Could Panama Canal Expansion Be A Good Thing For Puget Sound Ports?

You know when you’re watching television and a teaser commercial for the evening news comes on? It’s usually something like “Is Your Dog Trying to Kill You? Answer At 11!” And then you watch the news and they say “Well, no. But one dog did attack a cat recently.”

That’s sort of like the title of this blog post. Because, most likely, the ports of the Puget Sound will face significantly increased competition from ports in the East and South United States when the widened Panama Canal is opened for business. In fact, the US Army Corps of Engineers just came out with a new report that reiterated the importance of upgrading Southeast and Gulf ports to accommodate post-Panamax vessels.

But apparently, not everyone agrees.

Rodolfo R. Sabonge, Vice President of Market Research and Analysis with the Panama Canal Authority (ACP), told Bay Area shippers that a wider Panama Canal will pose no threat to the Port of Oakland. In fact, he said, it may bring even more business…The Port of Oakland may become an even greater ocean cargo gateway for U.S. exports to Latin America once the Canal Expansion is completed in 2014,” he said. [Emphasis added]

It’s an interesting point. As West Coast ports expand their shipping routes to serve Central and South America, a post-Panamax vessel might travel from Seattle to Brazil, say. And, of course, the Panama Canal goes two ways, such that maybe a large Brazilian ship might find it worthwhile to use the Port of Tacoma to offload goods meant for the Western part of the country. But, overall, the net impact of Canal expansion is going to be a challenge for the Puget Sound ports’ desire to maintain and expand their market share, as more shipping routes from Asia bypass the West Coast as a way to reduce land transportation times and costs.

In order to ensure that we don’t lose a disproportionate share of international trade business, it is incumbent on our state to find a way to invest in the infrastructure necessary to make freight mobility as efficient and affordable as possible..as well as address policy issues that are hindering our competitiveness, like the Harbor Maintenance Tax’s land border loophole. The potential for a national freight strategy in the upcoming federal surface transportation reauthorization legislation and the upcoming release of the Federal Maritime Commission’s Harbor Maintenance Tax trade diversion inquiry might be valuable tools in that endeavor.

In the meantime, make sure you watch the evening news. You never know what dangers lurk in normal household appliances.

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