Hanjin Shipping News

Chang Keun Yoo, president and CEO of South Korea container line Hyundai Merchant Marine (HMM)  has decided to resign from his position next month.Chang-Keun Yoo has been Chief Executive Officer and President of Hyundai Merchant Marine Co. Ltd since April 02, 2013 and serves as its Chairman of the Board. Yoo served as an Executive Vice President of Hyundai Merchant Marine Co. Ltd., and Head of HMM Europe Ltd.According to a report in WSJ, he has offered to resign after months of being under pressure from its top creditor to quit over failures in its turnaround. His successor has yet to be announced.Yoo thanked staff for support and requested them “to join forces with an incoming CEO and make a new leap forward for history” in the emailed farewell message…

South Korea's large family-owned business conglomerate SK Group is planning to get out of shipping by offloading shipping subsidiary SK Shipping Co., on account of the debt burden amid an industry slowdown.According to a report in the Pulse, SK Holdings Co., the holding entity of SK Group, is reportedly seeking to sell a majority of its stake in SK Shipping to local private equity firm Hahn & Co. for an estimated 1.5 trillion won ($1.3 billion).Hahn & Company is said to be reviewing a method of buying up new shares issued by SK Shipping.An official at SK Group confirmed that they are talking to Hahn & Company regarding the issue, but nothing has been finalized yet.

Hyundai Merchant Marine (HMM) announced that its cargo processing at Busan Port for January to July 2018, has hit a new record.Processed cargo during the first seven months of this year reached 1,157,980 TEU, an increase of 14.3 percent year-over-year.For the volume of exports and imports has recorded 608,872 TEU, a soaring 14.1 percent year-over-year.Also, the transit cargo volume increased from 473,341 TEU to 541,926 TEU, up 14.5% year-over-year.HMM attributed the performance to its service & volume reliability, and the launch of Asia Europe Express (AEX) service last April.An HMM official said, “Since Hanjin shipping’s collapse, HMM cargo processing at Busan port has hit a new record…

Global trade tensions have captured headlines in recent months, as the imposition of a series of tariffs and counter-tariffs by various global trade counterparts has raised questions about the possibility of a trade war. Such development could potentially have an impact on global trade flows, and, consequently, the companies which facilitate international movement of goods.Though the situation is still developing and the final impact is uncertain, Gregory Draco, the Chief U.S. Economist at Oxford, predicted in July that the tariffs would create an 0.1 percent to 0.2 percent drag on U.S. GDP.

The government of South Korea decided to invest 1.35 trillion won (USD 1.2 billion) in Korea Ocean Business Corporation (KOBC). The compnay was created in order to help its shipping industry stand on its feet, especially after the bankruptcy of Hanjin Shipping.Yonhap reported quoting the finance ministry that Cabinet approved a plan to contribute 12.7-percent stakes in each of the country's four port authorities to the KOBC.Earlier this month, the corporation was officially launched in Busan, South Korea's maritime gateway on the southeastern coast, nearly one year after the government proposed setting up the agency. The agency's initial capital base is set at 3.1 trillion won.The government also plans to invest 200 billion won in the agency.

As part of the government's large-scale rescue plan for shipping sector, the Export-Import Bank of Korea  (Korea Eximbank) sets a figure for loans and guarantees to the country's shipping sector. According to Yonhap, Korea Eximbank will funnel more than 800 billion won ($749.3 million) in shipping finance as a part of the state-sponsored program to revive the shipping industry following the collapse of Korea’s flag sea carrier Hanjin Shipping. The five-year plan for rehabilitating the maritime sector involves the building of more than 200 ships, including 140 bulk carriers and 60 container ships. The report quoted Eun Sung-soo, Korea Eximbank chairman and president saying that the fund will be given in the forms of loans and guarantees that the shippers can use to purchase new vessels…

South Korean shipowners Heung-A Shipping and Sinokor Merchant Marine have confirmed that they are in talks to merge their container businesses, reports Pulse News. According to various media reports, the South Korean liner companies have decided to merge their container shipping services by the end of the year before joining forces with Hyundai Merchant Marine (HMM). HMM had already agreed to become a strategic partner to Sinokor and Heung-A by creating an HMM+K2 consortium. The two companies would sign the deal on April 3, according to the Ministry of Oceans and Fisheries and the Korea Shipowners’ Association. It said that Korea Shipping Partnership (KSP)…

Korean carrier Hyundai Merchant Marine (HMM)’s expansion plans are incompatible with market stability. Will it settle for more limited ambitions? An Analysis by Drewry. South Korean carrier Hyundai Merchant Marine (HMM) is back in the news with an impending order for as many as 14 Ultra Large Container Vessels (ULCV) of 22,000 teu and for its intriguing re-entrance into the Asia-Europe market as a vessel provider, with reports suggesting a new standalone service called Asia Europe Express (AEX) using 10 Classic Panamax ships of 4,700 teu will commence in April. The AEX ships would be the smallest deployed on the route that is usually reserved for ULCVs…

As in 2016, Germany and Greece top the list of country dumpers in 2017, according to new data released today by the NGO Shipbreaking Platform. German owners, including banks and ship funds, beached 50 vessels out of a total of 53 sold for demolition. Greek owners were responsible for the highest absolute number of ships sold to South Asian shipbreaking yards in 2017: 51 ships in total. Since the Platform’s first compilation of data in 2009, Greek shipping companies have unceasingly topped the list of owners that opt for dirty and dangerous shipbreaking. Despite increased pressure for safe and clean ship recycling from Norwegian investors and authorities, in 2017, the number of Norwegian-owned ships scrapped on the beach was on the rise: 18 ended up in Alang, Gadani and Chittagong.

Maersk management hints at hitting top of 2018 EBITDA range. A.P. Moller-Maersk's move to focus on transport and jettison oil was tested on Friday as the world's largest container shipping firm missed profit forecasts and gave what analysts saw as a conservative outlook. Shipping, which has been hit by years of overcapacity and slow economic growth, saw early signs of a turnaround in early 2017, but freight rates fell in the second half. "I'm still very optimistic on the fundamentals of the global container shipping industry," Chief Executive Soren Skou told Reuters after the quarterly results. Skou, who has staked his future on Maersk as a transport business…

The former chairwoman Choi Eun-young (55) of the now-defunct Hanjin Shipping was jailed 18 months for insider trading, reports Yonhap. According to the report the Seoul Central District Court found Choi  guilty of selling off her family-stake in the shipping company days before it declared a court-led debt restructuring plan. She was also fined with USD 1.09 million. The court said, although her charges are grave enough to deserve a heavy punishment, it considered that the stake selling does not appear to have been meticulously planned out and that Choi already donated 10 billion won to bear the responsibility for her misdeed. Choi was indicted in December last year for unloading the stakes held by her and her two daughters, taking advantage of the undisclosed information.

Today, the Office of Commissioner William P. Doyle of the U.S. “Last week, I notified The President of the United States Donald J. Trump of my intention to leave the Federal Maritime Commission effective January 3, 2017. It has been an honor and a privilege to continue serving in the Trump Administration. I thank President Barack Obama for nominating and appointing me twice as a Commissioner. “I am proud to have worked alongside my fellow Commissioners and with such a dedicated and hardworking Commission staff. Over the past five years there has been an enormous amount of change in the international maritime industry including consolidations, mergers, bankruptcies, and the advent of mega ocean carrier alliances. As a Commissioner, Mr.

Maersk restates annual guidance after energy deal; lowers forecast for its key container business. A.P. Moller-Maersk , the world's largest container shipping group, cut the profit forecast for its core business on Tuesday after a costly cyber attack and a weaker than expected third quarter. Maersk, which agreed to sell its oil and gas business to Total in a $7.5 billion deal this year, has to prove to investors that the firm's strategy to focus on transport and logistics is the right one even with oil prices rising again. Expectations for the container shipping business had been high after Chief Executive Soren Skou said in August that fundamentals were "at their best since 2010".

Remarks from Federal Maritime Commissioner William P. Doyle at the FTR Transportation Conference 2017, Indianapolis, Ind. On September 13, 2017, I voted to expedite the Commission’s decision and support THE Alliance’s amendment authorizing creation of a contingency trust fund designed to protect customers’ cargo and the ocean transportation chain should one of THE Alliance’s carriers experience financial distress or an insolvency event. I support the goal behind this amendment: the smooth and continuous flow of cargo even in the face of another ocean carrier bankruptcy or catastrophic failure.

International transport and logistics executives using container shipping are facing the biggest shift in their ocean provider base for 20 years and must adapt their procurement and contract strategy, according to ocean freight procurement consultancy Drewry Supply Chain Advisors. In the last five years, beneficial cargo owners have been able to secure large reductions in freight costs by running traditional competitive bids with numerous providers in an over-supplied, fragmented market. “Today’s business environment is starkly different, so we are now pro-actively advising our BCO customers that last year’s contract strategy will simply not work as a blueprint for the forthcoming annual ocean tender,” said Philip Damas, Head of Drewry’s logistics practice.

Korea Maritime Promotion Corporation (KMPC), a dedicated support organization for the shipping industry, will be established in Busan in June of next year with capital of 5 trillion won (US$4.5 billion), reported BusinessKorea. KMPC is set to offer financial and industrial policy support, in order to reform and upgrade the shipping industry in Korea, in response to the Hanjin Shipping bankruptcy. At Seoul meeting of the ministers of economic affairs, on 24 August, South Korea’s Ministry of Oceans and Fisheries announced a plan to establish Korea Maritime Promotion Corporation, a support organization for the shipping industry, in Busan, in June 2018.

A group of 14 South Korean shippers are joining forces to form the first domestic alliance, aiming to restore the country’s shipping sector, reported Yonhap. Under the name “Korea Shipping Partnership (KSP)”, the new shipping consortium will be led by Hyundai Merchant Marine (HMM) and supported by Korea Shipowners Association (KSA). HMM, Pan Ocean Co. and 12 other shipping companies that are mainly involved in routes in the Asian region will cooperate to boost their profitability on routes to Vietnam, Indonesia and other countries through restructuring efforts. Under the terms of agreement, they will cooperate to improve their collective strength through various measures including increasing shared cargo capacity, adding new shipping routes and co-managing overseas terminals.

Hanjin Shipping Co., the South Korean shipping company that caused havoc when it filed for bankruptcy, is struggling to raise enough money to repay $10.5 billion in creditor claims, WSJ reported. Hanjin has raised only $220 million by selling ships, stakes in seaport terminals and other assets to repay its more than 180 creditors. A trustee charged with Hanjin Shipping’s Korean bankruptcy case in in Seoul said Hanjin has raised about $220 million since filing for bankruptcy nearly a year ago. At least 180 creditors were present for the court hearing on June 1, 2017. Hanjin Shipping in court was unable to say when distribution to creditors would begin. A Korean judge ordered Hanjin’s liquidation on February 17, 2017.

Large shipping losses have declined by 50 percent over the past decade, mostly driven by the development of a more robust safety environment by ship owners, according to Allianz Global Corporate & Specialty SE’s (AGCS) fifth annual Safety & Shipping Review 2017. In 2016 there were 85 total shipping losses reported, down 16 percent from 101 a year earlier. The number of shipping incidents declined slightly year-on-year by 4 percent with 2,611 reported, according to the review, which analyzes reported shipping losses over 100 gross tons.

There were a total of 210 ships broken in the second quarter of 2017. 158 of these ships ended up on South Asian beaches for dirty and dangerous breaking, said NGO Shipbreaking Platform. The Platform was able to document five accidents at the shipbreaking yards in Chittagong, Bangladesh, between April and June, which led to the death of four workers and the injury of two. Ishaq worked as a winch operator and died struck by a cable at the BBC Steel Shipbreaking/KR yard. This is the second fatal accident this year at BBC Steel. Zishan died in an accident at the Ratanpur Steel Re-Rolling mills where iron plates from the ships are transformed for the construction industry.

Hyundai Merchant Marine (HMM) requested the Korea Development Bank (KDB) to support with a total of 9.9 trillion won (US$8.9 billion) in funds until 2022  to grow into the 8th largest global shipping company in the future, Business Korea reported. HMM had asked consulting firm AT Kearney to estimate how much support funds for HMM would be needed. AT Kearney calculated that a total of 9.9 trillion won will be needed, including 5.6 trillion won (US$5.0 billion) for large container ships, 3.3 trillion won (US$2.9 billion) for container boxes (2 million won or US$1,800 for each box) and 1 trillion won (US$900 million) for the takeover of overseas terminals.

Japan's big three shippers on Monday reported profits for the first quarter, bouncing back from losses a year earlier and raising hopes the firms could be emerging from the industry's worst-ever downturn on record. Mitsui OSK Lines swung to a 1.1 billion yen ($10 million) operating profit in April-June from a loss of 3.6 billion yen a year earlier, as a strong U.S. economy lifted freight volumes on routes between Asia and North America to record levels in the last quarter. It now expects an 18 billion yen operating profit in the year through next March, double its previous forecast for 9 billion yen. Nippon Yusen booked operating income of 3.6 billion yen compared with a loss of 11 billion yen a year earlier…

Japan’s big three shippers -Mitsui OSK Lines (MOL), Nippon Yusen Kabushiki Kaisha (NYK) and Kawasaki Kisen Kaisha (K Line) -  have reported profits for the first quarter, bouncing back from losses a year earlier Reuters reported. Thanks to rising freight rates, the shippers showed brightened financials ahead of their integration into the Ocean Network Express (ONE) next April. The results are also raising hopes the firms could be emerging from the industry’s worst-ever downturn on record. NYK recorded a profit attributable to owners of the parent of 5.4 billion yen (U.S. $48.9 million) for the quarter, compared to a loss of 12.79 billion yen for the corresponding quarter a year prior.