Hanjin Shipping is a large shipping company based out of South Korea. Pursuant to many news reports, Hanjin had many ships and crew members stranded in a number of ports around the globe, but particularly in Asia. Cargo was left on-board and not unloaded as customs and port fees were not paid. Two days ago, the media reported that Hanjin received short-term financing to pay their port fees to allow them to unload cargo. While there are no reports of spoilage of materials used in pharmaceutical, medical devices, food or other consumer products, this alert is being generated simply to make users aware of the delay in unloading cargo in case there highly sensitive materials shipped via Hanjin Shipping that may require additional effort to ensure that such materials are still suitable for their intended uses.
What to expect? Hanjin represents nearly 8% of the trans-Pacific trade volume for the US market and the bankruptcy was having “a ripple effect throughout the global supply chain” that could cause significant harm to both consumers and the US economy.
We would expect that Hanjin’s proceedings in South Korea would receive a degree of support from the Singapore courts, though the extent of that support may depend very much on the terms of the South Korean court order.
A weakened economy since the 2008 recession hurt global demand and trade at the same time that steamship lines continued to build more and larger vessels — immense ships that were conceived as cost-effective when freight costs were higher several years ago.
The weaker trade and overcapacity has sent ocean shipping rates plunging in recent years