Magazine article Risk Management

Marine Cargo Security

Magazine article Risk Management

Marine Cargo Security

Article excerpt

Although most cargo security efforts now focus on mitigating issues associated with terrorism. the commercial security of cargo shipments has long been a problem throughout the world. Various studies estimate that theft losses, for example, range from $4 billion to $12 billion per year in the United States, while total global losses could exceed $50 billion.

The reason why estimates vary so widely is because many cargo thefts are not reported to authorities. The reasons for non-reporting include attempts to maintain a good name or reputation, lack of insurance, theft reported as another type of loss or the pride of cargo owners not willing to let others know that they have been duped by unscrupulous freight forwarders. In any event, the figures ore certainly sufficient to make any cargo owner or shipping company take a long look at cargo security.

Cargo Security Suggestions

Cargo security is closely associated with an aggressive management position that all participants in the transportation transaction will act as one in combatting the theft of goods. Cargo security activities may be broken into three distinct periods of time: prior to shipment, during shipment and after shipment.

The majority of theft involving ocean shipment of cargo takes place at either the port of embarkation of the port of destination. Although much has been written about piracy on the high seas, it accounts for a small percentage of overall losses (except in several specific areas of the world).

Prior to Shipment: The most important aspect to assess prior to shipment is how well you know your trade intermediaries. Are you confident that the freight forwarder in Europe will arrange to send your shipment of steel to its final scheduled destination, or could it end up in Syria being sold on the illegal market (an actual recent event)?

Ensuring the security of all the information related to your cargo is imperative. The first step is to make certain that you check the references of any trade intermediary used to assist your import/export activities. Trade intermediaries have knowledge of shipping routes, types of goods being shipped, cargo value and other sensitive shipping information that could aid thieves. Even if you deal with honest and reputable intermediaries, you should evaluate what information security system they use for their own records and which people have access to transaction records. The security of the offices of any firm or person assisting you with import/export transactions should also be checked to reduce the risk of break-ins and other thefts.

Improper security at the point-of-origin terminal can sabotage a transaction as well. If the terminal is also owned by the cargo owner, security procedures may be easier to implement and police. Terminals are normally owned by others (e.g., a government), however, questions related to security must be posed by both the cargo owner and the shipping company. History has shown that many ships are targeted because their cargo was observed while it was being loaded or when it was being packed into containers. All pre-shipment warehousing, packing and transportation must be reviewed for security concerns to ensure that unfriendly eyes are not scouting your shipment.

Other security aspects that should be evaluated at the point-of-origin warehouse or terminal include:

* employee background checks

* perimeter fencing and lighting

* gate control and credential checks of all people entering and leaving the facilities

* secure storage of already containerized cargo

* use of availability of technology to track movement of containers before and during shipment

* security officers to track containers in the terminal

* type of seal used on containers

During Shipment: Once cargo is placed on board a vessel, many owners feel their worries are almost over. …

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