Safely Transporting Hazmat and Other Dangerous Goods

Shipping hazardous materials (hazmat) by air, ocean, or by land is heavily regulated by many different agencies. It’s highly risky and must be done correctly. DHL, an experienced carrier, was fined as recently as last month for violating hazmat regulations. Here’s reporting from American Shipper:

“The U.S. Federal Aviation Administration on February 12th proposed levying $455,000 in civil penalties against parcel carrier DHL Express for seven alleged violations of hazardous materials regulations. The agency said DHL accepted shipments in 2013 and 2014 that were not properly prepared for air transportation and failed to ensure its employees or agents received required hazardous materials training.”

Shipping hazmat is heavily regulated for good reason: It’s dangerous and has cost people their lives. The fines for non-compliance can exceed $100K and lead to criminal indictments and jail time.

If you want to pack, ship, and certify hazmat for transportation, you need to go through formalized training and certification. It’s up to the manufacturer to recognize whether what they’re producing are classified as dangerous goods or not. If they are, then they must fill out official declarations of dangerous goods before they can be transported.

The shipper’s declaration (which must be completed by the supplier or manufacturer) is the most important document in hazmat transportation. It details exactly what is being shipped, how dangerous it is, how it must be packed and labeled, and how it must be transported. Shippers are required by CFR Title 49, the International Air Transport Association, and other regulators to ensure the safety of the cargo and everyone on board the flight.

Here’s an example of a properly completed shipper’s declaration of dangerous goods:

shippers_declaration_437x600

That’s all the responsibility of the shipper up to this point. They’re required by law to correctly prepare the shipment. Now let’s get to where other responsibilities lie.

Over the course of the hazmat shipment, everyone has to assume responsibility for safe transport. That’s why every carrier has to employ certified hazardous materials inspectors to check for safety and regulatory compliance. It’s not just that carriers accept only correctly documented, packaged, and labeled hazmat shipments; they have to ensure that they’re loaded correctly.

To better understand how hazmat compatibility works, let’s dive into the nine classes of dangerous goods:

Class 1: Explosives

HAZMAT_Class_1_Explosives

 

 

 

 

 

 

Class 2: Compressed Gasses

DOT_Placard_Class_2-new

 

 

 

 

 

Class 3: Flammable Liquids

hazardous-materials-label-class-3-flammable-liquid-roll-of-500-6-hml-r-500

 

 

 

 

 

 

Class 4: Flammable Solids

DOT_Placard_Class_4-new0412

 

 

 

 

 

Class 5: Oxidizers

DOT_Placard_Class_5-new

 

 

 

 

 

Class 6: Poison/Toxic

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Class 7: Radioactive

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Class 8: Corrosive

HAZMAT_Class_8_Corrosive

 

 

 

 

 

 

Class 9: Miscellaneous (Dry ice, magnets, vehicles, etc)

HAZMAT_Class_9_Miscellaneous

 

 

 

 

 

It’s not sufficient to document, package, and label. You also have to figure out how which other goods materials they can be stored and transported together. Here’s a table to figure that out.

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(Green indicates no restrictions. Yellow indicates that classes can be transported together with some restrictions. Red indicates that there are no circumstances under which these goods can be transported or stored together.) Improperly storing hazmat together can be catastrophic as we saw in the recent explosion in the port of Tianjin

If you’re transporting hazmat, we can’t emphasize enough that everyone along the supply chain is responsible for knowing the regulations around their safe handling. Even the most innocent looking items, like the batteries that power everyday toys, can be classified as hazardous materials depending on how they’re packed and shipped. It’s not always apparent what constitutes a dangerous good for transport and for this reason, personnel must be specially certified to take on these challenges. In the world of transporting hazardous materials, safety is no accident.

By Travis Falasco, global operations associate at Flexport.

What will happen if lithium ion batteries are banned on passenger planes?

The United Nations International Civil Aviation Organization has issued a directive to ban lithium ion and metal batteries from passenger flights, effective April 1st, 2016. Lithium ion and metal batteries can still be transported on cargo flights. This prohibition on passenger flights is meant to be temporary until investigators have more time to research how to prevent battery fires.

Although the U.N. agency doesn’t have actual enforcement power, national regulators generally follow its directives. The U.S. Federal Aviation Agency is expected to support the ban, in spite of protests from industry groups.

Lithium batteries are dangerous goods that sometimes spontaneously combust. Once the fire starts, it burns so hot and fast that the current firefighting equipment cannot extinguish the fire. This has actually brought down a plane before: In 2010, a UPS cargo plane crashed, killing both members of the crew; an investigation revealed that the fire was caused by the combustion of a pallet carrying batteries.

Here’s what shippers should know about the U.N. battery ban

Here are three major takeaways from the guidance issued by IATA, effective as of April 1st, 2016:

  • Lithium batteries, packed on their own, are forbidden from passenger aircrafts.
  • In addition to the standard labels, lithium battery shipments are to bear a “Cargo Aircraft Only” label.
  • Batteries must be shipped at a state of charge not more than 30% of rated design capacity. You must obtain approval from the State of Origin and the State of the Operator if you ship batteries that are over 30% charged.

The prohibition doesn’t apply to lithium batteries packed with equipment or in equipment (UN 3481).

The ban will continue until there’s more research into the combustibility of batteries. Investigators are also looking into a new fire-resistant packaging standard that will be used to transport the batteries. That new packaging standard is expected by 2018.

Passengers won’t be directly affected: You’ll still be able to keep the batteries in your cellphone and laptop in your carry-on. The greater danger is the close-packing of batteries in the cargo holds of passenger planes.

Here’s how the change might affect the industry

The Rechargeable Battery Association, an industry group, has opposed this move. It has called talk of banning batteries on passenger planes to be “outrageous rhetoric.”

Many shippers are displeased: It’s just gotten more difficult to get batteries at short notice because they have to rely on cargo planes. This is especially true for consumer electronics companies, which make significant use of rechargeable batteries. Their difficulties will likely also be felt by consumers.

The ban will likely benefit cargo-only airlines and specialized carriers like FedEx or UPS. Passenger airlines have just lost a reliable source of income, and cargo airlines will find that their space is in greater demand.

 

What Importers Should Know for Chinese New Year 2016

2016’s Chinese New Year will last from February 7th to February 13th. It’s also known as the Lunar New Year or Spring Festival, and it’s the biggest Chinese celebration of the year.

This is an important event for importing companies to know. Your supply chain may be disrupted for a significant period of that time.

Factories will be closed for the entire week. Keep in mind that the majority of Chinese laborers have jobs that are far from their hometowns; their return to family is one of the largest migration events every year. Businesses typically allow workers to start packing up as much as two weeks before the celebration. They’ll also take a week or more to return. All in all, factories may not resume production by the third week of February. That may take you to almost four week’s disruption, compounded with delays in transportation.

Here’s another issue: Even after factories re-open, it will take a while for them to return to production at full capacity. That’s because up to a third of employees never return to work. The inexperience from new workers can cause longer delays and lower product quality.

A top-tier supply is likely to have all these issues worked out or at least mitigated. So not the entire manufacturing sector is going to be affected in the same way, but you should be aware of these general effects.

What can you do to plan ahead?

Because of record low ocean rates, ocean carriers are planning capacity reductions for Chinese New Year. Some report that they’ll reduce capacity by up to 40%

That could be an issue if you don’t have protected space. Carriers and Freight Forwarders have an allocation based system which rewards shippers who consistently move freight throughout the year. If you’re not moving freight regularly, it may be a challenge to find space.

How can you avoid this challenge?

Plan ahead and work closely with your freight forwarder. Your forwarder can work with carrier partners to protect allocations or might be able to get space from another carrier. Forwarders may also have the chance to get allocation space from another shipper.

You should also plan to order at least three weeks prior to Chinese New Year. If you do, containers should be at the port by the second week of January.

Finally, consider shipping by air if you have a strict deadline from a retailer or are running out of stock. Paying for stock expensively might be better than having no stock at all. Don’t leave that decision for the last minute: flights just before Chinese New Year are often overbooked and carry a higher premium . Consider non-direct flight options and makes sure that your connection is outside of China.

Price increases during Chinese New Year

Seafreight and airfreight costs will increase before Chinese New Year. Carriers get overbooked earlier than usual. Be warned that even if you get a booking confirmation, your containers may still get rolled to the next available sailing. Carriers are especially eager to increase rates at this time.

Ocean carriers have already announced a Far East Asia to United States and Canada General Rate Increase (GRI) effective as of January 1st, 2016. Rates are meant to be as high as these levels:

Imports to the East Coast of the United States and Canada: US$1600 per 40’ container.

Imports to the West Coast of the United States and Canada: US$1200 per 40’ container.

Carriers have also announced a Peak Season Surcharge for all dry cargo in this tradelane. A US$400 surcharge per 40’ container will be effective as of January 15th, 2016. Furthermore, carriers have announced a $600 surcharge effective as of February 1st, 2016.

These are pretty high announced rate increases! But just because carriers have announced them doesn’t mean that they’ll be exactly this high. In the current market, it’s possible that the GRIs will be mitigated. The Peak Season Surcharge, though, is more likely to stick.

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Don’t wait until the last minute. If you can manage it, place your orders now and avoid unnecessary delays next month.

Update, 1.21:

Ocean carriers successfully implemented a General Rate Increase (GRI from Far East Asia to United States and) effective as of January 1st, 2016.

Here’s data from the Shanghai Containerized Freight Index:

Dec 2015-Jan 2016, rates per 40’

12/25/15 1/1/16 1/8/16 1/15/16
USWC $766.00 $1,519.00 $1,498.00 $1,417.00
USEC $1,448.00 $2,555.00 $2,542.00 $2,457.00

USWC = United States West Coast Ports

USEC = United States East Coast Ports

The Jan. 15th Peak Season Surcharge (PSS) was postponed to February 1st. Rates are expected to drop between now and February 1st.

It remains to been seen if February 1st increases will stick or not, we will update you as soon updates are available in the market.

By Nerijus Poskus, logistics manager at Flexport.

High Temperatures Troublesome for Air Cargo

A heat wave crushed Northern China last week, with temperatures surpassing 105° F in major cities like Beijing and Shanghai. The extreme weather grounded hundreds of flights and led to significant delays for air cargo shippers. Why?

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Air temperature and density have an inverse relationship. Lower air density limits engine performance and aerodynamic capabilities, meaning an aircraft requires a longer runway distance and faster acceleration to attain the same lift when climbing.

In other words, high temps result in weight restrictions, and since the majority of air cargo now travels in the belly of passenger planes, the preferred solution for airlines is to bounce cargo to the next flight. These occurrences are rare and typically don’t add more than a day or two to transit time, but with global temperatures rising across the board it may become an increasingly inconvenient supply chain risk.