Kostas Kakaris, GAC’s Group Dry Bulk Development Manager, considers the risks of using an under-resourced ship agent.
As the means of getting goods to market, shipping is inevitably at the mercy of the highly volatile global financial and commodities markets, and an environment
that leaves little margin for error in daily operations. This is especially true in the dry bulk sector. More than 40
professions can be involved in the loading or discharging of a dry bulk cargo to a vessel. And just as too many cooks can spoil the broth, the involvement of so many parties multiplies the opportunities for errors or delays.
If a ship owner, operator or cargo owner doesn’t choose a trustworthy ship agent, they could put their reputation or bottom line at risk and expose themselves to serious potential costs.
It is therefore essential to entrust your vessel and cargo to an agent able to minimize the multitude of risks that can present themselves in port. An agent that has the knowledge, experience, resources and financial stability to provide advance warnings of potential problems and respond to all manner of issues when they arise. Such problems are myriad and can include weather disruption, port congestion, legal and administrative delays, pollution, damages, non-availability of cargo, shortages of receiving trucks or equipment and load contamination.
Dry bulk transportation is highly fragmented and does not enjoy the end-to-end control commonly provided when transporting liquid cargoes. Not only must your agent be able to undertake their immediate tasks in port, they must also possess a forensic insight into the dry bulk industry, understand all operational and commercial constraints for each particular port and type of cargo, have the knowledge and foresight to account for all potential risks that can occur — and the resources to deal with problems when they arise.
For example, improperly tendered Notices of Readiness (NOR) or errors in export documentation can have dire consequences for vessel owners or the cargo traders, even delaying or halting the shipment at great expense. Likewise, agents that make mistakes in declarations or neglect to attend to arriving or departing crew members can cause serious delays to the vessel’s operations, and may even incur fines to be paid to the authorities. Although agents often have no control over who is appointed to physically handle loading and unloading operations, an experienced one should have the foresight to know where potential problems could arise.
Of course, there are many highly professional and capable agents around the world. However, there are also those that operate outside the boundaries of what should be acceptable practice. While their intentions may be good, they may not have the understanding of every cargo, or they may lack the resources to ensure they are handled safely and efficiently.
Mistakes, errors or simple omissions can happen in places where the boundaries of various authorities’ responsibilities may be blurred or multi-transport means are involved. A vigilant and querying eye, accompanied by a clear mind, is much needed there.
Being a dry bulk shipping agent is no easy job. Many join the profession, but only those who can endure sacrifices will last. Working round the clock, often having to be physically present on board the ship, or at the coal yard, silo berth, transhipment barge or dock, sometimes in extreme weather, and being far from friends or family, is not for the faint-hearted.
Unfortunately, there is a lack of regulation and accountability on a global, regional and even port-to-port basis that can leave owners and operators vulnerable to risk, and can expose multi- million dollar vessels or cargoes to ruin at the hands of under- resourced agents.
The Federation of National Associations of Ship Brokers and Agents (FONASBA) sets best practice guidelines and represents the interests of ship agents on a global level. The organization has consultative status with (among others) BIMCO, INTERCARGO and the International Maritime Organization (IMO), and comprises of national membership bodies, including but not limited to ECASBA (members flagged under European Union states),ASBA (USA) and CASA (China). Each regional body stipulates, to a degree, its own quality objectives, and provided through the GAC Corporate Academy, and extensive local engagement giving in-depth knowledge of the operational constraints in individual ports. No one can deny GAC’s global authority, hard won by years of working across the dry bulk sector, across the world, on a daily basis.
By keeping our finger on the pulse and being in a position to respond promptly and appropriately if problems arise, GAC can streamline its customers’ operations and to minimize downtime and costs for vessels during port calls.
My personal guiding principle is:“Have we done everything to ensure our principal can sleep at night, confident that we will look after his interests?” If the answer is an instant and unqualified ‘Yes’, I consider that we have done our duty and earned our fee honourably. In the process, we will have created long-lasting business relationships that often evolve into life-long friendships.
And, after all, isn’t that what we all want?
 
ABOUT GAC GROUP
GAC is a global provider of shipping, logistics and marine services. These services are constantly being refined and integrated to serve its customers’ increasing need for competitive solutions. Emphasizing trust, reliability and a strong human touch, GAC has been building its reputation in its chosen markets since 1956.
Headquartered in Dubai, GAC employs over 9,000 people in
more than 300 offices worldwide.