Abandoned cargo: alert to risk escalation
With supply chain congestion and widespread delays in the international container trades set to continue, the vexatious challenges of abandoned cargo will remain and probably increase. In its role as risk prevention advisor to the industry, TT Club has issued a StopLoss document to provide practical guidance on the issue to stakeholders across the supply chain.
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. Increased risks of safety and regulatory infraction are inevitably consequent, as well as significant demand 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,” comments 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 surge in container demand over recent months has however compounded container ship capacity issues, port congestion and consequent severe transit delays.
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 and TT’s StopLoss publication Abandonment of cargo: Avoiding the pitfalls is designed to deliver just that. It 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. Furthermore, once the cargo is defined as abandoned, the StopLoss 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,” concludes 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.”
There needs to be a greater understanding of why cargo is abandoned.
Abandonment of cargo: avoiding the pitfalls is available for download on the TT Club website.
On 30 September 2021, Transport Events will be hosting a webinar sponsored by TT Club on the abandonment of cargo. Those wishing to learn more about this pertinent topic from a selection of industry experts are invited to register to attend here.
Speakers will include: Peregrine Storrs-Fox, Risk Management Director, TT Club; Richard Brough OBE, Director, Brough Marine; Jens Roemer, Vice President and Working Group Seatransport Chairman, FIATA; Bob Ahlborn, Vice President – Liner Operations, National Cargo Bureau; and Uffe Ernst-Frederiksen, Vice Chair, IVODGA.
About TT Club
TT Club is the established market-leading independent provider of mutual insurance and related risk management services to the international transport and logistics industry. TT Club’s primary objective is to help make the industry safer and more secure. Founded in 1968, the Club has more than 1100 Members, spanning container owners and operators, ports and terminals, and logistics companies, working across maritime, road, rail, and air. TT Club is renowned for its high-quality service, in-depth industry knowledge and enduring Member loyalty. It retains more than 93% of its Members with a third of its entire membership having chosen to insure with the Club for 20 years or more.
Tel: +44 (0) 7979 868539
You may also be interested in:
TT Club offering evermore tailored service with additional underwriting resource in the Benelux region
Find out about the transport and logistics insurance providers new presence in the Benelux region
Brexit web resource for the freight industry
Recognising the complexities and the uncertainties that the upcoming consequences of Brexit will bring for all stakeholders in the UK and EU, international freight transport insurer, TT Club has launched a Brexit webpage resource in an attempt to bring clarity.
Freight transport and logistics insurance provider, TT Club announces a suite of risk management advisories in a new format and a variety of languages to guide transport companies and their operatives on common safety and security issues, providing key alerts to avoid damage and loss.