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South Korean ports overcome loss from Hanjin's exit with surge in nation's trade

SOUTH Korea's largest port, Busan, suffered a major setback in its global port rankings following the bankruptcy of Hanjin Shipping.

Hanjin Shipping's bankruptcy robbed the port of Busan of momentum that had helped it climb global port rankings.

Foreign trade-related container throughput at ports in South Korea expanded 10.5 per cent year over year in April on the back of the highest monthly growth in the value of exports since the summer of 2011.

South Korean ports handled 1.41 million TEU of exports and imports out of a total 2.34 million TEU throughput last month as the value of exports from Asia's fourth-largest economy rose 24 per cent year over year to more than US$51 billion. Imports grew 16.6 per cent to $37.7 billion, figures from the Ministry of Trade, Industry and Energy show, IHS Media reported.

The strong export growth was mainly driven by a large year-over-year rise in shipments of semiconductor chips and flat panel displays. Exports to China rose by more than 10 per cent year over year and exports to the US by just less than 4 per cent.

Data from the Ministry of Oceans and Fisheries showed non-containerised cargo volumes through the country's ports were up by 4 per cent compared with April 2016, to 88.7 million tonnes.

At Busan, the strong trade performance by the economy helped offset the damage on throughput of last year's collapse of Hanjin Shipping, which is still being felt by the port.

April 2017 volumes at the port in the southeast of the country rose to 1.77 million TEU from 1.59 million TEU in April 2016.

Prior to the collapse of the national shipping line, Busan was poised to supplant Hong Kong and move to fifth place in the global container port rankings, and become the world's second-largest transshipment hub after Singapore.

Busan handled 19.43 million TEU in 2016, just below Hong Kong. The port is near the 20-million-TEU barrier in 2017 despite a 3 per cent drop in transshipment business due to the Hanjin bankruptcy.

The port is hoping that part of the volume gap due to the loss of Hanjin will be filled by SM Line, the new purchaser and operator of Hanjin's Asia-North America route.

SM Line is headquartered in Busan and earlier in 2017, signed a memorandum of understanding with the Busan Port Authority (BPA).

BPA is providing the line with administrative and financial support, and cooperating with it in areas such as regaining trust and business from beneficial cargo owners hit by the collapse of Hanjin.

Other initiatives to boost its competitiveness include the building of a new data centre to collect, store, and manage data on the latest trends in container shipping. The centre will be built in phases before fully opening in 2019.