Because of its strategic location Panama is a key maritime center. The Panama Canal has historically been the symbol of Panama’s maritime activities. Panama’s traditional main ports, Cristobal on the Atlantic and Balboa on the Pacific, were privatized in the 1990s. Both ports are now modern facilities run by Hutchison Whampoa (Hong Kong) and are capable of handling increased container traffic. Additionally, two major container ports operate on the Atlantic: Manzanillo International Terminal (MIT), operated by the Seattle, WA-based Carrix, and Coco Solo operated by Evergreen Marine Corporation (Taiwan). Port Singapore Authority (PSA) has recently initiated a new container port at the Pacific end of the Canal, close to Panama Pacifico’s extensive logistics parks. Panama’s container handling capability has increased from 250,000 in 1997 to over 5 million in 2011.
A trans-isthmian railroad, built by the U.S. firms Kansas City Southern and Mi-Jack Products Inc., has been in operation since 2001. The railroad allows for surface container multimodal transshipment. The Panamanian ports are among the most active ports in the region and this situation is expected to continue in the near future, as the world economy show signs of recovery.
The U.S. has a strong position in the port equipment market, with a market share of over 50 percent. Major competitors are Korea, Japan, Germany, and the People’s Republic of China.
Sub-Sector Best Prospects
This increased port activity offers excellent opportunities for U.S. port equipment exporters. The following product categories enjoy good demand: quay cranes, container cranes, forklifts, top loaders, rubber tire gantry cranes, power packs, and flatbeds. Additionally, the new ports offer opportunities for material handling equipment such as small forklifts, small trucks, and similar equipment.
As the world economy recovers from the global crisis and the Canal expansion is completed, Panamanian ports will continue showing a strong growth. This will generate increased business opportunities for port-related activities, including port equipment, dredges, consulting services, and fuel supplies.
When completed, the expansion of the Panama Canal will allow all-water routes for container ships carrying up to 12,500 TEUs (twenty-foot equivalent units). Currently the largest container vessels that can pass through – referred to as Panamax – carry 5,000 TEUs. A number of analysts believe that the expanded Canal will increase transshipment activity dramatically. And in response to this prospect, the ports in Panama are investing heavily in dredging as well as purchasing such equipment as larger cranes.