Almost 80 Hanjin vessels have been either seized or denied cargo handling or docking at ports in countries including the US, China, Japan, Spain and Canada, South Korea’s government said Monday.
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“As the Hanjin side virtually made a concession, the government has to seek a compromise instead of a catastrophe”, said a high-ranking representative of the Korean shipping industry.
Hanjin just won’t die, will it?
A company spokeswoman, Park Eun-hye, confirmed Hanjin was moving to protect its assets but refused to specify in how many countries, beyond the USA and South Korea.
Last week’s collapse of the world’s seventh-largest container shipper has caused deep anxiety among its clients over the fate of stranded cargo, and pushed up cargo rates.
According to Hanjin, 68 out of its fleet of 141 ships have been stranded in global waters, while several ships have already been seized in ports. Hanjin Transportation Co. has set up a task force to help unload cargo from vessels and the group’s Korean Air Lines Co. also will consider moving cargo by air as an alternative way to easing the supply crunch. An unnamed labor union official said that “despite (the urgency), the government is only demanding the cash-strapped shipping company to secure operating funds, pushing sailors closer to the edge of a cliff”.
Hanjin Shipping was handling almost 8 percent of the trans-Pacific trade volume for the USA market, and with its container ships marooned offshore, major retailers have been scrambling to devise contingency plans to get their merchandise into stores.
Vice Finance Minister Choi Sang Mok said Monday that Hanjin Shipping is seeking stay orders in 43 countries to protect its vessels from being seized and will call at certain ports such as Hamburg and Singapore where they are deemed less likely to be stranded.
Hanjin Group said it would spend 100 billion won, which includes a personal donation of 40 billion won from its chairman and biggest shareholder Cho Yang-Ho, to “normalise” the operations of its container ships.
Hanjin struggled with debts and losses for years.
The unprecedented logistics disturbance seems to be over the hump as the Hanjin Group blitzed to make the decision for the support. Most are container ships although it has some dry bulk carriers. “But in the view of many experts, that possibility is low”, Yonhap quoted Yim as saying.
Shares recovered to be traded 1.6 per cent lower at 1,220 won ($1.1) early Monday afternoon – but still 36 per cent lower from last month and almost 80 per cent lower from a year ago.
But it is reluctant to commit huge sums of taxpayers’ money, and hopes to orchestrate a takeover by Hanjin’s smaller rival, Hyundai Merchant Marine, which is already being restructured.
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