Sign of the Times: Shippers In Trouble

Caixin: Three Private Shipping Companies Run into Financial Troubles
Three private shipping companies in China have run into financial troubles since the beginning of this year, problems one expert blames on overcapacity and weak demand for commodities.

Dalian Winland Group Co. Ltd. declared bankruptcy on February 13. The company, set up in 1993, has 18 bulk cargo ships and four container ships.

Also, the heads of Shanghai Hong Sheng Gang Tai Shipping Co. Ltd., a domestic operator of container ships, went missing on February 9, leaving behind huge unpaid debts.

And Xia Hanren, the boss of Zhejiang Xiazhiyuan Ship Management Co. Ltd., fled to Singapore at the end of January to escape mounting debts.

China's weak demand for commodities and overcapacity resulting from many new ships hitting the water recently have triggered the troubles, said Zhou Shu, an analyst from Shanghai Shipping Exchange, an information provider.

Customs data show the country imported 78.57 million tons of iron ore in January, down 9.4 percent from the same month a year earlier. It imported 16.78 million tons of coal, down more than half.

Steel companies bought less iron ore in January, said a middleman involved in ship rentals, and traders were reluctant make purchases. He blamed weak demand for steel and tight financial situations for the problems.

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