Korean Shipping Research Articles

머신러닝을 활용한 해운기업 파산 예측에 관한 연구

Purpose: This study aims to enhance bankruptcy prediction accuracy in the shipping industry by using advanced machine learning models, specifically XGBoost and LSTM, comparing the predictive factors between large enterprises and SMEs. Research design, data, and methodology: Utilizing financial data from 2001 to 2023 for the Korean shipping industry, the study analyzes key financial ratios and macroeconomic indicators. XGBoost and LSTM models are employed to develop customized bankruptcy prediction models for large enterprises and SMEs. Results: The XGBoost model outperforms others, effectively handling complex financial and macroeconomic variables. Large enterprises are more influenced by internal financial factors, while SMEs are sensitive to external economic conditions like a shipping index. Conclusions: The study highlights the need for tailored prediction models to improve bankruptcy risk management in the shipping industry, especially focusing on the size of the company. Future research should explore model applicability across different regions, and should consider integrating real-time data for enhanced accuracy.

국내 해운기업의 인권경영 체계 도입에 관한 연구

국내 해운기업의 인권경영 체계 도입에 관한 연구

Studying influence of the mathematical model error on the results of calculating freedom torsional vibration for marine diesel propulsion system

The Freedom Torsional Vibrations (FTV) Calculation (FTVC) for the marine main propulsion plant (MPP) to determine the freedom frequencies and the FTV formations of the mechanical system. Normally, the MPP is dynamically modeled as a finite n concentrated masses with the parameters of: Mass moment of inertia Jk (kgm2, k = 1÷ n) and the torsional stiffness Ck,k+1 (Nm/rad) between the k and k+1 concentrated masses. This paper studies the influence of the number of concentrated masses n as well as the accuracy of determining Jp (Moment of inertia of the propeller) on the solution of the MPP's FTVC. The research verifies to the MMP on the Korean ship XXX-XXX-XXX, using the MDE 6G70MEC. Keywords: Freedom Torsional Vibration (FTV); Mathematic model of the FTV; Exactness of the FTV calculation.

A Review of the North Korean Shipping Industry: Ships, Companies, and Registered Owners

A Review of the North Korean Shipping Industry: Ships, Companies, and Registered Owners

The Impacts and Implications of Interest Rate Hike on Korean Shipping Companies

The Impacts and Implications of Interest Rate Hike on Korean Shipping Companies

The announcement effect of shipping sale-and-leaseback transactions

PurposeThis paper investigates the announcement effect of shipping sale-and-leaseback (SLB) transactions. As an emerging source of financing, a growing deal of interest has been paid to the SLB. However, little is known about a variety of aspects of SLB transactions in the shipping industry. In this regard, this study examines the stock market reaction to the SLB announcements of shipping firms and their impact on shareholders' wealth.Design/methodology/approachA sample of 15 shipping SLB deals commenced by publicly listed Korean shipping companies during 2009–2023 are examined in this research. The announcement effect is measured by abnormal returns (AR) of their stocks based on the event study analysis.FindingsIt is found that the AR on the shipping SLB announcement date is, on average, −0.84% while there is no statistical significance. However, the results indicate that shareholders of shipping companies engaging in large-sized SLBs can experience positive AR around the announcement date.Originality/valueThis study is the first attempt to investigate the announcement effect of SLB transactions on the shipping industry and their impact on shareholders' wealth. The findings in this research can offer implications for the financing decisions of shipping companies and investment decisions of stock investors.

A novel business cycle indicator of the Korean shipping industry

The aim of this study is to construct monthly coincident and leading composite indicators for the shipping industry in Korea. The coincident and the leading indicators are computed using the generalized dynamic factor model. We use the production index of the water transport industry as the reference variable and compute the coincident indicator based on the common component of eight economic indicators. The analysis shows that the Korean shipping industry went through four business cycles during the sample period from 2007M1 to 2021M5. The leading indicator provides early signals of turning points in business cycles with a high correlation. The results suggest that the business cycle indicators present in this study may be useful diagnostic tools for understanding the timely and frequent economic state of the Korean shipping industry and its likely development in the near future.

IMO 선박 온실가스 감축 규제에 대한 국내 해운업계 대응의 해석적 구조 분석

Purpose : The purpose of this research is to analyze responses of the Korean shipping industry to IMO’s regulations to reduce greenhouse gas from ships. This includes identifying responses and analyzing their interactions, thus providing with reasonable grounds for the industry’s responses as well as policy suggestions. Research design, data and methodology : This paper collected data from the industry by using the Delphi method, and then adopted ISM(Interpretive Structural Modelling) to structure responses to regulations in a graphical manner. Results : According to the ISM model, it was found that the causal interactions starts from compliance with national action plans thorough alternative vessel fuel and operational efficiency to market-based initiatives. Conclusions : This paper provides policy suggestions, such as establishment of national action plans, concentration of national competencies on the decision and development of alternative fuels, and an impact analysis for supporting the most preferred market-based initiatives for Korean shipping industry.

Has Container Shipping Industry been Fixing Prices in Collusion?: A Korean Market Case

Purpose - The purpose of this study is to analyze the market power of the Korea Container Shipping Market (Intra Asia, Korea-Europe, and Korea-U.S.) to verify the existence of collusion empirically, and to answer whether the joint actions of liner market participants in Korea have formed market dominance for each route. Precisely, it will be verified through the Lerner index as to whether the regional market of Asia is a monopoly, oligopoly, or perfect competition.
 Design/methodology - This study used a Lerner index adjusted with elasticity presented in the New Imperial Organization (NEIO) studies. NEIO refers to a series of empirical studies that estimate parameters to judge market power from industrial data. This study uses B-L empirical models by Bresnahan (1982) and Lau (1982). In addition, NEIO research data statistically contain self-regression and stability problems as price and time series data. A dynamic model following Steen and Salvanes' Error Correction Model was used to solve this problem.
 Findings - The empirical results are as follows. First, λ, representing market power, is nearly zero in all three markets. Second, the Korean shipping market shows low demand elasticity on average. Nevertheless, the markup is low, a characteristic that is difficult to see in other industries. Third, the Korean shipping market generally remains close to perfect competition from 2014 to 2022, but extreme market power appears in a specific period, such as COVID-19. Fourth, there was no market power in the Intra Asia market from 2008 to 2014.
 Originality/value - Doubts about perfect competition in the liner market continued, but there were few empirical cases. This paper confirmed that the Korea liner market is a perfect competition market. This paper is the first to implement dynamics using ECM and recursive regression to demonstrate market power in the Korean liner market by dividing the shipping market into Deep Sea and Intra Asia separately. It is also the first to prove the most controversial problems in the current shipping industry numerically and academically.

Construction of Korean Shipping Industry Risk Sentiment Index Using News Articles

Construction of Korean Shipping Industry Risk Sentiment Index Using News Articles

Construction of Korean Shipping Industry Risk Sentiment Index using news articles

Construction of Korean Shipping Industry Risk Sentiment Index using news articles

The economic effect and policy performance of ship registration—A case of Korea

In response to the preference for flags of convenience, shipping countries have implemented offshore registries as second ship registers to prevent nationals from flying flags of convenience abroad. Korea likewise established the Jeju Special Ship Registration Zone system in 2003 to enhance the global competitiveness of its shipping industry, expanding its fleet. Various studies on ship registration mainly examine registration factors, ignoring the economic and policy effects on a country. Therefore, this study is the first to quantitatively evaluate the performance of the Jeju Special Ship Registration Zone system, employing the synthetic control method to analyze the effect of the system’s performance on the national economy. As a result of the analysis, the fleet increased to 42.16 million DWT out of 64.56 million DWT of Korean-flagged ships. Thus, Korea's shipping industry imports increased by 289 trillion won over 17 years from 2003 to 2019. Further, the effect of increasing the number of seafarers was 3714 persons. Hence, the policy continuation will benefit the Korean shipping industry and the national economy. The findings furnish useful grounds for evaluating policy effectiveness and continuity.

The Serious Accidents Punishment Act of South Korea and Its Impact on the Shipping Industry: Toward Sustainability

The Serious Accidents Punishment Act (SAPA) of South Korea mandates that chief executives secure operational safety and health to prevent industrial and civil disasters. The SAPA imposes civil and criminal responsibilities on chief executive officers, including business owners, for fatal accidents due to safety and health measures violations. We examine the SAPA’s challenges to the shipping industry and the measures taken by ship owners and ship management companies to address them. In the modern shipping industry, ships and crew often have different nationalities; hence, it may be difficult to determine which law applies or where liability lies. Business activities are mostly overseas. Ship management is performed by third parties, and the introduction of autonomous systems is leading to crew reductions and other changes; these factors create uncertainty about the SAPA’s applicability. Therefore, legal requirements and measures must be established to ensure that South Korean shipping companies do not take on excessive responsibilities internationally while still protecting workers and others. This study suggests measures to ensure safety and stability in the South Korean shipping industry following the SAPA through a horizontal comparative analysis with the UK’s Corporate Manslaughter and Corporate Homicide Act 2007, which served as a model for the SAPA.

Equal Opportunities for Foreign Seafarers to Ensure Sustainable Development in the Korean Merchant Shipping Industry

Despite the increasing number of foreign seafarers working in the Korean shipping industry and the growing concern for psycho-emotional stress due to discrimination in the maritime sector, few studies have focused on the working environment of foreign seafarers on South Korean vessels. This study aimed to determine whether foreign seafarers perceived discrimination in the Korean shipping industry and if so, the types of discrimination they faced and how they responded to this challenge. A survey was conducted to assess foreign seafarers’ experiences of discrimination, understanding of their own human rights, and level of satisfaction in working with Korean seafarers as well as identifying positive factors. The main positive findings included the kindness of colleagues, and excellent welfare facilities and benefits; whilst the most frequently reported negative factors related to language barriers and food types. These findings can be used to identify and share best practices and help determine priority areas for action. However, as the number of participants was small due to difficulties in contacting foreign seafarers during COVID-19 restrictions, further research is necessary to understand and improve the working environment of foreign seafarers on South Korean vessels.

How to control and manage vessels’ ballast water: The perspective of Korean shipping companies

Selecting the efficiency of the technologies and reasonable strategies to ensure compliance with stricter international regulations on ballast water are issues that need to be focused on. Particularly, in a period of economic decline, these auxiliary costs due to the regulation enforcement may be a significant burden for vessel operators, especially those with old vessels, where the maintenance costs are high. Because of these new limitations on marine transport, which has been regarded as a more eco-friendly alternative than other forms of transportation, maritime policymakers in each country may need to take prudence in making policy decisions. Nevertheless, few studies have evaluated the existing alternatives that can decrease the invasion risk due to ballast water release, and fewer have developed a general system for determining the optimal technology. Accordingly, in this study, an empirical analysis focusing on the alternatives of ballast treatment systems considered by Korean shipping companies is performed. As the main approach, surveys and interviews are conducted to examine how Korean shipping companies’ real response directions help cope with the International Convention for the Control and Management of Ships’ Ballast Water and Sediments. The results indicate that, among 15 sub-criteria of considerations for response by Korean shipping companies, approval is the most considerable factor. In addition, through the description analysis of Korean shipping companies, a difference in the recognition and response direction according to firm size and vessels’ age was observed. This study’s findings provides valuable suggestions for designing government policies for the shipping industry’s ballast water management.

Operational Performance Evaluation of Korean Ship Parts Manufacturing Industry Using Dynamic Network SBM Model

The purpose of this study is to analyze the efficiency and productivity of the Korean ship parts manufacturing industry. To this end, the manufacturing process was divided into two stages (operating activities, financial activities), and the Dynamic Network SBM model and Malmquist Productivity Index were used. We collected analysis data from KIS-VALUE, and analyzed 40 companies from 2014 to 2020. As a result of the analysis, from 2014 to 2017, the average operating efficiency was 0.7825, the average financial efficiency was 0.5208, and the average total efficiency was 0.4537. It was found that improving efficiency requires improving both activities simultaneously, rather than focusing on a specific activity. Operating activities DMI was 1.0025, financial activities DMI was 0.9236, and OMI was 0.9464. In order to improve OMI, it is necessary to improve the financial activities DMI, which is the cause of the decrease in productivity. In order to improve financial activities DMI, government policy or technology change to improve DFS was found to be necessary. Finally, the effect of environmental factors on efficiency was analyzed by tobit regression. It was found that Firm Size had a negative (−) effect on efficiency, and Firm Age had a positive (+) effect on efficiency. The analysis results of this study will help to understand the relationship between input and output, which has been treated as a black box in the manufacturing industry, in two stages; and this will serve as a guideline for those working in Korea’s ship parts manufacturing industry to establish policies.

The Effect of Ship Owner-Ship Operator Separation on the Market Risk Split

Purpose - There are three different business models in shipping: owner-operators, operators, and owners. This paper analyzes the effect of separating owner-operators into tonnage providers and operators, and considers this effect from the perspective of risks and returns. Design/Methodology/Approach - A historical simulation was performed to measure realized operating profits and the volatility of each type of player. Time series data from 1992 was adopted from Clarkson Research and Drewry Maritime Research to simulate revenues, capital costs, and operating costs for 229 investment cases. A bootstrap sampling enhances the robustness of the results. Findings - The results show that the operating profits of owner-operators are divided into those of two separate players. The same, however, cannot be said for market risk. Against general expectations, operator market risk was not significantly reduced by separation; in the case of Panamax, it even increased. This can be explained by a negative correlation between spot rates and actually-applied time charter rates. Research Implication - Most papers on market risk have so far focused on the measurement and forecast of return volatility. This paper, on the other hand, is a novel attempt to analyze the effect of business model separation on market risk. The public-sector owner model is widely discussed in Korean shipping circles, and this paper is expected to provide meaningful insight to policymakers. Additionally, the risk-return profile of the pure owner model provides a good basis to develop the model for the balanced growth of the Korean shipping industry.

Empirics of Korean Shipping Companies’ Default Predictions

In this paper, we use a logit model to predict the probability of default for Korean shipping companies. We explore numerous financial ratios to find predictors of a shipping firm’s failure and construct four default prediction models. The results suggest that a model with industry specific indicators outperforms other models in predictive ability. This finding indicates that utilizing information about unique financial characteristics of the shipping industry may enhance the performance of default prediction models. Given the importance of the shipping industry in the Korean economy, this study can benefit both policymakers and market participants.

Strategies of the Korean Shipping Industry in the Post-Corona Era

코로나19 사태로 컨테이너선 운임 폭등, 항만 혼잡, 컨테이너 박스 부족, 리쇼어링(reshoring) 등 해운업계에 다양한 이상 현상(abnormalities)이 나타나고 있다. 이를 배경으로 코로나19 발생 이후 해운업의 뉴 노멀(new normal)로 부상하고 있는 것은 무엇이고, 해운업 위기 극복 방안으로 무엇이 있는지 살펴볼 필요가 있다. 본 연구는 코로나19 발생 이후 글로벌 해운업에 등장한 뉴 노멀을 조사하고 해운업 위기 극복 방안을 도출하기 위해 통계 조사를 수행하고 해운업 실태를 파악하고자 하였다. 통계 조사는 코로나19 발생 이후 해운업에 어떠한 변화가 발생했는가를 검토하기위해 수행되었으며, 이를 통해 코로나19 발생 이전과 이후의 차이점을 정량적으로 파악할 수 있다. 코로나19 발생 이후 물동량이감소하고 투입 선복량 감소로 운임이 상승한 것 등이 알려져있지만, 코로나19로 어떠한 변화들이 발생했는가 정량적으로 제시한선행연구는 거의 없다. 본 연구는 클락슨(Clakrsons), 드류리(Drewery) 등 글로벌 해운 컨설턴트사가 제공하는 데이터에 대한 조사·검토를 수행하고, 코로나19로 인한 주요 항목별 변화 수치를 정량적으로 제시하였다. 우리나라 해운업은 매출 규모나 확보 선대 규모 등을 감안 시 국제적으로 일정 수준 이상의 경쟁력을 확보한 것으로 이해되지만, 포스트 코로나 시대에 해운업 경쟁력을 강화하기 위해서는 신규 성장방안을 모색해야 한다. 요컨대 본 연구의 목적은 코로나19를 배경으로 통계 조사를 수행하여 해운업 실태를 파악하고, 해운업 경쟁력 강화 방안을 제시하는 것이다. 한편 정보 기술(IT: Information Technology)을 활용한 디지털화와 온라인 플랫폼 구축 등이 해운업계의 새로운 핵심 역량으로 급부상하고 있으며, 기업에 대한 사회적 책임 완수 요구가 늘어나면서 물류산업의 친환경 기술 확보 노력이 강화되고 있다. 본 연구는 포스트 코로나시대의 해운업 신규 성장 방안으로 디지털화, 탈탄소화 등 구체적인 성장 전략 방안을 제시하였다는 점에서 시사하는 바가 있다.

Politics of scale: Colossal containerships and the crisis in global shipping

This article addresses overcapacity and crisis in global shipping through the case of the HMM Algeciras, the world's largest containership inaugurated in 2020. When she left the South Korean shipyard where she was built, the HMM Algeciras (with a size of two soccer fields) could carry 24,000 twenty‐foot equivalent units (TEUs) across the world's oceans. By following the mega‐containership's links to two South Korean shipping companies, Hyundai Merchant Marine and Hanjin Shipping, and her connections to a southern European port, the authors unpack some of the current flip sides of global maritime shipping. In this article, the authors argue that the promise of profit and endless growth, which has led to overcapacity in global maritime shipping, is spurred on by what they call ‘false economies of scale’. Claims of the future profitability of colossal containerships are, they argue, state‐driven political performances of scale.