Panama Canal to double its capacity
An expanded Panama Canal, which will more than double its capacity, now poses to disrupt shipping patterns in the Caribbean by prompting a container terminal building spree as various ports rush to claim market share, reports the Jamaica Observer, Transport Weekly reports.
Earlier this month, a court cleared the way for a US$1 billion port facility in Costa Rica, while Cuba is embarking on a US$800 million port in Mariel, said the report.
Beijing-based China Communications Construction Company signed a two-year agreement with the Jamaica government this month that would allow direct Chinese investment in selected infrastructure projects, including the port.
"When Costa Rica is finished it is going to be a threat to all of us in the Caribbean and Panama," said Carlos Urriola, the head of the Caribbean Shipping Association. "The only port that can compete directly with Jamaica is Cuba - Caucedo (Dominican Republic) is already full to capacity."
Mr Urriola, also vice-president of Panama's Manzanillo International Terminal, said that ports which hope to benefit from the canal expansion need to implement box handling projects before the expanded canal opens in the first half of 2015 - no longer 2014 as commonly assumed.
"The shipping community wants to know that you will be an alternative, but if you can't say when, you are not going to be a part of the decision making," he warned, adding that terminals have three years to become operational.
Jamaica's Kingston Wharves Limited raised JMD1.8 billion (US$20.2 million) from Jamaica Producers Group (JP) to undertake its expansion.
Meanwhile, the Cuban expansion, which will lift Mariel's annual capacity from 350,000 TEU to one million, is expected to come on stream in 2014.
Costa Rica's two million TEU annual capacity terminal located in Moin is to be completed in three to five years, but it puts it closer to the largest market in Latin America - Brazil.
Brazil's population is expected to grow 18 per cent to 251 million(of the 700 million in all of Latin America) by 2030. "Population growth shows were the cargo is going," said Mr Urriola.
Transshipment centres can also compete on price, but without value added, shipping lines will move on to other locations.
Manzanillo, targeting 12.4 million TEU by 2020, is the biggest regional competitor, moving seven million TEU last year compared to Jamaica's 1.7 million, has an entire logistics centre planned, including a large commercial freezone, highway, railway, airport and banking within the same area.
Productivity needs to be increased significantly, and container movement targets should be lifted from 30 moves per hour to 50, he said.
At Kingston Container Terminal, the average move per hour using gantry cranes was 19.8 TEU in 2008, while the facility focused on transshipment hit its highest productivity (36 moves per hour) on any vessel docked at its port in 2010. Kingston Wharves Limited had lower average in 2008, but it uses smaller cranes.
