Suez and Panama Canal will battle for market in 2016
Rivalry between the Suez and Panama canals is expected to reach unprecedented levels next year as the newly expanded Panama waterway targets larger ships on the Asia-US East Coast route.
The canals are the world’s two key hubs for global shipping traffic, with the Suez Canal having been re-launched this month with a new channel providing two-way traffic for the first time in its history.
The Panama Canal, meanwhile, will be re-launched in eight months time with a new set of locks and channels able to handle post-panamax container ships, which are currently routed to the US East Coast via the Suez Canal.
The canal will therefore get a shot at regaining a majority of the market shares lost to Suez since since 2008, according to analyst agency Alphaliner.
Vessels sizes on the Asia-US East Coast, through Suez, have increased an average 73% since 2005, while ships on the same route via Panama have increase a mere 12% due to the limitations imposed by the locks.
The redeveloped Panama Canal will provide shipping lines with a much faster, more direct route between Asia and the US East Coast, negating the need to transit the Mediterranean and Atlantic and is therefore expected to have a significant impact on existing route networks.