BIFAlink November 2021


Policy & Compliance

Carriage of containers on bulk carriers

With the shortage of available containerships leading to the growing use of bulk carriers for container transport, Michael Yarwood, managing director loss prevention at the TT Club, considers issues you should be aware of

The global container shipping market is currently experiencing extraordinary demands. In part driven by the ongoing effects of the COVID-19 pandemic, there is extremely high demand along major shipping routes, in particular the transpacific and Asia-Europe trade lanes. Market forces have resulted in container shipping costs reaching unprecedented highs in recent months; the outlook suggests that this trend is set to continue into 2022. Strong demand and high costs have resulted in some large retailers, or beneficial cargo owners (BCOs), along these trade lanes considering radical alternatives, including procuring containers and chartering ships directly themselves. The aspiration being to improve control over their respective supply chains, as well as bringing greater resilience and certainty in terms of both cost and service levels. The heated market conditions have resulted in reduced accessibility to purpose-built containership tonnage. This has led in recent months to a number of bulk carrier ships being chartered to carry containerised cargo, for which they are generally not designed. While such chartering might provide a more cost-effective short-term solution and be favourable to the shipowner, who would otherwise be undertaking a ballast voyage, due care is required. Critical considerations Where the carriage of containers on a bulk carrier is concerned, there are a number of critical safety, statutory, contractual and classification considerations. Standard charter party terms for a bulk carrier might not, for instance, provide for the carriage of cargo on deck. In fact, there might be explicit exclusions of liability for cargo carried on deck, with the associated risks resting with the shipper. Due to the design and intended stowing arrangements of containers, the point load at the corner castings (corners) when placed in the hold or on the deck of a bulk carrier risks damaging

the ship and resulting in container stack collapses. While steel ‘I’ frames can assist in spreading the load across the loading area, complex engineering calculations are required to assess and mitigate the risk. BCOs and those supply chain actors shipping containers in this way should be mindful of the potential liability exposures. Particularly where issuing house bills of lading, it is important to seek back-to-back terms to provide protection in the event of a loss. Recognise that NVOCs will retain a duty of care to carry the cargo safely under their house bills of lading. Where, for instance, a bulk carrier has not been adequately prepared to carry containers, or failed to obtain Class approval for material changes made to accommodate containers, the ship is likely to be considered unseaworthy at the commencement of the voyage. Prior to concluding the charter party, it would be prudent to obtain independent legal advice on this point. Safe stowage As we head into the northern hemisphere’s winter months, which in recent years have witnessed a number of container-overboard losses from containerships, one of the primary concerns for BCOs and freight forwarders will be the safe stowage on board the ship, ensuring that the cargo arrives in the condition it was packed in the origin country. Losing containers overboard is not the only risk in this context for bulk carriers. Container stacks stowed within the hold, if not sufficiently secured, are at significant risk of collapse. Since bulk carriers are designed for the carriage of bulk cargoes, a container stack collapse also risks causing structural damage to the ship, potentially leading to pollution or total loss casualties. Furthermore, lightly loaded bulk carriers generally have larger GMs (metacentric height) than laden containerships, resulting in potentially increased acceleration forces. Shippers should be aware of this and

consequently take additional precautions in securing goods within the containers. The Code of Safe Practice for Cargo Stowage and Securing (CSS Code) provides an international standard for the safe stowage and securing of cargoes promoting the safety of life both at sea, and during loading and discharge. While general guidance exists to secure containers on non-cellular bulk carrier ships, interests engaged in shipping containers in this way should undertake due diligence to ensure that detailed provisions, including lashing plans, are included in the ‘non-standardised cargo’ section of the Cargo Securing Manual (CSM) of the chartered ship. What equipment is available to be used and are the crew sufficiently trained to use, monitor and maintain the equipment during the voyage? A CSM prescribes how cargo onboard a ship should be stowed and secured, and is required on ships engaged in the carriage of all cargoes


November 2021

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