Container Ships Stranded At Sea After South Korean Company Goes Bankrupt : Parallels Dozens of giant container ships are bobbing around the oceans with no place to dock, after a South Korean shipping company went bankrupt. The stranded cargo may include as many as 500,000 containers.
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Container Ships Stranded At Sea After South Korean Company Goes Bankrupt

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Container Ships Stranded At Sea After South Korean Company Goes Bankrupt

Container Ships Stranded At Sea After South Korean Company Goes Bankrupt

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Dozens of massive container ships are stranded at sea, looking for a place to dock. They belong to a South Korean shipping company that declared bankruptcy last week. Ports around the world are either denying the ships' access to dock or demanding cash up front to unload the container vessels. That means the fate of $14 billion worth of cargo is in question. NPR's Jackie Northam has the story.

JACKIE NORTHAM, BYLINE: They're being called Mystery ships not because of any ghostly apparition. It's because it's anyone's guess what's going to happen to them.

LARS JENSEN: The number fluctuates a bit, but it is some 85 to 90 vessels, and they really are scattered all over the world.

NORTHAM: Lars Jensen is the CEO of Sea Intelligence Consulting, which focuses on container shipping. He says the ships are operated by South Korean-owned Hanjin Shipping company. It was the seventh-largest shipping line in the world, and its bankruptcy has left an enormous amount of cargo stranded at sea.

JENSEN: In terms of how much cargo is impacted, the only solid number we've heard we've heard out there came from the Korean ministry that said we're talking about 500,000 containers. My view, however, is the actual amount of cargo that is impacted is somewhat higher than that.

NORTHAM: Jensen says that's because other shipping companies have likely put some of their containers on the Hanjin vessels as well. They're carrying everything from electronics and clothing to furniture and, according to one report, 80 tons of kimchi, a spicy South Korean side dish.

Getting that cargo off the Hanjin ships has created a logistical nightmare during the peak shipping period ahead of the holiday season. Brian Dodge is the vice president of the Retail Industry Leaders Association.

BRIAN DODGE: Without a doubt it is a mess of an issue for the businesses themselves to be forced to untangle. We've got an inordinate amount of shipping containers containing merchandise destined for U.S. shelves trapped on Hanjin ships, unable to be offloaded and delivered to stores.

NORTHAM: Ship broker Basil Karatzas says Hanjin is reluctant to dock its ships in some of the world's ports, fearing they will be seized by creditors. And he says other ports around the world have simply turned the Hanjin ships away.

BASIL KARATZAS: The port terminals do not want to accept their vessels before they get paid in advance. The company is in bankruptcy, so nobody will give them credit anymore. Now it's cash payable up front.

NORTHAM: Karatzas says Hanjin is more than $5 billion in debt, and an emergency rescue plan in South Korea was rejected by creditors earlier this week. He says the shipping company sought Chapter 15 bankruptcy protection in the U.S. and was granted permission by a bankruptcy court, which means it could soon be able to dock ships here. But it's not clear who will pay to dock those ships or unload them.

Lars Jensen with Sea Intelligence says in the few places where cargo has been unloaded, owners are having their own problems.

JENSEN: The port is saying, sure, you're going to have to pay me a large amount of money as collateral for this container, otherwise we're not going to give it to you because Hanjin owes me money. And as long as I'm sitting on Hanjin containers, at least I have some collateral. So if you want your cargo, you got to pay me through the nose for the privilege of taking the container out.

NORTHAM: Jensen says while all this is getting sorted out, other shipping companies are moving in to snap up Hanjin's customers. Jackie Northam, NPR News.

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