(VGM) losses US$6billion approximately
The loss of more than a hundred containers from CMA CGM George Washington two years ago is evidence that there is some way to go before the regulation is completely effective, while the major loss of 342 containers from MSC Zoe in 2019 could also prove to be yet another major container incident caused by container weight issues.
Cargo losses as a result of improper weight declarations for cargo carried in containers were meant to have been solved with the introduction of the Verified Gross Mass (VGM) regulation in 2016. But cargo accidents since the introduction of the rule show that it can be ineffective.
VGM non-compliance is an urgent issue for the industry because, apart from the safety element of the rules, which is self-evident and must be the number one priority for the industry, the economic impact of such accidents is also a material consideration.
Shipping accidents, caused by VGM non-compliance and the improper declaration of containers, can financially affect all the stakeholders in the transportation process, including shippers, lines, terminal operators, insurance companies, all the way along the supply chain to truckers and retailers.
It is estimated that the transport and logistics industries lose more than US$6 billion annually due to poor practices in the overall cargo transport unit (CTU) packing process.
One reason that the regulations may be difficult to police is that there are different methods for calculating the weight of containers. In part, this is because the system is populated with stakeholders that have a varying level of wealth to invest in equipment and processes such as weigh-bridges.
If a port or terminal is lucky enough to have a weigh-bridge the calculation is straight forward. The container along with its cargo contents is weighed with a deduction for the weight of a truck and its fuel. This can be arranged by a shipper or a third party.
However, for those facilities that operate without the benefit of a weigh-bridge the calculation can be more complex. It involves weighing all the packages/cargo items and contents (including securing equipment/dunnage) before it is packed into the container by means of a certified method approved by the competent authority.
When each item has been weighed the totals will be aggregated to the container’s tare weight shown on a label on the container.
While this calculation helps those without the means to weigh containers, it can, however, create difficulties for shipments where multiple consignors are involved.
To begin with, it is important for everyone in the industry to realize the real jeopardies of a improper declaration of containers. The considerations of the involved parties are the mistakes in the declaration of gross mass and content, load distribution and classification of cargo. Errors in the above processes can potentially lead to accidents, including the damage or even the loss of containers.