News 21 Oct, 2015

China - Distillers Dried Grains and Solubles

In recent weeks the Club has experienced two cases where cargo interests in China have alleged that cargoes of Distillers Dried Grains and Solubles (DDGS) loaded in ports in Louisiana, USA, are off-specification for colour.

DDGS can range from a very pale golden brown to a dark brown colour, similar to roast coffee, with the colour of the product varying dependent on the processing employed in its production. In both cases some of the cargo has been more of a brown than a golden colour, with areas of the darker coloured DDGS found either irregularly placed or layered within all the holds, although clearly defined from the golden coloured cargo.

The Chinese market prefers pale golden DDGS, and cargo deviating from this colouring is giving rise to claims from cargo interests, alleging that the apparent discolouration of the product is affecting its usability as an animal feed. DDGS has suffered a significant price drop recently, hence the apparent readiness of receivers to find issues with the cargo.

Members loading DDGS in the USA destined for China are advised to ascertain the cargo specification from shippers, in particular the colour, and to monitor the cargo being loaded for any that does not appear to meet the specification. Consideration should be given to appointing a surveyor to attend for the purposes of monitoring the condition of the cargo, and to assist the Master in clausing bills of lading where necessary.

It is recommended that high resolution digital photographs be regularly taken in each hold during loading to show the colour of the cargo. Where concerns exist that portions of the cargo may be off-specification for colour, loading should be suspended while the matter is investigated and the Club contacted for advice. In a number of recent cases, cargo interests at the load port have stated that the colour differences are normal and do not affect the quality of the product. It should be considered that DDGS is often loaded from spouts at high speed, generating significant quantities of dust making it problematic to check the colour of the product coming onboard except during breaks in cargo operations. Cargo arriving in open barges and grab loading will afford greater opportunities to observe cargo that is not of the correct colour.

Although listed as a Group C cargo in the IMSBC Code (being one not liable to liquefaction or possessing chemical hazards), this cargo can self-heat which can adversely affect the colour and nutritional value of the product, therefore it is recommended that thermocouple probes be inserted into the cargo to monitor for any signs of self-heating during the voyage. Detailed records of the temperature of the cargo while onboard should be maintained, to help counter any allegation by cargo interests that any discolouration is due to deterioration as a result of self-heating.

When fuel tanks are adjacent to the cargo holds, and any fuel handing / residue tanks are situated on the engine room bulkhead, it should be ensured that the contents of these tanks are not heated excessively or unnecessarily while cargo is onboard. Detailed temperature records for all fuel tanks bordering the cargo holds should be maintained, to help defend any claim that inappropriate heating of fuel oil is the cause of cargo deterioration and discolouration.

Members requiring further guidance should contact the Loss Prevention department.

The Club would like to thank Brookes Bell for their assistance in the preparation of this article.