Container ship transits through the Panama Canal are running well below capacity following its $5.25 billion widening, according to ocean carriers that use the Central American waterway.
The canal, the larger locks of which opened at the end of June, can handle vessels up to 14,000 twenty-foot-equivalent units, compared with the previous limit of about 5,000 TEUs.
However, less than a third of the 12 daily transit slots for container vessels are being taken up, according to Matthias Dietrich, Hamburg-Sud’s vice-president for the Caribbean and Latin America west coast region.
“Bookings for the New Panamax (14,000 TEUs) vessels have been slow to come — last month, there were a few days which saw four vessel transits, but on most days it has been two or three transits,” Dietrich told the TOC Americas conference in Cancun, Mexico.
Mediterranean Shipping Co. has halved the number of vessels transiting the canal to nine per week since the widening, while the average ship size has risen to 6,400 TEUs from 4,600 TEUs, said Hernan Salazar, the Geneva-based carrier’s west coast South America planning manager.
There are now 13 weekly service strings, down from 16 before the waterway was enlarged, he said.
The canal is unlikely to boost traffic in the short term, particularly in a subdued container market, according to Hamburg-Sud’s Dietrich.
“There’s some reshuffling of service patterns possibly still to take place, but the main Asia-US East Coast, South America west coast-Europe and Asia-South America east coast services will likely remain as they are.”
“There is a theoretical opportunity for vessel upsizing on the route from Asia to northern Brazil, but that is unlikely while the ports of northern Brazil are not able to handle ships of that size — so it won’t happen any time soon.”
Although transit traffic would increase significantly in the medium term if shippers in the US Midwest and East Coast rearrange their supply chains from Asia.
“It is going to give US shippers more options about where their cargo enters the US — if port productivity is low on the West Coast, shippers have more options open to them than before,” said Mario Cordero, chairman of the US Federal Maritime Commission.
The Panama Canal Authority said more than 165 New Panamax vessels have transited the new locks and it has received more than 156 reservations for future sailings.
Nine New Panamax services currently transit the waterway with an average vessel size of 8,600 TEUs. A new service between the Far East and the US East Coast deploying ships with an average size of 8,500 TEUs is expected to launch in November.
Separately, the canal authority this week issued a request for proposals from four shortlisted port operators to build and operate a container terminal near Corozal, at the Pacific entrance to the waterway.
Three of the shortlisted bidders have links to ocean carriers — APM Terminals, the port arm of the Maersk Group, Terminal Link, majority owned by France’s CMA CGM, and Terminals Investment Limited, an affiliate of MSC. The fourth bidder, Singapore-based PSA International, operates a terminal in Panama.
The Canal Authority has set a deadline of Feb. 3, 2017, for the submission of specifications and economic plans for the terminal, which will have an annual capacity of more than 5 million TEUs.
Source : JOC.com – Contact Bruce Barnard at brucebarnard47@hotmail.com.