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Holland Transport

News

25 Gen 2016

Into the Great Wide Open

Transportonline
PANAMA_CANAL

The extended Panama Canal is casting its large shadow on 2016.

 

The Panama Canal Authority is expecting to open its expanded waterway in the second quarter of 2016. The consequences of this development, which will not only set the course for the shipping industry this year, have now been investigated by the Boston Consulting Group and C.H. Robinson, a third-party logistics company.

 

It is clear what event will represent the most crucial infrastructure development for the shipping industry this year: the expanded Panama Canal is set to open in Q2 / 2016. The Suez Canal was also enlarged recently for about USD 5.3 billion, with the operational benefits starting in summer 2015. Now around USD 5 billion has been invested in doubling the capacity of the Panama Canal, and this renewal is due to be inaugurated about a year later. The Boston Consul­ting Group (BCG) and C.H. Robinson, a non-asset based third-party logistics company, have published a white paper on the expected ramifi­cations for the logistics sectors in the USA especially, as well as the whole world.

 

Canals and coasts

The cards will definitely be reshuffled in the competition pitting the world’s two most famous canals against each other. From 2010 to 2014 Suez caught up and increased its share of boxes destined for the US east coast from 32% to 35%. The new Panama Canal will be able to offer shippers a faster link in this trade, however.

 

As for competi­tion between US ports, the white paper has predicted a significant shift of goods flows between the country’s two major coasts. In fact, the BCG and C.H. Robinson expect about 10% of Asia’s exports to migrate to the east coast by 2020. A substantial proportion of the expected growth in Asia’s export trade will thus be transferred to the east of the USA.

 

Who will serve the hinterlands?

 

Services to the hinterlands is one of the most important factors in the equation. Almost three quarters of US states now receive goods by rail and road from western ports, but there will be new ­options from 2016 onwards, for example for Chicago and Detroit in the north, or Memphis in the south. The time taken and the costs of shipping goods there will make it attractive to send them through the Panama Canal to east coast gateways, and from there to their final recipients on shorter overland routes. Read more

 

 

Source: ITJ

 

 

 

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