Dangerous Goods 101

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Speaker 1: TRAVIS FALASCO: Let's talk about MSDS and dangerous goods classification.

Speaker 1: You may have seen some pretty scary explosions in the news these past several years--

Speaker 1: Tianjin in 2015, Beirut in 2020, and Bangladesh more recently in 2022. What do all these explosions have in common? The improper handling of dangerous goods cargo.

Speaker 1: These kind of catastrophic events are thankfully very rare. However, we're still seeing several cargo fires that take place each year that would have easily resulted in another disaster.

Speaker 1: In April of 2021, a pallet of cargo autoignited and burst into flames moments before it was loaded onto the aircraft at Hong Kong International Airport.

Speaker 1: What was the commodity? Just everyday consumer cell phones containing small lithium batteries.

Speaker 1: So what are dangerous goods? Well, Dangerous Goods, or just DG for short, are defined as a substance or article that has potential to cause harm to a person, property, or the environment. These goods must be transported following local and international DG regulations to ensure they do not result in a tragedy like the ones I just mentioned.

Speaker 1: That means any liquids, powders, creams, gels, oils, batteries, or any other commodity that is potentially hazardous must be properly tested by a certified testing lab to confirm if they're DG or not. The most common output of this exercise is an MSDS, or sometimes simply called an SDS, which the shipper is responsible for obtaining from a certified testing lab.

Speaker 1: A standard MSDS is divided into 16 sections covering the various topics regarding the hazard. Section 14, transportation, of this testing report will confirm if the goods meet the classification of DG or not. If so, a unique United Nations identification number will be assigned to properly identify the hazard.

Speaker 1: A common misconception is that the MSDS classification in section 14 is absolute, when in fact, it is not.

Speaker 1: The MSDS only confirms the general classification of the material in bulk. It cannot confirm, however, how much material is being shipped at any given shipment. And that is the key component to the final DG classification, net quantity of hazardous material per package.

Speaker 1: For example, if an MSDS says the liquid is UN 1170 class three flammable, but you are only shipping 100 milliliters per package, it can ship as non-DG under an exemption. However, if you ship five liters per package, then it will qualify as regulated dangerous goods. And if you ship 65 liters per package, then it is restricted to cargo-aircraft-only flights, as an example.

Speaker 1: This is why providing just an MSDS is not enough. An example of an additional document often needed for DG shipments is the Dangerous Goods Declaration, or DGD. This document, completed by the shipper, should contain the specific cargo details for the shipment in question, including exactly what is being shipped and exactly how much.

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Speaker 1: TRAVIS FALASCO: Now, let's look at hidden and misdeclared DG cargo.

Speaker 1: Once your goods have been properly classified, the DG regulations will provide strict guidance on how to package, mark, label, and document those goods for safe transport. This is why you must be DG certified by law to prepare and ship DG cargo.

Speaker 1: The regulations are clear. Regardless of [INAUDIBLE]

Speaker 1: term, it is the shippers responsibility to properly classify, pack, mark, label, and document their DG shipment for export or hire a qualified DG-certified third party to do it on their behalf.

Speaker 1: Hidden or misdeclared DG cargo presents the greatest risk to the safety of everyone in the supply chain. Hidden DG refers to commonly shipped commodities that may or may not contain DG materials inside because the shipper just didn't realize.

Speaker 1: Some examples are medical kits, which may contain flammable liquids or gases, camping equipment, which may contain flammable solids, like matches, or even frozen fruit, which may contain dry ice if used as a refrigerant.

Speaker 1: Misdeclared DG is when a shipper declares their cargo to be ordinary, non-DG travel luggage, for example. But actually, the cargo is smart luggage that contains DG lithium batteries installed.

Speaker 1: The difference between hidden and misdeclared DG is subtle, but the end result is the same. And it really just boils down to whether the incident was unintentional or intentional.

Speaker 1: The most critical component to preventing DG accidents is following proper segregation procedures. Segregation is the process of ensuring that DG items that could react dangerously with each other are not loaded in the same truck, ocean container, or aircraft ULD together.

Speaker 1: Failure to properly segregate DG cargo was actually the cause of the horrific DG accidents in Tianjin, Beirut, and Bangladesh. This is also the number one cause of all the container fires we see at ports and on vessels.

Speaker 1: The root cause of segregation failure is not usually due to mistake, but it's because of hidden or misdeclared DG cargo.

Speaker 1: Think about it. The carrier can only segregate what their privy to. If a shipment contains DG cargo that is hidden from the carrier, they will load that seemingly normal cargo anywhere, perhaps next to DG cargo that actually should be segregated from the hidden DG cargo. And this is how most DG accidents are born.

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TRAVIS FALASCO: Let's talk about DG training requirements. Both local and international regulations are in agreement about DG training requirements, stating that a person must be adequately trained commensurate with their job responsibilities. Basically, if you handle DG cargo, you must receive as much training as necessary for you to perform your required functions.

Oh, but you only handle non-DG normal cargo? Guess you don't need any training, right? Wrong.

In fact, anyone handling normal cargo is still required to receive at least basic DG awareness training so they are competent enough to identify and report hidden or misdeclared DG cargo sneaking through the supply chain. It happens more often than you think. Since the ultimate goal of DG compliance is the protection of life, property, and the environment, the penalties for noncompliance can be severe.

As per US hazmat law, the minimum penalty for handling DG cargo without proper training is $540 per employee per day that that employee works without training. That can cost you at least $197,000 per employee per year. The current maximum penalty for improperly transporting DG cargo is almost $90,000 and goes up to a little over $200,000 if the violation results in a major DG accident.

Of course, the ultimate cost of DG noncompliance is the loss of human life or substantial destruction of property. It seems like the best move is to pay that small upfront training cost to ensure your team is properly trained, right?

The International Air Transportation Association, whose mission is to ensure the safe and compliant transport of cargo and passengers, sets the global standard for DG training protocols. Flexport is unique in the logistics industry, as it is one of the only freight forwarders in the world that is also an IATA-accredited training school. We offer a wide range of DG training products and services, all satisfying IATA cargo agent and licensing requirements.

Starting in 2022, IATA is transitioning away from the theory-based DG training methodology, leaving behind that old category system and moving towards a Competency Based Training and Assessment approach, or CBTA. In fact, Flexport is one of the first entities in the world to meet IATA's new standards of excellence to be certified as an IATA CBTA provider center. For more information, or to sign up for training, please visit flexport.com.

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Speaker 1: TRAVIS FALASCO: Now, let's look at carrier cargo acceptance. An important operational concept to understand about DG compliance is that no matter how much training you have or industry expertise you've acquired, at the end of the day, the carrier will always have the final say when it comes to accepting your cargo or not.

Speaker 1: As asset owners, carriers have the right to refuse any cargo they want for any reason, even if your shipment is the shining example of a perfectly prepared and compliant DG shipment. Also, everything contained within the DG regulations is only the baseline requirement carriers have to follow. They cannot be less restrictive, but they can absolutely be more restrictive.

Speaker 1: Some carriers will choose to outright ban lithium battery cargo, while others will choose to accept it only if you follow their specific conditions. The real fun part is that carriers have the right to change their acceptance criteria whenever and as often as they like. Even if your favorite carrier has accepted your DG product for the past several years without issue, all it takes is one major DG accident involving that product to spook the carriers into adding additional restrictions or simply placing an embargo on your product.

Speaker 1: However, being properly trained and certified gives you the best fighting chance for a carrier to accept your DG cargo.

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