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Study on Keeping Nuclear Bombs Away from U.S. Shows Misplaced Fear over Cost of 100% Overseas Cargo Scanning

June 25, 2009

A two-tiered scanning-protocol for inspecting all containers at international ports could be the most affordable approach to ensuring containers moving through the global transportation system are not carrying nuclear bombs, according to a paper being presented at a services special interest group meeting of the Institute for Operations Research and the Management Sciences (INFORMS®).

The authors challenge the federal scheme now in place that relies on targeting only a small number of containers that U.S. authorities identify as "high-risk" for inspection. Based on detailed data, involving 900,000 containers, drawn from two of the world's largest port terminal operations, they found that there is a serious risk of large bottlenecks in international shipping should a raised security alert or actual terrorist incident require that the current inspection protocol be ramped up.

"We find that the current inspection regime being advanced by the U.S. Department of Homeland Security and widely supported by the international community can only handle a small percentage of the total load," the authors maintain. "An alternate inspection protocol that emphasizes screening (a rapid primary scan of all containers, followed by a more careful secondary scan of only a few containers that fail the primary test) holds promise as a feasible solution for meeting the 100% scanning requirement."

"Estimating the Operational Impact of Container Inspections at International Ports" is co-authored by Nitin Bakshi, London Business School, Stephen E. Flynn, Council on Foreign Relations, and Noah Gans, The Wharton School. The paper will be presented at the INFORMS Manufacturing and Service Operations Management Society, Service Management Special Interest Group Meetings taking place at MIT in Cambridge, Massachusetts on June 28.

With continuing concern that Al Qaida or other terrorists will try to smuggle a nuclear weapon into the United States, Congress has mandated that, by 2012, all containers bound for the U.S. be inspected overseas.

The paper argues that a test program, the Secure Freight Initiative (SFI), could be adapted to successfully manage the large volume of inspections at ports around the world.

Under a variant of SFI that the authors describe as an industry-centric model, a larger number of containers - virtually all those originating outside the U.S. - would receive a rapid screening via low-cost, drive-through radiation and medium energy x-ray radiographic portals as they enter an international port. Containers that fail will not be placed in stacks for outbound containers, but will be flagged immediately and removed for a more intensive inspection. By segregating flagged containers outside large queues rather than placing them in piles that take time to stack and restack, potential bottlenecks are more easily averted.

By contrast, the current procedure, implemented by U.S. customs authorities under the Container Security Initiative (CSI), can be cumbersome and costly.

"The CSI and SFI protocols differ in the pool of containers targeted for inspection, as well as both the timing and tools used for preliminary inspection," the paper explains.

"The CSI inspection process is geared exclusively towards US-bound containers, it begins 24 hours in advance of a container's lading onto an oceangoing vessel, and it uses information contained in the shipping manifests to decide whether or not specific containers require intensive non-intrusive inspection (NII). The SFI protocol uses drive-through portals to scan every container as it enters a port terminal, and the results of these scans in addition to shipping manifest data can trigger the need for more intensive NII."

The authors' research shows that disruptions at major terminals could be significant under CSI. If there is limited scanning and radiation capacity, containers could sit idle at ports for an extended time. The additional logistics requirements that arise due to the need to divert containers within port terminals for inspection could lead to major congestion.

The current CSI protocol relies on removing targeted containers that are in terminal yards made up of thousands of containers, stacked up to six-high. Targeted containers must then be moved to an inspection facility where their contents are scanned using sensitive equipment. This is a slow process that involves sophisticated tools and specialized training that only support limited throughput. Consequently, there would be major delays associated with attempting to scan more than the small fraction of U.S.-bound containers that the system now handles, especially if there is a terrorist incident or a raised security alert requiring more overseas inspections.

Using simulation, the authors find that no more than 5% of U.S.-bound traffic flowing through one port and 1.5% of traffic through a larger port can be handled by the equipment and procedures used in the CSI approach, before the number of containers awaiting inspection starts growing more rapidly than those that can be inspected.

Costs varied considerably as well, with the CSI method costing roughly $100 per inspected container, and the SFI method favored by the authors costing $1-2 for containers passing through a single screening and an additional $11-$13 for containers that require secondary inspection. This was, in part, due to the cost of inspection being defrayed over only U.S.-bound container traffic under the CSI protocol, as opposed to spreading them over the entire volume of container traffic at a terminal (for the initial primary scan) under the SFI-variant.

Implementing their recommended model would require terminal operators to purchase, deploy and operate inspection equipment in consultation with the U.S. government; to hire, train, and monitor private inspectors to analyze secondary inspection images; and to overcome some information technology challenges associated with sharing scanned images with government officials who require them.

When it comes to protecting the nation's ports, the authors warn, the challenge of comprehensive inspection and the cost of failure are both great.

"Unlike a long range missile, the millions of shipping containers that are used to transport goods in ocean-going vessels provide terrorists with a way to hide a nuclear device destined for U.S. shores," they write. "Further, by using a container, terrorists can potentially achieve mass disruption to global supply chains by creating widespread public anxiety that other containers may have nuclear devices."

The economic cost resulting from actual detonation of a nuclear device, one expert says, would be between $55 - 220 billion.

Institute for Operations Research and the Management Sciences