The earliest return date (ERD, or sometimes called the earliest receiving date, earliest receipt date, or early return date) is the first time an export container can be delivered to its terminal. Earliest return dates are a simple concept in theory, but in practice become much more complex.
The earliest return date and the last return date, also known as the cut-off date, create a window of time called the export receiving window. During this window the container can in-gate at a terminal, but if the container arrives too early the container may be turned back or incur storage fees. If the container arrives too late, it may miss its scheduled voyage and have to wait for the next available vessel — and likely also incur additional fees.
Managing export receiving windows has become unnecessarily complicated and costly, creating painful results for export shippers. While some of the issues are systemic, as we explain in this article, improvements in logistics data flows can be a big help.
The export container checklist
For any export container, the return to a seaport is a big occasion. After fulfilling its duties as an import and finding other cargo to shelter on an overseas journey, returning to the terminal signals the stars have aligned to repeat the logistics process.
But several things need to happen to ensure the container can make its way back to the terminal as an export:
● Booking with the ocean carrier
● Container, chassis availability
● Container loading
● Drayage truck power
● Coordination between shipper, forwarder, railroad, motor carrier, terminal, and steamship line
The process can be fluid, allowing containers to move nimbly back to the terminal to load on designated vessels. This is the ideal scenario, but often doesn't execute smoothly. Challenges arise when any of the actors in the export process make an abrupt change. Recently, changes driven by inconsistent and late vessel arrivals have become so frequent that process continuity has been effectively squashed. Data from Statista reveals that container vessels are over 6 days late on average globally, revealing a systemic problem in container shipping.
The impact of changing earliest return dates for shippers
Let’s jump to the sequence in the export process when a container is ready to depart for the terminal. Pulled and loaded, with the expectation of moving to the terminal four to five days in advance of its vessel, the container is one of thousands that are planned and mapped out for drayage. The order has been loaded, the booking confirmed, and the ERD determined. Additionally, the shipper has been notified in the booking confirmation of its documentation and physical cut-off dates.
The document cut-off is the last day that information on the contents of the load, including its verified gross mass (VGM), can be submitted to ensure it is part of the carrier’s load plan. These documents also ensure that the contents pass through customs and export controls.
The physical cut-off, which comes a few days later, is the last day that a container can gate in and be accounted for at the terminal.
It is worth noting that many containers with a confirmed booking never make it on the vessel. No-shows and rolled bookings are a related problem that inhibit smooth export movements, and are becoming more common and more costly.
NYSHEX research found that only 60% of shipper-carrier contracts are fulfilled as planned. That is, the shipper delivers the box on time, and the ocean carrier moves in the originally booked voyage. The gap means the allocated space goes unused, unless another container is booked on the voyage to take its place.
Indeed, ocean carriers typically oversell space on their vessels, resulting in regular rolling of containers to future voyages. Rolled cargo, or cargo rollover, is when a container misses its scheduled vessel and must wait to be sent with a future ship. Project44 data reveals that 40-50% of cargo was rolled in 2020.
Why do earliest return dates change?
The gap between the early return date and cut-off date create a window of time to bring an export container to the terminal- the terminal receiving window. With consistent schedules, meeting the terminal receiving window becomes routine. The flow into the terminal and on to the vessel becomes routine. The challenge comes when any party in the process inserts an unexpected change. Recently, there have been many unexpected changes.
Late container ship arrivals are a major problem in managing earliest return dates. Vessel schedule integrity reached new lows in 2021, and rebounded somewhat in 2022. Major steamship lines arrived on time only 36% of the time, according to Sea-Intelligence, a shipping consulting firm. In June of 2022, top ocean carriers averaged around 40% schedule reliability. “On time” is considered arrival at berth within 24 hours of scheduled arrival — although, no universal standard exists, and on time reporting metrics can vary.
Vessel delays are among the most disruptive problem for exporters, mainly because schedule changes are often not communicated until the last minute.
According to a study by the Agricultural Transportation Coalition (AgTC), vessel changes and poor data communication has severely hurt U.S. agricultural exporters. Since 2020, 36% of survey respondents said that more than 50% of their shipments had changes to their ERD, and most of them discovered the changes by monitoring terminal websites. Over 61% of the time, changes came with less than one day of the actual ERD.
40% of respondents claimed that changes resulted in additional charges for 10% or more of the impacted containers. Costs incurred mainly include:
● Storage fees at the trucker’s yard
● Container per diem
● Chassis charges
With a cost impact clearly squared on the ERD issue, 90% of respondents called for coordinated action to address the problem.
While vessel schedule integrity is a global, uncontrollable issue for shippers and forwarders, better data can start to provide a clearer picture.
How to avoid earliest return date expenses
Splice Exports takes the guesswork out of export receiving windows by automating the collection of ERD and cut-off data. This works to keep shippers’ information up to date and reconciled. Using Splice’s ability to connect, translate, and automate the movement of data, Splice Exports makes container scheduling timely, efficient, and automated. Splice Exports enables shippers to:
Track elusive schedule changes with streamlined visibility into ERD and cut-off data.
Eliminate manual data validation by collecting and reconciling logistics data for you.
Control costly fees with clear and comprehensive information on container scheduling.
Get started quickly with behind-the-scenes multi-source data integration.