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Lessons We Can Learn from The Loss of The Hanjin Shipping Line

By ussa-login on Monday, May 15, 2017 - Blog

Ocean shipping companies around the world were shocked at the sudden collapse of South Korea’s Hanjin Shipping [HJSC] last year. Witnessing the world’s seventh largest container line go bankrupt; with a cargo worth US$14 billion stranded in ports and at sea; was a wake-up call for all freight companies.

Repercussions

  1. Mergers will be on the rise. Increasingly, smaller to medium sized carriers will avoid going under by merging with larger operators, thus becoming more stable.
  2. Distinguishing opportunities from threats by using better algorithms to predict the behavior based on previous patterns will become essential. The HJSC bankruptcy lead to a fundamental rethink of how business should be done in terms of managing the risk.
  3. Company splits – splitting the container shipping segment away from other divisions like bunkering or non-maritime interests such as those of Maersk – allows companies to better focus on their differing markets.
  4. Rate changes – most probably increases – will emerge from the diverse and competitive environment.

If your business involves international ocean shipping, you may want to become a member of USSA.  The benefits of membership include:

  • Reduced shipping cost
  • State of the art contract management technology
  • Greater industry knowledge
  • More contract choices
  • Broader negotiating skills
  • Low volume trade lanes support
  • Export Trading Certificate protection

To learn more about us, please contact us electronically or call (979) 793-7375.

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