Hanjin Shipping plans to leave the Port of Portland, Ore., to cut costs, according to the port.
After nearly two decades of service to the port, the carrier has confirmed that it will end its weekly service in January, putting the port’s container terminal and regional economy at risk, The Oregonian reports. The move is expected to hurt big importers such as Fred Meyer and Columbia Sportswear, as well as exporters, who will now have to pay more to truck containers to the Port of Seattle. The pullout will also end a $250,000 weekly payroll for longshore workers who load and unload the vessels at Terminal 6.
Hanjin Shipping, the largest container line calling at Portland’s Terminal 6, was negatively impacted by increased terminal charges and an ongoing longshore labor dispute. The International Longshore and Warehouse Union and ICTSI Oregon, terminal operator, have exchanged accusations of blame regarding the pullout.
Moreover, the troubled carrier, which reported a net loss of about 80.4 billion won (about US$72.3 million) in the second quarter of 2013 and a net loss of 34.8 billion won in the first quarter, badly needs to cut costs amid overcapacity concerns.
Port officials will be meeting with Hanjin and ICTSI Oregon in coming weeks.
“Hanjin has been a valued customer of the port for almost 20 years, and we continue to believe that they have a valuable container shipping franchise in this market,” said Sam Ruda, chief commercial officer for the Port of Portland, in a written statement.
“They have reached out to us,” Ruda told an Oregonian reporter. “Their senior vice president of sales, marketing and operations wants to come out here within the next two weeks and certainly talk to the port and ICTSI.”
Additionally, Hanjin sent a letter to customers last week that left an opening for reconsideration. “Hanjin Shipping will continue to review the resumption of direct call service based on changing circumstances,” it said.