By Eugene Nweke
BACKGROUND TO CARGO TRACKING.
- The security imperative of Cargo Tracking Note:
The United Nations through the International Maritime Organization (IMO) introduced the International Ship and Port Facility Security (ISPS) Code, with Cargo Tracking (CT) as one of its Critical Components). This was in response to the September, 2011 terrorist attacks in the United States.
The ISPS Code regulations require all signatory Nations of IMO to initiate and develop Security Plans for Vessels, Port Facilities, Cargo and Persons entering and exiting all the National Ports.
The Cargo Tracking Note (CTN) component of the ISPS Code presently is to provide relevant information that would help monitor Maritime Security Threats, while revealing shipping and cargo information that will aid in the risk profiling of vessels, crew members, ports of calls, Mid-stream operations, cargo characteristics, etc which will be tracked from port loading to port of discharge.
By IMO recommendations, the implementation of Cargo Tracking Notes will accelerate Compliance as well as yield additional revenue, which is an insignificant cost as levy already built into the Ocean Freight Rates. Such revenue when generated will be used to beefing up Security at the Ports and Entry Points in line with globally agreed standards.
The Cargo Tracking Scheme is presently in force and applicable in Several Countries in America , Europe, Asia, and in African countries, such as Angola, Benin, Burkina Faso, Cameroun, Congo, Cote d’ voire , Togo, etc.
In Compliance to the ISPS Code, Cargo Tracking was introduced in Nigeria in 2007 through the Federal Ministry of Transport. After due consultations with Nigeria Customs, the Attorney General/ Minister of Justice, and relevant Stakeholders, the Federal Executive Council of Nigeria in its Session on December 9th, 2009 granted due approval to the implementation of the CTN Scheme, under the initial supervision of the Nigeria Port Authority.
Within less than two years of the Implementation the scheme was officially stopped by the Government following noticeable abuses and lack of supervisory roles/controls.
- Impact of the prevailing cargo tracking practices
At present, most of the prevailing tracking systems in use in our International Gateways are not trust- worthy. They have failed to meet the expectations of the Shippers and Concerned Stakeholders because the necessary shipments information are not received on real time basis with regards to the movement, product nature and Characteristics, stuffing information, quantity and general data of cargo shipped from different Ports of Origin to the Destination Ports in Nigeria, due to non coordinated and effective Tracking System.
The absence of a Coordinated imports and Exports Trade Data Collation Base, with respect to effective Portals to promote Tracking system either as Self Operator or in Collaboration or on Consultancy Basis, brought so many operational and economic issues to the front burner.
It is a common practice in Ports where an efficient Port tracking system is lacking that Manual Data Input are relied upon. However, manual data input application causes delays in data transmission to the Processing Centers and in most cases such data are not authentic or reliable.
2). THE CARGO INSURANCE CONCERN:-
Another Critical Economic concern brought to the fore is the Insurance Factor. Both the Ship -Owner, Cargo Owner and Insurers were dis- satisfied with the Capacities/out-put of the Prevailing tracking system, because it fails to provide complete information about Vessels or Container Ladened Data or its Movement, which is needed for maximum and efficient Ship Navigation and Cargo Delivery to destination Ports. This short- fall therefore, evokes Complaints From foreign Insurers. The Insurers noted that:
“The Present system fails to provide real authentic information with regards to what is happening with the Vessel /Container in transit. This explains why insurance rates for Cargo destined for Nigeria Ports are high, thereby creating extra difficulties in attracting transit goods (transhipment goods) to our Ports”.
At present, with regards to the volumes and parameters of Data in relation to insurance rates as provided by the present tracking system, are tiny fractions of the cost price of the goods filled by foreign Freight Owners or Forwarders (who are unaccustomed with the principle of Tracking System in our international gateways), whereby they (Foreign Freight Owners) Insure their Freights abroad without recourse to our indigenous insurance/underwriters.
3). LOGISTIC AND ECONOMIC IMPACT:
It is a common practice to note that in most climes, the demand for Satellite Aided Tracking Services is with the consideration to the insurers requirements. It is incumbent on the Insurance firms to reduce their rates and offer discount if the tracking device has the capacities to transmit more detailed specific information about Containerized Cargo.
With a year on year increase in our National Cargo through-puts /Container Traffic, it has been estimated that the Cost of Insurance increases, reaching up to 28% in 2009, following the Ports Concession in 2006.
It is emphatic, to state that, Insurance Firms in Nigeria, cannot be said to be uncompetitive, but are seriously suffering from non -patronage, non active involvement and non participation in the International Trade movement and environment. This represents an economic (trade) misplacement. It becomes even worrisome, to note that our crude oil sales and exports are based on “Freight on Board” -(FOB incoterms basis ), whereas, our Imports Trade incoterms are based on “Cost Insurance Freight”- “CIF”.
4). CARGO TRACKING AS LOGISTIC SOLUTION.
In solving this economic misplacement and operational hiccups, as obtains in other climes, the need for Nigeria to embrace and align with other Nations Providing Freight Logistic Solutions, therefore requires both the evolution and buying into a Cost effective Tracking System.
In this regard, the National Ports Authorities, Carriers, Terminal Operators, Private individuals, Agencies of the Government, are hereby encouraged to embrace an initial logistics solution process known as “Modern Radio-Frequency System” which automatically identifies Vessels or Containers. This is achieved by installing a Satellite aided System of Vessel or Container for Tracking purposes.
Radio -Frequency Tracking System with the aid of Satellite technologies is now practiced globally. Notably, the Automatic Tracking of Vessels and Ladened Cargoes now makes it possible to design efficiently, plan transport operations and shorten the idle time of vessel at anchorage, the dwell time of Containers at the Terminals and Cargoes at the Warehouse etc.
5). VARIOUS METHODS OF TRACKING OF CARGO:-
a). THE CARGO IDENTIFICATION AUTOMATED SYSTEM:- This Method of Tracking System transmits data from all intermediate communication posts, channelled data into the database of the Main Computing Center. For instance, once a Container is being loaded into a vessel, the particulars of the Container, Size, Marks and Numbers, ladened content, Names and address of owner, etc are transmitted. At this point, the data on the Container is stored and it disappears as the monitoring of the containers continues.
In this System, the objects monitored are the Vessels and the Container from the port of Loading to Port of Offloading. By default, it is considered that the Container has not been taken off the monitored Vessel.
The special character of the System is that, it is centered on identification application, with the level of trustworthiness and efficiency of data base of the automated control systems. The method is unique and has infrastructures consisting of various Storage units for the identification of Containers and Vessels.
Together, with other informatization, the system facilitates the Consolidation of Control Centres. It ensures real time receipt of data on the vessel locations during voyage, making it possible to determine the locations and condition of the vessel while sailing on the Sea (Voyage).
The real time information received is used in advance to resolve tasks of management, analysis, accounting, mutual settlements etc, which engender and fast track trade facilitation. However, the list of Containers to be tracked is made available from the Port of Loading. Then the system can be combined on an informational basis with the satellite tracking system. It is also possible to install a separate sensor on each Container and use the data on the Vessels routes transmitted by digital channels.
b). TRACKING FROM SPACE: – The Tracking of Vessels/ Containers by Satellite is a common practice globally. It has been noted that it is only a Satellite Tracking System that can provide Foreign Cargo Owners with Container Tracking Services. It gives confidence to relevant international rules.
It is important to state that with the growing demand and competition in Tracking Services, both the Radio Frequency Identification (RFID) and the Satellite Navigation System (SNS) are now coping with allied tasks and at the same time complementing or supplementing each other.
As noted before, every Tracking Services must inculcate in it the Insurers requirements. However, presently, Tracking Services Firms introduce and render extra Services to determine not just the Location of Vessels/Containers, but to also determine the Condition of the Containers and even the ladened goods in it, thereby making Tracking System to attract a Fee.
c). THE AUTOMATIC TRACKING METHOD:- This System is an improved automated version of Cargo Identification Method. It makes for higher efficiency and accuracy in transport planning operations and reduces Container Demurrage. This is because the System can also monitor the integrity of the Electronic Locking / Sealing device, of the Container markings and of the electronic Seals of the Container Equipments.
This system sort of, serves as a guarantee to the insurers who are ready and willing to lower the tariffs for their Services for Carriers who have fixed to their containers, locking mechanism that are connected to Tracking System. It is note -worthy to state that, it is more profitable for Carriers to use data provided by the tracking system, because this simplifies the process of planning and monitoring the operations and movement of the Container.
Furthermore, it promotes and attracts Container Transhipment business and operations. Since all parties know what is going where, intermediate operations become fewer; logistics becomes simpler and delivery time shorter.
6). BENEFITS OF INTERNATIONAL CARGO TRACKING NOTES – ICTN
The New Cargo Tracking Note has the following benefits:
It boosts and encourages faster clearance of cargo.
The information on a laden cargo will be made available to all concerned, for quick Cargo treatment and dispatch.
It will assist critical operators to know the nature of Ladened Cargo and it’s corresponding solution attainments.
CTN application will install sense of uniformity and conformity, thereby boosting the shippers compliance level to the role of engagement.
The fee will constitute a component of Ocean Freight, which components will be renegotiated downwards.
The tracking system will correspond with the Nigeria Customs Service- NCS , operational functions, in line with its Risk Profiling and Management System.
Naturally, Carrier treats component of ocean freight as business secret, but tracking system will remove such secrecy.
It will fast track and complement a Central trade information data warehouse that is all inclusive.
Information warehousing (a seemingly Port Net), will be boosted by the tracking system.
Issue of Delays and validation will not pose a serious problem, because it is a web- based portal- driven system.
It Saves Cost of doing business in the Port.
It will Fast- track and boost insurance business and prompt participation in the Marine activities, as a result of its Guaranteed capacities.
It will Fast -track greater Patronage and boost transit /Transhipments activities in our Ports, because of its Guaranteed elements.
7). NOTICEABLE PITFALLS ASSOCIATED WITH SATELLITE CARGO TRACKING:- In rare Cases, the Commercial use of a Satellite aided tracking system is delayed as a result of the complex hardware’s requiring an autonomous power blocks and it has a complicated operating system. For instance:
A Container can be on transit for weeks in an unfavourable temperature conditions, and this may lead to serious problem. In this case, passive electronic markings are a better option as with High Frequency identification automated system. They do not need electricity; they are simple and practically do not break, do not require servicing and are not costly.
Unlike the applications in the Satellite aided Tracking System, where a number of technical problems are been rectified or solved to make its Services simpler.
It was noted that at the initial stage, one of the factors that hampered the application of Satellite aided Tracking System was the costly nature of its sensors.
8). CONCLUSION:-
Considering the advantages inherent and associated with Cargo Tracking or Cargo Policing, especially in relation to revamping our Insurance Sector and Boosting the Patronages of our Ports Via Transhipment Container Traffic, among other operational benefits, Both the Legislature and Executive Should join hands to support the Nigeria Shippers Council to resuscitate this worthy concept as planned; so as to boost International Cargo Activities in our Ports and boost efficiency of the revenue generation.
Fwdr, Chief (Dr) Eugene Nweke,Rff ,Mpta,Mnis,Fffa,Mccc.
National President, NAGAFF.
Facilitator: Customs Consultative Committee – CCC.
CEO, Virtues Marine and Freight Services Ltd.
Gbobaniyi of Ilogbo Eremi Kingdom.
2A Maybin, Road Apapa, Lagos, Nigeria .
Cell. 08136242266.
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