Exporters hiring ships using piracy-prone routes will incur additional insurance costs and pay for the days a vessel is detained by hijackers.
Exporters hiring ships using piracy-prone routes will incur additional insurance costs and pay for the days a vessel is detained by hijackers. Other costs relate to additional crew and preventive measures employed to reduce the risk of attacks, according to new guidelines published by the Baltic and International Maritime Council (BIMCO), an independent international shipping association.
The new guidelines on transportation of bulk cargo vulnerable to piracy mean companies will spend more when hiring a ship for a specific period.
For instance, if a ship is hired for 15 days, and is hijacked and detained for 25 days, the company hiring it will pay for the extra 10 days.
Other costs the company could incur are those of additional personnel and for preventive measures to reduce the risk of pirate attacks. This is justified on the basis that without the charterers specific orders to proceed to or through a risk area, such costs would not have been incurred.
Ships that are hired for a specific period of time are mostly used to transport bulk cargo like oil, clinker or coal. It means that cement makers and oil importers in Kenya will need to be extra cautions in line with the new guidelines, which could see them spend more on shipping if not properly followed.