Hong Kong’s OOCL halts loading cargoes from Hanjin Shipping

South Korea’s Hanjin Shipping, one of the top 10 container shipping firms in the world, filed for bankruptcy on Wednesday. “One lesson for shippers is to maintain multiple carrier options and to spread shipments across multiple carriers to avoid being stuck in such situations”. Hyundai Merchant Marine Co., the nation’s second-biggest container line, stepped in, saying it plans to add 13 more vessels to ease the squeeze.

Hanjin carries 7.8% of the US market’s trans-Pacific trade volume: Millions of dollars worth of merchandise could be delayed by the shipper’s woes, some stuck in Asia and some at USA ports, as trucking companies and others avoid taking up the cargo for fear of not being paid, according to the NRF. So its woes threaten to derail the supply chains of global companies that need to send goods well in advance of the year’s biggest shopping season.

Jablon reported from Los Angeles.

A number of Hanjin ships which were in port at the time of its collapse have been impounded while others are effectively stranded at sea, unable to put in to port due to the risk of being seized.

“Ports will not have these vessels because they are anxious port and other fees won’t be paid”, said Rahul Kapoor, a Singapore-based director at Drewry Maritime Services Pvt. “This is going to play out for the next few weeks”.

“Retailers’ main concern is that there is millions of dollars worth of merchandise that needs to be on store shelves that could be impacted by this”, Gold said.

Poskus expects the current spike in prices to last only a month or two.

The National Retail Federation, the world’s largest retail trade association, wrote to U.S. Secretary of Commerce Penny Pritzker and Federal Maritime Commission Chairman Mario Cordero on Thursday, urging them to work with the South Korean government, ports and others to prevent disruptions. “If we don’t get this resolved pretty soon, you’ll notice it as soon as this week”.

Hanjin officially entered court receivership Friday, the Seoul Central District Court announced.

A spokesman for the Port of Felixstowe, the UK’s largest container port, said that, in line with its normal practice, the company would not comment on commercial matters. Another was seized in Singapore late Monday.

The Korea International Trade Association said about 10 Hanjin vessels in China were seized or likely to be seized by charterers, port authorities or other parties. Trading in its shares were suspended after a 24 percent plunge Tuesday to their lowest level since December 2009.

The Wall Street Journal also noted that Hanjin accounts for almost 8 percent of all trans-Pacific trade volume for the USA market.

As of Friday, 27 ships had been refused entry to ports or terminals, said Hanjin Shipping spokesman Park Min.

“Some of their clients would be anxious about getting their cargo if the vessels can’t enter ports”, said Shin Ji Yoon, an analyst at KTB Investment & Securities Co.in Seoul.

“August is the peak month for USA container imports, and the industry can’t turn on a dime”, he said. Japanese shipping companies Kawasaki Kisen Kaisha Ltd. and Nippon Yusen KK said they are working to limit delays to clients’ cargo.

The court will decide whether to keep Hanjin afloat under a recovery program including debt rescheduling or to declare it bankrupt.

However, industry insiders and analysts have said it is unlikely that Hanjin Shipping can survive as creditors make claims on its assets and customers look elsewhere, setting the stage for what would be the container shipping industry’s largest-ever bankruptcy in terms of capacity.

Evergreen also said on Wednesday it had activated a contingency plan to stop loading Evergreen Line cargo on to Hanjin Shipping’s vessels and would also stop Hanjin Shipping’s cargo from being loaded on to its ships.