A growing number of goods are being transported by sea and in containers, including electronics and, increasingly, chemical products. However, dangerous goods are not always properly declared, which can have dire consequences, specially when considering the trend of larger vessel sizes, according to Allianz.
With several major incidents in a matter of months, fires on board container ships – potentially coming from misdeclared cargo – are a hot topic. The large size and capacity of container ships today increases the risk of cargo misdeclaration and therefore of something going wrong.
…says Régis Broudin, Global Head of Marine Claims at AGCS.
The International Cargo Handling Coordination Association has estimated that some six million containers contain dangerous goods, and nearly 1.3 million of those boxes are not properly packed or are incorrectly identified, according to logistics insurer TT Club.
Containerized shipments are misdeclared for a variety of reasons, most notably to avoid the additional costs and requirements associated with transporting certain cargoes.
Misdeclared cargo can happen on mega container ships by virtue of their sheer volume. The greater the number of containers stowed, the more chance there is of a mistake, such as storing dangerous cargo close to a hot spot like the engine. Meanwhile, the size of the vessel can make it harder to access a fire and impede attempts to extinguish,
…added Régis Broudin.
Cargo is handled and stowed according to its declared contents and weight, and misdeclaration can have dire consequences.
For example, cargo that carries a risk of explosion must be stowed well away from crew accommodation, while heat sensitive cargo must be kept away from hot areas like fuel bunkers and engines.
Preventing cargo fires saves lives and property at sea, notes Volker Dierks, Head of Marine Underwriting, Central and Eastern Europe at AGCS:
Increasingly, more goods are containerized, and many more substances will be transported on container ships in the future. Yet it is not always understood about the risks that certain circumstances pose (for example, incorrect stowage or temperature).
Given the threat posed by container fires, a number of shipping companies have taken steps to address misdeclared cargo.
Maersk, for example, has instituted a policy of not loading hazardous cargo adjacent to living spaces. It also recently announced that it will now work with the US National Cargo Bureau to carry out random checks of containers.
Meanwhile, Hapag-Lloyd is using software to scan bookings to detect undeclared dangerous cargo that require a deeper investigation. Between 2015 and 2017, Hapag-Lloyd identified some 11,000 incorrectly declared shipments.
In this regard, a number of shipping companies already share information from cargo inspections via the Cargo Incident Notification System (CINS), which alerts ship owners to potential misdeclared cargo, prompting additional checks or a ban.
In October 2018, CINS also proposed a common cargo scanning system that would help shippers search for bookings that may contain undeclared or misdeclared dangerous goods.
I could imagine that the insurance industry would support any shipping industry initiative that brings increased transparency on parties that misdeclared cargo. One practical solution would be a blacklist of freight forwarders that misdeclare cargo. Obviously, some operators already do this, but to gain momentum and market acceptance more need to get onboard,
…said Justus Heinrich, Chief Underwriter Marine Hull, Central and Eastern Europe, AGCS.