A bad idea?

by John Southam, Loss Prevention Executive, and David Richards, Director Claims, North P&I Club Amid a shortage of container ship capacity and soaring rates for transporting containerised freight, carriers are increasingly exploring alternatives, including the potential for getting bags, flexible intermediate bulk containers or intermediate bulk containers on board dry bulkers. While more and more bulk carrier operators are considering carrying cargoes that would usually be containerised, not all goods are suited to this shipping method. Those still willing to explore the opportunity should be aware of the associated risks.

Let us start with bagged coffee, a high-value commodity, with current prices around $6.0/kg for arabica beans and roughly air is not properly expelled. Cardboard or kraft-paper lining is often used to protect the cargo, but the effectiveness of this method is disputed. Similarly, the effecIf overloaded or poorly stowed, jumbo bags can split, causing their contents to leak into the hold. This not only presents a health hazard to those working in the hold but half that for robusta. Carrying coffee beans using any recognised method presents challenges for the carrier. The beans are highly hygroscopic, which means they absorb a significant amount of moisture from the air, making them vulnerable to condensation that wets the bag and encourages fungal growth. This risk is exacerbated when the coffee beans – grown in warm, humid regions – are transported to cooler climates, as is frequently the case.

Condensation that forms on steel structures – ‘ship’s sweat’ – is the primary source of wetting. Even when carrying bagged coffee using dry containers as per standard industry practice, the same risk is present: with limited ventilation, moist tiveness of building ventilation channels into the stow is unproven, while hold ventilation may also be limited in its efficacy. Dunnage can prevent cargo-to-steel contact, but applying enough to have the desired effect can prove challenging. Such is the risk of wetting damage and the difficulty of preventing it that cargo expert BMT advises against carrying bagged coffee in cargo holds altogether. A further danger in transporting bagged coffee in break-bulk is crushing damage caused by the weight of the cargo loaded above. Second, chemicals. Some of them, like sodium metabisulphite, have traditionally been carried in containers but are now put in jumbo bags as break-bulk cargo. can also cause damage to adjacent cargo and the surrounding steel structure. Third, car parts. Parts used in the manufacturing of vehicles are increasingly finding their way on board bulk carriers as break-bulk cargo, usually packed within crates and/or palletised. Shippers must ensure that the crate or packaging affords adequate protection and is properly stowed and secured in the hold.

Carefully scrutinised

While adapting to new customer requirements and solving capacity issues to keep trade flowing is nothing new in the shipping industry, requests to carry cargo unconventionally should be carefully

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scrutinised, notably when dealing with dangerous or high-value loads.

Given reported shortages in reefer capacity, there are particular concerns around high-value goods requiring temperature control, like some pharmaceuticals. For example, carrying such cargo in IBCs across the top of a bulk stow of grain may prevent effective fumigation and ventilation, leading to contamination.

Cover may be prejudiced where unconventional cargo arrangements mean a shipment cannot be carried per a safe and proper system (or if the carriage is imprudent for some other reason). The carriage of rare and valuable cargo may require advanced approval from the vessel manager. Any change in risk due to the carriage of an unconventional cargo requires prompt disclosure to the protection and indemnity club to ensure that cover remains in place. Legal advice should be sought when a charterer requests a carrier to transport cargo using unconventional methods. Depending on the charter-party terms, such an order may be illegitimate, specifically where compliance would be impossible or unsafe. Owners may wish to explore taking a letter of indemnity from a charterer who requests unconventional carriage arrangements. ‚

North P&I is a leading global marine insurer providing P&I, FD&D, war risks, hull and machinery, and ancillary insurance to over 250 million GT of owned and chartered tonnage. The S&P Global ‘A’ rated Club is based in Newcastle upon Tyne, UK with regional offices and subsidiaries in Australasia, China (Hong Kong and Shanghai), Greece, Ireland, Japan, Singapore and USA. North is a leading member of the International Group of P&I Clubs (IG), with over 12% of the IG’s owned tonnage. The 13 IG clubs provide liability cover for approximately 90% of the world’s ocean-going tonnage and, as a member of the IG, North protects and promotes the interests of the international shipping industry. Head to www.nepia.com to discover more.