Annual cargo theft report indicates significant new trends
The report, which reflects whole year data from 2020 compiled by leading international transport and logistics insurer, TT Club, and global provider of supply chain intelligence, BSI, highlights significant new trends in risks both regionally and globally.
- Thefts of cargo in transit remains highest proportion of total, all though the 71% share is a decrease from 2019 (87%)
- Losses from warehouses and other storage facilities increases to 25%
- An atypical year due to supply chain threats from the pandemic. These likely to be of continued concern well into 2021
- New high-value targets created such as PPE, face masks and anti-bacterial gel. Vaccine supply chain to come under threat as roll out expands
- Food & beverage sector remains largest target at 31%
The most significant trend highlighted by the report was the relative shift in the location of thefts, with in-transit incidents and those involving vehicles showing a decline, though remaining the most dominant threat, and theft from storage facilities increasing. The extent of the rise in the latter was variable from region to region however this trend was reflective of the disruption to supply chains brought about by radical changes to consumer buying patterns as a consequence of the pandemic.
TT Club's Managing Director, Loss Prevention, Mike Yarwood explains more, "The effects throughout 2020 of the COVID crisis threatened supply chain security, continuity and resilience. Not only did newly created high-value commodities such as PPE become targets for theft but bottle-necks in the logistics infrastructure at ports and warehouses brought increased potential risks. Temporary overflow storage facilities added to the dangers in loosening the grip of existing security systems."
Although specific incidents have not yet occurred, unless distribution plans for vaccines are perfectly executed within the expectations of any given population, challenges will arise in protecting the single most valuable cargo of all in the coming months.
"Challenges will arise in protecting the single most valuable cargo of all in the coming months"
The infographics within the report give an overview of the global data findings, but regional variances are worthy of note. In Europe, the stockpiling of goods meant these inventories came under particular threat with 48% of 2020 reported thefts coming from warehouses and production facilities. This was in contrast with 2019 when only 18% came at such locations. On the other hand, 54% of incidents occurred in rest areas and parking sites in 2019 - the 2020 figure was 19%.
In Asia, the countries with the highest risk remain India, Indonesia, China and Bangladesh. The proportion of storage-based risk remains around 50% in Asia as a whole but in Southeast Asia the in-transit risk indicates the prevalence of bribery and corruption with a high percentage of thefts being facilitated by employees and customs or other officials.
North America continues to see theft coming almost exclusively in-transit via hijackings or directly from a parked vehicle. The risk of social unrest, particularly in Mexico, arguably impacted the risk of cargo loss through most of last year. Significant disruption to the Mexican rail freight industry, with protesters setting up blockades on train tracks, created a backup of cargo across the country. This disruption led to estimated losses of close to US$4.4billion.
"This disruption led to estimated losses of close to US$4.4billion"
In South America, Brazil was a hotspot last year. A key driver of the high rates of cargo theft here remains the presence of major illegal drug smuggling gangs that need to fund their trafficking efforts. Again, the dominant risks were from hijacking and theft from or of vehicles. These theft types accounted for 78% of the total losses reported. The extreme rate of cargo theft, however, did drop for the first time in several years, as continued efforts by police and industry contributed to a slight decline in incidents in 2020.
In the coming year disruption and the uneven resumption of international trade resulting from the spread of COVID will continue with imbalances in shipping container distribution that are likely to impact maritime, and through a knock-on effect air cargo capacity throughout 2021. The added vulnerability of cargo will therefore continue.
The key to mitigating threats in 2021 is to stay ahead of the risk. BSI and TT Club have once more collaborated to analyse the detail of these risks. In the report, the authors furthermore offer mitigation techniques so organisations can proactively understand their risk and build a supply chain that is ahead of the criminal tactics and emerging threats.
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)1737 248300
BSI is the business improvement company that enables organizations to turn standards of best practice into habits of excellence. For over a century BSI has championed what good looks like and driven best practice in organizations around the world. Working with over 84,000 clients across 193 countries, it is a truly international business with skills and experience across a number of sectors including automotive, aerospace, built environment, food, and healthcare. Through its expertise in Standards Development and Knowledge Solutions, Assurance and Professional Services, BSI improves business performance to help clients grow sustainably, manage risk and ultimately be more resilient.
To learn more, please visit: www.bsigroup.com
About BSI Supply Chain Services and Solutions
BSI Supply Chain Services and Solutions is the leading global provider of supply chain intelligence, global supply chain verification auditing services, audit compliance and risk management software solutions, and advisory services. BSI's supply chain services and solutions and services can work independently to address specific needs or combined together to gain unparalleled visibility into your global operations. Implementing BSI's holistic supply chain risk management suite provides organizations with a complete solution for a more sustainable and secure supply chain.
To learn more, please visit www.bsigroup.com/supplychain
Ed Lowcock/Deborah Burgess
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Lucy Robinson / Naomi Prior
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