Panama Canal Expansion

After a decade of theorising and debate, the reality of how Panama Canal expansion will impact shipping is finally at hand.

The ‘neo-Panamax’ era is about to begin, and it is increasingly obvious that the shipping effects will be far more acute in some sectors than in others. In the container shipping market, major changes are already afoot. Liner operators are upgraded their vessels immediately to take advantage of the expanded locks. In other sectors, such as LNG and LPG, the use of the expanded Panama Canal – or the decision to bypass it – will be driven by cargo interests, not vessel operators.

News & Analysis

The signing of the maritime treaty in November 2017. On left, Panama Minister of Maritime Affairs Jorge Barakat; on right, China Minister of Transport Li Xiaopeng
22 Jun 2018
Panama’s maritime authority is enhancing its co-operation with China on both the seafaring and finance fronts.
Mærsk Mc-Kinney Møller
26 Jan 2018
Container ship operators have shifted the focus from what are now medium-sized vessels to mega and ultra-large container vessels. IHS Markit figures show the decline in orders for the middle-sized ships, while orders for feeders and larger vessels have doubled in the past five years.
14 Dec 2017
The number of LPG carriers using the Panama Canal route for Asian-bound cargoes of US propane remains extremely high despite a 29% jump in toll costs.
Panama canal
22 Oct 2017
Record levels of cargo traversed the Panama Canal during the first full fiscal year of operations of its larger locks. Traffic is set to ramp up even further in the years ahead.
06 Jun 2017
In the 11 months since the debut of Panama Canal’s larger locks, demand for ‘neo-Panamax’ transit slots has been higher than expected, driven by LPG cargoes from the United States to Asia and a rapid upsizing of container ships.
20 Oct 2016
The Caribbean has had little difficulty handling the larger vessels calling since the expanded Panama Canal opened in June. The next test comes in 2017, when container lines unveil major changes to their regional networks.  

Commentary

After a very strong start, how much room does the expanded Panama Canal have to grow cargo volumes before it needs to build even larger locks?