Last week I posited in this regular Scuttlebutt column that it looked like we were entering peak bankruptcy season. This week by looking at what you have been reading on this site it’s clear bankruptcy paranoia is now roiling the shipping industry in ways not seen since 1986.
Of course, the fallout from Hanjin dominated many headlines here over the past five days, but the false rumours allegedly started by APL Logistics about K Line going bankrupt was what grabbed most interest.
“[T]his is going to spook many companies away from booking on K Line regardless of how many emails they send around reassuring everything is going according to the status quo,” one Splash reader commented. The Japanese shipping major, the eighth largest shipping company in the world with an owned fleet worth $6.12bn according to VesselsValue.com, may well take APL Logistics to court, as well it might given the jittery nature of shippers in the wake of the demise of Hanjin Shipping.
Other container players have fallen by the wayside. Hermann Ebel’s Hansa Treuhand, a lead name in KG financing from Hamburg, has become another high profile casualty. Rickmers Maritime in Singapore admitted it too was in dire financial trouble. There’ll be plenty of others going to the wall – that’s not just my point of view, it was one shared by Rodolphe Saade, vice chairman of CMA CGM, who warned this week: “We think that small or medium sized operators are going to go bust or be forced to join large operators like us.”
The sheer scale of the container shipping crisis was crystallised with our exclusive news report that a 10-year-old panamax boxship had been sent for scrap – only the OSV sector is scrapping ships that young.
If I had to beseech you to read just one article from the 100 plus published on Splash this week, it would be Australian lawyer Frazer Hunt’s brilliant contribution, Welcome to Hanjin California, outlining the mad chaos he has seen since the Korean line filed for court receivership at the end of last month, all to the lyrics of The Eagles’ most famous track. “The best thing I have read all year,” gushed my colleague, Grant Rowles, and he may well be right.
“We are all just prisoners here of our own device.”