Hanjin ship unloads in
U.S. as fresh funds pledged
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[September 12, 2016]
By Jim Christie and Joyce Lee
SAN FRANCISCO/SEOUL (Reuters) - A
Hanjin Shipping Co Ltd vessel is finishing unloading in California
and scheduled to leave port on Monday, shipping industry officials
said, as shareholders and executives associated with the South
Korean firm pledged funds to help resolve the turmoil created by its
The Hanjin Greece docked in Long Beach on Saturday after a U.S.
bankruptcy court granted it protection and terminal operators agreed
to take it.
Truck drivers probably will begin moving containers from the Greece
on Monday while the vessel prepares to leave late in the day for the
Port of Oakland, said Teamsters spokeswoman Barbara Maynard and
shipping traffic controllers.
However, the Greece carries only a fraction of the $14 billion in
goods on dozens of ships owned or leased by the world's
seventh-largest container carrier.
The collapse of Hanjin under debts of $5.5 billion has caused havoc
in global trade networks and a surge in freight rates. Some vessels
have also been seized.
On Monday, Choi Eun-young, a former chairwoman of Hanjin Shipping
pledged to provide $9 million in private funds to help resolve the
situation "in which economic damage is increasing from the turmoil
in shipping due to its unexpected court restructuring".
Choi, who controlled Hanjin Shipping between 2007 and 2014, will
provide the funds "within days".
Parent company Hanjin Group pledged last week to raise 100 billion
won ($90 million) in funds to help rescue stranded cargo.
Korean Air Lines <003490.KS>, the biggest shareholder of Hanjin
Shipping, on Saturday approved a conditional plan to provide a loan
of 60 billion won to the troubled shipper. Hanjin Group chairman Cho
Yang-ho will raise the remaining 40 billion won and the goal is to
raise it by Tuesday as the funds are needed as soon as possible to
unload cargo, a Korean Air spokesman said on Monday.
MORE SHIPS COMING
Charter owner Seaspan Corp <SSW.N> has three ships under charter
with Hanjin - the Hanjin Buddha, Hanjin Namu and Hanjin Tabul –
which are all due to hit the U.S. West Coast within the next few
days. Chief executive Gerry Wang said he was confident the South
Korean government would provide sufficient funds to pay port
operators and Seaspan by the time those ships arrived to ensure they
"We’re keeping our fingers crossed, but South Korea is an export
economy and the government needs to ensure the flow of goods to
consumers," Wang said. "I don’t think they want that supply chain to
be interrupted on a permanent basis."
Creditors have sought an arrest warrant against the Seaspan
Efficiency, a ship hauling cargo for Hanjin that was due to arrive
in Savannah. Wang said the cargo concerned amount to just around
$800,000 and that he was confident the parties involved could come
to an agreement.
It is not clear when port operators will bring others to berths in
Southern California and elsewhere. The U.S. court on Friday gave
three other Hanjin ships protection from seizure.
[to top of second column]
A Hanjin Shipping Co ship is seen stranded outside the Port of Long
Beach, California, September 8, 2016. REUTERS/Lucy Nicholson
The three other Hanjin ships protected by the U.S. court order are the Hanjin
Boston, which remained off the Port of Long Beach awaiting orders on Sunday, and
the Hanjin Gdynia, which was several hundred miles away from Long Beach, and the
Hanjin Jungil, 310 nautical miles west of San Francisco with its destination
listed as Long Beach, according to Marine Exchanges on the west coast that
coordinate shipping traffic.
Another Hanjin ship off Long Beach, the Hanjin Montevideo, is under the
supervision of a court-ordered custodian after two fuel companies obtained an
arrest warrant for it over unpaid bills. Hanjin and the fuel providers are
trying to work out an arrangement to release the vessel.
In Hong Kong, the Hanjin Belawan arrived from Shanghai on Monday loaded with
containers and was anchored a short distance from the city's Kwai Chung
Terminal operator Hongkong International Terminals, a unit of Hutchison Port
Holdings Trust controlled by tycoon Li Ka-shing, has outraged local cargo owners
by charging fees of between HK$10,000–HK$15,000 ($1,285-$1,928) per Hanjin
container to release them at the port.
The delays have concerned importers like Alex Rasheed, president of Pacific
Textile and Sourcing Inc in Los Angeles, which has a shipment of clothing in 16
containers on Hanjin ships off Long Beach.
"We're already starting to run out of some colors and some sizes," Rasheed said,
noting Hanjin's collapse comes as U.S. retailers prepare for the all-important
holiday shopping season.
In Singapore, cargo owner AP Oil International said it had been sending
replacement cargos on urgent orders.
"On the procurement side, we do also face some issues to receiving raw materials
shipped on Hanjin vessels, which of course we are adjusting our supply chain and
production to meet and replace the cargo due to the uncertainty of the situation
now," Group Chief Executive Ho Chee Hon said.
(Additional reporting by Nick Carey and Keith Wallis; Editing by Peter Henderson
and Lincoln Feast)
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