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.
31 May 2016
Toll costs and a reduction in cross-basin liquefied natural gas (LNG) flows should undercut the Panama Canal expansion’s impact on LNG routing, according to IHS Energy senior principal researcher Andres Rojas.
31 May 2016
The expansion of the Panama Canal will allow a much shorter route for liquefied petroleum gas (LPG) exports from the United States to Asia, which could further depress already low Very Large Gas Carrier (VLGC) rates.
20 May 2016
Chinese consortium Panama Colon Container Port (PCCP) has reached agreement on a deal with the Panama Maritime Authority (AMP) to construct the first terminal in Colon able to handle post-Panamax vessels.
TC Mariel boss Charles Baker
18 May 2016
Plans are in place to transform Cuba’s Mariel container terminal into a major transhipment hub after the US trade embargo is lifted, according to TC Mariel general director Charles Baker.
04 May 2016
APM Terminals, Terminal Link, Terminal Investments Ltd, and PSA International have pre-qualified for bidding on Panama’s proposed Corozal container terminal. Three other interested parties – Mitsui OSK Lines, Manzanillo International Terminal, and Ports America – failed to make the cut.

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?