Finance Minister Yoo Il-ho said Wednesday that the cargo crisis caused by Hanjin’s slide toward bankruptcy will begin to ease this week.
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According to the sources, U.S. Bankruptcy Judge John K. Sherwood on Friday granted Hanjin Shipping protection under Chapter 15 of the Bankruptcy Code. That has exporters in the USA scrambling to reroute cargo to other carriers.
“I’m aware that some exporters are going through considerable difficulties from the Hanjin Shipping incident”, Bank of Korea Governor Lee Ju-yeol said at a press conference in Seoul on Friday.
Droves of Hanjin ships packed with over 500,000 containers were denied docking privileges globally, due to uncertainty as to who will pay docking fees and the cost of container storage, the Wall Street Journal reports.
“While it will take some time to fully resolve the situation, we expect slowly to start seeing some improvements”, the government said in the statement.
The South Korean government said Saturday it will work with the court, Hanjin Shipping, Hanjin Group and creditors to solve financial issues faced by the company in unloading cargo.
Major retailers like Samsung are also asking the US government to immediately approve Hanjin’s Chapter 15 application to get millions of dollars of its stranded goods moving again.
The four US -bound ships are the Hanjin Boston, Hanjin Greece, Hanjin Jungil and HanjinGdynia.
The failed Hanjin shipping group is desperately seeking funds to rescue $14bn (£10.5bn) worth of cargo stranded round the world following its collapse.
Cho still expected to provide the 40 billion won in private funds next week, the Korean Air Lines spokesman said.
South Korean media said as many as a thousand crew members – both Hanjin employees and temporary workers – could be stranded on the ships. HP said it has products in more than 500 Hanjin-controlled shipping containers and that an inability to “place these products on shelves in a timely manner will likely result in loss of market share”.
As ships await at sea, anchored off various ports from Long Beach, California, Mexico to Panama City, problems for the financially-strapped company mount as fuel suppliers also demand payment and provisions run low on the ships.
The map below shows the locations of Hanjin’s container ships.
But some companies may not yet be aware if they’re exposed to Hanjin. The group will raise the money by providing a stake in overseas terminals, like the one in Long Beach, to secure loans worth about $54 million. It is now considering chartering 16 freighter planes to take goods to customers – mostly in the US.
At the same event, Emanuel Chirico, CEO of Calvin Klein and Tommy Hilfiger owner PVH Corp, said Hanjin handles a small portion of the company’s business, and “it really hasn’t impacted us at all”.
Hanjin’s woes were having wider knock-on effects. “Even when the containers are offloaded, there still appear to be questions about how containers can be retrieved from the ports”.
But import cargo volume at the nation’s major retail container ports should be at near-peak levels for September, according to the monthly Global Port Tracker report by the National Retail Federation and Hackett Associates.
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If the cargo can not be unloaded immediately, Samsung will be forced to transport alternative parts by air to help meet contractual obligations, entailing “great costs”, it said.
