Container Ships Stranded At Sea After South Korean Company Goes Bankrupt

The court, however, requested additional funds from the creditor, saying it is unclear when Hanjin Group's support package would be executed and the funds are far short of the amount required to normalize the shipping line's operation. Liaoning Shidai Wanheng Co., a Chinese fabrics importer and a supplier to Marks & Spencer Group Plc, has made alternative arrangements for shipments that were scheduled with Hanjin.

Hanjin Shipping, now under receivership in South Korea, has sought court protection in the four of its ships have been stranded off the coast of the USA out of fears that they will be seized by creditors. Its visual display business division has parts and finished goods in 304 containers meant for its factory in Mexico, while its home appliance business unit has refrigerators, washing machines, dishwashers and microwaves in 312 containers.

But Hanjin representatives will have to appear in court again on Friday, and there's no indication whether they'll be able to come up with enough emergency cash to unload the billions of dollars in cargo now tied up around the world. The firm said it may have to charter at least 16 planes to move the goods if the cargo can not be unloaded immediately, costing the tech giant at least $8.8 million. First, ports here and around the world are refusing entry to Hanjin vessels.

South Korea's cash-strapped Hanjin Shipping adrift at sea - and in more ways than one. "It's early in that process, so we're hoping there isn't too much impact", he said. Hanjin Shipping is seeking stay orders to prevent its ships from being seized by creditors in over 40 countries.

Dozens of massive container ships are stranded at sea, looking for a place to dock after one of the world's largest shipping companies went bankrupt. A spokesman for the port said many are asking for the money up-front.

Volkov said at least $10 million was authorized by a Korean court to begin servicing the four ships.

"The industry is increasingly interwoven with carriers sharing slots on vessels, so what we are now seeing is huge disruptions in the global container supply chain", said Peter Sand, chief shipping economist for BIMCO, a Bagsvaerd, Denmark-based association representing owners and operators in about 130 countries.

Melina Cordero, head of retail research, Americas for CBRE, said the Hanjin issue - including expensive contingency shipping plans as well as fears of unstocked holiday shelves - is destined to cause future margin pain for a retail sector already hurting from sales declines, store closings, ecommerce competition and omnichannel growing pains. "A lot of new surcharges have been applied (by cargo handlers and operators) starting over the weekend and the Federal Maritime Commission is making sure they don't violate the Shipping Act".

However, the shipping company's parent, Hanjin Group, has pledged to raise 100bn won ($90m) - although there are doubts as to whether that would be enough to cover the cost of unloading cargo. South Korea's ruling Saenuri Party also proposed the government offer about 100 billion won in low-interest loans on condition the owners provide collateral. On September 2, Hanjin Shipping filed for bankruptcy protection under chapter 15 which deals with global insolvency situations to the United States court. South Korea's decision not to had rocked that assumption, he said.

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