The expanded Panama Canal opened today, June 26, 2016. Now, how long before we see what impact (if any) this has on volumes at eastern ports and on the railroads?
I don't think we will see much of an impact. I think Western Europe and Africa will see the brunt of the change.
Reuters reported it, so it must be true:
http://www.reuters.com/article/us-panama-canal-idUSKCN0ZC0Q9
A recent discussion topic here:
http://cs.trains.com/trn/f/111/p/255191/2853904.aspx
An opinion from western Kentucky:
http://www.kentucky.com/news/business/article86082827.html
Anyone know what's the latest on that canal in Nicaragua?
Tick, tock, tick, tock ....
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Todays Chicago Tribune has an aticle about and a photo of a Panamax ship making a test entry into a new lock.
http://www.chicagotribune.com/news/nationworld/ct-panama-canal-expansion-20160626-story.html
MikeF90 An opinion from western Kentucky: http://www.kentucky.com/news/business/article86082827.html
Thanks to Chris / CopCarSS for my avatar.
Murphy SidingCan the big ol' ships built for shipment through the enlarged Panama Canal really go all the way the Mississippi and Ohio Rivers to Kentucky? Would that be cost competitive with unloading onto a train at an Atlanic or Gulf port?
LOL, No, the bridges over the rivers would need to be rebuilt and the rivers would need to be dredged for the increase in draft.
I would be careful of any source from Kentucky, I used to live in that state and the state officials there are just butt stupid.......same with their Senators and Congress critters. Could be the Whiskey or Burbon.
People forget the U.S. Economy increases it's import of goods by over a Trillion Dollars a year and capacity plans that made sense 10 years ago are probably out dated today. Pretty sure they will build even bigger ships to ship containers to the West Coast. Right now Panama Canal still has a size limit on Container ships that can transit. More importantly they have a speed limit because the speed and or wake generated increases the need to dredge. Ships still have to drop anchor on both ends of the Canal and wait because of the congestion.
Nicaraqua's canal is a environmental disaster waiting to happen and thats the only reason they could only find the Chinese to attempt it. China doesn't care what happens to Nicaraqua environmentally, they just wanted the money.
This business all the Western railroads will lose all their bridge traffic is nonsense, at most this is a suppliment not a replacement. Even with two canals, there will still be ships waiting in line for their turn to transit either canal. Still can't wait to see the collapse of Nicaraqua's system which should take about 4 years after opening.........so we won't have two open canals for very long (ha-ha).
Remember also the United States has not started to ship Oil or LNG yet (no terminals built).....those two items alone will generate more canal traffic as well.
I wasn't about to characterize the intelligence of that Kentucky pundit as was done above - I spent some years in Tennessee and agree that the inhabitants of that place to the north live in their own universe. As for a new-Panamax ship cruising up the Mississippi - just look at a map, folks. The Big Meander is NOT a comfortable fit for a ship a quarter of a mile long drawing 40 feet of water. Rather like trying to ride a jet-ski in a typical backyard pool. I rather suspect that those big ships will transload to barges (for low cost) or trains (for speed at a higher cost) in or near New Orleans. And, for total time, the fastest route from China to Kentucky will still be overland from the West Coast.
Chuck (Long time ago Merchant Marine cadet)
New Panamax ships are estimated to carry 12,000-14,000 TEUs (Twenty Foot Equivalent Units)...
However, Triple E or "Chinamax" ships now coming on line are too large to go through the new Panama canal - New Panamax ships have a beam of 49 meters and a draft of 15.2 meters, but Chinamax ships have a beam of 65 meters and a draft of 24 meters
The CGA CGM Benjamin Franklin is an example of a Chinamax ship - it can carry 18,000 TEUs and has called at Oakland and LA/Long Beach - here it is at Long Beach...
China Shipping Container Line (CSCL) Globe is capable of hauling 19,000 TEUs...
So wherever the Chinamax ships go - they must go the long way around as they don't fit any of the short cuts. 24m draft is approximately 75 feet - to the best of my knowledge max draft in US ports is approximately 59 feet.
Never too old to have a happy childhood!
Now on the National Defense side of things. U.S. National Security just improved quite a bit in being able now to accomodate most U.S. Navy Ships through the Canal............I wonder if finally an Aircraft Carrier will fit?
Murphy Siding MikeF90 An opinion from western Kentucky: http://www.kentucky.com/news/business/article86082827.html Can the big ol' ships built for shipment through the enlarged Panama Canal really go all the way the Mississippi and Ohio Rivers to Kentucky? Would that be cost competitive with unloading onto a train at an Atlanic or Gulf port?
Can the big ol' ships built for shipment through the enlarged Panama Canal really go all the way the Mississippi and Ohio Rivers to Kentucky? Would that be cost competitive with unloading onto a train at an Atlanic or Gulf port?
Insane as this may seem, there was a report yesterday that was advocating West Memphis as an alternative 'deepwater port' (that was the term I recall hearing them use) to Mobile. Now, I'm fairly sure this wouldn't involve Panamax-size ships, but I have to wonder if some of the proponents of the idea entirely understand ship size as well as they should.
I note peripherally that the Chinamax spec explicitly indicates the ships aren't expected to go under any bridges to reach their docking facilities.
BaltACD, you are spot on. To head to Europe the Chinamax ships have to go around the Cape of Good Hope at the southern tip of Africa
However, to get to the US West Coast is, of course, a direct shot from China. CGA-CGM, CSCL, and Maersk all have ordered large fleets of these Chinamax ships, also known as Triple E.
LA, Long Beach and Oakland have all invested to be able to dock and service these ships - there are pictures out on the net of CGA-CGM Benjamin Franklin docked at all three. I don"t have confirmation but I would guess Seattle, Vancouver and Prince Rupert will be getting ready for them also.
18,000 TEUs (Twenty Foot Equivalent Units) is 9,000 40-foot containers.
A train of 150 wells could carry 300 40-foot containers, so each one of these Chinamax ships carries the equivalent of 30 double stack trains of 150 wells.
Of course, a lot of the freight landed on the West Coast stays on the West Coast, but with approximately 2/3 of the US population still living east of the Mississippi River, there will still be considerable container business for BNSF and UP to haul from West Coast ports even with the opening of the expanded Panama Canal.
There is a lot of interesting information on Chinamax ships out on the Web that comes up with Google searches of either "Chinamax ships" or "Triple E ships".
It would actually be a great article for a future Trains volume - "The Ships That Fill The Transcon And Sunset Routes" or something of that nature.
kgbw49 BaltACD, you are spot on. To head to Europe the Chinamax ships have to go around the Cape of Good Hope at the southern tip of Africa However, to get to the US West Coast is, of course, a direct shot from China. CGA-CGM, CSCL, and Maersk all have ordered large fleets of these Chinamax ships, also known as Triple E. LA, Long Beach and Oakland have all invested to be able to dock and service these ships - there are pictures out on the net of CGA-CGM Benjamin Franklin docked at all three. I don"t have confirmation but I would guess Seattle, Vancouver and Prince Rupert will be getting ready for them also. 18,000 TEUs (Twenty Foot Equivalent Units) is 9,000 40-foot containers. A train of 150 wells could carry 300 40-foot containers, so each one of these Chinamax ships carries the equivalent of 30 double stack trains of 150 wells. Of course, a lot of the freight landed on the West Coast stays on the West Coast, but with approximately 2/3 of the US population still living east of the Mississippi River, there will still be considerable container business for BNSF and UP to haul from West Coast ports even with the opening of the expanded Panama Canal. There is a lot of interesting information on Chinamax ships out on the Web that comes up with Google searches of either "Chinamax ships" or "Triple E ships". It would actually be a great article for a future Trains volume - "The Ships That Fill The Transcon And Sunset Routes" or something of that nature.
Although as you point out the Port of Los Angeles can accommodate Chinamax sized ships there are still major capacity issues there in unloading the massive amount of containers in a reasonable timeframe and ships of that size are not currently using the port on a regular basis:
http://www.wsj.com/articles/giant-container-ship-unloads-at-port-of-los-angeles-1451513531
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CMStPnP Now on the National Defense side of things. U.S. National Security just improved quite a bit in being able now to accomodate most U.S. Navy Ships through the Canal............I wonder if finally an Aircraft Carrier will fit?
The best answer I could find from a web search was "probably" (in other words dimension-wise they should fit)
Does anyone know for sure?
Everything I can find online says even up to the Newest Ford Class Carriers should fit thru now. Her beam is 41 Meters at the waterline however she is 78 Meters wide at the flight deck so hard to say. The America Class LS will fit easily so the Marines will have an Easier time of getting around the world.
Any guess how soon there will be a shut down of one or more locks for more than 24 hours ?
carnej1 CMStPnP Now on the National Defense side of things. U.S. National Security just improved quite a bit in being able now to accomodate most U.S. Navy Ships through the Canal............I wonder if finally an Aircraft Carrier will fit? The best answer I could find from a web search was "probably" (in other words dimension-wise they should fit) Does anyone know for sure?
If you look up the stats on the carrier it is pretty clear
Nimitz Class:
Ford Class
Looks like both should comfortably fit in new Panamax Assuming waterline Beam. Which may not be sufficient.
Both classes would fit if the waterline beam was all that mattered but the beam at the flight deck precludes their use of the new Panama Canal locks.
Isn't that something. All that money and effort spent to upgrade the canal, and the ships coming online can't make use of it...
How far would $5.2 billion go toward creating a grade-separated non-stop rail route through Chicago?
Gramp Isn't that something. All that money and effort spent to upgrade the canal, and the ships coming online can't make use of it... How far would $5.2 billion go toward creating a grade-separated non-stop rail route through Chicago?
Not very far at all.
GrampHow far would $5.2 billion go toward creating a grade-separated non-stop rail route through Chicago?
A fine question. The answer is: Not very far. I mean, why would people in Panama pay for a grade-separated non-stop rail route through Chicago? (no US taxpayer money is involved in this latest iteration of the Panama Canal)
To be serious, this proposed Chicago project is precisely the sort of infrastructure improvement that the US should be building (and financing). It would put people to work in many industries and they would be spending that money in their communities, thus creating more jobs and wealth. Borrowing money will never be cheaper (I hope!) than it has been since 2009.
I believe J. M. Keynes termed this "pump priming," and it has a long record of effectiveness. The opposite approach, "trickle-down economics," has long been completely discredited, yet the 1% and their lackies keep promoting it because they benefit personally. No one else has or does.
The following NY Times article is not very optomistic. Many problems but those that stand out are poor concrete, using tug boats instead of the electric locos to transit locks, & lack of water ( Probably the most critical ) Many ships may have to unload part of cargo to pass thru. Guess that will keep our west coast RRs busy and especiallly KCS of Panama.pana
http://www.nytimes.com/interactive/2016/06/22/world/americas/panama-canal.html?emc=edit_th_20160623&nl=todaysheadlines&nlid=34218840&_r=1
carnej1[previous quote omitted - PDN] Although as you point out the Port of Los Angeles can accommodate Chinamax sized ships there are still major capacity issues there in unloading the massive amount of containers in a reasonable timeframe and ships of that size are not currently using the port on a regular basis: http://www.wsj.com/articles/giant-container-ship-unloads-at-port-of-los-angeles-1451513531
Consider a few humongous container ships. They take about 2 months to load, a month to sail from China to the US, 2 months to unload, another 2 months to load up again, a month to sail back to China, and then 2 more months to unload before starting the cycle again = 10 months total. OK, make them a little bigger so each load/ unload operation takes 2-1/2 months, then that'll be 1 round trip a year, just in time for the fall peak (holiday) shipping season . . .
- Paul North.
Right now most of the ultra large container ships are on the Asia-Europe route. However, the dynamics in the ocean shipping world right now is that there is excess capacity on the Asia-Europe route with even more coming on line over the next 2-3 years, so there is a race to low cost with the economies of scale of these very large ships. Chinamax ship orders continue - Maersk has ordered 20 ships with 18,340 TEU capacity, CGA CGM has ordered 6 ships with 18,000 TEU capacity, COSCO has ordered 11 ships with 19,000 TEU capacity, and Mitsui OSK has ordered 6 ships with 20,150 TEU capacity, to name a few. Here are a couple of articles on orders:
http://www.cargobusinessnews.com/news/040616/news3.html
http://www.mol.co.jp/en/pr/2015/15013.html
As shipping capacity keeps getting constructed and deployed, efficiency will gradually win out, just as it did in the railroad industry with Mountains and Northerns bumping Mikados to local service, two 4400 hp diesels pushing 3 SD40-2 units into local and yard service, etc.
It will take some time but eventually larger container ships will call more frequently on the West Coast, as the 18,000-20,000 TEU ships push the 14,000-15,000 TEU ships to other routes.
And not to be lost in the discussion is that at least the ports of Oakland, LA and Long Beach have all invested in the cranes with spans long enough to service the 18,000-20,000 TEU ships, and have dredged their harbors deep enough to dock those vessels, proven by several port calls by those large ships. They would not have invested in those improvements if they did not think those larger ships will eventually be calling on a consistent-enough basis to earn a return on that investment.
Paul_D_North_Jr carnej1 [previous quote omitted - PDN] Although as you point out the Port of Los Angeles can accommodate Chinamax sized ships there are still major capacity issues there in unloading the massive amount of containers in a reasonable timeframe and ships of that size are not currently using the port on a regular basis: http://www.wsj.com/articles/giant-container-ship-unloads-at-port-of-los-angeles-1451513531 OK, now carry this out to its (il)logical extreme: Consider a few humongous container ships. They take about 2 months to load, a month to sail from China to the US, 2 months to unload, another 2 months to load up again, a month to sail back to China, and then 2 more months to unload before starting the cycle again = 10 months total. OK, make them a little bigger so each load/ unload operation takes 2-1/2 months, then that'll be 1 round trip a year, just in time for the fall peak (holiday) shipping season . . . - Paul North.
carnej1 [previous quote omitted - PDN] Although as you point out the Port of Los Angeles can accommodate Chinamax sized ships there are still major capacity issues there in unloading the massive amount of containers in a reasonable timeframe and ships of that size are not currently using the port on a regular basis: http://www.wsj.com/articles/giant-container-ship-unloads-at-port-of-los-angeles-1451513531
OK, now carry this out to its (il)logical extreme:
To add somewhat to what Paul North has mentioned as to the Load/Unload and Transit Times of some of the Larger Container Ships [ # of T.E.U's carried on a ship seems to be the universal 'yardstick' as to the capacity of a container ship.]
* ULCV is the largest class of current cantainer ships with a TEU capacity of 18,270. Ship size is 400m X59m X Draft of 14.5, and able to transit Suez Canal.
*Panamax ships are at the upper limits of ships able to transit the Panama Canal. T.E.U. capacity is 4,224. Ship size is 292.15mX32.2mX 13.3m
* Another consideration is that plans are underway to build to a larger TEU capacity of 20,000 TEU's. Putting additional burdens on Ports and their 'Lift' capacities.
More information on these ship diamentions can be found @ https://en.wikipedia.org/wiki/Container_ship
Here also, is a link to another site that has inforamtion as to dredged depths of entrances/channels to U.S. East Coast Harbors :[ Bear in mind: the Harbor itself may have differences as to the depth maintained within the Harbor infrastructure: ie; Harbor, Berths, and Turning Basins.]
@ https://www.people.hofstra.edu/geotrans/eng/ch4en/conc4en/uswaterwaysystem.html
With current conditions in Europe as to political events and some financial reregulations threatend there; potentially, to have effects on global commerce. There may over the coming couple of years be forced changes in the current traffic patterns within the United States.
The current traffic flows for Import/Export Container business seem to currently favor West Coast Ports; with the Southern California Ports handling the larger portions of International traffic. All of that may questions as to how will the traffic patterns, currently favoring the West Coast, change IF those patterns shift to the East Coast Ports? Will those Ports and their infrastructure be able to shift in a reasonably quick change to accomodate the increases in their traffic?
Great chart on port depth. Oakland Is also capable of handling 18,000 TEU ships, as the CMA CGM Benjamin Franklin has been there several times.
http://sanfrancisco.cbslocal.com/2016/02/24/giant-cargo-ship-benjamin-franklin-making-return-to-port-of-oakland/
Here is a picture of it berthed in Los Angeles, right behind a Maersk Line 14,770 TEU ship.
http://www.sfgate.com/bayarea/article/Largest-cargo-ship-coming-to-oakland-6727878.php
Here is an article about it docked at Seattle. This has interesting information about what the West Coast ports are doing or have done to prepare for these ships.
http://www.maritime-executive.com/article/cma-cgm-benjamin-franklin-to-call-at-seattle
The last article also quotes CMA CGM as saying the Benjamin Franklin is being deployed between China and the West Coast.
NKP Guy,
I couldn't have said it better!
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