The Panama Canal’s container traffic is unlikely to return to 2007’s pre-crisis levels according to Jorge Quijano, CEO of the Panama Canal Authority.
In an interview with the Financial Times, the canal’s top executive cited changing patterns in global trade and manufacturing plus the increasingly austere behaviour of US consumers.
The trend of booming container trade has “peaked”, he said, adding that “reshoring or near-shoring” patterns will see many US companies move production closer to home, contributing to slower growth in global trade.
However, Quijano expects growing US energy and grain exports to help increase traffic on the 100-year-old canal, validating its $5.3bn expansion, which will be completed next year.
The upgraded Panama Canal will be able to handle ships of up to 14,000 teu although with 19,000 teu ships already in operation worldwide, he confirmed that discussions are underway about further expansion.
Container ships account for a quarter of all trips through the canal and almost half of collected tolls while the US economy is responsible for more than two-thirds of the canal’s business.
In the 2014 fiscal year, 2,891 container ships transited the canal carrying 11.6m teu, down from pre-crisis highs of 3,600 vessels carrying 12.6m teu in the year to September 2007.