Panama canal expansion

1. IMPACT ON TRADE ON
EXPANSION OF PANAMA
CANAL

2. OBJECTIVE AND NEED OF THE
STUDY
• To know the trading pattern of countries directly
linked by Panama Canal.
• To know the major changes in traffic flow from
Panama Canal.
• To know how the expansion of Panama Canal
will directly or indirectly affect the container, dry
bulk and tanker trade.

3. Contd…
• To study the expansion program of US of
its Panama Canal.
• To find out the answer of the question “Is it
true that expansion of existing Panama
Canal would prove to be a game changer
for the container, dry bulk and Tanker
trade?”
• How the Panama Canal can be used
strategically by the USA?

4. RESEARCH METHODOLOGY
• The data collected is secondary data:-
 internet
 Library books
 Trade Journals
 Trade news from economic times
• The urls are as follows:-
The Panama Canal Expansion: Potential impact on logistics and
supply chains, By Onesimo V. Sanchez, Office of market research
and analysis, June 2012.
http://caribgrowth.competecaribbean.org/content/OnesimoSanchezKin
gstonpanamacanaljune2012_.pdf

5. Contd…
• Expansion of the Panama Canal Potential impact on Asia – East
Coast/Golf trade, By Rodolfo Sabonge, Vice President, Marketing
research and Analysis office, Panama Canal Authority
http://www.fhwa.dot.gov/planning/freight_planning/talking_freight/talkin
gfreight10_21_09rs.pdf
• The Panama Canal Expansion: Business as usual or Game
changer?, By Dr. Jean-Paul Rodrigue, Hofstra University, New York,
USA, & Dr. Theo Notteboom, President of ITMMA, University of
Antwerp, Antwerp, Belgium
http://people.hofstra.edu/jean-paul_rodrigue/downloads/PT51-
10_3.pdf
• Effects of the Panama Canal Expansion on Distribution Networks,
By Fortna, www.fortna.com
http://www.fortna.com/whitepapers/Article_Viewpoint_PanamaCanalE
xpansion_FINAL_EN.pdf

6. RESEARCH DESIGN
• The design of the research is mentioned
below:-
 Conclusive research
 Descriptive research
 Explanatory research
 Quantitative research

7. Panama Canal Expansion
Program Objectives
• Maintain Canal competitiveness as well as the value of the route
• Increase capacity and allow the transit of larger ships
• Reduce water consumption
• Improve safety and efficiency
• Sustain tonnage and profitability growth

8. Canal Expansion Program Components
• Deepening of Pacific and Atlantic
entrance channels
• Deepening and widening of the Gatun
Lake navigation channel
• Construction of new access channel
for Pacific Locks
• Construction of new Post Panamax
Locks and water saving basins in the
Atlantic and the Pacific
• Increase the maximum operating level
of Gatun Lake

9. Pacific Locks Site

10. Atlantic Locks Site

11. Benefits of the Panama Canal
Expansion
• Largely decrease the instances of bottlenecks
• Lower the average transit times by rendering
raised capacity
• Allow for transit of Post Panamax vessels
• Increase capacity to 42 vessel per day & by
2020 to 51 vessel perday
• Average canal water time could be significantly
redused by using more robust tugs.

12. Main competitors of the Panama Canal route

13. Impact of the Panama Canal
Expansion

14. The Panama Canal Authority Classifies its
market into eight Segments
• Containers
• Dry bulk vessels – grains, ore, coal
• Vehicle Carriers
• Liguid Bulk Vessels
• Reefers or Refrigirated Transport
• Cruise Ships
• General Cargo Vessels
• Micellaneous vessels – Navy, Barges, Dreges

15. General Cargo
CN
CSX
CSX Main Line &
Yard
AGR/BNSF
Canadian
National/KCS
Norfolk
Southern
TASD Switch Yard
TASD Terminal
Yard
Mobile Container
Terminal
Steel
Heavy Lift/Oversized
I-165 / I-65
I-10
Future ICTF
Mobile Ship Channel
3.5 Hrs. to Sea Buoy
McDuffie Coal
Terminal
Pinto Steel Terminal
CG Railway
Service to Mexico
Pier 2 – Open Yard
NAFTA Gulf Bridge
to Mexico
Access to
15,000 Mi.
Inland Waterways
Via Tenn-Tom

16. 5
0 5
0
Mobile Container
Terminal
Intermodal Container
Transfer Facility
5
0
 2 Post-Panamax Cranes (4 More
Planned)
 2,000 Feet of Berth at 45 Foot Draft
 Weekly Carrier Service on Major Trade
Lanes (Maersk, CMA CGM, ZIM, HMM,
APL)
Intermodal Container
Transfer Facility

17. Future Rail
Intermodal
 Rail Intermodal Extends
Port’s Reach into Midwest
and Southeast U.S.
Markets
 Serves Domestic
Shipments
 Adjacent Land for
Logistics
 3-Year Development
Plan
 200,00 TEUs Throughput

18. Heavy Lift Crane
 900T Crawler
Crane
Secured to
a 210’ x 68’
Barge
 Capable of
Lifting
400 Tons to
the Center of a
Panamax
Vessel

19. Alabama Cruise Terminal
 66,000 Sq. Ft. State-
of-the-Art Terminal
 Six Covered Drop
Off/Pick Up Lanes
 On-Site, 500 Space
Parking Deck
 Immediate Access
to Interstate 10 and
Interstate 65 (4 Miles
via I-10)
 Proven Drive
Market
 Entertainment,
Museums, City Center
Within Walking
Distanced
 New Marriott
Rensaissance, Hilton
and Holiday Inn Hotel
Investments Within
Walking Distance

20. Panama Canal Expansion
• $5.25 billion dollar project
• Schedule for Completion in 2014
• Panamax Vessels with up to 12,500 TEU
• Will double the amount of goods
• Impact on the gulf ports:
• Increase in incremental cargo
• An additional Asian Service
• Increase in feeder services from Transshipment
Hubs in the Caribbean

21. Shippers control supply-chain
decisions that will influence the use
of the canal
• routing strategies will continue to be
assessed based on:
• Fuel prices
• Sourcing dessisions
• Delivery times
• Added value distribution centers
• Intermodalism capabilities