A February report by Carrie Kissel, associate director of the National Association of Development Organizations, about potential economic development opportunities associated with the expansion of the Panama Canal for regional organizations in the South and East of the United States contains some flawed statements.
For instance, she writes that “West Coast ports are the largest receivers of Asian imports, and containers make it possible for imports to then be transferred and transported via rail and truck inland, or to be shipped by sea again from the East Coast to destinations in Europe.”
Now, I may not be a genius, but I can figure out that it doesn’t make much economic sense to ship goods from Asia or South America through the U.S. West Coast, transport them across the country, reload them in a container and ship them across the Atlantic.
Kissel also referenced a Bloomberg news story stating shippers could save up to $1,000 per container as larger ships are deployed through a wider set of locks. That number seems like pure fantasy and was not carefully vetted. Experts I’ve talked to have mentioned potential savings of maybe $400 per container. But the economies of scale will mostly accrue to the ocean carrier, with the shipper getting less than a quarter of that amount in some form of rate reduction.
The report also listed the Port of New Orleans as one of only three ports in 2011 that had the 45-foot depth to handle post-Panamax vessels. No mention of the Port of New York-New Jersey, the largest container port on the East Coast, which has a 45-foot harbor and is in the process of being dredged to 50 feet. The Port of Baltimore, with a 50-foot channel and as of 2012 a 50-foot container berth, was omitted too. And let’s be realistic. No super post-Panamax vessels with12,000 TEUs are going to sail 100 miles up the Mississippi River to unload Asian cargo in New Orleans. It’s a relatively small container port that eventually may receive some feeder vessels from hubs in the Caribbean, but it’s not going to be a primary port of call for mother ships. – Eric Kulisch
Washington Notebook: Panama Canal report’s credibility issues
