Sunday, February 20, 2011

Widening of Panama Canal results in more spending elsewhere

The $5.25 billion being spent on widening of the Panama Canal is only the beginning of expenditures in the rush to accommodate giant container ships. Billions more dollars will be spent in the United States, as ports rush to expand facilities to receive the post-panamax ships passing through when the expansion is completed in 2014, one hundred years after it first opened.

Panama has been hosting delegations or port authorities and logistics experts from New York to Miami, including Savannah, and Atlanta, Georgia; Charleston, South Carolina; and Jacksonville Florida.

The widening will lead to the biggest shift in the freight business since the 1950s, when ships first started using giant containers of equal size.

Some of the ships known as post-Panamax can carry three times as many containers as the largest ships currently making the 48 mile transit.

The widening will also allow the U.S. Navy to transit some of its super sized aircraft carriers that currently have to make the long haul around the cape.

The expansion will enable products made in Asia to be sent directly to the East Coast instead of being unloaded on the West Coast and then sent east by train or truck.

A result could be a shift in business worth billions of dollars to ports, and big savings for companies like Ikea, Home Depot and Wal-Mart, always on the hunt for more efficient ways to serve shoppers in the Eastern third of the United States, where a majority of the U.S. population lives.

To capture some of the new traffic, almost every large East Coast port and those along the Gulf of Mexico have projects under way. Some ports that are too small to handle the giant ships are improving railroads and truck routes, making them more efficient in anticipation of an overall increase in the number of containers coming to the East says the New York Times.

Others want to dig deeper channels and become the leading port in their regions for companies operating the big vessels.

Containers have become the name of the game in shipping says a lead article. Although cruise ships and imports and exports of cars, oil and bulk agricultural loads like cotton and fertilizer still make up a good portion of port traffic, most of the growth is in containers filled with products that Americans like to buy.

The newest, biggest ships can carry the equivalent of as many as 15,000 containers that are 20 feet long. But they are also heavier, wider and require deeper water. In Savannah, for example, the water is only 42 feet deep. That is enough, with tidal variations, to handle ships loaded with 5,500 containers.

The port at Norfolk, Va., is 50 feet deep, and is the only one on the East Coast that can handle the biggest, fully loaded container ships.

The navigation channel that feeds the Port Newark-Elizabeth Marine Terminal in New Jersey is deep enough, but the Bayonne Bridge is not tall enough for the new container ships to pass under.

Officials at the Port Authority of New York and New Jersey are studying options. They might raise the bridge by 64 feet. A study estimated the cost at $1.3 billion.

As Savannah port officials are learning, digging up six feet of mud is not easy or cheap. Environmentalists are concerned that dredging will cause historic Savannah buildings along the shore to tumble into the water, suck sand from the shores of Tybee Island and ruin freshwater marshes.

The Corps of Engineers' environmental impact document, issued after a 14 yearstudy, suggested deepening but not widening the channel to protect the buildings along the shore and adding 3,000 acres of wildlife preservation land to help offset the impact on freshwater marshes.

1 comment:

Famacusta Developers said...

The Panama canal widening has had much flak and hype. Hopefully, the move will result in better things eventually. Thanks for the posting.