October 31, 2011
US canal expansion causes grain, soy exports to set record
US grain, soy set a new record of 322 million tonnes for the total cargo volume in fiscal 2011 outdoing 2010's volume by 7.1% as a result of the Panama Canal's expansion, according to the US Grains Council (USGC).
A transportation study by the United Soybean Board (USB) projects that the total volume of soy and grain traffic through the canal will increase by 30% when the canal opens a third lane of locks in 2014. This new larger, shipping lane will expand the average area for barge transport from 70 to over 150 miles. And assuming the ports will dredge to ensure passage of larger ships, the expansion is expected to save about US$0.35 per bushel on transportation costs for elevators within range of the central Gulf of Mexico ports.
The canal's increased capacity will also allow a Panama ship originating in southern Louisiana to load an additional 13,300 tonnes (524,000 bushels) of corn per trip, increasing each shipment's value by about US$3.4 million.
The USB analysis indicates the total volume of grain and soy transiting the Panama Canal will increase by 30% (426 million bushels) by 2020-21.