A Hanjin Shipping Co. vessel is expected to start unloading Saturday morning at the Port of Long Beach after a US court granted the company reprieve from having its assets seized, easing a cargo bottleneck resulting from the container line’s filing for bankruptcy protection.
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The country’s Finance Minister Yoo Il-ho in a meeting this afternoon discussed the government’s role in minimizing losses in the maritime industry and economy as a whole caused by Hanjin’s demise.
During a hearing Friday morning, Hanjin 117930, +1.15% bankruptcy lawyer Ilana Volkov told Judge John Sherwood of the U.S. Bankruptcy Court in Newark, N.J., that the company now has the funding and legal permission necessary to offload containers bound for U.S. ports.
A USA federal judge on Tuesday agreed to grant Hanjin short-term protection from its creditors, temporarily allowing the embattled shipping company to dock at US ports without immediate fear of retaliation. At the same time, South Korea’s ruling Saenuri Party asked the government to offer about 100 billion won in low-interest loans to the shipping line if Hanjin Group provides collateral, Saenuri lawmaker Kim Gwang Lim said in a statement.
The business realities are complicated: Hanjin Shipping has filed for protection from creditors in dozens of countries.
While the Financial Services Commission (FSC) of South Korea has published a plan to help the several hundred South Korean Hanjin suppliers who risk going bankrupt on the heels of Hanjin’s decision to file for receivership, Hanjin has begun to procure food, water and other goods to the crew on six Hanjin vessels anchored off ports such as Rotterdam and Singapore.
With three of the ships seized by creditors, 70 container ships are marooned at sea as they have been denied access to ports.
Even if Hanjin ships dock in the USA, no one knows for sure if they can pay the fees required to unload the cargo.
The world’s seventh largest shipper’s bankruptcy filing has put global commerce into trouble.
Earlier this week, Samsung said goods worth US$38 million, mostly televisions and appliances, were stuck aboard two Hanjin ships.
– Peter Friedmann, executive director of the Agriculture Transportation Coalition shipping industry group Hanjin would normally pay the fees for port usage and container handling as part of its freight services.
Currently, Hanjin’s fleet is carrying roughly $14.5 billion dollars worth of cargo and its inability to reach port is considered a significant threat to the global logistics network.
Hanjin’s parent company pledged million to help resolve the disruptions. This includes almost $37 million from the company’s chairman Cho Yang-Ho.
Last week’s financial fall of Hanjin has had a stunning ripple effect throughout the United States, leaving ships stacked high with goods as the holiday shopping season looms.
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“We haven’t reached a conclusion at today’s board meeting, so we have chose to discuss the matter again tomorrow”, a spokesman for Korean Air Lines said.
