Assessing the Impact of the New Panama Canal on Your Supply Chain

File:Panama Canal Miraflores Locks.jpg  

Panama is investing  $6Billion to add a wider 3rd lane to the Panama Canal and due to open in 2015. At a cost of $1Billion, the roadway of the Bayonne Bridge near New York is being elevated to a height of 215ft to allow larger container ships to pass under. Most modern harbors are being dredged to a depth of 50ft to accommodate the greater shipping tonnage of deeper container ships.  These are just samples of the massive investment in infrastructure undertaken to bring the North American shipping traffic into the current century.  With this new capability, ships will widen from the prior beam standard of 106’ set in 1910, to a new standard of 160’ wide, 1200feet long and 50’ draft.  These new dimensions, called PANAMAX, are consistent with new global shipping standards and dimensions including Chinamax, Suezmax, Seawaymax and Q-max.  Are we prepared?

Global supply chains are responding to these changes.  Decades  in the planning, new markets, bigger ports, high-tech hub and spoke distribution networks create new opportunities in the supply chain as cost factors adjust to this new scale. With container shipping being the economical delivery of choice, supply chain cost algorithms will be taxed again to find least cost routing rules. Managers will use newer tools, technologies and intelligence to squeeze added cost from their value chain as these new high scale opportunities surface.   Be aware of the challenges and opportunities that the new Panamax standards will create for you and your supply chain.  New SCM applications are being released to help supply managers to more effectively respond to new demands from the markets.

*(see bounding box definitions in http://en.wikipedia.org/wiki/Panamax)

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A Blog about how Oracle helps organizations transform their supply chains into more holistic and integrated value chains that cover the three key operational pillars; Demand, Supply and Product.

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