Hidden Dangers of Cargo Fires

The industry bodies of the Cargo Integrity Group expand on their concerns relating to cargoes that can catch fire and cause significant damage and casualties under certain conditions. Circumstances created by an alignment of mistakes, oversights, or failed controls can turn a minor incident into a major event.

Following its identification of ‘cargoes of concern’, the Cargo Integrity Group (the Group) now focuses on the issues that may commonly compromise safety by initiating or proliferating fire under certain conditions.

It is recognized that many of the cargoes in this category, labelled ‘reactive hazards’ already fall within the scope of Dangerous Goods regulations. These regulations start from the premise that the transport of Dangerous Goods is prohibited – except in accordance with the details of the regulations.

However, incidents still occur too frequently; as the judge in one casualty litigation explained, disasters are only infrequent due to a “lack of a similar perfect storm of events, and simple good fortune”. All that is required is an alignment of mistakes, oversights, or failed controls. The Group is at pains to explain the dangers associated with these cargoes and emphasize strongly that only reliance on robust diligence or precise emergency response prevents many minor incidents becoming major casualties.

Furthermore, the Group is generating greater awareness overall and urges attention to the need for stringent compliance with mandatory regulations, such as the IMDG Code, and adoption of industry good practices, such as found in the CTU Code.

Such cargoes with reactive hazards include:

Calcium Hypochlorite, a powerful oxidiser, prone to rapid decomposition. In low concentrations, the chlorine content is used as a water cleanser and disinfectant, such as household bleach and swimming pool maintenance. Decomposition – taking place constantly at a very slow rate – is accelerated by higher temperatures and by contamination. The latter can be unpredictable since it necessitates rigorous controls over the raw materials used and the entire manufacturing process.

Charcoal concerns include among others charcoal that is intended for burning on barbecues, shisha pipes etc – sometimes having been treated with accelerants to assist ignition. There has been lengthy debate at IMO to fashion a revised safety framework for transport by sea, that will become mandatory from January 2026. This will remove an unreliable test regime and require that charcoal is always declared as a DG.

Cotton and Wool, Fishmeal and Krill and Seed cake are perhaps less in the public eye, but also prone to self-heating and fire, where integrity and care are required both to ensure compliance and maintain safety during transport.

Lithium ion battery hazards are becoming known, but many are emergent, not least as science advances global energy transition. Many incidents to date have involved new batteries; the hazards will only multiply with age and deteriorating condition. While this will challenge the recycling industry, the reality is that all these products, whether new, used, in use, damaged or end of life, will impact the transport and storage industries for decades to come.

The Group calls for continued and thorough research into all the hazards presented by lithium ion batteries and dependent devices. Apart from fire, incidents have revealed risks from toxic gases and vapour cloud explosions that can be critical in transport and storage.

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Supply chain fraud – the dangers of extended credit

Fraudulent strategies can prove extremely profitable to the international criminal fraternity and the global supply chain is typically low risk due to the remote nature of the actual physical theft of goods. The TT Club regularly highlights the risks of theft through fraudulent documents, mandate fraud, fraudulent truckers, and trucking companies presenting themselves to collect cargo and more recently fraudulent freight forwarders or brokers.

Now the insurer is drawing attention to another type of fraud prevalent over the last twelve months; that of credit fraud. TT’s Logistics Risk Manager Josh Finch comments, “Credit fraud is an exposure to all in the global supply chain and a danger that ought to be considered through the risk management structure of every business. This is primarily a financial risk as operators are left with freight costs that can’t be collected. The losses as a result of such fraud can escalate quickly.”

The methodologies of criminals may vary but they all prey on the priority of all operators to maximise revenue in a highly competitive commercial environment. A brief example can help illustrate the dangers.  Finch explains, “A new customer approaches with a single shipment, typically to transport internationally, for instance from Bangladesh to Spain. The ocean shipment will be completed by road at source and destination.  There is a suggestion this could be the start of a potentially large and lucrative contract.   A rate is agreed and a 60-day credit facility arranged. On completion of the shipment the freight account is settled within the agreed 60 days.”

What follows, from the operator’s point of view seems favourable, as four more consignments of clothing are booked on similar terms to the first. Then the ‘sting’ is put in place as these consignments become urgent and must be sent by air.  Several more air freight shipments occur regularly over a three-week period.  All successfully delivered.

However after that, communications to the customer go unanswered; the 60-day credit period expires, and the freight account goes unsettled. The operator is left with significant carrier costs and no revenue.

TT urges operators to engage in extensive due diligence when advancing credit to new customers and points to advice from the British International Freight Association (BIFA).  Based on the unfortunate experiences of a number of its members, BIFA highlights some similar characteristics shared by this type of fraudulent ‘customers’ :

  • Customer wants only airfreight handled
  • No customs clearance or delivery at destination required
  • Completely new contacts, never previously engaged with operator
  • Large volumes of cargo involved
  • Customer accepts the quote without negotiation
  • No record of customer ever importing or exporting previously on the UK’s HMRC Traders website

Concluding Finch emphasises, “Undoubtedly the best course is to withhold extended credit such as 60 days until a trusting relationship has been established with a customer. If commercial necessities dictate offering a more immediate credit facility then careful due diligence is vital. It is wise to maintain that primary risk management revolves around knowledge of your customer at all levels including regulatory compliance, safety, and security.”

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Continued Risk to Inland Waterway Freight Operations

There are alarming warning signs says international freight and cargo handling insurer TT Club, that severe climatic events are already impacting inland waterway operations; these impacts are widely forecast to get worse in the future.

2024 was the hottest year on record globally. Reinsurer Swiss Re reported natural catastrophe losses exceeding US$100 billion for the fifth year in succession and with thirty-seven events recording losses over US$1 billion the prior year as reported by the Financial Times, from extreme weather. Estimates forecast that insured losses could double within the next ten years.

In 2024 European waterways continued to experience significant disruption to cargo transport. In June the Rhine suffered from extreme weather conditions with torrential rain leading to severe flooding in southern Germany. Cargo handling was interrupted to/from Switzerland and caused substantial delays in inland traffic between the Lower and Upper Rhine.

Conversely, increased droughts have led to record low water levels on major rivers with some vessels carrying only 25% of their usual load to avoid running aground and causing delays. Shipping lines have had to switch cargo from river to rail to maintain connections between industrial regions and the ports.

“Climate change effects on river navigation are significant as it is highly sensitive to changes in weather patterns and long-term climate trends,” says Neil Dalus from TT’s Loss Prevention Department. “This challenge highlights the vulnerability of Europe’s inland waterway transport system, emphasizing the need for infrastructure improvements, planning for risk mitigation and workforce training to ensure operational resilience.”

TT’s historical data points to an continuing rise in claims from weather-related losses over the last ten years. These result from numerous types of damage from navigational and berthing accidents to collapse of cranes and port equipment collisions to container stacks blowing over, and of course flood damage to buildings and infrastructure.

Uninsured and consequential losses can also be costly reports Dalus, “As a result of operational delays reputational damage can occur. Emergency supplies and additional labour costs can accrue and increased maintenance, training and management downtime have to be factored in.”

TT is determined to emphasise the need for a focus on climate change resilience measures; to sharpen detailed awareness of such risks that, with undeniable global warming are clearly set to increase. Additionally as a mutual insurer TT will work in assisting inland waterway operators to devise loss prevention strategies to help minimise the future costly consequences of weather-related incidents.

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The Freight Crime Supply Chain

Surprisingly, this shadow supply chain uses all of the same components as the legitimate one, from route planning to warehousing, with stolen goods marketed and sold using legitimate platforms to unsuspecting buyers. Freight insurance provider TT Club is promoting awareness of this supply chain ‘Black hole’.

Much freight crime is perpetrated by organised crime with profit, similar to commercial businesses as the ultimate aim. The process of storage, transport, distribution and marketing of stolen goods often shadow those of legitimate supply chains with criminals acquiring sophisticated logistics skills. Their knowledge assists them in targeting shipments at a multitude of points; from truck hijackings to pilfering items from unsecured warehouses. Needless to say such theft not only results in significant financial losses but also disrupts the flow of goods, leading to delayed deliveries and dissatisfied customers.

“At TT we are striving to highlight the responsibility that landlords in particular have to properly vet tenants of storage facilities and how they can prevent their properties being used to warehouse stolen goods” says Josh Finch.

“In a recent operation, police in the UK discovered a warehouse, at a location in Bradford that held hundreds of pallets of stolen goods. With the assistance of the National Vehicle Crime Intelligence Service (NaVCIS) the goods found were linked to known cargo theft incidents which spanned the previous six years and amounted to several million pounds in value,” continues Finch.
“The warehouse itself was an unassuming commercial unit, which blended seamlessly with other legitimate businesses and exemplifies the duty landlords have to ensure that the sites they own and lease are not being used by their tenants for illegal purposes.”

TT Club is endeavouring to pinpoint the warning signs, and the nature of due diligence that is essential in preventing such properties from being exploited by criminals. Such measures include:

• Background checks to scrutinize the business operations, financial stability, and track record of potential tenants
• Inspection of premises regularly to ensure they are being used for legitimate purposes
• Monitoring tenant activity, employing modern monitoring technologies, such as security cameras and access control systems
• Collaborating with law enforcement at a local level to share information and report any suspicious activity promptly
• Review lease agreements to include clauses specifying the permissible uses of the property and outline the consequences for illegal activities
• Engagement of professional services such as security experts with experience in identifying and preventing criminal activities

Increasing evidence from law enforcement agencies is confirming that a shadow supply chain operates alongside the legitimate transport of goods, using all of the same components from route planning to warehousing, with stolen goods marketed and sold using legitimate platforms to unsuspecting buyers.

“As TT helps operators to navigate the complex world of cargo theft and freight crime, it becomes increasingly clear that shedding light on this black hole requires a collective effort from all stakeholders in the supply chain, from law enforcement agencies to warehouse landlords. Only through such collaboration can we hope to mitigate this ongoing threat and safeguard the integrity of the supply chain,” concludes Finch.

Death in Confined Spaces: Hidden Danger

International freight transport insurer TT Club is seeking to draw attention to the hidden danger and life-threatening hazards caused by enclosed and confined spaces prevalent throughout the global supply chain. Toxic gases produced by some cargoes as well as leakages, residual fumigants and other causes of a reduced oxygen environment are the chief problems, with 60% of fatalities suffered by would be rescuers.

Confined or enclosed spaces are common in the supply chain industry. Such spaces exist across all freight modalities; from tank containers to cargo hold stairwells and holds, to road tankers and sealed cargo units. A lack of understanding of the danger present may have fatal consequences.

Without sufficient oxygen the human body starts to shut down very quickly. Any rescue operations are therefore time critical. The primary cause of reduced oxygen levels is the increased presence of other gases, such as carbon dioxide. This may arise from rusting of the ship’s structure or metal cargoes, oxidation of cargoes such as coal or the decomposition of biodegradable cargoes, for example fish meal, logs, bark, or wood pellets. All these lead to carbon dioxide – and potentially other gases – being released, simultaneously depleting the oxygen. Other associated hazards include flammable or toxic vapours from leaking cargoes or leaking pipes or hoses.

Peregrine Storrs-Fox, Risk Management Director at TT explains that a lack of awareness of these, often hidden dangers is surprisingly high. “The key risk is that workers may not readily recognise spaces that could present danger,” he states. “The cargo hold of a ship is a leading example, but containers and other cargo transport units pose similar risks; there may be a lack of knowledge of the cargo packed or whether fumigants have been used. Similarly, tanks units, whether a road barrel or tank container, certainly qualify as enclosed spaces.”

The speed with which the effects of oxygen depletion can become debilitating require thorough and regular communication to ensure that operatives understand the risks. When entering a lethal space there are no obvious red flags. In terms of symptoms there are no warning signs such as coughing or feeling breathless or nauseous. An individual can pass out without having the opportunity to raise an alarm or escape.

The quick onset and catastrophic nature of these symptoms often leads to others rushing to the aid of the casualty, unaware of the reason for their collapse. Statistically, over 60% of fatalities connected to confined and enclosed spaces are suffered by would be rescuers.

“The silent and invisible nature of this killer emphasises the importance of raising awareness of the risk,” stresses Storrs-Fox. “Developing and undertaking drills to practice rescues are crucial steps in mitigating the risks, as are a number of other strategies including risk assessments of working in potentially hazardous spaces, discouraging short cuts in work practices and testing, monitoring and venting air in confined areas.”

While not exhaustive, TT has developed a checklist of risk mitigation strategies that can be applied across all modes, whether on land or at sea.

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