River Valley, where intermodal and all-water costs and transit times are similar,
thanks in part to improved rail service
from East Coast ports.) West Coast intermodal offers more flexibility in terms of
service and pricing, and for time-sensitive
goods, more precision thanks to door-to-door service, he says. Faster transit times
equate to lower inventory holding costs
too. From a shipper’s perspective, all-water
to the East Coast via Panama may be best
suited for commodities with year-round,
steady demand, he notes.
The view from Panama is more upbeat.
New container services attracted by the
expanded canal are creating more opportunities for U.S. companies, says Demóstenes
Pérez, supply chain business developer and
strategist at Logistics Services Panama, a
provider of warehousing, order fulfillment,
and value-added services in Panama’s
Colón Free Zone. “The increase in ‘New
Panamax’ vessels using the all-water route
from Asia to the East Coast has brought
... new options for our customers to use
inventory in Panama’s logistics hub to ship
product to the U.S. East Coast,” he says.
Some of the big ships stop at the Pacific end
of the canal to load containers originating
in Panama’s free trade zone as well as agricultural products from Central and South
America, he adds.
The increase in the size of the ships is
requiring third-party logistics companies
(3PLs) to make adjustments, says John
Knohr, managing director for DHL Global
Forwarding, Panama and the Caribbean.
“Since the vessels coming from Asia are
bigger than they used to be, the number of
containers we handle per bill of lading or
per ship sometimes is double what we saw
before.” As a result, he says, his company
is accepting more outbound containers
at one time into its Panama distribution
center than in the past in order to prevent
customers from facing demurrage penalties. If the ship is delayed, the longer wait
times can potentially cause bottlenecks in
the DC, he says.
PORTS PAY A PRICE
The scenario Knohr describes is not unique;
capacity is a concern in many warehouses
and DCs in Panama as well as around U.S.
ports where Neopanamax ships unload. It’s
U.S. shippers. Manufacturers and
agricultural producers that export
from the U.S. Midwest to Asia via
the Mississippi River and the Gulf
Coast have reduced their shipping
costs by using the bigger ships that
now pass through the canal, she
contended in ACP’s e-newsletter.
The picture is different on the
inbound side. Even considering the
time and cost of delivering containers from East Coast ports to
inland destinations, it’s generally
faster and often just as cost-effective to serve the western two-thirds
of the U.S. via intermodal service
over the West Coast, Prince says.
(The “battleground” is the Ohio