A review of shipping safety by the insurance company Allianz says while there was a slight uptick in shipping incidents (or “casualties” as they are termed in the industry) during the past year, there was a continuing downward trend in the number of casualties that resulted in the total loss of a ship.
While the number of casualties grew 3 percent to 2,712 incidents in 2017, only 94 resulted in the total loss of a vessel. That compares favorably to the 98 in 2015 and the 10-year average of 113. About half of the total losses last year, 53, involved cargo ships; eight were fishing boats.
“Over the past decade, total losses have declined by more than a third (38 percent), driven by improved ship design, technology and advances in risk management and safety,” says Allianz’s Safety and Shipping Review 2018.
Over the past decade, foundering or sinking has been the leading cause of total losses, followed by shipwrecks and grounding, fires and explosions, machinery damage, and collision.
“Behavioral and cultural risk” in the shipping industry needs to be addressed, says Allianz. “Despite huge improvements in maritime safety, fatal accidents at sea persist. Human error continues to be a major driver of incidents and captains and crews are under increasing commercial pressure as supply chains are streamlined. Tight schedules can have a detrimental effect on safety culture and decision-making leading to the ‘normalization of risk.’”
Captain Andrew Kinsey, senior marine risk consultant at Allianz, told American Shipper in an interview, “We take too much risk for granted. We accept it at too high a level, and we need to change that.”
Kinsey said shipping companies are “starting to get mature safety management systems in place now for ocean vessels and we need to utilize that.”
The report says data about “near misses” can identify risky behaviors and “hull stress monitoring sensors on board ships could be linked to ship navigation in bad weather, feeding real-time information on structural integrity.”
Kinsey said it is also important for shippers to have a safety mind-set. Cargo owners need to properly declare the contents of containers, verify the weight of cargo and make sure it is properly stowed.
The report said, “Major fires on container vessels are one of the most significant safety issues” facing the shipping industry.
“The blaze on the ultra-large container ship (ULCS) Maersk Honam in March 2018 is one of a number of incidents in recent years. Issues driving containership fire exposures include the adequacy of firefighting capabilities as vessels become larger, misdeclaration of cargo, salvage challenges and time taken to
access a port of refuge.”
Kinsey said that it is essential that “hazardous goods are properly identified, properly manifested and properly stowed.”
He pointed to actions Maersk has taken to improve stowage of cargo following the Honam fire. The company organized a workshop led by the American Bureau of Shipping to identify and evaluate potential hazards associated with dangerous goods stowage on containerships including many that are not fully addressed by the International Maritime Dangerous Goods Code.
He also praised inspections being done by the National Cargo Bureau of inbound containers in the United States.
“We know that there’s a problem with misdeclared goods, we know there’s a problem with incorrect stowage, but we don’t know the specific details, and until we get that data we can’t act.”
Kinsey noted the insurance industry and shippers must contend with greater “accumulation of risk” on ultra large containerships.
Shippers need to have a better understanding of where their cargo is, especially cargo that is critical to their operations.
“It goes back to the old adage: Don’t put all your eggs in one basket,” he said. To have a robust supply chain, a shipper does not want to concentrate all of its cargo on a single vessel or through a single port.
“If you are looking to get into the East Coast of the U.S. during hurricane season, you may want to ship some of your cargo via the West Coast and put it on a train,” he said.
The issue has become even more important with consolidation in the shipping industry and space sharing on the same vessel by many carriers.
“It used to be that you knew if you were booking it with Farrell Lines, it was going on a Farrell ship,” he said. “But those days are long past now.”
The International Maritime Organization requirement that ships utilize low-sulfur fuel or scrubbers to clean engine emissions after 2020 will present many challenges to the shipping industry.
In addition to questions about the availability of fuel and an expected hike in bunker prices, Kinsey said ships will need to make sure fuel is not contaminated with heavy fuel and pay more attention to lubrication of engines.