ACP Expects Double Digit Jump in Transhipment Activity

The Panama Canal Authority (ACP) expects its Pacific coast container port volumes to reach 6 million teu after the expanded canal is opened in 2016, UK Shipping consultant Drewry said.

This would be a massive 75% increase on estimated 2014 throughput levels (gateway and transhipment), however, the timescale for this anticipated increase in demand is not clear.

Larger ships transiting the Panama Canal will seek to make more use of transhipment options, both for hub and spoke and relay/interlining. Growth in transhipment activity both in Panama and the wider Central America/Caribbean region seems certain therefore, Drewry said.

Drewry expects there to be a double digit jump in Panama transhipment activity as a result of the opening of the expanded canal in 2016, and thereafter growth of around 5% p.a. On this basis, Panama Pacific coast throughput of 6 million teu would be reached by around 2024.

“The expanded Hutchison and PSA terminals could in theory accommodate 6 million teu of traffic, but adding in Phase 1 of Corozal would give a more comfortable 8.2 million teu of capacity versus 6 million teu of demand. Whether the existing terminal operators will be able to bid for the Corozal concession is not yet clear though,” Drewry added.

For the ports on the Pacific coast of Panama, the level of transhipment activity will, according to Drewry, be driven by the underlying levels of growth in Latin America in particular (along with any changes in liner shipping network patterns).

For this sector of the market, other Pacific coast hub ports such as Manzanillo and Lazaro Cardenas (Mexico) and Callao (Peru) will also be vying for a share of the growing market.

“There is also wild card in the pack as well – the potential Nicaragua Canal which, if built, would inevitably impact on both Panama Canal vessel transits and regional container transhipment activity,” Drewry said.

The project envisages the construction of two deep water ports, one at each end of the canal – Punta Aguila on the Atlantic side with an intended capacity of 2.6 million teu p.a. and Brito on the Pacific coast, with a capacity of 2 million teu p.a. – and these would surely have transhipment business in their sights.

The maximum size of container ship able to transit the Nicaragua Canal would likely be around 20,000 teu, significantly higher than the 13-14,000 teu New Panamax size. The project though remains speculative in the eyes of many observers (despite the recent news that construction work has already commenced), not least because of its USD 50 billion+ price tag.

“Expansion of the Panama Canal will trigger growth in regional transhipment activity and Pacific coast ports should be beneficiaries. The timing and phasing of the new Corozal terminal project will need to be carefully judged though – and a close eye will have to be kept on Nicaragua,” Drewry added.

Source: Drewry