“We are working with customers to minimize impacts of this situation on their business as much as possible”. Exporters are trying to find alternative shipping companies to reload outgoing cargo that was bound for Hanjin ships.
Advertisement
The failure of South Korean worldwide containerline Hanjin is having an effect in Australia, as it is elsewhere in the world.
No more Hanjin export loads will be accepted at the SPA’s terminals in Charleston or at its inland port in Greer until further notice, the state maritime agency said.
At the Port of Long Beach, where Hanjin owns a majority stake in Total Terminals International, operators stopped accepting delivery of Hanjin containers.
Hanjin is part of The Alliance, a six-member group that was formed in May to rival the dominance of global giants Maersk Line and Mediterranean Shipping Co.
“We do not want to hurt the truckers”, Jim Newsome, the SPA’s president and CEO, told the Journal of Commerce. TVs, cars and sneakers sail about 10 days to reach Los Angeles from Asia while they could take as many as 30 days to Rotterdam. “It is just so murky right now”, he notes.
Evergreen also said on Wednesday it had activated a contingency plan to stop loading Evergreen Line cargo on to Hanjin Shipping’s vessels and would also stop Hanjin Shipping’s cargo from being loaded on to its ships.
The Port of Virginia on Friday updated some policies announced on Wednesday, reflecting Hanjin’s connections with some other big ocean carriers that together make up the “CKYHE” alliance, by which they share space on one another’s ships.
Suppliers with goods that have yet to leave Asian ports, and that had been scheduled for Hanjin ships, are hustling for new shippers.
Seizing of container ships could have collateral damage, disrupting shipping until Hanjin can come up with 300 billion won After Hanjin Shipping filed for court receivership on August 31, foreign creditors and ports began seizing its container ships and banning their entrance. Overseas creditors are expected to keep refusing entrance to harbors and placing ships under provisional attachment.
The Maritime Commission, which regulates trading, doesn’t have jurisdiction to intercede in bankruptcy proceedings, but issued a statement that it would be watching for any “improper behavior” by other carriers.
A South Korean court, where the company filed for receivership, will soon decide whether the company will get a chance to restructure or will be forced to liquidate.
According to Reuters, Hanjin lost the support of banks after a funding plan submitted by its parent group was not sufficient to address its almost $5 billion debt load.
“Ports will not have these vessels because they are anxious port and other fees won’t be paid”, said Rahul Kapoor, a Singapore-based director at Drewry Maritime Services. “It’s very unlikely Hanjin can come back from the ashes”.
Advertisement
State-run think tank Korea Maritime Institute estimated that shipping rates on Busan to U.S. routes would rise 27 per cent and Busan to Europe routes would rise 47 per cent in the near term, causing Korean exporters additional shipping costs of about 440.7 billion won per year. The decline in trade comes on the heels of a ship-building boom. (KOREAN) (PHONE INTERVIEW) “Shipping companies have a lot of customers outside of Korea”.
