As the holiday season approaches, brands are releasing regular updates to customers regarding supply chain delays and longer delivery times. From manufacturing delays to traffic jams at harbors and ports, to lack of manpower, coupled with increased demand around the world, these have caused significant issues for companies who rely on global shipping routes to reach customers.
Understanding the major shipping routes used for global trade is the first step to mitigating these problems and making adjustments to improve supply chains in many industries. Here are five major shipping routes used for global trades, and why better management of these routes is good for consumers — and the planet.
5 Major shipping routes
This map from the UCL Energy Institute helps visualize the movement of goods and materials around the world. The data used to inform this map came from tracing container ships, dry bulk carriers, oil and fuel tankers, gas carriers, and ships transporting vehicles as they circumnavigate the globe.
Before we dive into the busiest ship routes, a few things stand out about global ship routing data. The first: container ships operate similarly to bus routes, moving on fixed routes on paths to predetermined ports. This restricts the possible variations and adjustments a ship can make in its planned route.
Second, shipping routes are concentrated around ports, with some ports handling more than twice the number of ships than average. In places like the Port of Singapore, this can quickly create bottlenecks and hold up traffic. The Strait of Malacca is the shortest route between the Pacific and Indian Oceans, and sees about 40% of world trade each year traveling past Singapore, Malaysia, and Indonesia.
And finally, one expert notes that “only a few countries have direct shipping routes to their trade partners. Less than 6% of all 22,650 pairs of countries with container ports are directly connected.” This complicates supply chain operations further.
With these insights in mind, here are a few of the major shipping routes that stand out.
The English Channel
The English Channel separates the UK from mainland Europe and connects the North Sea with the Atlantic Ocean. It’s approximately 350 miles long and hosts 500 ships daily. This critical shipping route serves as a gateway to Europe, as well as to the UK; the Strait of Dover, the narrowest part of the English Channel, is used by more than 400 vessels daily that carry grain, minerals, steel, and oil.
The Strait of Malacca
The Strait of Malacca is the shortest route between the Pacific and Indian Oceans, linking the major Asian economies with the rest of the world. This is the world’s second-busiest waterway. More than 83,000 vessels travel through the Strait of Malacca each year, connecting India, Indonesia, China, Japan, Malaysia, Singapore, and other major Asian producers. The Strait of Malacca is a critical shipping route for bringing oil and natural gas around the world.
The Panama Canal
The Panama Canal was built to make transport between the Pacific and Atlantic Oceans easier. Using a series of three locks, ships carrying up to 14,000 TEUs are able to pass and significantly reduce their travel time. It’s estimated that more than 14,000 ships each year navigate the Panama Canal bringing everything from vegetable oil to chemicals to lumber and machinery parts.
The Suez Canal
The world learned a lot about the Suez Canal when the Ever Given was accidentally lodged for more than six days and blocked shipping traffic, causing major problems for global logistics.
The Suez Canal provides the shortest sea link between Europe and Asia. Roughly 12% of annual world trade flows through the Suez Canal; while the Ever Given was stuck, estimates found that the stranded ship was holding up an estimated $9.6bn of trade each day. It is a major shipping route for oil from the Middle East, as well as petroleum, coal, metals, wood, cement, and fertilizer.
The Strait of Hormuz
The Strait of Hormuz connects the Gulf of Oman with the Persian Gulf. It’s a major artery for oil transportation. oil transportation. In 2016, 30% of the world’s total oil consumption was transported via this waterway, primarily to Asian markets such as China, Japan, India, South Korea, and Singapore.
Improving shipping routes with better data
These popular waterways see a lot of traffic over the year. The movement of goods around the world comes with a huge environmental price. In 2012, maritime shipping companies were responsible for 796 million tons of carbon dioxide: "the whole of the UK, Canada or Brazil emit in a year." That’s roughly 3-4% of all manmade greenhouse gas emissions.
Rethinking global shipping routes requires a combination of solutions, including measures to unclog ports and rerouting cargo to smaller ports. Sofar Ocean’s Wayfinder product can incorporate weather data, business goals, and fuel costs to find the optimum route and arrive Just-In-Time (JIT).
[Read more: Important Benefits of Weather Routing for Optimal Voyages]
Better ship routing can also help shipping companies work toward decarbonization goals. Tools like the Wayfinder allow ocean freight logistics companies to predict weather and wave conditions with high accuracy, giving vessels the most safe and fuel-efficient route. Wayfinder optimizes a vessel’s entire voyage by evaluating live weather data at planetary scale and operational metrics such as market impact, contract terms, and strategic initiatives (e.g. time charter index, demurrage, bunker prices, CO₂ targets).
To learn more about shipping routes, check out the Sofar Ocean blog.
