Panama Canal Expansion

Panama Canal Expansion

The $5.25 billion expansion of the Panama Canal will either dramatically boost East and Gulf Coast container trade or disappoint their expectations of gaining more cargo. But the opening of much larger locks in early 2016 is already boosting prospects for more exports to Asia from U.S. Gulf ports of LNG, coal and grain cargos.

What is certain is that the doubling of capacity on the connector of the Atlantic and Pacific oceans will change the way the world¹s shipping lines ply their global routes when the project is completed. The doubling of the canal’s capacity will allow shippers to bring their Asian goods to the Eastern and Gulf coasts for less money. That’s largely because the new locks will be able to handle larger vessels that can carry nearly three times as many containers. The project is also expected to bolster Panama’s strategic positions as a transshipment hub and business center for much of Central and South America.

For general developments at the Panama Canal, see also JOC’s Panama Canal News page.

News & Analysis

18 Mar 2015
The agency responsible for the operation and management of the Panama Canal has asked for an international arbitration panel to review a $233 million award to the consortium expanding the waterway.
container ship squeeze through Miraflora locks at Panama Canal
23 Feb 2015
The Panama Canal Authority is setting its sights on retaining the increase in container volumes from Asia to the U.S. East and Gulf Coast ports it gained in recent months, thanks to shippers diverting cargo from congested West Coast ports.
07 Jan 2015
An international arbitration panel ruled that the engineering consortium that is building the Panama Canal’s third set of locks has the right to seek payments from the Panama Canal Authority agency for $233 million of the $463 million in cost overruns it's claiming for cement and aggregate.
07 Jan 2015
The new toll structure on container ships proposed by the Panama Canal Authority could produce significant reductions in toll costs for carriers deploying the larger post-Panamax ships that will be able to pass through the expanded locks.
06 Jan 2015
The Panama Canal Authority released proposals for a new toll structure that it has been reviewing with various industry segments for the last year.
05 Jan 2015
The Panama Canal Authority recently cleared the way for building a big new transshipment port at Corozal near the Pacific entrance of the canal that is expected to boost traffic once the current expansion project is completed in early 2016.

Commentary

Canals used to be a sleepy topic. Suddenly, times have changed.

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Video

James Hertwig, president and CEO of the Florida East Coast Railway, discusses the railroad’s preparations for the opening of the expansion of the Panama Canal, through projects at the Port of Miami, Port Everglades and the South Florida Logistics Center.
On the second day of a two-day tour of Panama, JOC Editor Mark Szakonyi rides the Panama Canal Railway to the Port of Colon, a growing transshipment hub.
On the first day of a two-day Panama Canal tour, JOC Editor Mark Szakonyi checks out a Hamburg Sud container ship pass through the canal.