Hanjin declared bankruptcy, cargoes are in limbo, and 8% of capacity is off the market. Cost of shipping a container from China to USA jumped 50% in one day. Don't be surprised if toy train orders are delayed.
What, me worry?
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Also read it here-
The price of shipping a 40-foot container from China to the U.S. jumped up to 50 percent in a single day, said Nerijus Poskus, director of pricing and procurement for Flexport, a licensed freight forwarder and customs broker based in San Francisco.
The price from China to West Coast ports rose from $1,100 per container to as much as $1,700 on Thursday, while the cost from China to the East Coast jumped from $1,700 to $2,400, he said.
This is part and parcel of dealing with offshore suppliers. Better get used to it.
Dave Warburton posted:This is part and parcel of dealing with offshore suppliers. Better get used to it.
It really has nothing to do with offshore suppliers. It has to do with a shipping company. It's a world economy, and has been for a long time now. Anyone who isn't in tune with that after all this time needs to get a new radio.
It's Just normal supply and demand at work. Shipping supply shortage, shipping prices go up..... until the shortage is remedied, which it will be. Prices will come back down at some point when some of the smoke clears around the sudden announcement of Hanjin's situation, and financial arrangements are undertaken.
"Following the Hanjin default there has been a considerable rise in freight rates, brokerage firm Fearnley Securities wrote in a note to clients on Friday.
"To our understanding this has been driven by shippers being reluctant to put their cargoes on Hanjin vessels, whilst ports are not accepting the vessels as they are afraid of not getting paid," Fearnley wrote.
A Hanjin spokeswoman said that 44 of its 98 container ships had been denied access to ports including Shanghai, Sydney, Hamburg, and Long Beach, California. One ship had been seized, in Singapore.
As the collapse happened in the midst of the peak season it has spurred a supply shock in a market which, despite poor freight rates, was characterized as relatively tight, the Fearnley note said."
I would say it has a lot to do with off shore suppliers. I read Hanjin has been losing money for years and it was a state-owned bank that shut their money off. Plus there are several other shippers in bad shape. It doesn't do any good to have all that stuff in China at Xmas. One shipping guy said that the containers may never get to their destination unless Obama rides to the rescue.
There is such a glut of shipping companies, that it's cheaper to ship corn from Brazil to Maryland chicken farmers than by rail from Iowa.
Jon 
That doesn't help the thousands of containers full of product now stranded on Hanjin ships and at ports. In an article I read, a shipping agent said it might take a year to get some of the containers-if ever.
When General Mills had Fun Dimensions, a general rule was the cartons of toys had to be out of their three distribution centers by ten days before Thanksgiving. Generally to customer's distribution centers, this gave them time to unload a truck of toys, stock it, pick a store's order and get it to the store one day before Thanksgiving. The stocking crew would have it on the shelves when the stores opened the day after Thanksgiving. As much as we get bog down with pre-orders (who ever dreamed up that phrase), Christmas time is the big sales season for toys. Ten days before Thanksgiving may no longer be valid as so many retailers are using shelve space for toys before Thanksgiving. John in Lansing, ILL
If they can't deliver them, I would expect them to scuttle their ships or dump cargo overboard.
Fred
Dump all those heavy boxes overboard ?? With what ?? And have them floating around?? Scuttle the ship ?? How about insurance and it is an asset in the bankruptcy. Plus navies and coast guards are funny about sunken ships.
Would this be a good reason to move production back to the U.S.A?
No, that's just the cost of doing business in Asia. Don't forget, model trains are just a small, very small, part of commodities possibly being affected. Retailers gearing up for the holidays who sell everything from clothes to appliances to the latest electronic gadgets and gizmos will feel the crunch on a much greater magnitude.
OK everybody... Let's see how long it takes for prices to increase on those Atlas-O Hanjin containers. After all, they're bound to become collectors items now, right? 
I can't wait to see the first eBay listing by some "opportunist" asking $75 for one plastic Hanjin container. 
(Hey, the starting bid on many of those K-Line 20' ISO tanks is now $40+, and they could be had years ago for less than $15/each).
David
my thread gets deleted and another shows up yet stays
what's up with that?
Rocky Mountaineer posted:OK everybody... Let's see how long it takes for prices to increase on those Atlas-O Hanjin containers. After all, they're bound to become collectors items now, right?
I can't wait to see the first eBay listing by some "opportunist" asking $75 for one plastic Hanjin container.
David
Bankruptcy can take the form of reorganization or liquidation. Expect the former is Hanjin's case and the company will continue to exist.
From what I've read, shipping companies that declare bankruptcy usually do not recover and are liquidated. Reason being, once customers lose faith in the shipper they will not risk the loss to use them again. If be willing to bet the worst we see is a short delay while everyone works out the logistics and then a continued price increase. I'll bet that the big solvent shippers are looking at ways to accumulate the asserts at a discount.
bigdodgetrain posted:my thread gets deleted and another shows up yet stays
what's up with that?
Well... now that I talked about the effect this bankruptcy might have on the price of Atlas-O Hanjin containers, we can now say this thread is talking about TRAINS. 
David
jim sutter posted:Would this be a good reason to move production back to the U.S.A?
Yes indeed, but , could they do that and avoid significant price increases?
I read the same thing-that a shipper has never come back from a bankruptcy and they expect the company to be broken up. What isn't being said, is that Hyundai, another big shipper and 5 others are in a "debt monitoring" program of some sort. I think that is short of bankruptcy. But this is Korea so who knows what will happen.
That is why every shipped item is late unless it was the MTH Philosophy at the 2015 October York with Breast Cancer Awareness GE EVO and Caboose.
