Nightmare on Ocean Street! There are many forms of risk. Bankruptcy of a huge player is one we don’t think about or prepare for well.
Forwarders could have a big problem collecting fees they’ve paid already. and equipment owners may have difficulty getting their equipment back if it is tied up in disputes and court actions over who pays. Ports could be jammed up if ships get held due to legal orders.
Crisis mounts for container supply chains as Hanjin vessels anchor to avoid arrest and shippers scramble for alternative sailings
Source: Forwarders dangerously exposed by Hanjin bankruptcy, as scramble for unpaid debts and fresh capacity begins – The Loadstar
Talk about unintended consequences.
The Verified Gross Mass (VGM) rule promulgated by the International Maritime Organization (IMO) on July 1, 2016 is intended to make cargo and ships safer, by making sure that container weights are properly recorded. when you are loading a ship, it’s good to know how the weight is distributed. if people give you containers overfilled, you won’t have the right balance on your ship. A ship might turn over, or other containers might be damaged if there’s a shift in cargo.
But the rule has created an entire industry and a plethora of fees being charged by supply chain partners. they’re presumably to offset ‘costs’ of the rule. But there is a concern that they are merely ways of increasing profits. And the fees certainly add to the complexity and cost of a container shipment, and even of identifying the best route for my cargo.
This story about India’s experience highlights some of the bad experiences shippers are having. And it is affecting which ports are used and which carriers. Will there ever be rationality in this area? Everyone agrees we want correct weights of containers, unless we want to cheat, but how complex can it be?
The downside of IMO’s container weighing rule
Source: Shipping Tribune