Panama Canal to modify tolls, decrease containership rates

Panama Canal Authority executives have been meeting with industry leaders around the world to gain feedback on its current toll structure, a proposed modification of which would decrease rates for containership but increase them for LPG and LNG tankers.    The Panama Canal Authority (ACP) has put forth a proposal for modifications to its current toll structure that could ultimately lower rates for containerships, but raise them for LPG and LNG tankers.
   The proposal signals the start of a 30-day formal consultation period with the industry, though Panama Canal Administrator Jorge L. Quijano and executives have already met with canal customers in Europe, Asia and North America, the ACP said.
   The feedback obtained through these meetings told ACP that it was “necessary to provide additional incentives to the containership segment – the largest user of the expanded canal – to revise the tolls for liquefied petroleum gas (LPG) and liquefied natural gas (LNG) vessels, and to reclassify container/breakbulk vessels,” said Quijano.
   “These meetings with customers in Asia, Europe and North America have been extremely valuable in providing us with a deeper understanding of the industry today, the challenges faced by individual market segments, and the projected demand for the Neopanamax locks,” he added.
   The containership proposals will offer more attractive rates per loaded container on the return voyage, but only for Neopanamax vessels deployed on the canal route in the head and back haul legs, said ACP. Furthermore, containerships will only receive these new rates if they adhere to the following standards: the utilization rate for a ship’s northbound transit must be equal to or more than 70 percent and the time between the northbound and southbound transit must not be greater than 25 days.
   However, ACP said any additional days that the vessel requires to perform port-related activities in Panamanian terminals will not add to the 25-day period.
   Tolls for LPG and LNG vessels will be modified, but the units of measurement will remain unchanged because of its adherence to industry standards. The tolls proposals will reassign the vessels classified by ACP as “container/breakbulk” into the “general cargo” segment, as these vessel are currently part of the “others” segment, said ACP.
   “This reassignment will result in more attractive tariffs for customers in this category, as general cargo tolls are lower. This change is made in response to a request submitted by customers during the 2015 tolls hearing and consultation process, and due to the fact that container/breakbulk vessels operate in a manner similar to that of general cargo vessels,” the authority added.
   The modifications to the toll structure are slated to be implemented in October 2017. Until then, all interested parties are invited to participate in the consultation process as well as the public hearing to be held in Panama City, Panama, on July 5, 2017. After evaluation and analysis of the comments received and any changes are included in the proposal, the Cabinet Council of the Republic of Panama will officially approve the modifications, said ACP.