Singapore-listed lubricant blender and trader, AP Oil International was forced to re-align its finished lubricant supply and waits for raw materials to be unloaded from vessels of bankrupt Hanjin Shipping Co., the company told Lube Report Asia last week.
We have replaced finished lubes supply in some containers loaded on Hanjin vessels to help our customers ease the demand situation first, said Ling Tai Boon, senior business development manager of AP Oil.Being a global shipping hub, there are no issues to find alternative shipping lines to ship and export the lubricants with all the main line operators having service fromSingapore.
According to a Singapore Supreme Court statement, Hanjin is the largest container-shipping firm in Korea and the ninth largest in the world. The company filed an application for rehabilitation proceedings to the Korean Bankruptcy Court under the Korean Debtor Rehabilitation and Bankruptcy Act on 31 August this year. On the same day, the Korean Bankruptcy Court granted provisional orders to preserve Hanjins assets.
AP Oils additive supplies were not affected as they are produced in Singapore but we do have some containers in flexi-tanks, from Europe stuck on Hanjin vessels and awaiting clearance from the Port of Singapore Authority for the Hanjin vessel to discharge the cargo, said Ling.
He pointed out that "bearing the risks and payments for the delays for supply of raw materials import or finished lubes exports, the uncertainty of this unprecedented situation does cause hassle to various stakeholders."
"Right now, cargo owners are at the mercy of the port and Hanjin to negotiate a situation for clearing the cargo from the vessels, he added.
AP Oil may have found alternative transportation routes for its products but financial issues are unresolved. We are negotiating and cooperating with our partners to settle amicably the payment issues whilst waiting positive results on the cargo discharge, said Ling.
Financially as the cargo documents like bill of lading are clean, many banks and insurance parties are scrambling to protect the interests of the suppliers and buyers alike, he added. A bill of lading is a legal document for freight services.
According to a Sept. 6 circular published by the Port of Singapore Authority, companies with cargo shipped by Hanjin Shipping have to pay a refundable deposit of SG $5,000 (U.S. $3,700) for every delivered container, and the deposit will be refunded upon returning the empty container to the PSA's yard.
The High Court in Singapore has temporarily frozen all Singapore proceedings against Hanjin and its Singapore subsidiaries allowing ships owned and chartered by Hanjin to dock in Singapore without being seized by creditors. There will be a hearing for all parties in the country on whether the freeze should continue until next January.