Businesses may well be forgiven for thinking that the biggest threat to their supply chains is the ongoing conflicts in Ukraine and the Middle East.

It is fair to say a significant amount of the world’s oil, gas and fertiliser chemicals have been stopped from being exported via the Strait of Hormuz and now the Red Sea, while hundreds of millions across the world rely on the grain exported from Ukraine which again is under immense pressure.

Therefore, as marine and energy insurers from across the world gathered in Rotterdam for the International Union of Marine Insurance’s annual conference the threat from conflict and wars was always set to be high on the agenda.

The impact on the marine and energy markets are profound. Ships attacked, over 20 seafarers tragically killed on vessel which have come under fire and a raft of delays and physical damage to vessels, crew, and cargo.

However, it comes to something when one of the sessions made it clear that a new conflict is certainly not what is keeping these underwriters awake at night.

What might you ask can be more challenging than two all-out conflicts involving two of the world’s major armed superpowers?

The answer for the cargo underwriters is the emergence of a new breed of criminal gang that is causing havoc across the world as they target goods and cargos and do so in increasingly sophisticated ways.

Gone are the days of armed men hijacking vehicles. Now they will hack into logistics companies, shipping companies, and port systems to identify valuable cargos and how and when they will be transported.

Some go as far as to create fake certificates of ownership and will simply pick the cargo up from the unsuspected port official or shipper who believes they have done their job.

Others will attempt daring robberies boarding trucks while they are in motion to steal goods from the rear of the vehicle.

Two things are striking terror into cargo underwriters and should also do so for their clients. The first is the organisational complexity of the criminal gangs who contain not only members which will stage hold ups, but also highly skilled computer scientists and the most cutting-edge AI systems all designed to make the theft of goods so much easier.

The second is the sheer costs of the goods that are being transported across the world by road, air, and sea.

Lorries can be carrying a payload worth in excess of $100 million, and that lorry can be intercepted stolen, unloaded and the goods transferred in the space of 30 minutes. An hourly rate of $200 million would appeal to anyone.

As the gangs’ sophistication grows so does their audacity.

Cargo underwriters say they need more information to mitigate the risks, and they may well help themselves by explaining to their clients just how big a risk moving goods from A to B has become.

Jon Guy, Editor

Emerging Risks