Bulletproof Logistics: Compliance and Risk Management for Chemical Products 

What are chemicals, and why do they matter to the logistics sector?

In a word, matter.

Everything around us consists of chemicals: substances that contain matter. Solids, liquids, gases. The success of our economy relies on the safe and timely transportation of chemicals from where they’re produced to where they are needed for the manufacturing of products.

The global chemicals industry is colossal. It includes petrochemicals, fertilisers, pesticides, pharmaceuticals, cleaning products, cement, and so much more. According to Global Chemical Industry Outlook 2025, published by Markets and Markets, the global market was valued at $6.182 trillion in 2024. The market is currently growing at a modest rate, driven by the growing demand for energy transition materials such as battery chemicals and specialty chemicals needed for high-tech solutions.

A significant drag on the global chemicals industry in recent years has resulted due to the disruptions that have occurred to the complex supply chains. The COVID-19 pandemic created a major imbalance that has taken years to recover from, and now wars, trade wars, and other geopolitical disputes are disrupting markets, often significantly.

Chemical logistics is a serious business where the consequences of failure can be catastrophic. In a challenging global environment, clients are looking for logistics companies that can store their chemicals safely and move them where they need to go reliably, safely, and efficiently.

The storage of chemical products represents a foundational and high-stakes component of chemical logistics. Warehousing facilities must be engineered not only to meet strict regulatory compliance—often including segregated, temperature-controlled, and explosion-proof zones—but also to serve as the primary defensive barrier against public and environmental hazards. A secure, well-managed storage site is essential for effective risk mitigation, ensuring product stability and preventing dangerous incidents before they can enter the transportation network.

Compliance may sound like an uninteresting subject to the uninitiated, but in the world of chemical logistics, complying with regulations controlling the storage and transportation of chemicals can literally mean the difference between life and death. It’s that important.

Without going into too much detail, when something goes wrong in the chemical logistic space, explosive chemicals can explode, flammable chemicals can catch fire, toxic gases can kill people or wildlife, and toxic and/or radioactive liquids can flow into rivers and cause lasting damage over great distances.

Nobody argues against the need for stringent chemical logistics standards.

Apart from the standards that protect the handlers of chemicals and those involved in logistics, the major objective of chemical logistics standards is to ensure the safe storage and handling of chemicals and their safe transportation on roads, waterways, railways and air routes without failure. Failure in chemical logistics almost always affects the safety of the public. 

Every time you pass a chemical logistics storage facility or a vehicle or train with a symbol on its containers denoting that it is carrying toxic, radioactive, or flammable chemicals, you want to be reassured that the chemicals are being held or transported by a logistics provider that is laser-focused on compliance with the relevant safety standards.

While the human toll is, naturally, what we think about first when we hear of toxic spills, the environment often sustains damage, especially over the long term. When a fire burning toxic chemicals has to be extinguished, the resultant runoff of firefighting materials and chemicals will often find its way into the nearest waterway, killing plants, fish, and animals. And the effects on the receiving environment of such spills can be long-lasting, often extending into years after the accident.

Chemical logistics is not a game. Compliance is critical.

The basic aims of risk management, in general, are to identify, assess, mitigate and monitor potential risks.

The first task is to develop a comprehensive list of the potential hazards associated with the storage and transportation of a particular chemical. This generally involves considering all the ways that the chemical could escape from the vessels used to contain it, and the harms that might occur as a result. Spills or leaks will most likely occur when the material is being transferred from one container to another.

Risk is a function of the likelihood of a hazard occurring and the negative consequences that might occur as a result. Risks can range from low risk, common occurrences that have little or no negative consequences (e.g. minor oil spills when filling a truck) to very high risks (e.g. a leak in a fuel tanker that leads to a deadly explosion).

Mitigation involves implementing measures that reduce the likelihood of hazards occurring and/or minimising the negative effects should they occur. Examples of mitigation measures include regular training and auditing of safety procedures; storing chemicals in segregated areas in controlled environments; transferring liquids into tankers within bunded areas to contain any spills that may occur; and implementing fire suppression systems that are appropriate for the specific flammable materials being stored or transported.

The gold standard for risk management is the implementation of continuous monitoring systems that can address potential problems before they become actual problems. 

This is where Industry 4.0 comes into play.

Industry 4.0 is increasingly being used to bake safety into a fortified supply chain. This is done by harnessing IoT devices at all the key points in the supply chain and using AI to monitor the data coming from them.

Sensors can be installed from one end of the supply chain to the other to measure things such as temperature, weight, pressure, and air quality. Changes in the data coming from these sensors can signal problems and trigger inspections or other mitigation measures.

The job of monitoring tens or hundreds of thousands of sensors across a supply chain, including on vehicles criss-crossing large networks, is too large for human operators, especially when working with high-risk chemicals. AI is rapidly becoming indispensable in this area, ensuring greater safety in chemical logistics.

Because of the serious consequences of failures, chemical logistics benefits from every improvement in safety measures and visibility throughout the supply chain. And tech provides the tools to do that.

Digital control enables tighter control, which enables closer monitoring of safety procedures when chemicals are transferred between different modes. Chemicals in transit can also be tracked constantly and more accurately.

A Control Tower acts like a centralised nerve centre that gives end-to-end visibility and real-time monitoring of the supply chain. It draws data from suppliers, manufacturers, logistics partners, and customers and leverages cutting-edge technologies such as data analytics, artificial intelligence, and machine learning to aid decision-making and optimise processes. 

Safety is no accident. 

It starts by developing a culture of safety in which nobody is willing to compromise their standards. It requires developing best practice procedures, documenting them, and training and auditing staff regularly to ensure those standards are maintained.

Best practices for storing and transporting chemicals include the following:

It’s worth repeating: safety is no accident. FM Logistic knows this, and that is why we keep ourselves at the cutting edge of chemical logistics.