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Canal expansion strengthens one transportation link

The Panama Canal expansion strengthens one link in a long chain of shipping infrastructure between the U.S. Corn Belt and Asia. Soy Transportation Coalition Executive Director Mike Steenhoek says a study recommended by the coalition shows the expansion will result in a greater volume of exports coming from a wider area at a lower cost.

“We applaud the fact that the Panama Canal Authority is investing a lot of money – $5.2 billion – to enhance their canal,” Steenhoek told Brownfield Wednesday, prior to a presentation he made to the Tri-State Development Summit in Quincy, Illinois. “Our concern is are we just simply shifting the bottleneck from where it currently exists in Panama to our ports, to our inland waterways, to our rail infrastructure, to our roads?”

The canal expansion, allowing bigger vessels, has several implications for U.S. agriculture, according to Rodolfo Sabonge, vice-president of market research and analysis of Panama Canal Authority.

“Larger ships will, of course, represent lower costs, but that can only be done if you have the infrastructure adequate to be able to handle the larger ships at the ports, and of course up the river with the barging system and so on,” said Sabonge, also a presenter at the Summit Wednesday in Quincy.

The expansion is to accommodate vessels up to 150,000 tons, versus the 80,0000-ton so-called Panamax ships that currently squeak through the aging artery with about a foot of clearance on either side. However the larger ships will require that U.S. ports in southern Louisiana be maintained to a depth of 45 feet.

Release of the study comes on the heels of Congress getting free trade agreements with Panama as well as with Korea and Colombia.

AUDIO: Rodolfo Sabonge (5 min. MP3)
AUDIO: Mike Steenhoek (7 min. MP3)