Increased Vessel Delays and Rising Transportation Costs Threaten Last-Mile Retail Operations

Recent vessel-tracking data from project44 reveals substantial year-over-year increases in vessel and shipment delay times across most major trade lanes connecting China to the rest of the global economy.

These longer lead times cast a spotlight on already overburdened transportation networks and ongoing supply chain disruptions. For many businesses, the unrelenting supply-side bottlenecks and increasing transportation costs are impacting their ability to meet customer demands and forcing them to pass costs on to their customers, causing upward pressure on global inflation.

While select China-US West Coast routes schedules have improved significantly over the past months, data gathered by project44 shows that along many critical routes, multi-day delays remain high, or are even rising in the face of recent outbreaks of the COVID variant in southwestern China. This indicates that global supply chains remain fragile and far from quickly return to pre-COVID levels.

There were substantial delays for ships operating on routes between China and US non-West Coast ports, where ship delays increased from 0.6 days on average in July 2020 to 2.44 days in July 2021. For example, year-over-year, median delays for ships traveling from Tianjin to New York increased from 0.96 to 7.29 between June 2020 and 2021.

Delays in other ports of US were steady from last quarter of 2019 until August 2020 when they started rising to a peak in February 2021. Moderate improvements have been made with delays working their way down as of June 2021.

For China-EU maritime traffic, delays increased from an average of 0.51 days in July 2020 to 2.18 days in July 2021.

As of June 2021, Shanghai-Hamburg and Shenzhen-Hamburg were representative of other modern, high-volume China-EU port pairs, seeing median ship delays extending more than a week, at 8.44 and 7.86 days, respectively. For ships traveling from Tianjin to Antwerp in June, the median delay was 11.42 days.

Delays in EU trade started increasing from December 2019 when the first impact of COVID-19 was felt in China. Delays peaked in March 2020 but dropped in May 2020, possibly due to China coming out of COVID-19. They started rising again from July 2020, peaking in February 2021 when the rest of the world was battling with COVID-19. The delays were working their way down as of July 2021, but still at levels higher than the 2020 peak.

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