Rising tide of abandoned cargo threatening supply chain

There are growing calls for urgent action over the rising levels of abandoned cargo in the aftermath of COVID.

With supply chain congestion and widespread delays in the international container trades set to continue, marine insurers have warned the growing challenges of abandoned cargo will remain and highly likely to increase.

The TT Club said the potential catastrophic impact arising from the deterioration of abandoned cargo cannot be disregarded as a remote risk. However, the considerable costs accruing from container demurrage, detention, storage and disposal regularly result from cargo that, for a variety of reasons, is no longer required by the original receiver or consignee, and is simply abandoned at a port terminal or cargo facility.

The abandonment of cargo is threating to increase safety risks and regulatory infraction, as well as place significant demands on management and operational resources to resolve individual cases.

“Levels of cargo abandonment have always been problematic to forwarders, NVOCs, logistics operators and, of course container terminals,” explained Peregrine Storrs-Fox, TT’s Risk Management Director. “The surge in container demand over recent months has however compounded container ship capacity issues, port congestion and consequent severe transit delays. These factors will do little to alleviate the practice of cargo interests, in circumstances of loss of market for goods or bankruptcy, simply relinquishing ownership of consignments.”

The TT Club warned those left with the responsibility of removing and/or disposing of the goods and returning the container to the appropriate carrier, are in need of guidance. As such the insurer bas issued a set of guidance that identifies ‘red flags’ that forwarders, logistics operators and carriers should consider.

“Certain commodities such as waste, scrap, materials for recycling and personal effects, previously unknown shippers, particularly individuals rather than companies are deemed red flags,” added the TT Club. “Furthermore, once the cargo is defined as abandoned, the publication outlines the role of enforcement agencies and the responsibilities of others involved in the supply chain. “

“Above all the value of our guidance lies in mitigating the risks associated with abandonment and recommended actions outlined in methodical steps and a ten-point checklist,” concluded Storrs-Fox. “There needs to be a greater understanding of why cargo is abandoned and how it is handled in order to restrict the growth of a serious trend leading to increased safety and cost ramifications.”

The abandonment of cargo is threating to increase safety risks and regulatory infraction, as well as place significant demands on management and operational resources to resolve individual cases.

Follow us on twitter: @risksEmerging

Remember the European Super League?

Well, what if we told you the company behind it was at the EU's highest court last month and… it did not go that badly for the ESL?

@mjshrimper explains why we certainly haven't seen the last of it yet...

https://theathletic.com/3450382/?source=twitteruk

#Mutual and #cooperative insurers in Europe outperform the overall European insurance market with a record high share of the total European market of 33.4%, according to our recent "European Mutual Market Share 2022 report".
https://www.icmif.org/news_story/mutual-insurers-in-europe-outperform-the-overall-european-market-with-record-share-of-total-market-premiums/

[email protected]_Inc slows growth to avoid squeezing markets for fresh funds. nsurtech ups profit target in peak loss period even while adding in loss-making Metromile. https://bit.ly/3Qy0MSI #insurance #reinsurance

Judge hands PGA Tour win over LIV Golf as 3 players denied request to play in FedEx Cup Playoffs https://cnn.it/3AbpqD5

Former U.S. President Donald Trump indicated he would testify in a New York investigation by the state's attorney general into his family's business practices, with the possible testimony coming amid a flurry of legal woes for him https://reut.rs/3dle9Hu

Brazil vowed last year to halt deforestation by 2030, yet the number of fires burning in the country's Amazon rainforest hit a 15-year high in June. Here are some factors driving destruction of the world's largest rainforest https://reut.rs/3Q7stSp

"When you get hungry you get more vulnerable healthwise" - Abdul Razak Gurnah.

Millions are facing acute food insecurity in the Greater Horn of Africa.

WHO's funding appeal for $123.7 mill is aimed at addressing urgent health needs in the region. http://bit.ly/3SnSyyc

Load More...
SHARE: