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emerging risks briefing


A growing industry The shipping industry has inevitably suffered from the recent global economic downturn.The contraction in trade during 2008 and 2009 reduced the global demand for shipping as fewer goods were exported. a solid recovery is predicted in 2010 but it will bring with it new challenges for the shipping industry.

The international shipping industry is responsible for the carriage of around 90% of all world trade(1). approximately 50,000 merchant vessels carry every kind of cargo and containers account for approximately 90% of non bulk shipments, i.e. those transported packaged in containers as opposed to directly into the holds of the vessel.

Knowing your cargo and keeping containers safe containers have become the major conduit for moving cargo to and from every corner of the world. They can contain anything from consumer goods to highly dangerous and toxic waste.Therefore, it is crucial that all containers are properly loaded and stowed to prevent cargo movement while in transit.

it is estimated that approximately 10,000 containers are lost at sea every year(2). rsa has experienced a number of losses involving containers not being adequately declared and secured.This has meant cargoes have shifted in transit putting lives in danger and increasing the danger of environmental pollution.

correct declaration of product type and weight within a container is critical within the shipping industry as very few containers are able to be opened/veried by the authorities or third parties involved within the supply chain. if goods are misdeclared the container may be stacked in an incorrect location on the vessel which may place the ship, personnel on board and the environment in danger. problems can also be exacerbated where the mitigating response is based on incorrect information.

if a container is loaded incorrectly and the vessel then hits heavy weather, it could be lost overboard or shift within a stack causing damage, res or even manoeuvring difculties. if this happens, not only could there be a potential loss of goods but the vessel could be affected and/or create a hazard for other vessels on the sea.

incorrectly declaring the contents of a container will also mean those responding to the incident will not know how they should prepare.The response could in turn aggravate any environmental pollution.This was highlighted in the 2007 msc napoli grounding where it was reported that a large proportion of containers had been misdeclared.The response efforts and assessment of the extent of environmental pollution were delayed due to inadequate information.

Looking to the future it is vital to develop a better understanding of the benets of loading, stowing, declaring and moving containers properly to reduce potential environmental impacts.

as an insurer we would expect customers to implement a number of basic risk management measures when transporting cargo:

  • firstly we expect customers to understand the rigours of transit that the container and enclosed goods will have to withstand.This will help to inform how to load, stow and secure the goods within the container appropriately; and

  • secondly, they must ensure all paperwork for the container is correct and that weights and cargoes are properly declared, including any hazardous properties.This will allow the vessel planner to ensure the container is stowed correctly to reduce the chance of loss and potential environmental damage.

rsa is working with an international consortium of customs authorities, third party logistics providers, cargo owners, research institutions, systems developers and port operators to develop a safer and faster means of container transport. financed by the eU, our aim is to create a more transparent and secure door-to-door supply chain.Through a new certication system, customs will not need to check contents and this should result in faster movement of cargo, minimising delays and reducing potential product damage.

(1) annual review 2009, international chamber of shipping, international shipping federation

( 2 ) h t t p : / / n e w s . n a t i o n a l g e o g r a p h i c . c o m / n e w s / 2 0 0 1 / 0 6 / 0 6 1 9 _ s e a c a r g o . h t m l

© sTeve mOrgan/WWf-Uk


  • Pollution from lost cargo

  • Less carbon from quicker carbon transfer

emerging risks briefing

systemIc rIsk



    • Stowing cargo correctly

    • Declaration of goods correctly

    • COP15

  • Growing world trade

  • Price of carbon

  • Fuel conservation (slower)

  • Reduced crew sizes

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