Title: News from ... the Panama Canal
Full Citation
Permanent Link: http://ufdc.ufl.edu/UF00099414/00011
 Material Information
Title: News from ... the Panama Canal
Physical Description: Serial
Language: English
Publisher: Autoridad del Canal de Panama
Place of Publication: Balboa, Panama
Publication Date: March 2005
 Record Information
Bibliographic ID: UF00099414
Volume ID: VID00011
Source Institution: University of Florida
Holding Location: University of Florida
Rights Management: All rights reserved by the source institution and holding location.


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Mesg from the Admnsrao/E 'AS

On this occasion, I want to express my sincere
appreciation to all of the customers,
governments and organizations that honored
us with their participation in the consultation
and public hearing process regarding the
"Proposal to Modify the Tolls System and the
Regulations for the Admeasurement of Vessels
for the Panama Canal". For more than 10
months, we at the Panama Canal Authority
have engaged in informal and formal meetings
with representatives from maritime
associations, shipping lines, foreign
governments and Panamanian citizens in order
to discuss the new system. Based on
recommendations from the shipping industry,
the implementation of the revised
measurement and pricing system of the
Panama Canal will be phased in over three
The new system will reflect international
standards for measuring a container the
Twenty-Foot Equivalent Unit (TEU), which is
20'x 8'x 8.5' in size. Taking into consideration
visibility restrictions set by the ACP that limit
the height of on-deck containers, full container
vessels will be charged on the total number of
TEUs the vessel can carry fully loaded. This
standard replaces the current Panama

Canal/Universal Measurement System (PC/UMS)
tonnage. The $54 perTEU charge is equivalent to
the ACP's initial proposal to charge $40 per TEU
for on-deck capacity plus the under-deck PC/UMS
tonnage. For other vessel types with on-deck
container carrying capacity, the current PC/UMS
system will be used to measure spaces below-
deck and the TEU toll will be applied to the actual
number of containers on-deck.
In comparing the average price per container
transiting the Canal today with the $54 unit cost
that will be in effect May 1, 2007, the difference in
cost per container will be approximately $20. We
do not consider that this increase will have a
significant impact on the cost of goods
transported in containers, particularly when
compared to the recent increases in shipping
industry freight rates ranging from $200 to $300
In closing, I wish to reiterate that the new system
will bring the ACP into conformity with container
industry international standards and enable us to
receive fair value for our services. It will also
provide more accurate measurements and
increased transparency to you, our valued

Alberto Aleman Zubieta



Mesag frm 0h


Paam Caa

Measrmn and
Prcn System -
Ne Locomotives
Caa Welome

Adisr Boar

Panama Canal Traffic

Preliminary traffic statistics for the first four months
(October January) of fiscal year 2005 increased 2.6
percent to 4,170 oceangoing transits from 4,063 transits,
recorded during the same period the year before. Transits
of Panamax-size vessels, the largest vessel that can fit
through the Canal's locks, totaled 1,919 from 1,797
transits in fiscal year 2004 with a strong 6.8 percent
increase. (The adjoining table illustrates a monthly
comparative breakdown by fiscal year.) During this four-
month period, Panamax-size vessel transits held a 46.0
percent share of total oceangoing transits. In turn, dry bulk
carriers and full container vessels represented 43.1 percent
of oceangoing transits, with shares of 21.9 and 21.2
percent, respectively. The ever-increasing presence of
Panamax-size vessels continues to capture our attention as
we examine our long-term improvement programs, which
include a possible expansion of the waterway.

Panamax Transits
100'Beam & Over

October 428 493 15.2%
November 464 482 3.9%
December 468 469 0.2%
January 437 475 8.7%
Total 1,797 1,919 6.8%/

New Panamax Pier at the

Port of Balboa
On January 3, 2005, APL and Mitsui began operations at the
new Panamax Pier 17 at the Port of Balboa, located near the
Pacific entrance of the Panama Canal. This new state-of-
the-art facility provides: a 620-meter-long deep water
wharf open for Panamax vessel operations; a 220-meter-
long wharf for feeder vessel operations; 12.9 meters of
draft in the access channel; 16 meters draft along the piers;
six super post Panamax and three Panamax wharf cranes;
24 rubber-tired gantry cranes; 16 hectares of container
yard; and 868 reefer plugs for refrigerated containers.
Mr. Alejandro Kouruklis, General Manager of Panama Ports
Company (PPC), commented that, "the first vessel call of
APL Turquoise at the new Panamax pier 17 of Balboa
Container Terminal, represents an important milestone in
the process to transform Balboa into a mega container port.
APL and Mitsui, as partners, will greatly benefit by being the
first customers to use our new facilities at Balboa." Mr.

APL Turquoise (left), was the first APL vessel to call at the new
Panamax Pier at the Port of Balboa (courtesy of Panama Ports

Kouruklis added that PPC is excited about doing business
with these two major shipping lines. He hopes that this
trend will continue with other shipping lines operating on
the West Coast of South America. PPC plans to further
develop the Balboa and Cristobal ports in an effort to
transform them into mega container ports, which can
evolve as the largest multimodal center in theAmericas.
The port of Balboa serves as a key transportation hub
connecting all major East-West trade routes with north-
south feeder services.

Revised Measurement and

Pricing System

Following a recommendation from the Board of Directors
of the Panama Canal Authority (ACP), the Cabinet Council
of the Republic of Panama approved a new measurement
and pricing system for full container vessels and other
vessel types with on-deck container carrying capacity.
"The bottom line is that we simply closed a loophole that
prevented us from charging for containers carried on-
deck," said Administrator/CEO Alberto Alemcn Zubieta.
"Today, with some vessels carrying more containers on-
deck than in the vessel's belly, this new system is more
equitable, more transparent and will provide the Canal
with a fair price. Considering other shipping options, the
Canal is still the best deal in the industry."
Along with this revised system comes a new booking rate
for full container vessels. The new rate is now $5.30 per
TEU, which is equivalent to the total number of tons of a
container (13.6) multiplied by the current booking fee of
$0.39 per PC/UMS tons. The present booking fee will be
maintained for vessels that reserve prior to May 1, 2005,
for transits that take place up until April 30, 2006.

Phased-in implementation over three years, beginning
i May 2005:

8.78% of total on-deck
container capacity
TEU = 10.31 PCIUMS Tons Internal
,l Equivalent to $3 per TEU

S Total Moulded Volume
Equivalentto $60- $80 perTEU

Under the current system, the ACP charges full container vessels for a
very small portion (8.78%) of the cargo carried on-deck and it applies
the standard PC/UMS tonnage to enclosed and under deck spaces.

I nt ia AC PropsiO l

100% of total capacity of on-deck containers
without considering visibility restrictions
TEU = 13.6 PC/UMS tons (external
measurement 8' x8.5'x 20') = $40/TEU

Total Moulded Volume
Equivalent to $60 $80 per TEU

In August 2004, the ACP informed the shipping industry of its intent to
charge for the maximum number of containers that the vessel could
carry on-deck at $40 per TEU and maintain the PC/UMS tonnage for
spaces below deck. Following the industry's recommendation, the
ACP formally proposed a toll per TEU that would be applied to the
whole vessel, regardless of the location of the container.

^^^^K'ii^:\S Pt* B B y7l'i'l^ ^^^^

U J $54 per TEU

The revised system includes recommendations from the shipping
industry, including: simplifying the pricing system and developing a
single rate per TEU in accordance with industry standards; adjusting
the on-deck TEU capacity to reflect ACP visibility restrictions;
phasing-in implementation over three years; beginning the new
system in May 2005, May 2006 and May 2007 (instead of May 2005,
January 2006 and January 2007); and modifying the toll structure so
container vessels in ballast (not carrying containers or any other cargo
above or below deck) are charged less.

$42 May 1, 2005
$49 May 1, 2006
$54 May 1, 2007

For other vessel types with on-deck container carrying
capacity, the ACP will continue to apply the PC/UMS
tonnage to measure enclosed spaces and spaces below
deck, and will charge a perTEU fee to the actual number of
containers carried on-deck, in accordance with the above
The impact of the change to the most price-sensitive
commodities, like Ecuadorian bananas, was carefully
evaluated and amounts only to $0.108 per 42 lb. box
Modified toll structure for container vessels in ballast (not
carrying containers or any other cargo above or below

$33.60 May 1, 2005
$39.20 May 1, 2006
$43.20 May 1, 2007

New Locomotives
On January 31, 2005, 10 new locomotives were received
at Gatun Locks. They were transported from Japan on
board the M/V Bright State. A total of 66 locomotives
have been shipped to the Canal by Mitsubishi Corporation
in fulfillment of contractual obligations. An additional 34
will be arriving within sixteen months starting May 2005.
ACP engineers and technicians will assemble 14 of the 34
locomotives in Panama.



Canal Welcomes Louisiana

On January 20, a 47-member trade mission from the
State of Louisiana visited the Panama Canal. The
mission included lawyers, pilots, businessmen,
journalists, doctors, academics, staff members of the
State of Louisiana and representatives of the Port of
New Orleans, among others.
The trade mission was organized by the World Trade
Center of New Orleans in conjunction with the Louisiana
Economic Development initiative and representatives of
the Port of New Orleans. It was the fourth annual
mission to a Central American country. The aim is to
create trading synergies between natural partners who
use the products and services of Louisiana and Panama
to create product and service opportunities.
The trip to Panama was particularly worthwhile for
Louisiana because of the similarities between Louisiana
and Panama. The Panama Canal itself is vital to ports
lining the Mississippi River. Approximately one-third of
the total cargo going through the Port of New Orleans
transits the Panama Canal. Many of the mission
attendees realize the potential for trading opportunities
since the river and more than 30 U.S. states are linked
with the Panama Canal.
The ACP maintains an alliance of cooperation aimed at
generating new business by promoting the "All-Water
Route" between Asia and the Gulf Coast via the
waterway and the Port of New Orleans.

Maritime Navigation Advisory

Board Meets

The Maritime Navigation Advisory Board of the Panama Canal
Authority held its first meeting January 24-28, 2005. Its goal
was to evaluate the current Canal navigation infrastructure as
well as modernization plans and improvements needed for the
waterway to meet increased demands.

Members of the Maritime Navigation Advisory Board during their visit
to the ACP Simulator Center

The Board is composed of a group of internationally renowned
professionals from the maritime navigation sector. Its
members act as a sounding board on proposed ACP initiatives
to improve the Canal's infrastructure on short, medium and
long-term bases.
During the meeting, board members were presented with
specific information on the Canal by ACP officials, as well as
with descriptions of efforts underway to optimize the waterway.
At the end of the first session, the board prepared a report
suggesting potential areas for emphasis aimed at the safe
expansion of the Canal's capacity. The board will meet at least
twice a year to review planned channel designs and other
navigation infrastructure improvements.

ACP Corporate Planning and Marketing Director Rodolfo
Sabonge and ACP Deputy Administrator Manuel Benitez (to the
center) with members of the Louisiana trade mission

We wan you co met fo mor infor atio

Your comments and suggestions are very importantto us. If you need additional
copies mailed to other officials within your corporation, please contact us at the
address indicated in the next box.

Panama Canal Authority
Corporate Planning and Marketing (PM)
P.O. BOX 526725,
Miami FL. 33152-6725

Tel. (507) 272-7961
Fax: (507) 272-1416
e-mail: customerelations@pancanal.com

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