Coronavirus: Worst Shipping Crisis in Decades Puts Lives and Trade at Risk

Cruise ships aren't the only ones hit by the coronavirus pandemic. With 300,000 workers stranded on merchant ships, Bloomberg found dozens of labor violations that threaten seafarers’ safety, as well as the global supply chain.

On July 25, the Unison Jasper pulled into the Australian port of Newcastle carrying 31,000 tons of alumina bound for one of the country’s largest smelters. The ship had traveled around the world in the seven months since the pandemic began, but in Australia, authorities found a problem serious enough to detain the vessel.

Seven of the 22-person crew had been on the ship for 14 months, beyond the end-date of their contracts and in breach of international maritime law, regulators and union officials said. They were owed $64,000 in back pay, and there wasn’t enough fresh food. There was also no valid plan to get them home to their families in Myanmar. They wanted off.

“I’ve been on the sea for 14 months,” one of the sailors said in a video interview with an organizer for the International Transport Workers’ Federation, a union that represents seafarers. “We are actually very tired. I want to go home.”

Ratified by more than 80 countries, the Maritime Labour Convention isn’t mere guidance—the agreement sets minimum working conditions for seafarers that underpin the insurance policies and global contracts that govern the transport of basically everything. But the ongoing pandemic has shattered the norms of this highly fragmented industry, and with countries wary of relaxing port and border restrictions, violations of worker protections have become common. Nearly 20% of the world’s 1.6 million seafarers are stranded at sea and, like those on the Unison Jasper, at the mercy of employers and shifting quarantine requirements to get them home.

In conversations with Bloomberg reporters, more than 40 seafarers on nearly as many ships described deteriorating conditions. Most asked for anonymity given the fragility of their situations. About half didn’t have current contracts and some said they hadn’t been paid in more than two months, meeting International Labour Organization's definition of forced labor. Overtime pay, they said, was inconsistent, if their extra hours were logged at all. Most haven’t left their ships in months after coronavirus outbreaks tied to cruise liners and merchant ships put an end to shore leave. Seafarers with abscessed teeth haven’t been able to get dental care, and others say they’ve received stitches from crewmates in lieu of off-shore medical attention. On one ship, the captain died of a heart attack, and the crew stored his corpse in the freezer for nearly two weeks before it found a port that would repatriate the body.

The past-due contracts and unpaid overtime are especially troubling, said Brandt Wagner, head of the transport and maritime sectoral policies unit at the ILO, which administers the Law of the Sea. “These are violations of the Maritime Labour Convention,” he said. “We should make sure that the Covid-19 pandemic isn’t used as an excuse to breach the law … Seafarers’ rights have to be upheld, even if it’s cumbersome or difficult.”

The industry says the options are limited. Changing immigration rules and limited air travel have made swapping workers more difficult and more expensive, said Esben Poulsson, chair of the International Chamber of Shipping, the industry’s principal trade group. “The efforts that are being made by companies to take care of the seafarers and effect properly timed crew changes have been and continue to be tremendous,” he said.

Many companies have rerouted ships and chartered flights to facilitate crew changes, and still some 300,000 seafarers are overdue for relief—a number that grows as the pandemic drags on. The crisis has begun to reach shipping investors including global asset manager Fidelity International Ltd., American insurance giant Massachusetts Mutual Life Insurance Co., asset manager Oaktree Capital Group LLC and finance titan JPMorgan Chase & Co. If it isn’t resolved soon, analysts say, it threatens to ripple up the supply chain, affecting commodities companies like Cargill Inc. and Glencore Plc. and retailers like Dick’s Sporting Goods Inc., just in time for the holiday shopping season.

“This is the most dire situation with vessels and crew that I’ve seen in many decades,” said Andrew Kinsey, a New York-based senior marine risk consultant at Allianz Global Corporate & Specialty.

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