Thousands of containers are falling off ships

By Yahoo Finance

International shipping has always been a dangerous game, with hazards including storms, pirates - or even getting your ship stuck sideways in a canal. But pressure to speed up journeys and carry ever-greater carrier loads amid changing weather patterns has created a new hazard: containers plunging into the ocean.

Cargo worth tens of millions of dollars has fallen off ships in recent months, as the industry suffers the sharpest surge in lost containers for seven years.

More than 3,000 containers went overboard last year, with at least 1,000 lost this year already, disrupting supply chains and hitting manufacturers including Tesla.

It comes as AP Moller-Maersk, the world’s biggest shipping group, said disruption and price rises prompted by the closure of the Suez Canal would continue for most of the year. The Danish company nearly doubled its profit forecast as a result to between $9bn and $11bn.

Maersk described an “exceptional market situation with surging demand leading to bottlenecks in the supply chain”.

Freight rates have surged to record highs after the colossal Ever Given ran aground in the Suez Canal, the vital link between Europe and Asia. Global demand for containers this year is expected to be the highest since the financial crisis.

A boom in online shopping during the pandemic has increased pressure further. It is against this backdrop that container losses are spiking.

The 364-metre One Apus lost almost 2,000 containers – about a seventh of its capacity – after being caught in gale-force winds in November.

The ship finally dropped off her cargo in Long Beach, California, earlier this month after being held at Japan’s Kobe port for repairs.

The stack collapse could prompt insurance claims worth at least $220m.

One Apus - Buddhika Weerasinghe/Bloomberg

In January the Maersk Essen lost about 750 containers while sailing from China to Los Angeles. A month later, the Maersk Eindhoven lost 260 containers on the same route following an engine failure.

As ships grow ever-larger – a phenomenon highlighted by the Even Given’s grounding in the Suez canal last month – they are becoming more vulnerable to high winds and nautical phenomena such as “parametric rolling”, in which waves throw a vessel into a rolling motion.

Shipping experts told Bloomberg that human error was underpinning many incidents, with stevedores failing to correctly lock containers onto stacks, or captains pressing on into storms in a bid to speed up journeys and save fuel.

The World Shipping Council estimates an average of 1,382 containers were lost at sea annually between 2008 and 2019.

The worst year was 2013, when more than 5,000 containers were lost. Almost 4,300 were lost when the MOL Comfort broke in two, burst into flames and sank on a voyage from Singapore to Saudi Arabia. That remains the highest number of containers lost in a single incident.

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