Although volume increases will moderate from the rebound, 2011 will bring more and larger container ships to the U.S. East Coast.
Last year, I predicted (or maybe speculated) ocean carriers would seek to reduce costs by deploying post-Panamax ships on the U.S. Atlantic Coast with greater frequency, perhaps even with ships of 8,000- to 9,000-TEU capacity. That happened.
Frankly, this wasn’t going too far out on a limb. Deploying bigger ships to the U.S. East Coast is a business decision that makes perfect sense considering the logistics, cost and market advantages.
Although 70 percent of the country’s population lives east of the Mississippi, only 30 percent of the trans-Pacific cargo is moved across the East Coast. The Southeast also has a growing population, a substantial manufacturing sector and a healthy export base. In addition, more than 75 percent of all capacity on order is for ships too big for the existing Panama Canal. These ships are coming.
However, completion of the critical Panama expansion is not a metaphorical or a literal flipping of the switch. In fact, we already are feeling big ship economics. Today there are multiple strings employing post-Panamax ships on services to the East Coast. More will come.
This means ports with deep, capable channels stand to benefit, as do the companies that use them. It’s a risk-reducing, cost-saving solution for ocean carriers and shippers alike. Both groups of port customers are becoming more knowledgeable of the implications and the opportunities.