While the Panama Canal Railway has had some huge economic losses due to port congestion which impacted the normal flow of cargo between ports of the Atlantic and Pacific, road carriers are living through a golden age on the Panama – Colon route.
Earlier in 2012, the Minister of Commerce and Industry, Ricardo Quijano, predicted that the railroad would not be able to meet the cargo demand that was recorded before the port strike.
However, the official announced an investment by the State to improve road connectivity of Panama to facilitate the movement of goods between the Atlantic and Pacific.
An average of more than 400 containers a week are being moved between the Atlantic and Pacific by highway, according to shipping lines, with better time than by rail, although this is a little more expensive.
Road transport companies recognize that their rates are a little higher than the railroad, but the railroad is limited in capacity and road transport can help ease that deficiency.
The railroad moves 35% of cargo between Panamanian ports and is considered a link in the logistics chain of the country. Currently the railway is operating at 40% capacity and in recent weeks the average weekly volume was 7,500 containers when demand is for 12,000 containers.
Transport companies said freight movement by road has grown more than 40% this year and for this reason, they also face a shortage of skilled labor and drivers of heavy equipment.
The statistics of the Panama Maritime Authority (AMP) reveal that in the first half of 2012, the Panamanian port system grew by 11.8% over the same period of last year.
The second section of the Panama – Colon expressway was inaugurated in mid July this year, and allows safe driving between the Atlantic and Pacific in just 40 minutes. With this second phase of the highway completed, transit through this “dry canal” is speeded up, becoming another option for quickly moving cargo between oceans.
This post is also available in: Spanish