The recent reports of container ship fires has once more focused those in the container supply chain on safety issues related to the incorrect processing of dangerous goods, says international transport and logistics insurer TT Club in a new article.
It said that the nascent Cargo Integrity campaign initiated by the club had as a consequence gained renewed impetus.
The club said that the recent fire aboard Yantian Express, details of the final judgment on the MSC Flaminia explosion in July 2012, and the ongoing investigation of the Maersk Honan fire were all currently making headline news.
The news of the Grande America sinking in the Bay of Biscay in mid-March after a container caught fire was a further illustration that such incidents could cost lives and millions of dollars in cargo losses and ship damage. They also caused “significant delays in cargo supply chains amounting to major disruption across numerous industries in these ‘just-in-time’ days”, TT Club said, while noting that these headline incidents were just the tip of the iceberg.
The Club estimated that a major container ship fire at sea occurred on average every 60 days, “albeit that there have already been four major cargo-related fire incidents in 2019”.
TT Club’s records indicated that, across the intermodal spectrum as a whole, 66% of incidents related to cargo damage could be attributed to poor practice in the overall packing process; that is not just in securing but also in cargo identification, declaration, documentation and effective data transfer. The calculated cost of these claims in the Marine Aviation & Transport (MAT) insurance sector exceeded $500m a year.
Peregrine Storrs-Fox, TT Club’s Risk Management Director, who is leading the Cargo Integrity charge, said that “we are endeavouring to focus all direct and indirect stakeholders on recognizing and doing the right thing,” adding that “one particularly critical aspect of this is the correct declaration and handling of dangerous goods (DG).”
Although all types of cargo can be mishandled, the wrongly classified, labelled, packed or simply inaccurately identified dangerous commodities brought the greatest potential risk of disaster. The Club said that estimating the degree of failure to comply with best practices in this regard was not straightforward.
ICHCA International, the cargo handling operatives association has calculated that, of the 60m packed containers moved each year, 10% were declared as DG. Information from published government inspections suggested that 20% of these were either poorly packed or incorrectly identified. This translated into 1.3m potentially unstable DG containers travelling around the world each year.
Storrs-Fox warned that this scale of risk was elevated when undeclared or misdeclared DG consignments were considered. “In these cases an estimate of volumes is more obscure. An indication has been given through the work of one container carrier, Hapag-Lloyd, developing a profiling algorithm to search its booking system for potential misdeclaration of commodities. Results from Cargo Patrol, when extrapolated to the carryings of all the lines, concludes a reasonable estimate in excess of 150,000 volatile containers in the supply chain each year.”
TT Club observed that the Cargo Incident Notification System (CINS), in which many of the top container lines were participating, had been active for a number of years and had successfully identified a number of commodities that commonly cause problems during transport – not always limited to those formally identified as dangerous.
Additionally, TT Club had been promoting, together with UK P&I Club and Exis Technologies, the Hazcheck Restrictions Portal, which is designed to identify and streamline the complexity of regulations and protocols imposed by carriers and ports around the world in relation to transporting declared dangerous goods.
Storrs-Fox concluded that, “our diverse campaign is seeking significant cultural and behavioural change to say the least. Certain elements may require legislative action, enforcement and inspection and there are great challenges in the field of technological development. Above all there is a need for all involved in the supply chain to have a realistic perception of risk and a responsible attitude towards liability.”