12 million containers: Can we scan them all?

Late last year, the outgoing Congress adopted—and the president signed—a bill aimed at improving security at the nation's ports. Called the Security and Accountability For Every Port Act (SAFE Port Act) of 2006, the bill calls for the installation of radiation detection equipment at major ports and establishes several other pro grams designed to tighten control over container freight destined for the United States.

But the bill did not go far enough for some members. And the newly empowered Democrats, flexing their muscle when the new Congress con vened in January, pushed a bill through the House that included even tougher freight security lan guage in the first 100 hours of the session.

Some of the provisions of that measure, HR 1—Implementing the 9/11 Commission Recommendations Act of 2007, have shipper and carrier groups plenty worried. In particular, they are concerned that a provision mandating inspection of 100 percent of containers bound for the United States within five years could seriously disrupt trade while adding little in the way of real security. It would also require the use of "smart" seals on container doors that would provide some sort of notification in the event of unauthorized entry—a technology some say does not yet exist. The bill also mandates inspection of aircargo shipments. (See the accompanying story.)

The concern over the container inspection requirement centers on cost and technological feasibility. Some 12 million containers arrive at U.S. ports every year from around the world; inspecting every single one of them before they left the port of origin would be a formidable task.

"There are huge technological and logistical problems that the House bill ignores," argues Eric Autor, vice president and international trade counsel for the National Retail Federation. "If it is not done properly, it could seriously disrupt global trade, particularly in the poorest countries. The technology is not cheap. How can the poorest countries afford the technology, and if they cannot, what impact will that have?"

At press time, it appeared that a similar bill would soon get attention in the Senate. Doug Sibila, chairman of the International Warehouse Logistics Association (IWLA) and president and CEO of Ohio-based transportation and storage specialist People's Services, said that the group feared that Democrats might push a bill with provisions like those in HR 1.

Autor said he doesn't expect the Senate bill to include the provision for 100 percent inspection, but added that he does worry that some senators may try to attach amendments inserting the requirement. In anticipation of Senate action, Peter Gatti, vice president of the National Industrial Transportation League (NITL), wrote to all U.S. senators in January outlining the league's concerns.

In that letter, he argued that a major provision of the bill regarding container cargo and air cargo "would divert valuable resources from existing security programs that have proven to be effective and would significantly disrupt commerce, without reasonably improving security."

Gatti contended that even if it were possible to implement the requirements, they did not offer the benefits proponents suggest and could come at a high cost to the economy.

"Our concern is that even if the employment of such technology is feasible, reliance on such an approach would provide a 'false sense' of security and would result in legitimately safe cargo being delayed," he wrote. Gatti added that the security seals that the law would mandate were not yet available. Further, requiring the seals could decrease security if containers were delayed until port workers could assure that compliant seals were in place and working. He contended that the delays the requirements would impose would "have serious adverse impacts on companies' 'just-in-time' supply chains and, in turn, the U.S. economy."

At present, about 5 percent of inbound containers are inspected. Autor reported that on average, the release time for containers held for inspection is about two weeks, an indicator of how serious delays could become should 100 percent of the containers be required to undergo inspection.

Not ready for prime time?
The shippers and trade organizations are essentially unanimous in agreeing that port security must improve. Most support the existing multi-layered approach, which includes shipper registration programs, strict documentation rules, pre-screening of containers before loading in foreign ports, and other steps aimed at weeding out high-risk freight.

Gatti wrote that the existing approach was designed to ensure that any high-risk cargo would be inspected, and was a better approach than the proposed inspections. He pointed out that the SAFE Port Act adopted in October requires 22 major U.S. ports to install radiation detection equipment this year and calls for the development of technology for "non-intrusive" cargo inspection. The law requires 100 percent screening, as opposed to inspection, of all cargo containers bound for the United States, with inspection of all containers considered high risk.

Matt Schor, director of homeland security solutions for WhereNet Corp., a supplier of logistics visibility and control systems that was recently acquired by Zebra, says that any technology installed on containers would have to be robust enough to withstand 20 or more scans a year for the decade-long life of an ocean container. "No one has focused on whether a technology can withstand being repeatedly scanned like that," he says.

Schor reports that while WhereNet and other technology developers are working on solutions that capture supply chain and logistics data, demands for tools that can detect nuclear material, for example, make product development difficult. "What it comes down to is that the rules of the game are changing," says Schor. "You almost have to go back to the drawing board. It's going to slow things down."

Scanning technology is already available. Schor points out that all trucks loaded on trains for transport through the tunnel connecting England and France are scanned. In addition, several terminals in Hong Kong scan all incoming cargo containers. But the technology is not cheap.

Autor says using the Hong Kong experiment as justification for expanding screening is problematic. "First, Hong Kong is wealthy and has the resources to do this," he says. "Secondly, no one is looking at these scans." The United States faces a different set of challenges, he says. "We have 12 million containers coming into the United States each year.

We need a system in place—not only human, but technological—to be able to examine these scans and take appropriate action. Our experience with the computer systems at Customs does not fill us with too much confidence. ACE is still not fully implemented and it was authorized 13 years ago." (ACE—the Automated Commercial Environment—is an initiative to automate Customs' systems and processes.)

Autor argues, too, that widespread use of "smart" seals won't be feasible until some technological hurdles can be cleared. "We need a system that is effective—one that can operate in the bowels of a vessel. We cannot have a system that results in a lot of false positives. It has to be … able to detect any breach, not just opening the doors. And it has got to be cheap. We are talking tens of millions of containers. The seals cannot cost $10 each. There are not any seals out there that meet those requirements. It is a real technological problem."

"The question is how to minimize risk," says Sibila, adding that many Democrats do not understand the impact the proposed law would have on businesses. "There's a misunderstanding between 100 percent inspection and 100 percent screening."