Tag Archives: supply chains

Talk about unintended consequences.

The Verified Gross Mass (VGM) rule promulgated by the International Maritime Organization (IMO) on July 1, 2016 is intended to make cargo and ships safer, by making sure that container weights are properly recorded. when you are loading a ship, it’s good to know how the weight is distributed. if people give you containers overfilled, you won’t have the right balance on your ship.  A ship might turn over, or other containers might be damaged if there’s a shift in cargo.

But the rule has created an entire industry and a plethora of fees being charged by supply chain partners. they’re presumably to offset ‘costs’ of the rule.  But there is a concern that they are merely ways of increasing profits.  And the fees certainly add to the complexity and cost of a container shipment, and even of identifying the best route for my cargo.

This story about India’s experience highlights some of the bad experiences shippers are having.  And it is affecting which ports are used and which carriers.  Will there ever be rationality in this area? Everyone agrees we want correct weights of containers, unless we want to cheat, but how complex can it be?

The downside of IMO’s container weighing rule

Source: Shipping Tribune