Panama Canal Expansion Will Lead to Improved Warehouse Investment in American Ports

The Panama Canal is one of the world’s busiest waterways, managing approximately 5% of the world’s cargo each year. Since its completion in 1915 there have been some small exertions to improve the 48 mile-long canal. These were restricted to efforts prior to WORLD War Two of constructing a few new locks to enable the canal to manage bigger warships as well as the construction of the Madden Dam to increase the water supply to the canal. The entrances to the canal are being enhanced too with the building of numerous new locks at both the Atlantic and Pacific ends. The most important feature of these developments is that it will start a new lane and double the capacity of the canal by 20253. One of the major impacts that this increased capability is expected to have is that it’s going to make a heightened need for warehousing of cargo that has passed through the Panama Canal over the Gulf Coast and also the eastern seaboard of the USA. This anticipated increase in traffic has seen capital investment being poured into gearing up the intermodal freight infrastructure from Texas to NYC where in fact the Bayonne Bridge has been raised to let larger boats to pass beneath it. Another advantage of the widening of the Panama Canal could be the petroleum refiners who are now the third biggest consumers of the canal behind grain and container transports. Less time sensitive cargoes like crude oil can gain from the more economical transportation provided by ships, though a lot of cargo will still be transported across inland USA by railroad or highway. Because the decline of the supertankers in the previous decade and the widening of the canal, the size constraints that once held the oil tankers out of the canal will have been overcome along with they will now have the capacity to take the shortest path between the Atlantic and the Pacific. This more direct passage is expected to have a positive effect on oil costs within the US generally. At the same time the greater capability of the canal may also increase the quantity of freight that will be sent to the east coast ports, further stimulating the creation of our seaports and stimulating economies across the country.