Prepared by: Group Charlie

Cadet. Jimenez, Steven V.

Cadet. Guades, Mark Andre D.
Cadet. Lacopanto, VJ L.
Cadet. Lajom, Carl Norbert S.
Cadet. Lampano, Jeric T.
Cadet. Malaque, Justine Aaron Z.
Cadet. Maranan, Neil Patrick F
BAGGED FOOD CARGOES AND PREVENTION
OF STEVEDORE DAMAGE AND PILFERAGE
 INTRODUCTION
Large cargoes of bagged food products such as rice, sugar and flour
are regularly shipped on board bulk carriers and general cargo vessels.
The related loading and discharge operations, particularly at developing
nation ports, can be problematic due to stevedore negligence or even
deliberate rough cargo handling which result in broken bags, cargo
spillage and facilitate stevedore pilferage. This Risk Bulletin is intended
to raise awareness of these problems and provide recommendations to
minimise bagged cargo damage and consequent shortage claims.
 BACKGROUND
Bagged food product cargoes are relatively high value commodities.
Examples include refined sugar, currently trading at about USD 486.00
per m. ton FOB, and rice and at about 415.00 per m. ton FOB. The
market value of these commodities increases exponentially as they move
through the ‘added value’ sales, transport and distribution processes to
the ultimate consumer. As a consequence, their retail value in local
markets at the discharge port may be as much as three to four times the
original FOB price. This can of course generate a strong inducement for
stevedores to pilfer cargo during the discharge process.
 WHAT TYPES OF FORESEEABLE OR DELIBERATE DAMAGE CAN OCCUR?

• Bags can weigh up to 50 kg such that they can be difficult to carry and handle
manually. As a consequence, stevedores often make up sling loads within and under
the cargo hold wings and well outside of the hatch square. These loads will then be
dragged out by the crane hook or derrick hoist wires and across the top of cargo in
the hatch square. This often results in ruptured bags and spillage. The damage
suffered is not usually deliberate, but it is foreseeable and preventable.
• Stevedore crane drivers or winchmen may intentionally cause slung bags to rupture
by swinging and contacting sling loads heavily against the side of the hatch coaming
as they are being raised or lowered from the cargo holds. This kind of damage (as a
precursor to pilferage) is deliberate, but it is also preventable.
• Stevedores may carelessly or, more likely, deliberately rip open bags with cargo
hooks or deliberately cut them open with knives in order to pilfer the cargo. Again,
this kind of deliberate damage and theft is preventable.
 WHAT LOSSES MAY THEN BE SUFFERED?
When food cargo bags are ruptured, cargo loss will usually occur in two ways:

• The pilferage of spilled cargo is usually confined to smaller quantities of cargo which
can be concealed in the clothing or knapsacks of stevedores. However, as there are often
10 or more stevedores in a hatch gang and if cargo operations extend to multiple shifts,
these small quantities can quickly add up to significant losses.
• Probably larger that the losses from pilferage is the cargo spillage residue which
ultimately works its way down to the bottom of the cargo hold as all bags are discharged.
This cargo then becomes contaminated with dirt and although it can be swept up and re-
bagged, it becomes unusable; except perhaps as animal feed at a greatly diminished
value.
 WHAT STEPS SHOULD BE TAKEN TO PREVENT BAGGED CARGO DAMAGE AND
LOSS?
• Formal planning for cargo operations security should be completeted on board prior to arrival at
the load or discharge port. These plans should incorporate the general requirements of the ship’s
ISPS security plan together with specific cargo operation requirements. MM recommends that this
should include:

• Master’s pre-arrival awareness of his charter party and/or bill of lading obligations in relation to
the overall supervision and control of loading and discharging operations.
• Master’s pre-arrival notification of the number of cargo hatches to be worked simultaneously, the
scheduled times of working and the number of stevedore gangs and personnel which will board
the vessel.
• Master’s on-arrival receipt of the names and 24/7 contact details of the Stevedore Foreman, the
Charterer’s Agent and the Cargo Consignee or their Representative.
• Agent’s confirmation that stevedore identification will be issued by the port authorities to assist
the ship’s control of all stevedores boarding and disembarking the vessel in full conformance with
the ISPS Code and IMO MSC/Circ.1132.
• Consideration of the appointment of independent surveyors to represent and protect the Member’s
interests by:
• Tallying the bagged cargo being loaded or discharged.
• Ensuring that any damaged bags being loaded are returned ashore and replaced by undamaged
bags and that any bags ruptured during discharge are re-bagged immediately.
• Providing a full and detailed report of the cargo operations and any observed problems and
losses.
• Ensuring all ship’s Officers of the Watch (OOWs) understand that:
• All stevedore related incidents (inclusive of the three types of foreseeable or deliberate
damage described above) must be reported immediately to the Chief Officer and/or the Master.
• All cargo damage and loss incidents observed are to be photographed and recorded in the ship’s
deck log with the location, time and nature of and their apparent cause.
• Ideally, stationing a member of the ship’s crew at each cargo hatch where loading or
discharging is taking place to observe, record and report continuously all stevedore activities
and incidents to the OOW.
 CONCLUSION AND TAKEAWAY
• Bagged food product cargoes which are not loaded into containers and which are shipped as
break-bulk cargo on board bulk carriers or general cargo vessels are likely to suffer cargo loss
and damage due to foreseeable or deliberate bag rupturing or tearing by stevedores and
consequent pilferage. Experience suggest that the amount of the damage and loss will be
higher in developing nation ports, where the motivation to pilfer the cargo may be increased
by low stevedore wages and poverty.

• In circumstances where bagged cargo damage and pilferage occur, claims may include spilled
cargo re-bagging costs and shortage claims deductions by charters from freight or hire.
Customs ‘fines’ for short delivery may also be imposed and cargo interests may threaten ship
arrest or detention. All in all, not a good place for a shipowner Member to be. Members who
are involved in the bagged food products trade are therefore encouraged to ensure that their
ship managers, DPAs, Company Security Officers (CSOs) and Masters are made aware of this
Risk Bulletin. Members should then ensure that MM’s loss prevention recommendations are
fully implemented.
Every year, there are 1000’s of complaints registered for cargo claims associated with
different kinds of cargo damages. UK P&I Club lists below cargo damages as faced on a
regular basis.
 Types of Cargo Damage

Physical Damage
• Physical cargo damagePhysical damage is when
cargo is damaged due to dropping, rolling,
breakages, being knocked during transit, etc. The
main cause of physical damage is bad stowage inside
the container resulting in damages. Bad stowage
includes incorrect, improper, and insufficient lashing
(not using enough dunnage, chocking, lashing
materials), incorrect weight distribution, improper
loading affecting the stability of the cargo.
 Wet Damage
• Wet damage as the name suggests, is damage
to cargo duWet Cargo Damage e to water and
wet conditions a cargo is exposed to. The
damage could be due to changes in climatic
conditions such as moisture, condensation
during transit or seawater ingressing into the
container due to small holes. Condensation
can also happen when an incorrect type of
container is used to transit sensitive products
for e.g. usage of a normal container instead of
a ventilated container.
 Contamination Damage
• Contamination Cargo DamageDamage to a
cargo when it has been made impure through
pollution, poisoning, etc. which renders it
unusable for human consumption or other
industrial or operational usages. There are
numerous ways in which another commodity
can contaminate a cargo, e.g., by inadequate
cleaning after a previous cargo; by improper
storage before shipment and consequent
exposure to a contaminant; by poor separation
from another commodity in the same cargo
space, etc.
 Reefer Related Damages
• Reefer Cargo DamageThe damages are
quite common occurrences and are
caused by reefer equipment or
mishandling or power failure. Reefer
cargo damage includes decay, thawing,
freeze damage, over-ripening, bruising,
off-size, and/or discoloration of products
in transit. The damage could occur due to
improper setting of temperature,
unintentional human error, improper
stowage, poor air circulation.
 Infestation Damage
• Infestation Cargo DamageInfestation damage is
caused by the presence of a large number of
insects or animals, especially rodents in a cargo.
Such type of damage mainly occurs in the cargo-
carrying agricultural products. Infestation
damage can also lead to contamination damage
making products unsuitable to be used by the
end-user. The damage can also cause delay of
cargo in transit as port authorities need time to
inspect the cargo for the cause of damage.
 Measures to prevent Cargo Damage
• As a forwarder, shipper, manufacturer, or importer, it is essential that you take some definite steps to reduce
the risk of damaged cargo and save financial and operational losses. Thankfully, today there are plenty of
ways by which you can prevent damage to your cargo. Few of them are listed below:
• Use the correct type of container for shipping respective products. E.g. heavy cargo needs a container
designed to carry heavy items.
• Ensure that the right lashings and dunnage material are used within the container to restrict the movement of
cargo.
• Ensure that the incompatible products are not mixed in the container e.g., mixing clothing with chemicals.
• When shipping cargo susceptible to wet damage, make sure the correct route is chosen. Climates with high
humidity, for example, could affect the cargo, and condensation could create water damage. Before shipment,
ensure all doors of the container are well sealed and that all rubber gaskets are present.
• Frozen cargoes should be checked for dehydration, desiccation, fluid migration, odors, black spot, color and
flavor changes, and should also be examined for signs of any upward temperature deviation and subsequent
re-freezing
• Ensure you use technology-enabled solutions to know real-time updates about the location and condition of
your cargo in transit to avoid any damage and take proactive measures to reduce further losses in case cargo
has already been damaged. Use data from these technology-enabled services to accelerate your claims
handling process.