Market Report: Hazardous Cargo Middle East

Should a Mideast blacklist be launched for the hazardous cargo sector?
ANALYSIS

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With demands to implement a regional blacklist in the hazardous cargo sector, how can warehousing and transportation companies in the Middle East remain ahead of the game?

In this increasingly dangerous world, would you believe that aerosols, perfumes and concentrated food flavours are deemed hazardous cargo? It’s true, and there is an entire profession dedicated to handling these and other hazardous materials properly. This includes managing and advising other managers on hazardous materials, as well as process planning and development of new products through manufacturing, distribution, use, disposal and cleanup.

“Any item or substance that places the public, animals and the environment at risk when it’s being transported or moved is considered a hazardous product,” explains Omar Abdullah Al Shamsi, logistics and trading manager at Emarat. “Our company transports and trades mainly jet fuel, gas oil, gasoline, fuel oil, lube oil and LPG. Every one of these products is officially classified as hazardous cargo.”

Although the contents of hazardous cargo shipments can vary, most often they remain liquid or gaseous in nature, and are shipped or stored in bulk to reduce associated costs. The consignments are often more expensive to insure and require specialised handlers and logistics support. “Most of the products we deal with are relatively low in value and high in quantity,” explains Sumesh Nair, general manager of Dubai-based Globelink West Star Shipping.

“The majority are chemicals. However it is often not cost-effective to transport or store because of the segregation that must be provided. As well as restraints imposed on the quantities handled. We would like to see this policy changed. ”

As there are many laws and regulations that define and govern hazardous cargo, the regulations are generally administered by environmental agencies, safety and health administrations, and transportation departments. “Transporting by road tankers must comply with civil defence rules and regulations,” says Waddah Ghanem Bani Hashim, group EHSQ compliance manager at Emirates National Oil Company (ENOC), which deals with a number of hazardous products in Dubai.

On the international side, there are additional rules that govern hazardous product transportation, whether by sea or by road or sometimes by air.

“The main regulations related to transporting such cargo by sea are MARPOL Annex 2 (Marine Pollution), the IBC code (International Code for the Construction and Equipment of ships Carrying Dangerous Chemical in Bulk), and the IMDG code (International Marine Dangerous Goods),” states Ashita Khanna, chemical tanker analyst at the UK-based Drewry Shipping Consultants.

Whenever a hazardous shipment is transported, containers are appropriately labelled to identify the hazard that could result from the product, should anything happen. There are many dangers involved if these shipments are not labelled or packaged correctly. “If such products are in direct contact with environment, they are going to cause harm; at the very least, the hydrocarbon gas emissions damage the ozone layer and enhance global warming,” warns Hashim.

Some within the industry, including Emarat’s Al Shamsi, are lobbying for a blacklist of those who are caught not following the strict procedures that have been put into place. “In the worst-case scenario, if a company fails to comply with industry standards, the business must be closed immediately by the concerned authority and persons in charge should be black-listed from handling any business related to hazardous cargo,” demands a vehement Al Shamsi.

And while some companies specialise in hazardous cargo, most do not. It remains something they are willing to handle on behalf of their customers, although it is rarely the core aspect of their business.

“We handle hazardous freight for several major companies in the region, including petrochemical and oil and gas companies. Some of the products are very toxic and require special handling,” comments Peter Richards, group director and general manager at the Sharjah-based logistics specialist Gulftainer, which operates more than 180 trucks from its network of shipping ports.

The majority of hazardous cargo friendly companies, including Gulftainer, use their own transport fleet and need to ensure that their drivers are aware of safety requirements when transporting hazardous cargo.

“Currently we are handling all products through our own road tankers and have chartered a ship for one year for sea
transport, which puts all responsibility of the carriage of the cargo during sea passage on the ship operators,” says Al Shamsi. “Additionally, every truck utilised during the transport of hazardous cargo should be equipped with fire fighting equipment, to allow for immediate intervention, should the worst case scenario actually become a reality.”

Nair says while oversight, especially in this sector, is a good thing, he would prefer an easing in limits, as profit
margins are too slim to justify housing or transport. “Regarding regulation, we welcome it. However, some would like permission to actually handle greater quantities, so as to make it more cost effective for us to handle such dangerous and precarious goods,” he says.

“We recommend every provider to follow established regulations, including using protective gear and always having knowledgeable staff on hand.”

While choosing to remain anonymous, one source believes there is currently an issue with quality storage facilities within the UAE, and some companies are failing to take measures to ensure the safety of workers as well
as cargo. “Right now there is a serious shortage of hazardous cargo storage. This presents a problem because some companies are choosing not to declare their freight, and keeping it in unregulated conditions.

Consumers in this market are relatively limited in their knowledge of requirements for HAZMAT and some companies are taking advantage, undercutting the market and degrading the industry’s reputation. We can only hope that they will
be flushed out in due course.”

Largest accidental explosion
The world’s largest man-made accidental explosion occurred in 1917 in Halifax Harbour, Nova Scotia, Canada. An estimated 2000 people were killed and 9000 injured when a French cargo ship laden with explosives collided with a Norwegian livestock carrier. The explosion caused a tsunami in the harbour and a pressure wave of air that snapped trees, bent iron rails, demolished buildings, grounded vessels and carried fragments for kilometres.

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