• Ferrous Beat

Hanjin Bankruptcy Roils Shipping Industry

The shipping industry was shocked when Hanjin, the large South Korean ocean shipping carrier filed for bankruptcy protection leaving many expecting their cargo shipments in limbo.

Without the necessary funding, dock workers would not unload the cargo and in other cases, creditors were threatening to confiscate ships and containers if the ships entered ports. Making matters more complicated, Korean Airlines, a major shareholder in Hanjin, indicated it was unwilling to provide the necessary cash to unload the ships. Also, the South Korean government also refused to provide the money. At the same time, other ocean carriers were having problems of their own, leaving no one to swoop in a pickup Hanjin’s assets. After a couple of uncertain weeks, a U.S. bankruptcy judge ordered assets to cover the costs of unloading the ships and begin the process of winding down the carrier since no suitors were in sight. This news comes as mega-container ships are entering the global fleet and other mergers are occurring between European shipping giants.

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