14 Oktober 2016

[141016.EN.BIZ] Hapag-Lloyd CEO Expects More Mergers In Wake of Hanjin Collapse

THE bankruptcy of Korea's Hanjin Shipping will spark more mergers as container lines worldwide try to weather the storm buffeting the industry, says Hapag-Lloyd CEO Rolf Habben Jansen.

In the past two years, a new wave of mergers has witnessed the disappearance of five of the 20 biggest carriers, noted Bloomberg News.

"A lot of people hadn't expected the difficulties for Hanjin in the magnitude we have seen them," Mr Habben Jansen said. "It will change behaviour," with some assessing whether it might be better to "team up".

Germany's biggest carrier, which has used mergers to bring down costs and counter the slump that has shaken shipping for the past eight years, doesn't plan to buy the Asian company or its assets.

"We will look at the vessels like everyone else, but our primary objective is not to grow faster than the market," Mr Habben Jansen, forecasting company growth at two to three per cent this year.

Having already absorbed the container shipping business of Chile's CSAV, Hapag-Lloyd is full engaged completing its merger with United Arab Shipping Co (UASC) which has "quite a lot of capacity".

Source : HKSG.



13 Oktober 2016

[131016.EN.BIZ] Hanjin Customers Turn To Rail And Air To Move Ocean Backlogs

HANJIN customers that have suffered delays due to the container line's bankruptcy are now looking for alternative shipment modes into European markets to ensure key products are in stores ahead of the holiday season, according to leading forwarders.

Forwarders say the preferred option for shippers trying to expedite shipments to Europe while also limiting transport costs is rail. However, air freight solutions are expected to become more prominent the longer cargo is stranded in Hanjin's network as the countdown to the Christmas sales season begins, the UK's Lloyd's Loading List reported.

"In view of the current situation, we are seeing higher demand for rail services to Europe. We are also receiving more enquiries in Europe for rail deliveries to Asia, especially Korea," said a DHL statement.

DB Schenker also reports growing demand for accelerated shipments resulting from Hanjin's bankruptcy and the subsequent supply chain chaos that has followed.

"Some leading electronics customers face serious challenges to get time-critical supplies to Europe," a DB Schenker spokesman said. "From the corporate side, we have counted three major customers asking for rail as a substitution for ocean to avoid air shipments."

Procurement research analyst at market research firm IBISWorld, Ashley Cruz, said the inability to retrieve cargo from stranded Hanjin ships had sent retailers and forwarders into a spin.

In the aftermath of Hanjin's receivership filing, which left as many as 500,000 containers of cargo stranded offshore, she said freight forwarders were scrambling to reorganise and redirect the rail, air freight and trucking services that were supposed to follow the docking and unloading of Hanjin ships.

"Forwarders have also been rushing to arrange alternative transport routes for cargo that was due to be carried on Hanjin ships," she said.

"Most freight forwarders are seeking other deep sea cargo carriers, in spite of the substantial spot price spikes that have occurred during the past few weeks and could potentially last for months.

"However, some forwarders are also looking to international air cargo services as a substitute for ocean shipping in order to avoid further delays," said Ms Cruz.

A number of airlines have already reported an upsurge in demand out of Asia post-Hanjin and many others have capacity on standby.

Korean Air, a shareholder in Hanjin Shipping, has also reportedly laid on extra freighters to help out Korean exporters including Samsung. However, a spokesman for the carrier refused to confirm the reports.

But although there will be some switch to alternative modes, Swiss forwarder Panalpina believes it will be minimal, at least in terms of volumes.

Source : Unknown.



12 Oktober 2016

[121016.EN.BIZ] Thousands of Hanjin Boxes Stuck In Limbo Clog LA-Long Beach Ports

STRANDED Hanjin containers are clogging supply chains and the ports of Los Angeles and Long Beach with thousands of box-mounted chassis taking up space and getting in the way of the flow of other cargo, reports American Shipper.

Shippers or truckers are unable to return containers to terminals or container yards of the near bankrupt South Korean shipping giant, so the chassis are not available for use.

"Other ports talk about hundreds, here it is thousands. The situation is critical," said Harbour Trucking Association executive director Weston LaBar.

He estimates at that 10,000 chassis out of 100,000 cannot be used because they have Hanjin containers on them.

In a Newark bankruptcy court filing, Hanjin said it did "not assert any interest in containers that it does not own or are the subject of a saleleaseback agreement," but added it had not settled issues relating to the saleleaseback agreements.

Hanjin also told the court it "advised customers that they should contact the owners of the containers to arrange for inland delivery and their return".

As to Hanjin owned containers, Hanjin is finalising a lease for property located near New York City for the return and storage of Hanjin containers. Hanjin said it was also working diligently to find space on the west coast for the return and storage of its containers.

"Moreover, Hanjin has been working with more than 70 marine terminals and offdock container yards to arrange for return and storage of Hanjin-owned and Hanjin-leased containers.

But Hanjin said it is has been advised by more than 40 of such terminals and yards that they are now at full capacity.

Said Mr LaBar: "When Hanjin declared bankruptcy, the trucking community saw a real dire situation that they would be facing. We've been pretty disappointed with the allotment of chassis in the pool of pools."

He said repairs were not being made at an adequate pace, there were concerns there were not going to be enough chassis for companies to operate.

Long Beach port's chief commercial officer Noel Hacegaba said they were encouraging the largest source of chassis in the region - the "pool of pools" - created by leasing companies DCLI, FlexiVan and TRAC Intermodal to do chassis repair faster.

They were also looking for locations where containers owned and leased by Hanjin can be stored.

The pool of pools has about 74,000 chassis, and 700 returned to service in just the past week. The percentage of "bad order" chassis has fallen to 7.6 per cent from nine per cent in the past two weeks.

Mr Hacegaba said leasing companies are continuing efforts to speed repairs and put the number of Hanjin containers "on the street" at 10,000 with 5,000 containers at terminals.

Many containers are at Pier T in Long Beach, which is operated by Total Terminals International (TTI). Hanjin's 2015 annual report notes it owns 54 per cent of TTI.

Meanwhile, other containers are scattered among at least five other terminals in the two ports where Hanjin or its space sharing partners in the CKYHE Alliance Cosco, "K" Line, Yang Ming and Evergreen operate.

Mr LaBar said some larger trucking companies do have the ability and space to put Hanjin containers on ground and continue to use chassis, but he said for small and medium size draymen, "they have run out of space and may not necessarily have the ability to ground Hanjin containers, so for them, the chassis situation is critical and they are looking for some true relief".

It is not clear exactly what percentage of the Hanjin containers in southern California are leased and what percentage are owned.

But many are leased from Triton International, the world's largest container lessor, formed recently through the merger of Triton Container and TAL International.

At a presentation to securities analysts last week, Triton said it had 87,010 containers (with 148,108 TEU of capacity) hired by Hanjin with a net book value of about US$243 million.

Triton also said it was seeking to gain control of those containers and redeploy them as quickly as possible.

With leased containers, Mr LaBar said there is some opportunity to return those containers, but he said some locations designated by leasing companies for returns "filled up quickly".

"You get some in and out, but they still tend to be pretty much fully utilised," he said. "It's not like there is a large amount of these leased boxes that are able to be returned at this point in time."

LA port spokesman Phillip Sanfield said the port had short-term agreements with terminals and other businesses to store containers, mostly those leased to Hanjin in and around the port.

But space was limited in and around the port. Port executive director Gene Seroka said storage was being set up away from in the "Inland Empire" area.

Mr Hacegaba said Saybrook Capital, affiliated with Total Transportation, is making 50 acres available in Ontario, California for Hanjin leased boxes, but not owned.

Said Mr LeBar: "I don't think that does anything for the trucking community unless that is a termination yard. You drop your box 50 miles from the harbour and you pay $15 a day on storage. That is not a solution."

LaBar and Hacegaba said none of the marine terminals in Los Angeles and Long Beach are accepting Hanjin-owned boxes, including TTI's terminal at Pier T.

Source : SN – TR.



11 Oktober 2016

[111016.EN.BIZ] Delays Expected As Carriers Batten Down For Florida's Hurricane Matthew

SHIPPING lines are reconsidering voyage plans in face of the arrival of Hurricane Matthew, the biggest storm in 10 years, that was threatening to devastate the Florida coast.

The US Coast Guard has placed all South Florida Ports, including Port Everglades, under Hurricane Port Readiness Condition X-Ray and expects to set Port Readiness Condition Yankee later.

"Under Condition Yankee, SeaLand will not be allowed to receive any containers either loaded or empty. We will be open to deliver imports and empties to the truckers," said SeaLand.

"If we have any additional updates, we will continue to communicate with you. You will be informed directly by your local representative if there is impact to your shipments," SeaLand told shippers.

Hurricane Matthew made landfall over Haiti, bringing 20 to 40 inches of rain and a storm surge of up to 10 feet near the epicentre. Its wind speeds were in the range of 150 mph, reported Maritime Executive of Fort Lauderdale.

After Haiti, the storm tracked north-northwest past Cuba and along the coast of Florida, passing the world's busiest cruise ports at Miami and Fort Lauderdale.

Jacksonville cargo operator TOTE Services, whose 1,200-TEU El Faro went down with all hands in Hurricane Joaquin last year, said it had no public plans to alter its sailings.

The company said that it Jacksonville-based TOTE Services whose con/ro vessel El Faro went down with all hands during Hurricane Joaquin last year told local news in Florida that it trusted its officers to make the right decisions regarding weather.

"Our captains have control and authority to alter course for any purpose, weather, crew illness, or to assist another ship at sea," said the company.

TOTE did not mention any plan to cancel or reroute sailings of the newbuild container vessels Isla Bella and Perla del Caribe, scheduled to pass through the storm track.

In investigative proceedings regarding the sinking of the El Faro, TOTE Services managers emphasised that weather routing decisions are ultimately the responsibility of each vessel's master. TOTE reiterated that position Tuesday in a statement to NBC News, saying that

The Perla del Caribe departed Jacksonville at 1630 hours local time, bound for San Juan. The Isla Bella remained moored in Puerto Rico as of 1900 hours.

Crowley Maritime, which operates a liner service, announced that it would instruct its vessels to remain in port or change course as needed to stay clear of the storm.

It published a notice warning of disruption to shipments in the Caribbean including cargo on its runs to Puerto Rico as it takes steps to reroute or cancel sailings.

Crowley also expects disruption to services to Jamaica, the Dominican Republic, Cuba, Haiti, Central America and the Caribbean islands. The firm included an image of the storm's forecast track to illustrate its decision.

Said Carnival Cruise Line: "We are keeping the ship out of harm's way and providing guests with a safe and enjoyable vacation experience," the firm said. It added that Carnival Elation, Ecstasy, Pride, Victory and Splendour will all have altered routes to account for the storm.

Disney's Disney Dream said it will go to Cozumel rather than the Bahamas. "We are always prepared to visit alternate ports or spend days at sea to ensure the safety and comfort of our guests."

Likewise, Royal Caribbean's Freedom of the Seas will call San Juan instead of Coco Cay in the Bahamas, and its Majesty of the Seas will go to Key West instead of Nassau.

On shore, state officials in Florida are bracing for the effects of Matthew. "Hurricane Matthew is a life-threatening category four hurricane and we must all take it seriously," said Florida Governor Rick Scott.

Source : SN – TR, 10.10.16.