Panamax May Move Supply Chains Eastward

Savannah, GA and other East Coast ports have already seen a greater share of US shipping traffic, CBRE says.

LOS ANGELES—An expanded, higher capacity Panama Canal is scheduled to open this Sunday, more than a year and a half behind schedule. When that happens, about 10% of the Asia-to-US container traffic is expected to shift from West Coast ports to East Coast terminals by 2020, according to a Boston Consulting Group report. “So far, 136 ships that wouldn’t have fit through the pre-expansion canal have made reservations to follow,” the Wall Street Journal reported earlier this week.

A special report from CBRE Group in advance of the June 26 Panamax opening also notes the coming change. “The debut of the expanded Panama Canal marks a fundamental shift in the shipment of Asian goods to the Eastern US,” says David Egan, director of industrial research for CBRE. “The short term won’t bring massive, game-changing gains for East Coast ports because much of that repositioning already occurred in recent years. But it will shift US cargo delivery from slightly favoring the West Coast to a more even split between the two coasts.”