Importers that struggled with tight carrier capacity and soaring freight rates during the COVID-19 pandemic are finally seeing some relief on the service side, according to a pair of new reports on trends in ocean and road transportation. What’s more, the numbers suggest the beginning of a shift in sourcing away from Asia, in favor of points in North America.

The latest Ocean Shipping Index from e2open, covering the first quarter of 2023, finds a significant reduction in the time it takes “to deliver goods to truck or rail carriers after booking with an ocean carrier and completing the cross-ocean journey.” Total booking-to-receipt time for cargoes moving from Asia to North America shrank by 11 days from the previous quarter, and 24 days from same quarter of 2022.

Also notable was a reduction in the time it takes for inbound cargo to be unloaded from a ship to when it leaves the marine terminal for movement inland, e2open said. In the first quarter of 2023, the global average time from initial booking aboard ship to clearing the gate at the port was 60 days — down five days from the fourth quarter of 2022, and 12 days from the first quarter of last year.

The reason for the marked improvement in carrier and terminal service, as reflected in shorter booking and transit times, was an overall decline in demand for goods shipping out of Asia. 

Over-the-road shippers experienced some additional good news. According to e2open’s latest Road Freight Market Index, truck capacity for agricultural goods remained “plentiful” in April, “while spot rates continue marching toward record lows relative to the rate index.” Dry van rates were down by 7.2% over the previous month, and a whopping 35.9% from April of 2022. Refrigerated transport rates also fell, albeit less dramatically: 1.3% from the previous month, and 20.7% year-over-year.

Availability of both truck space and service quality was up. Primary tender acceptance by carriers rose in April by 0.9%, to 94.3%, while on-time performance continued to increase, “and is sitting at or above pre-COVID levels for the first time in nearly three years,” the report said.

Spot rates fell in April by 2.6% from the prior month, and by 17.9% year-over-year. A likely reason for the decline was the continued steady drop in diesel fuel prices, down nearly 30% year-over-year, although still higher than in previous years. Despite the rate reductions, higher inflation continued to plague transportation markets, the report noted, cautioning shippers against place too much reliance on the volatile spot market instead of making solid commitments to carriers.

Gary Barraco, e2open’s assistant vice president of product marketing, said the latest edition of the ocean index added South American ports to its statistics, a reflection of the shift in sourcing imports away from Asia. That said, Central and South America have long been strong source of fruits and vegetables for the North American market, providing avocados, pineapples, papayas, bananas, cocoa and coffee. More recently, the war in Ukraine put a damper on the importation of certain types of produce, such as tomatoes and cucumbers, from the United Kingdom. High oil costs have made it more expensive to maintain the greenhouses in which much of that product is grown, Barraco says.

As risk management rises to the top of executives’ list of concerns, supplier diversification becomes the order of the day. At the same time, Barraco says, there’s a push to rely more on regional suppliers that are closer to end markets — a reversal of the previous trend toward wholesale offshoring.

The reduction in ocean freight from Asia is also a reflection of economic fears that are persisting in spite of the failure of a deep recession to materialize. “There’s hesitancy on the buying side,” Barraco says. “It could be the customer, manufacturer or distributor. Nobody wants to hold the inventory.”

The recent spate of good news for shippers, then, could prove to be a brief respite if consumer demand once more surges, or a new set of supply chain disruptions upsets the marketplace. For now, Barraco doesn’t see a big change in the volume of consumer goods moving across North America — at least until the traditional peak fall and holiday shopping seasons begin. Positive trends notwithstanding, the last attitude that shippers should be adopting in uncertain times is that of complacency.