Winners and Losers: Panama Expansion to Shake Up Shipping Sector

Date: December 22, 2010
Pages: 10
US$ 1,295.00
Report type: Strategic Report
Delivery: E-mail Delivery (PDF), Download
ID: W4E5697E767EN

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Industry Analysis
BMI believes that the expansion of the Panama Canal, which is due to be completed in 2014, will have a significant impact on trade routes, port development, cargo distribution and the US shipping sector in general.

West-coast ports are currently the main entry point for shipments from Asia to the US. Once shipments arrive at ports such as Seattle and LA they are transported to the larger consumer markets on the east coast by rail or by road. BMI believes this will change dramatically when the expansion of the Panama Canal is completed.

Once the expansion is complete, it will be possible to ship goods from Asia directly to east-coast ports such Charleston, Jacksonville and Norfolk using Post-Panamax vessels. This will be considerably cheaper than shipping to west-coast ports and then using rail and road to move goods to the more populated east, and will also offer companies more control over their supply chains.

Key Views
  • When the expansion of the Panama Canal is completed in 2014 vessel calls on the east coast will increase significantly as cargo shifts away from the congested west coast and instead goes directly to the main consumer markets on the east coast.
  • Norfolk and Charleston are currently best placed to become the east coast's hubs in 2014.
  • We expect other east-coast ports to continue their drive to expand and modernise in time for 2014.
  • Given that the US has traditionally been served by direct services, ports in the Caribbean and Latin America are unlikely to become transhipment hubs, particularly given security concerns about cargo passing through them.
  • LA and Long Beach, the current US container shipping hubs, will continue investing in infrastructure as they try to minimise the loss of business in 2014.
  • Post-2014 LA and Long Beach could carve out a niche for themselves as hubs for mega-vessels that are too big to pass through the expanded canal.
Panama Expansion to Shake Up Shipping Sector
Industry Analysis
Changing Tide
Key Views
USPopulation Density Per Square Mile
Panama Canal Expansion: Who Will The Winners Be?
Top Ten Container Ports In The US
Other East Coast Ports Race To Catch Up With Norfolk And Charleston
USCoast Ports Preparations For 2014
The Fate of New York/new Jersey
LatiN American Or Caribbean Transhipment Hubs Unlikely
What Will 2014 Bring For Current USHUB Ports?
Los Angeles And Long Beach Throughput, TEU
Chart: Re Turn of The Giants
Container Lines Who Own Mega Vessels
2014 To Change The Face of US Shipping
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