Hanjin Shipping Bankruptcy Filing Driving Industry Anxiety
Hanjin Shipping filed for bankruptcy protection in its home country of South Korea, according to a statement from the South Korea Financial Services Commission (here). The country will seek to maintain Hanjin's existing services through a sale to Hyundai Merchant Marine, the commission said. "In response to the market concern over the shipping sector, one of Korea’s key industries, the government will make sure to maintain the shipping industry’s competitiveness," it said. "Hyundai Merchant Marine (HMM) will acquire Hanjin Shipping’s core assets such as ships, overseas sales network and key work forces to retain Hanjin Shipping’s competitiveness as much as possible." Some U.S. and other countries' ports have stopped Hanjin ships from entering, according to a report from The Korea Times (here).
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While bankruptcy filing was largely expected, the news elicited worries throughout the industry. "While it is too early to speculate on the ongoing operations of Hanjin Shipping, it is clear that this court filing will create significant challenges for both Hanjin customers as well as the overall Transpacific trade," Gemini Shippers Group said in a notice (here). Gemini said it expects delays to delivery of cargo aboard Hanjin ships. Meanwhile, EMO Trans said by email (here) it stopped "usage of any Hanjin vessel or container."
Scarborough International said (here) it is working to get cargo rebooked on new carriers but that "it is our belief that other carriers will use this as an opportunity to increase rates through General Rate Increases (GRIs) and a possible Peak Season Surcharge (PSS)." The National Customs Brokers & Forwarders Association of America advised caution in an alert. "The situation remains fluid and the actual effect on the supply chain is unclear," the group said. Hanjin didn't immediately comment.