Container ship Schedule Reliability

 Schedule Reliability is a word that means whether departure/arrival is on time. In particular, in the shipping industry, it is a major indicator used for liner routes. It is one of the factors directly connected to the service of the logistics company because it means that the container ship did not follow the set departure and arrival times well.

 

 Also, in the case of container ships, if the speed of the ship is increased, the fuel is multiplied. For example, raising the ship from 10 knots to 20 knots increases the speed of the ship, but doubles the cost. For this reason, it is important to drive at a set speed and at a set time.

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1.     Global Schedule Reliability

(Source : Sea-Intelligence)

 Let's take a look at the reliability of global container ship operations. In September 2022 (45.5%), it decreased slightly compared to August, but it is much higher than in 2021. The current level is December 2020 (44.5%), which is lower than the average of 2019 (78.0%) before covid-19, but it is judged to have recovered to a significant extent.

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2.     Reliability by route

 Let's take a look at the reliability of the main east-west routes.

Asia-NAWC recorded the lowest point in December 2021 (9.7%) and then rebounded sharply this year. In addition to the reduction in deductions on the West Coast, reliability improved dramatically after the signing of the US President Biden's FMC Order. On-time (32.1%) in September 2022 is 21.6% higher than the same month last year.

In the Asia-NAEC route, it was recorded in September 2022 (21.2%), which is 6.9% higher than the same month last year. Compared with Asia-NAWC, reliability decreased during June to August 22 (3 months). The reason for this is that the US West Coast (ILWU-PMA) negotiations were delayed and cargo was transferred to the NAEC due to concerns about a strike by the railroad union. It can be seen that the cargo cannot be handled during the rapid increase and the reliability has decreased.

Asia-N. In Europe, September 2022 (36.3%) was the highest in the last 20 months. It can be seen that the cargo volume decreased after the Russian-Ukraine war, and the reliability continued to rise as the supply of ships became smooth.

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3.     SCFI vs. Reliability

It can be seen that there is a negative (-) correlation between SCFI and Reliability, a representative spot rate index. Correlation analysis yields -0.93. This is because a high level of reliability can be achieved with a stable capacity when freight rates are low, but when freight rates surge or volatility increases, it is difficult for shipping companies to provide services desired by all shippers on time with the capacity they have.

 

In conclusion, the route reliability should rise to the 2019 level, and although the decline in SCFI will not be large, there still seems to be downward pressure.

 

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