The Growing Gap Between Hazardous Cargo and the Code Designed to Manage It

An estimated 300,000 misdeclared dangerous goods containers move through global supply chains every year. And the problem is getting worse. The IMDG Code — the international standard designed to manage this risk — cannot keep pace with increasing cargo volumes and the growing prevalence of new hazardous materials as technology evolves. But there is another factor often missing from the discussion: the economics of shipping and insurance can actively encourage misdeclaration through lower premiums and cheaper freight rates.

In 2019, the container ship KMTC Hong Kong exploded at a Thai port. The cause was 13 containers of calcium hypochlorite and five containing chlorinated paraffin. But this cargo was declared as dolls. Why dolls? Because declaring the actual contents would have triggered dangerous goods surcharges, carrier restrictions, or outright refusal to load. More than 130 people were taken to hospital.

In 2012, the MSC Flaminia burned for weeks after cargo was misclassified as a marine toxin rather than an explosive hazard, and was stowed in the wrong location as a result. Three crew members died. The cost of the tragedy ran to hundreds of millions in damages.

These are not isolated tragedies. They are symptoms of a system that is struggling to keep up. New materials and technologies are creating hazards faster than the regulatory framework can classify them, supply chains are too fragmented for paper-based compliance to work reliably, and the economics of shipping often make honesty the most expensive option.

What the IMDG Code Does — and Where It Falls Short

The International Maritime Dangerous Goods Code is the international standard for transporting dangerous goods by sea. First adopted in 1965 as a voluntary guideline, it became mandatory in 2004 under SOLAS Chapter VII. The Code classifies hazardous materials into nine classes, each with specific packaging, labelling, stowage, and documentation requirements.

The system depends on a chain of accurate documentation: Dangerous Goods Declarations from shippers, container packing certificates, material safety data sheets, and a detailed Dangerous Goods List containing 18 columns of information for every regulated substance. It is comprehensive, thorough, and built on decades of hard-won expertise.

But it has a fundamental limitation: the Code can only regulate what it already knows about. And amendments operate on a two-year cycle.

Technology Is Creating Hazards Faster Than Regulation Can Follow

Two years. That is the time between IMDG Code amendments. In an industry where novel battery chemistries, new chemical formulations, and emerging materials enter global supply chains continuously, two years is an eternity. A new hazardous product can be manufactured, exported, and shipped across oceans thousands of times before the Code formally recognises it as dangerous.

Lithium batteries are the most visible example. When the IMDG Code first addressed them, they were a niche product found in laptops and mobile phones. Today they power everything from consumer electronics to electric vehicles to grid-scale energy storage systems, with energy densities and form factors evolving faster than any regulatory body can track.

On Christmas Day 2023, the cargo vessel Genius Star XI was crossing the North Pacific carrying 192 lithium-ion battery energy storage units — a cargo category that barely existed a decade ago — when units broke free in heavy seas and erupted into thermal runaway, an uncontrollable self-heating state exceeding 300°C. Two separate fires broke out. The crew exhausted all 153 CO₂ cylinders fighting the first blaze, leaving nothing in reserve when the second ignited days later. Damage: $3.8 million.

But it is not just batteries. Charcoal has caused numerous container fires through self-heating. Despite years of documented incidents, it took until IMDG Code Amendment 42-24 — adopted in late 2024 and not mandatory until January 2026 — to require charcoal to be declared as dangerous goods without exception. That is more than five years of discussion at the IMO while ships continued to burn and shippers continued to exploit exemptions.

Novel chemical formulations, advanced composite materials, and new types of fuel cells mean the list of emerging hazards grows every year. Each one follows the same pattern: the product enters the supply chain, incidents occur, investigations are conducted, discussions begin at the IMO, amendments are drafted, and years later the Code catches up. In the meantime, these materials are moving through ports and across oceans — often without anyone on the vessel fully understanding what is on board.

When Misdeclaration Is Not Malicious

Not all misdeclaration is deliberate. Modern supply chains are long, fragmented, and opaque. A single shipment can pass through multiple freight forwarders, warehouses, and transport modes before reaching a vessel. Each handoff is a potential point of failure where documentation can be altered, lost, or simply misunderstood.

Small freight forwarders may lack the expertise to properly classify novel products. Online marketplaces have made it easy for uninformed shippers to send hazardous goods into the supply chain without understanding the implications. A warehouse worker in one country may not read the language on a material safety data sheet from another. A booking agent processing hundreds of shipments a day does not have time to cross-reference every item against the Dangerous Goods List — an 18-column reference covering thousands of substances that requires specialist knowledge to interpret correctly.

Enforcement is equally fragmented. While the IMDG Code provides a universal framework, implementation varies dramatically between nations. Some countries lack the resources for meaningful oversight. Port inspections can only check a fraction of containers. The weakest link in the chain determines the strength of the entire system.

The Knowledge Gap on Shore

Seafarers receive mandatory training on dangerous goods handling. But the people who create and process the documentation — booking clerks, warehouse workers, truck drivers, freight forwarders — often receive far less. These are the people who determine what goes on a Dangerous Goods Declaration, who decide how a container is packed, who make the first-mile decisions that determine whether hazardous cargo is properly identified.

The pressure to keep cargo moving is relentless. In that environment, a lengthy, complex rulebook — however comprehensive — is only as useful as the time and expertise available to consult it. For many people in the supply chain, that time and expertise is simply not available.

When Honesty Is the Most Expensive Option

Beyond the regulatory gaps and knowledge shortfalls, there is a harder truth: the economics of shipping actively discourage compliance. Declaring dangerous goods triggers higher freight rates, special handling fees, mandatory documentation, dedicated stowage requirements, and potential delays. Insurance premiums for hazardous cargo are significantly higher than for standard freight.

For a shipper moving thousands of containers a year, the financial incentive to quietly reclassify hazardous goods as something benign is substantial. Fireworks labelled as toys. Lithium batteries declared as computer parts. Corrosive chemicals shipped as cleaning products. Volatile oxidisers listed as dolls. Every one of these has been documented in incident investigations. Research suggests that around a third of all misdeclarations are deliberate, driven specifically by surcharge avoidance or carrier restrictions.

Some carriers have introduced penalties of $15,000 to $30,000 for misdeclaration, but the effectiveness of these deterrents remains unclear when the savings from years of non-compliance can far exceed the fines — and the probability of detection is low. On average, a major containership fire occurs every 60 days.

The Same Technology That Created the Problem Can Help Solve It

If technology is creating hazards faster than the rulebook can absorb them, then technology also has to be part of the answer. The IMDG Code is not going to become less complex, supply chains are not going to become shorter, and the volume of dangerous goods moving by sea is not going to shrink. The question is whether the industry can build systems that do not depend on every participant in a global supply chain reading, understanding, and honestly completing the paperwork.

The beginnings of this shift are already visible. AI-based screening tools can cross-reference booking details against known hazard profiles, flagging shipments where the declared contents do not match expected risk characteristics before cargo reaches the quayside. Digital platforms are replacing paper-based processes, creating audit trails that are harder to falsify. Automated systems can detect that a shipment described as “cleaning products” from a known chemical manufacturer warrants a closer look — without relying on a busy booking clerk to make that connection.

Crucially, these systems can operate in the gap that regulation cannot fill. A new battery chemistry does not need to be formally classified under the IMDG Code for a screening tool to flag it as potentially hazardous based on its composition, origin, or shipping pattern. An unusual cargo description from a shipper with no history of dangerous goods declarations can be flagged automatically and in real time, rather than discovered after an incident.

This is not about replacing the IMDG Code. The regulatory framework remains essential. But it needs digital reinforcement — systems that can move at the speed of trade rather than the speed of international regulatory negotiation.

The IMDG Code was built for a world where dangerous goods were a known, finite set of materials moving through established supply chains with experienced handlers at every stage. That world no longer exists. Somewhere right now, a container is being loaded with cargo that does not match its paperwork. The question is no longer whether the industry has the tools to catch it. It is whether it will use them in time.

With everything that is at stake, that is why Tigris is committed to solving the challenges of dangerous goods in marine logistics. Get in touch to find out how we can help.