The Ailing Shipping Industry: Container Fire Incident

Container ship's fire incidents have been frequently covered in the news over the course of 2019. In order to decrease the number of incidents, the supply chain industry has established the Cargo Incident Notification System (CINS) in 2011 with approximately 17 shipowners. The most recent major cases fire incidents have occurred on Herbert, Maersk, and MSC container ships. According to a report by TT Club, container ship fire incidents occur every 60 days or so, highlighting a serious problem that has puzzled the industry – improper stowage/cargo declaration.  

The National Cargo Bureau (NCB), a non-profit organization, has been assisting shipowners since its establishment to ensure safe and proper cargo loading. NCB agreed to inspect 100 Maersk containers free of charge after the fire on the Honam Ship this January 2019. Often, containers are shipped ashore without damaged goods but handling instructions are ignored when unloading. Although there was no incident on the container during the unloading process, it was unclear whether the goods were mislabeled, declared, or stowed improperly. In order to obtain more meaningful data, the NCB expanded its free inspection service for other members of CINS to 500 containers. Members are also aware of the value of the cargo inspection process.

The result of the examination was not positive - 55% of all containers including dangerous goods and general goods (non-dangerous goods) failed to pass the inspection. A false declaration such as these can cause multiple risks such as incorrect container labeling, improper stowage, failure to segregate in accordance with IMDG, or excessive heat generation resulting in a spontaneous combustion of goods.

Other problems include documentation errors. This kind of mistake, whether intentional or unintentional, will mislead shipping companies and lead to improper stowage of goods. The severity of document record errors can be large or small ranging from the information provided by the shipper, to the classification of goods. Any of these errors will cause the container to fail the inspection.

For these problems, shipping companies have made a rapid and reasonable response. In August this year, Herbert announced that starting from September 15, 2019, in case of any misdeclaration of goods, the shipper may face a fine of USD $15,000 in addition to the relevant losses. For the illegal, fine, loss, accident, claim and after-treatment measures caused by the concealment and false declaration of goods, Herbert requires the shipper to be fully responsible for the relevant costs and consequences. This is the company's direct response to the fire in Yantian express in January 2019

Evergreen shipping announced that it would impose a fine of US $4000 to US $35,000 on each vessel that has wrongly declared containers. OOCL also announced its own fine mechanism. Now that shippers are beginning to realize the danger of cargo misdeclaration, we are expected to see shipping companies adopt stricter fines and enforcement programs in 2020.

Since SOLAS requires water guns on board, ship operators should consider purchasing multiple portable water level monitors so that they can be used in the event of a fire at the height of the cargo pile. However, without proper training and exercises, even with these tools, it is difficult for the crew to be ready for use in case of a real emergency. The training should include the use of the IMDG Code and the MSDS to ensure that the crew understands how to use these resources to identify the response to a particular cargo fire.

With the increasing size of the ship in the industry, the shipowner's disaster caused by the cargo fire is even worse. Shippers need to be more careful than ever, and if they unfortunately fail to do their job, shipping companies must be prepared for the worst.

Contributor: Teresa Xu

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