Intercontinental lithium battery transport could turn to rail, says insurance company

TT Club freight insurance company says that overland transport, including rail, could attract more dangerous goods for long-distance intercontinental traffic. Despite being forbidden in the New Silk Road transport, lithium batteries could have chance onboarding trains due to safety incidents and stricter safety regulations on the sea and air transport.

Lithium batteries are the holy grail for Silk Road transport companies. The Chinese government forbids their transportation by rail due to safety concerns. Many companies have expressed their desire to lift the restrictions and allow them to transport these products belonging to a booming market.

For DB Cargo Eurasia, transporting batteries was on the wishlist for 2021. GEFCO also struggles since it cannot transport electric cars from China to Europe by rail. Restrictive regulations were not lifted in the past year, and it does not seem that 2022 will be the year of change. Nevertheless, TT Club’s prediction leaves some space for optimism. Could the restrictions on other transport modes allow finally dangerous goods, batteries in particular, on Eurasian rail?

Safety concerns

“The lithium battery market is exponentially increasing through consumer demand for a wide variety of rechargeable products from handheld devices to power tools and electric vehicles. Recently recorded incidents of container fires caused by or suspected to involve lithium batteries and conflagrations of significant proportions on car carriers and ro-pax ships mean that safety concerns rightly continue to grow amongst the maritime community. In addition, revised regulatory restrictions regarding the carriage of lithium batteries by air, which took effect from 1 April, may result in greater volumes being transported by surface modes”, explained the insurance company.

However, even if regulations revise to allow the transport of lithium batteries, shipping and transportation companies have a great responsibility to ensure safety during transit. “Understanding the risks is crucial,” said TT’s risk management director, Peregrine Storrs-Fox.

“Throughout their intermodal journey, the primary risks exist when batteries are poorly manufactured, untested or defective; these have a higher tendency to malfunction. However, supply chain risk – at any point of handling, storage and transport – is compounded by used, fully or partially charged batteries. The reverse logistics of batteries must be carefully managed; damaged and faulty products being returned or shipped as waste for disposal or recycling present increased risk”, illustrated TT Club.

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Author: Nikos Papatolios

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