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Panama Canal expansion may generate new business for West Coast ports

The Port of Oakland may have even more outbound business once expansion is completed
By Patrick Burnson, Executive Editor
June 22, 2012

Rodolfo R. Sabonge, Vice President of Market Research and Analysis with the Panama Canal Authority (ACP) told Bay Area shippers that a wider Panama Canal will pose no threat to the Port of Oakland. In fact, he said, it may bring even more business here.

He was the featured speaker last week at the “Ports & Terminals” dinner staged annually by the Pacific Transportation Club.

“The Port of Oakland may become an even greater ocean cargo gateway for U.S. exports to Latin America once the Canal Expansion is completed in 2014,” he said.

Sabonge has been with the Authority since 1986 and has been instrumental in the Canal’s growth and current expansion project.

In his hour-long dinner presntation, Sabonge provided an update on the construction of the third set of locks, an ambitious, eight-year, $5.25 billion engineering and modernization feat that will help double current tonnage capacity.

In addition to being wide enough to fit a 12,000 twenty-foot equivalent unit (TEU) containership (from the current limit of 4,800 TEU) the new locks will enable larger cruise, tanker, bulk, LNG, and ro-ro vessels to use the Panama Canal routing.

“It is one of the largest engineering projects in the world and will significantly impact vessel routings and global trade patterns,” he said. “Currently, about 65 percent of the goods transiting the Canal originate from, or are destined to, the United States.”

Evidence that Oakland can accommodate the new generation of “Mega” vessels was demonstrated earlier this year when one of the world’s largest cargo vessels came into the San Francisco Bay.
The MSC Fabiola is part of a new class containerships creating greater economies of scale, increased fuel efficiency, and more service options for shippers.

Of the more than 5,000 containerships deployed around the world, only 71 have a capacity of 12,500 TEUs or more, and the MSC Fabiola is the only one to have regular port calls in the United States. Virtually all vessels in this ultra-large class are deployed in the Asia-Europe trade lane.

About the Author

Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).

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