Posted on 07/10/2014 5:25:44 AM PDT by bestintxas
Texas stands to take a bite out of California’s lucrative port business according to the Wall Street Journal.
The widening of the Panama Canal, due for completion in early 2016, will divert a significant portion of the lucrative container shipments that currently pass through the Port of Los Angeles and other West Coast ports. The canal’s widening will allow much larger container ships to transit the canal and deliver their goods to the Port of Houston and other ports along the Gulf and East Coasts.
The WSJ reports:
Because of cheaper per-unit shipping costs, as much as 25% of West-bound cargo from Asia could shift to the south and northeast, according to a report by brokerage firm JLL.
The Port of Houston is expanding its warehouse space in anticipation of the increased traffic along with Gulf and East Coast ports.
The cost of shipping through the Port of Los Angeles increased substantially several years ago when then Los Angeles Mayor Villaraigosa pushed through regulations requiring the replacement of 16,000 diesel trucks to accommodate stringent new low particulate matter diesel engine regulations.
Former Obama Chair of the Council of Environmental Quality, Nancy Sutley, led the effort to implement the new rules as the Mayor’s head of energy and the environment. The impact of the rules reverberates to this day as an issue in a truck driver strike at the LA Port.
(Excerpt) Read more at americanthinker.com ...
I got my “Order Of The Ditch” while leaving Panama after Operation Just Cause and the ouster of Noriega.
We got stuck in one of the lakes for almost six hours, because a cargo ship got stuck in a lock - he was moving too fast, got a little sideways and they had to use tugs to dislodge him and the they had to inspect the lock to ensure there was no real damage.
There is some BEAUTIFUL land, mountains and country sides throughout Panama!
The Panama Canal Time Lapsed in HD
https://www.youtube.com/watch?v=_quhzVvK—Y
You better believe that this will impact Class 1 railroads currently moving containerload after containerload of cheap plastic fake vomit and dogshit from China to the east coast by the doublestack trainload.
Hopefully, by that time our economy will go back to producing things so that rail traffic can be taking produced goods, raw materials, and commodities to our ports to ship out to the world.
And Florida. Jacksonville is already a busy port and with the rail/road connections we could catch a bit of the new traffic as well.
Jacksonville, FL is ready to take more.
The article is not very accurate. Replacing the junker shuttle trucks that serviced the California ports was only a small part of a much, much larger set of issues.
There was the issue of the Mexican ports: Lazaro Cardenas, Manzanillo, and Punta Colonet. And the railroads that serviced those ports. And where the inland ports would be situated. Back in those days, there would be a new, huge inland port in the Inland Empire. Kansas City Southern Railway would expand to bring containers from Lazaro Cardenas to a new inland port in Kansas City. Punta Colonet would be built as an American City in Mexico and the railline would bypass California.
Meanwhile, the Trans Texas Corridors were being proposed to handle the truck traffic from the Mexican ports and that morphed into the conspiracy theory about the North American Union.
Then it came to light that there would have to inland ports associated with the increased traffic thru the Houston ports.
There were two parts to the emission problems from the California ports. The junker shuttle truck emissions and the emission from the ships. So they had provide electric power to these ships in port because the ships have to have power when they unload and those ships engines are fueled by marine diesel which is very polluting.
And then there was the issue of who would pay for the new shuttle trucks so CA had a referendum on whether the taxpayers would pay, and they voted no, after which the unions said they would pay, but the drivers would have to join the union.
Then there was the issue as to whether the new shuttle trucks would use the new diesel engines or the natural gas engines, so Boone Pickens and his natural gas company were heavily involved in that and Nancy Pelosi was a big stockholder in Pickens' company so she was getting involved.
But the bottom line, the LA mayor forced everyone to get off high center and move forward because this was a problem that LA had to address. If you don't lower your emissions, you can't grow.
While I am a great fan of Texas, I look at the map and see New Orleans and Mobile.
1. Port authority officials all up and down the East Coast have been advised for several years now to take these predictions of port growth related to the Panama Canal with a grain of salt when they make their investment decisions. A big part of this is Item #2 below.
2. A customer on the East Coast who pays a shipping line to move cargo from Asia to the U.S. isn't going to jump at the opportunity to save $100 on the cost of shipping a 40-foot container by routing it through the Panama Canal if it takes 7-8 days longer than moving the same container to the East Coast via Los Angeles/Long Beach and a cross-country railroad move.
3. Early this spring, the Port of Long Beach just had a port call from one of the newest container ships that is used in the shipping industry today. That ship is too big to fit through the Panama Canal -- the expanded Panama Canal, that is.
4. When you put all of these factors together, what you find is that a trip from Asia to the eastern U.S. through the West Coast and on the U.S. rail network is still going to be faster and more cost-effective even with the wider Panama Canal.
An interesting development in global trade is that traditional sources of manufactured products in northern Asia (Japan, Taiwan, Korea, and now northern mainland China) are now considered "expensive" production locations. They're slowly losing their market share to countries in southern Asia like Vietnam, Cambodia, Malaysia and Indonesia. The interesting dynamic here as it relates to U.S. trade is that shipping directly to the East Coast via the Suez Canal becomes much more cost-effective than trans-Pacific shipping.
Bump
There are some excellent posts on this thread, I hope the discussion continues.
It is amazing the tonnage that goes through that canal, plus that extra 15 tons.
Not to mention the lower taxes!
Aren’t the commies in Nicaragua getting ready to start on the new CommieCanal?
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