The ocean shipping industry is still recovering after South Korea’s largest shipping line unexpectedly filed for bankruptcy protection, freezing all of their assets. Since this occurred August 31st, Hanjin ships have been rejected from berthing leaving loaded vessels idle for weeks, cargo has been left sitting on docks as ships are denied entry to ports, and creditors have seized different assets for money that is owed to them.
On a more positive note, Hanjin Group has recently been approved to spend $54 million to help recover stranded cargo around the globe and is anticipated to recover 530,000 containers from various vessels and ports. This spending was approved by the board of Korean Air Lines, who wants to receive a portion of Hanjin Shipping’s stake in Total Terminals International (TTI) at the Port of Long Beach in return.
Hanjin Greece, which has been stranded off the US West Coast, was called at the Port of Long Beach and is finally being unloaded after threats of arrest were dropped. According to JOC, Hanjin has the funds to pay for the three other ships waiting on the US West Coast to be unloaded but are still unsure about the idle vessels on the US East Coast.
Other vessels have successfully passed through the Suez Canal, which will allow even more of the fleet to reach their final destinations. This is a slow but promising start for the billions of dollars worth of cargo still tied up around the globe.
Protection by bankruptcy courts has been granted in Korea, United Kingdom, and the US. This ruling protects Hanjin’s assets from being seized and also allows BCOs to pay fees upfront for their containers to be released from terminals.
The capacity issues and chaos created by the loss of Hanjin has shocked the entire industry this peak season. Multiple carriers have added vessels to their weekly services to keep up with demand, especially on Asia to US routes.