The danger in the safety and security of the cargo at ports due to the expected port congestion caused by the Suez Canal blockage has been highlighted by Mike Yarwood, TT Club managing director, loss prevention.
The arrival of large volumes of laden containers, coupled with the requirements for hinterland distribution, will create disruption at ports and terminals, straining throughput and yard capacities, and creating an accumulation of cargo, according to the UK-based insurance company TT Club.
[s2If is_user_logged_in()]The situation will also aggravate an already widely reported imbalance of container equipment, especially on the East to West trade routes as laden containers are tied up and consequently empty availability to reposition to shipment areas worsens.
“The risk of theft at ports and freight depots in this scenario is heightened and a greater focus on security is required,” pointed out Yarwood.
He went on to explain, “Whether it simply be at an overspill holding or storage area, or temporary warehousing, wherever and whenever cargo is not moving, it is more likely to be stolen. Those active in the supply chain should be mindful of these security risks. Due diligence, undertaken to ensure that any third party provider of storage is adequately resourced to meet these demands, is a prudent step to take in these circumstances.”
In the meantime, a recent International Road Transport Union (IRU) survey has shown that driver shortages are already expected to soar through 2021 especially in Europe, a fact that is expected to exacerbate the difficulties in delivering import cargoes and picking-up consignments for export.
The overall lack of capacity to move containers has the potential to create additional challenges, noted TT Club, while those seeking to secure road haulage capacity should be mindful of the associated security risks outlined in the recent TT Club/BSI joint cargo theft report.
Yarwood concluded, “Experiences over the last twelve months through the pandemic, the Brexit transition and more recently the Suez Canal blockage, bring into question this bias towards efficiency and cost reduction. If such is achieved at the expense of resilience, is this policy the correct one? The new normal might see many stakeholders increase their focus on contingencies and adopt more a ‘just in case’ philosophy than a ‘just in time’ one.”
The Ever Given incident in the Suez Canal has further challenged the already strained by the Covid-19 disruption global supply chains with the Suez Canal Authority’s claim reported about US1 billion.
Although the canal is now functioning normally, there were reported 300 ships to have been delayed awaiting transit, and many others that were re-routed via the longer passage around South Africa’s Cape of Good Hope.
“Beyond the delay to cargo on board those ships affected, there will inevitably be a knock-on impact for those involved in discharging the containers at destination ports when they finally arrive, as well as the final mile delivery carriers,” said Yarwood and added, “While the immediate impact may be a lack of cargo arriving when expected, presenting market supply challenges, it is when the cargo does start to turn-up that further potential risks emerge.”
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