Air cargo continues to battle dangerous goods issues

Protection against the threat from lithium batteries to commercial aviation is arguably one of those cases where enough is not enough.

The tenth Global Annual Dangerous Goods Confidence Outlook, published in September, reflects a high level of confidence by industry professionals in their current level of protection, but the mood changes when the gaze is shifted forward.

Even worse is the picture when it comes to supply chain partners on either side of companies’ internal preparedness.

The survey of nearly 300 dangerous goods (DG) professionals from around the globe found that 57% of respondents were very confident that their firms’ current arrangements meet today’s compliance and safety standards, and another 35% reported that they were ‘somewhat confident’.

When it comes to other stakeholders in supply chains, confidence is drastically lower. Only 22% expressed confidence in their upstream partners, and 19% felt confident that their downstream partners could meet current requirements.

In this respect, the needle has not changed much. “There’s been a consistent level of doubt up- and downstream,” says Robert Finn, vice president of hazmat compliance specialist Labelmaster, one of the sponsors of the report.

A timely reminder of the risk associated with lithium-ion batteries came in September, when the US Federal Aviation Administration issued fines to three companies for violations of hazmat regulations regarding the shipment of such batteries on cargo planes operated by FedEx and UPS.

One firm was hit with a $170,000 penalty for shipping undeclared and improperly packed lithium-ion batteries on four occasions. In one case, a fire erupted.

Smoke and flames also emanated from a shipment of five batteries while it was in a sorting facility, which led to a $60,000 fine for the shipper, while another undeclared battery shipment headed for China resulted in a $74,250 penalty.

All of these shipments lacked adequate classification, description, labelling and packaging.

The threat is rising all the time, as more and more dangerous goods enter supply chains, warns Finn.

DG professionals are wary. While 33% of the respondents believe that their current investment will meet future needs, 57% think that theirs is only adequate for today and that more investment is needed.

Finn notes that investment has increased 43% over the past five years, but agrees that more is needed.

Companies that fail to do so not only risk fallout from incidents or bans of their traffic by carriers, but they also lose out on “measurable operational and financial advantages” associated with investment in this arena.

Better packaging

Better packaging solutions rank highly on companies’ agendas, with 60% in the survey planning investment in smart packing solutions over the next two years.

This is hardly surprising, considering that packaging issues have affected more than half of the companies participating in the survey, with 21% experiencing moderate to severe consequences.

“The majority of companies have started to look at this at the strategic level,” says Finn.

Digital transformation and data quality are other key focus areas besides packaging. Digitalisation extends beyond e-documentation and digital regulatory publications to aspects like virtual training or the use of smart sensors to monitor DG shipments in transit.

“Five, six years ago, companies were using tech just to validate; now it’s used to help enhance learning, to make processes faster and to eliminate tribal knowledge,” observes Finn.

Standardising and sharing data not only facilitates and accelerates their flow between stakeholders, but it also leads to seamless understanding to get beyond this “tribal knowledge” – the expertise of one or a few persons in an organisation that everybody else relies on.

The growing number of carriers and other parties in air cargo supply chains that embrace CEIV lithium batteries certification is another reflection of the rising importance of adherence to standardised processes and protocols.

Another objective of standardisation of processes and data, and the use of technology, is the ability to streamline processes so that DG shipments do not have to be pushed to the side and moved manually, typically at a slower pace.

This should speed up their flow and allow them to almost process them as a non-hazardous item, says Finn.

This can reduce headaches and yield financial results. DGeo, which evolved from Labelmaster’s packaging division into an entity to help customers develop solutions for their hazmat issues, unveiled new enhancements to its DGIS hazmat shipping software this summer, which include automated guidance and real-time validation capabilities.

These automatically determine when a product has to be classified as a dangerous good and when a classification as ‘partially regulated’ or ‘exempt’ is applicable, opening routes where less stringent requirements and restrictions apply.

Not ‘over-declaring’ shipments can reduce labelling, packaging and shipping costs and expand transport options, DGeo stressed.

While this is an outcome dear to CFOs, there is also a need for spending on defensive arrangements.

Last year, Hong Kong Air Cargo Terminals opened a dedicated storage zone for lithium batteries in its facility.

The zone is equipped with fire suppression systems and fireproof partitions. Another step taken by the handling firm at an earlier date saw the implementation of an intelligent cargo thermal detection system that can identify a potential risk of a battery fire. 

Increased education of shippers and better information about shipments will help lower risk levels, but it remains crucial to beef up physical safety measures when shipments fall through the cracks.