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Ten Ways the New Panama Canal May Affect Logistics
June 26th, 2016 is a big day for the historic Panama Canal , which is the only waterway connecting the Pacific and Atlantic oceans in the western world. The canal has been undergoing an expansion project that will widen and deepen its capacity. June 26th marks its official re-opening for operations. Larger, heavier vessels will now have passageway, potentially revolutionizing shipping practice in the Americas and beyond.
Here are 10 things to consider regarding the impact of the Panama Canal Expansion:
1. In its 100+ years of existence, the Panama Canal has serviced more than 1 million ships
2. This expansion project began in 2007, and was completed June 2016
3. The modified Panama Canal will effectively double its former capacity of vessels
4. Logistically and commercially, the obvious result will be more goods moved, on larger vessels
5. The renovated canal will provide potential for a higher volume of transshipments –offering the option of transferring cargo to smaller vessels for calling to smaller ports
6. Current “Panamax” - sized vessels will now give way to the new “Neo-Panamax” or “Post-Panamax” size, which is considerably larger, as shown below:
- Current Panamax: 965 feet long, 42 feet draft, carry up to 4,800 TEUs
- Post-Panamax: 1,200 feet long, 50 feet draft, carry up to 12,600 TEUs
7. Many North American ports are hoping to be competitive ports of call for the new, larger vessels, and have been spending time and resources to update their ports to accommodate the Post-Panamax capacity. Not all ports are ready, and exactly which ports will benefit least and most from the canal expansion is a much-debated prediction.
8. Here is a list of the major North American ports and their Post-Panamax capabilities:
- Port Everglades: not ready, 2017/18 completion
- Port Baltimore: ready
- Port of Charleston: ready, expanding for higher volume by 2018
- Port of Houston: ready, with potential capacity issues, due to 52-mile long waterway
- Port of Jacksonville: not ready, but will be soon
- Port of Miami: ready, and expanding
- Ports of New York and New Jersey: ready, with potential congestion and low bridge complications
- Port of Savannah: ready, with fuller capacity by 2018
- Port of Virginia: ready, and expanding
9. Current transportation markets for cross-country ground shipments could be affected, as could the US ports of call on the Pacific coast
10. Logistics considerations and processes should be evaluated for North American imports, exports, and movement along the Mississippi, in preparation for a possible increase in demand and volume
It remains to be seen how the effects of the new and improved Panama Canal will affect specific locations. But that there will be an effect felt in the Logistics world is undeniable. This new era of vessel trading in North America promises to be an exciting one. For the eager learner it will provide opportunities to adapt to the changing face of global logistics.
Allyn Contributor: Benjamin Woodard
Sources: Select U.S. Ports Prepare For Panama Canal Expansion, NAIOP Research Foundation
file:///C:/Users/502551174/Downloads/PortsReport_FINAL_010915_rvsd.pdf
U.S.Port and Inland Waterway Modernizations by the US Army Corps of Engineers
Official Website for the Panama Canal Expansion
http://micanaldepanama.com/expansion/
Isthmus
https://placesjournal.org/article/isthmus-panama-canal-expansion/?gclid=CLKgvr6c5cwCFQcKaQodZF8Nww