It can be nail-biting waiting for goods you’ve ordered or are selling to arrive at their destination. That’s because cargo theft is rising, and so are new risks, thanks to the pandemic.
A recent report found thefts globally were happening:
In transit (accounting for 71% last year and 89% the year before)
Warehouses and other storage facilities (25%)
While those figures vary by region, they highlight supply chains have been disrupted due to the surge of consumers buying online. The most stolen items included food and beverages, consumer products, electronics, alcohol and tobacco, and fuel.
The report highlighted new risks in different regions, including:
Temporary overflow storage facilitates
Goods being stockpiled
Thieves actively targeting personal protective gear
Increased throughput, stretching existing security systems
In-transit hijackings or goods pilfered from parked vehicles or blockaded trains
Drug-smuggling gangs stealing goods to fund their operations.
Not quite shipshape
Just one percent of thefts happened from ships on the seas, the report showed, but that doesn’t mean they’re risk-free. A World Shipping Council and Bloomberg study shows a big disruption to supply chains is the biggest increase in seven years of containers lost at sea. In the first four months of this year, 1,000 containers went overboard. That compares with 3,000 for all of last year. Those numbers sound like a lot, but were among the 225 million containers in sea transit annually. However, the 1,000 lost earlier this year comprise almost 60% of the dollar value of all container incidents over that period.
This loss of containers was due to more unpredictable weather, larger ships stacked higher, and consumer pressure for goods to be delivered faster. Surprising, safety issues didn’t contribute to those losses, but they could in the future, the study revealed. Overworked crews who are fewer in number yet have more containers to manage mean they may take shortcuts in securing the containers on board.
Water, water everywhere
Another watery risk factor is moisture damage to goods inside the container. That can occur when water comes into the container, such as during a rain event or sea spray hitting it, or the container has been sitting in water when there’s a flood at the wharf. Such incidents are covered by ‘all risks insurance’. That protects your goods against damage due to something unexpected, such as an accident or chance.
However, insurers consider condensation as ‘fortuitous’. It’s a risk that could be prevented, that’s inevitable or quite likely to happen. No container is airtight, so condensation and cargo ‘sweating’ will happen. It will also occur as cargo travels through different climates on the road, inland by rail or waterway, or on the high seas. You might see the droplets form on the container’s ceiling and walls or mould growing on surfaces such as wooden pallets.
As a business using marine transit to send goods, you can minimise these risks by:
Using dry pallets
Storing your pallets in a dry, covered area before they’re loaded (tarps can absorb moisture, so aren’t ideal)
Try not to load cool cargo when the weather is warm and moist
Avoid moving goods by land during severe cold snaps
Assess if the container should be ventilated
Use moisture-absorbing products and dehumidifiers.
Pandemic prompts piracy on the seas
Meanwhile, since last year there has been a spate of private attacks and such attempts, according to a global sea piracy expert. Such attacks involve small, fast boats with pirates hopping on board to seize goods, sometimes even the ship and crew for ransom. Improved security, education, aerial and naval surveillance helped reduce the numbers of such incidents to an all-time low in 2019. The expert says the coronavirus may take a toll on crews’ ability to protect ships and their cargo, with issues in finding replacement crew. Ships may be an easy target for pirates from nations struggling economically, too.
Hooking into better risk management
So, there are plenty of perils affecting goods in transit, whether they involve a commercial vessel, cargo, or truck. To protect your business from the multitude of risks, talk to us about marine transit cover, which may cover:
Accidental physical damage
Insured events that the insurer nominates, usually fire, collision, and/or overturning cover
If your goods are damaged due to the carrying vehicle or vessel colliding or hitting another object
Your goods being dropped during loading or unloading
Fire, lightning, explosion
Your goods falling from and within the carrying vehicle
It’s unlikely the policy would cover war, delay, consequential loss, or loss of market. We can customise marine transit insurance to your needs, such as if you need cover for door-to-door delivery of goods globally, including in-transit storage.