit times across various shipping routes. Routes from Europe and South America to Asia, which heavily rely on these disrupted areas, have seen the greatest increases in transit times. Shipping times from Asia to Europe have risen to 75 days, marking a 14-day YoY increase. South America to Asia exports have the longest transit times overall, at 87 days, a 15-day increase from the previous year.
Port Congestion and Future Implications**
Adjusted schedules due to these disruptions have led to port congestion, particularly in Asian ports. Recent political unrest in Bangladesh and an explosion at the port of Ningbo threaten to further increase transit times during the expected rush to restock before the holiday season. The only route that has maintained its container transport duration from the previous year is Europe to North America. For more on the impact of market shifts on logistics employment, click here.
Pawan Joshi, EVP of products and strategy for e2open, notes that these increases in global shipment durations reflect the ongoing disruptions impacting ocean shipping. He emphasizes that weather, geopolitical conflict, port congestion and closures, and route diversions due to turmoil in the Red Sea region and drought issues in the Panama Canal are significantly affecting ocean shipping, the primary mode of transportation for global trade. For more on understanding global supply chain risk in 2024, you can read here.
