Whereas fewer whole losses of cargo ships worldwide is nice information for marine insurers, the variety of shipping casualties rose throughout 2021, mentioned Allianz World Company & Specialty’s (AGCS) annual Security & Shipping Overview.
Globally, 54 whole vessel losses have been reported in 2021, 11 fewer than 2020. That’s a giant enchancment from the Nineteen Nineties, when greater than 200 vessels yearly have been declared whole losses. (Spectacular, since there are about 130,000 cargo ships working globally at present, in comparison with roughly 80,000 within the Nineteen Nineties.)
The maritime area of South China, Indochina, Indonesia, and the Philippines accounted for 12 losses in 2021. Loss drivers have been excessive ranges of commerce, congested ports, older fleets and excessive climate.
However, whereas general losses declined, studies of shipping casualties, or incidents, rose. The British Isles reported probably the most incidents (668 out of three,000). Worldwide in 2021, 1,311 incidents have been brought on by equipment injury, 222 by collisions and 178 by fires.
Over the previous decade, 10 whole losses of vessels have been reported within the Canadian Arctic and Alaska area, making it the 19th most frequent loss location globally, ACGS instructed Canadian Underwriter. The most typical trigger was foundering (sinking/submerging).
Plus, the previous 10 years noticed 508 shipping incidents reported in that area (mostly equipment breakdown), making it the 14th most frequent incident location.
The report additionally factors to looming factors that would rapidly change what’s now a usually optimistic story.
“The tragic state of affairs in Ukraine has brought about widespread disruption within the Black Sea and elsewhere, exacerbating ongoing provide chain, port congestion and crew disaster points brought on by the COVID-19 pandemic,” mentioned Captain Rahul Khanna, who heads world Marine Danger Consulting at AGCS.
“[And] a few of the trade’s responses to the shipping growth, reminiscent of altering the usage of, or extending the working lifetime of, vessels additionally elevate warning flags.”
Russia’s invasion of Ukraine affected the shipping trade in a number of methods, the report famous, together with lack of life and vessels within the Black Sea, commerce disruption and rising burdens from sanctions. Plus, there are knock-on results to day by day operations, crews, price and availability of marine gasoline oil, and probably extra cyber danger.
A protracted struggle might, probably, reshape world commerce for vitality and other commodities; and a tighter ban on Russian oil might push ship house owners to make use of various fuels. “If such fuels are of substandard high quality,” the report mentioned, “this may increasingly end in equipment breakdown claims in future.”
Onboard fires are also a rising concern. The report mentioned there have been over 70 reported fires on container ships up to now 5 years.
Fires can begin on account of misdeclaration (or no declaration) of hazardous cargo, like chemical compounds and batteries. And rising shipments of electrical automobiles create challenges as a result of current fire-suppression measures may not correctly handle an EV blaze.
Additional, losses might be costly as a result of the cargo is excessive worth, and it’s costly to take away wrecks and mitigate air pollution.
“Beforehand, a wreck may need been left in-situ if it posed no hazard to navigation,” mentioned Khanna. “Now, authorities need wrecks eliminated and the marine atmosphere restored, no matter price.”
Characteristic picture courtesy of iStock.com/Federico Rostagno
