Hanjin situation

16 September 2016

It’s been over two weeks since the South Korean shipping company Hanjin filed for bankruptcy. The elimination of this 6-largest container shipping company, inevitably causes some major problems. What is the current situation and what is yet to come?

Ports refuse Hanjin vessels

Almost all ports are refusing Hanjin vessels. There are a couple of reasons for this:

1. Hanjin isn’t able to pay for the costs of berthing and unloading the vessels. Until the ports are sure that they will receive their payment, ships are refused.
2. Hanjin vessels can be seized. This has already happened in some ports. These seized vessels are keeping moorings occupied, which means ports are missing out on revenues. Of course, they don’t want this to happen.

70 vessels still at sea

At this moment, there are still 70 Hanjin vessels stranded at sea. They have nowhere to go. They can’t dock at any harbor and besides that, the usual sailing routes are not all available. The Suez- and Panama Canal refuse passage, since Hanjin can’t pay the fee. Rerouting via The Cape is also no option for most vessels, because they simply don’t have enough fuel.

Expectations are that the vessels will berth at the first port that will allow them to do so. The cargo on these ships will then be loaded in vessels of other carriers. Lately, we’ve seen that Hanjin containers are often being unloaded with severe delays. As a result, transferring the cargo might take some time. When all of this is done, the containers will continue to their final destination.

Huge delays

South Korea is currently providing 90 million euros to solve the problems surrounding all Hanjin vessels. We expect a delay of 4 to 8 weeks for all containers aboard Hanjin ships. Any customer affected by this situation, will of course be kept up to date.

Hanjin containers in Rotterdam

Some Hanjin containers already arrived in the port of Rotterdam. Special arrangements have been made for releasing these containers from the terminal. Against a surcharge of €500 per container plus a deposit, containers can be obtained. These costs must be paid to the Europe Container Terminal, Euromax Terminal or Rotterdam World Gateway. They are responsible for the handling of containers in the port of Rotterdam. This procedure will probably also apply to Hanjin containers arriving at a later time at the port of Rotterdam.

Impact on ocean freight rates

The ocean freight rates will continue to increase in the coming period. Carriers are still experiencing financial problems and with the loss of Hanjin vessels, a lot of capacity has been lost. As a consequence, we don’t expect the ocean freight rates to decrease any time soon.