The TT Club estimates that the international maritime industry incurs losses of about $6 billion each year because of incorrectly packed or documented cargo.
“That includes damage to the cargo and delays, environmental cleanup, injuries and ship damage. The point is that $6 billion is totally unnecessary. If people followed things correctly, then that $6 billion would be saved to the entire industry,” said Peregrine Storrs-Fox, the TT Club’s risk management director.
The TT Club, with a global network that includes offices in London, Hong Kong, Sydney and New Jersey, provides insurance and related risk-management services to the international transportation and logistics industry. It has been working with the Global Shippers Forum, International Cargo Handling Coordination Association (ICHCA), World Shipping Council and Container Owners Association to push for thorough adoption of the Code of Practice for Packing of Cargo Transport Units (CTU Code), issued in 2014.
The CTU Code, which applies to packing and transport operations throughout the supply chain, was jointly developed by the International Maritime Organization (IMO), International Labor Organization (ILO) and United Nations Economic Commission for Europe (UNECE).
“From the TT Club’s perspective, one of the frustrations despite putting out advice around lots of different cargo issues over decades now, we still find that somewhere around two-thirds of cargo damage-related claims are coming because of some sort of poor practice in terms of packing — load distribution or securing of the cargo — but also documentary things around classification, declaration of cargo, how that’s documented, how the information is passed correctly through the system between different stakeholders by way of data transfer,” Storrs-Fox said.
In the five-plus years since the CTU Code was adopted, “we haven’t actually seen a significant improvement in the incident statistics. Certainly wherever we go, we see that a lot of people are not aware of the CTU Code at all,” said London-based Storrs-Fox.
Storrs-Fox said the TT Club, with the Global Shippers Forum, ICHCA, World Shipping Council and Container Owners Association, have built a cargo integrity campaign that begins with promoting awareness of the CTU Code itself.
The TT Club defines cargo integrity as the “adoption of best practices in all aspects of cargo care through the entire intermodal supply chain.”
On its website, the TT Club said cargo integrity includes:
Selection of a suitable unit for the intended commodity and journey.
- Ensuring that the unit positioned for packing is sound and free from previous cargo residues.
- Prevention of contamination by plants, plant products, insects or other animals.
- Proper packing of cargo within a unit, including load distribution, and effective blocking, bracing and securing.
- Correct classification, packaging, marking/placarding, documentation and declaration of packed goods, particularly those that are regulated (i.e., dangerous or waste).
- Complete and transparent transmittal of all data regarding contents, enabling appropriate safe handling through the intermodal supply chain.
- Effective methods of stowing and securing of units for transport in land, sea or air modes.
The TT Club said while the CTU Code provides “the framework for achieving cargo integrity,” further guidance is needed.
“TT Club statistics indicate that as much as 66% of incidents related to cargo damage in the intermodal supply chain can be attributed in part to poor practice in the overall packing process, including not just load distribution and cargo securing but also the workflow from classification and documentation through to declaration and effective data transfer,” it said on its website.
Germany’s Federal Bureau of Maritime Casualty Investigation (BSU) said in February that misdeclared coconut charcoal was the most likely source of the blaze on the Yantian Express, which caught fire in the Atlantic Ocean on Jan. 3, 2019.
International Union of Marine Insurance (IUMI) Secretary-General Lars Lange told American Shipper last month that vessel fire safety “needs regulation and it needs a level playing field. Safety shouldn’t be left to individual business entities. Safety should be dealt with at a regulatory level, and that would mean in this case the IMO.”
The IUMI issued a report in October titled “Containership fires: It is time to take action.” It said that 2019 had an alarming number of container ship fires, including the Yantian Express and APL Vancouver, which suffered from a fire while en route from Shekou, China, to Singapore