The South Korean ocean carrier has started discharging cargo in Long Beach following a court order from a U.S. bankruptcy court on Friday to protect the carrier.
Hanjin Shipping has begun discharging cargo in Long Beach following a court order from a U.S. bankruptcy court in Newark, N.J. on Friday to protect the Korean shipping company.
The 10,100-TEU Hanjin Greece arrived at 6:50 a.m. on Saturday morning and began to discharge cargo at Total Terminals International (TTI) according to J. Kip Louttit, executive director of the Marine Exchange of Southern California.
Work on the ship follows a report by the Yonhap News Agency that earlier Saturday, “the board of directors of Korean Air Lines Co., Hanjin Shipping’s biggest shareholder, approved a proposed 60 billion won (U.S. $54 million) in assistance for its affiliate earlier in the day on the condition that the loan be extended in exchange for collateral.”
Before docking, Louttit said the Hanjin Greece, owned by Danaos, had been drifting off the West Coast of Mexico where it did not have to use low-sulfur fuel because Mexico is not part of the designation by the International Maritime Organization’s Emissions Control Area agreement requiring use of low sulfur fuel within 200 miles of the U.S. coast.
In an email, Louttit also said the 7,471-TEU Hanjin Boston, which had also been close to running out of low sulfur fuel, has taken on bunkers. The Hanjin Boston safely anchored inside the Long Beach breakwater at approximately 3:00 p.m. on Friday, refueled, and then moved back to her anchorage outside the Long Beach breakwater at 11:00 p.m. Friday.
A third ship, the 4,250-TEU Hanjin Montevideo, which had been arrested before Hanjin filed for protection from creditors, remains anchored inside the Long Beach breakwater.
Hanjin said at the hearing that it had $10 million to work the Hanjin Greece and the Hanjin Boston, as well as the 4,275-TEU Hanjin Gdynia off the coast from Santa Barbara, Calif. and the 10,010-TEU Hanjin Jungil, which was off the California coast from San Francisco.
Meanwhile, Hyundai Merchant Marine was scheduled to put an extra ship into service to move Korean cargo to the U.S. The vessel was scheduled to leave Busan Saturday with 1,300 containers, mostly filled with products from Samsung Electronics and LG Electronics bound for Los Angeles, according to an earlier story by Yonhap.
Several labor leaders held a press conference Saturday to bring attention to the impact the Hanjin bankruptcy is having on workers, including the crews of ships stranded offshore. “There has been a lot of focus this week on the customers and companies like Samsung and Target and Walmart whose goods are on these ships,” said Barbara Maynard, a spokeswoman for the Teamsters. “We are here to say we are concerned about the workers.”
Maynard said unions were also concerned about the well-being of crew members on the Hanjin vessels that have been delayed in unloading, but said the International Transport Workers’ Federation had reported that the crew members of the Hanjin Greece when it docked were fine.
There was a “tremendous impact” on workers in the supply chain who were not getting work because the Hanjin ships were idled, including port truck drivers, Maynard said. Few port truck drivers are union members and the Teamsters said most are misclassified as independent contractors and must continue to pay expenses regardless of whether they have an opportunity to work. She vowed the Teamsters would continue to work to get those drayage drivers “employee rights” such as unemployment insurance and disability insurance.
Maynard also noted that tugboat operators, pilots, longshoremen and warehouse men also have lost work.
Patrick D. Kelly, secretary treasurer of Teamsters Local 952, used the event to draw attention to the impact of globalization. “I think that Clinton and Trump need to be held accountable and state exactly what they are going to do about the maritime industry and what is going to happen to the consumers who are going to be subjected to a heck of a lot of price increases,” Kelly said.
A component of the bellwether Shanghai Containerized Freight Index (SCFI) showed shipping rates from Shanghai to the U.S. West Coast jumped 51 percent between Aug. 26 and Sept. 2 following Hanjin Shipping’s protection in Korean bankruptcy court. However, in the past week, rates on the Shanghai to U.S. West Coast trade were nearly unchanged, up only 0.2 percent to $1,749 per 40-foot container. The overall SCFI is well below where it was in late 2014 and early 2015.
“If TPP happens, it becomes even more problematic for the workers because they lose the traditional avenues to fight for their wages in a situation like a bankruptcy,” Maynard said. “I’d say it was the Wild West, but it is the Wild Globe at this point. We don’t know where to go with this. What happens when a foreign owned shipping company in South Korea goes bankrupt with ripple effects throughout the entire economy? And it is not just the U.S. They have ships all over the globe in this situation.”
In a statement sent to American Shipper Friday, the Commerce Department said, “The Administration is aware of the Hanjin bankruptcy and its impact on the movement of U.S. cargo around the world. We are in close touch with the South Korean government as they work to provide needed financing that will allow U.S. goods to reach their destinations. Additionally, we are maintaining strong coordination across the Federal government and will continue to closely track this situation. We encourage all parties to work together to continue moving these goods through the shipping network and to their intended destinations as quickly as possible while bankruptcy proceedings continue.”
Hanjin vessel begins discharging cargo
