Container quality: What you need to know

Shipping companies are currently directing many of their better-quality containers to ports in Asia. They’re taking advantage of historically high rates and concentrating on the busy China–US trade. At the same time, there are stacks of empty containers in other parts of the world.

The inevitable result for Australian exporters and importers is that we see more lower-quality containers arriving on our shores. You always want to be confident that your cargo will arrive at its destination in the best possible condition, so it’s critical to have a suitable container. 

But with the current global situation, you might not get the quality you’ve had in the past. To mitigate any risks and protect your cargo, you’ll need to devote a little more time to your containers than previously.

Check your container

As container availability becomes tighter, take extra care to inspect the containers you receive. Low-quality units might have holes or severe corrosion, with rougher surfaces and even, in some cases, jagged metal edges that can damage your cargo.

When a container arrives in your yard, start by inspecting the exterior. Document your inspection with written notes and photos. Kurt Herron, Logistics Risk Engineer at NTI, notes some key points to check:

“Corner castings are where the container gets lifted and secured, so you want to check their quality. Are they rusted? Are they solid? Can you see any damage? 

“In terms of CSC [convention for safe containers] plates, make sure the container was inspected and is within date. 

“Check the external surfaces for damage or deterioration like holes in the container, significant rust – not just surface rust – dents, dings, anything like that. 

“Internally, check the walls and floor. But one of the main things is light testing.

“Light testing a container means you stand inside while someone closes the door to make it pitch dark, and you check for any signs of light coming in.”

The same goes for containers received with goods inside: inspect and document the exterior’s condition before opening, then check the inside thoroughly after you’ve unloaded it.

Check it again

Dan Morrison, National Cargo Product Manager at NTI, highlights another potential problem: you might not have received the container you should have.

“All containers will have a serial number or container number,” he says. “You need to be careful to check that the one that’s on your document is the one that’s in front of you.”

“If the one you ticked off as okay isn’t the one that got sent overseas, then you’ve got a good chance at recovery from logistics provider or shipping line. 

“But it’s a problem if you didn’t check, and at the other end, they can say ‘well, you signed off on everything’.”

One of the critical business risks here is that your customers’ delivery will be delayed as you chase down its container. 

In a highly competitive global trade environment, you don’t want delays. If you can’t deliver safely, you risk losing customers. 

Then check your insurance

Insurance policies play a critical role in protecting cargo owners and representing their interests pursuing responsible third parties. From an insurance point of view, your cargo policy will cover damage to your goods. But the process is much easier if you’ve documented any concerns about your container.

“Your policy still protects your goods if they’re damaged,” Dan says, “and thorough documentation helps us recover claims from the responsible party.”

“We still pay the claims, but the benefit to the insured of doing all those things is the claim won’t sit on their policy,” Dan says. That, in turn, makes managing your insurance costs easier.

What do to if there’s a problem

Suppose your inspection shows your container isn’t suitable. In that case, you have only one option: let your freight provider or shipping line know and request a replacement. It’s unlikely that they’ll want to risk being liable for a damaged cargo. They’ll most likely send you a new container, as Kurt explains: 

“Outline the problem, and they’ll decide what to do. If you report it before you load it, ninety-nine per cent of the time they’ll organise a new container.”

They should also reimburse you for any additional costs. 

“It’s all about being prepared, documenting what you’ve got, and then notifying people immediately,” Kurt says.

When you receive a shipment, the same principles apply. Inspect the container before opening it, then document your opening and inspection. Contact your freight or logistics provider if you have any concerns. 

As with any shipping, once a container leaves your yard, you don’t have much control over it. Inspect your containers, work with your shipping partners to resolve any problems and, of course, make sure you’re adequately insured. 

Bad containers sometimes happen to good cargos. But with a little care, you can make sure they don’t happen to yours.