Panama Canal Expands – East Coast Freight Patterns Impacted

Estimates say 10% of Asia to US container traffic will be shifted from West Coast to East coast terminals.  This means more logistics activity on the East Coast and a ripple effect as shipping patterns and prices adjust to the new inflows.  The new canal should also shift cargo going around Africa to the new passageway, further effecting US trade in the Atlantic.

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The Panama Canal was first built in 1914, and has provided a convenient route for shippers and travelers to bypass South America in trips from Asia to the Atlantic.  Modern developments in shipping have been maximizing vessel size, and many of these ships can no longer fit through the canal’s narrow passageways.  The $3.1 billion project involves massive engineering efforts- new locks will be added, which are wider and deeper than the existing ones.  The project is managed by Chinese investors, who anticipate increasing US-Asia trade in the short and long term future.

 

Valley Distributing & Storage Company is well positioned to help you take advantage of these changes market conditions.  Having an effective 3rd Party Logistics and distribution center on the East Coast will be paramount in the coming years.  Having a 3PL partner who can control logistics costs effectively will be even more important, as traffic and shipping demand increases.