Railroad Forums 

  • Panama Canal Widening - 2014

  • Pertaining to all railroading subjects, past and present, in New Jersey
Pertaining to all railroading subjects, past and present, in New Jersey

Moderator: David

 #1034630  by SemperFidelis
 
Sort of Off-Topic

Interestingly enough, it would appear as though the advent of global warming (no matter what it is or might be caused by) has allowed for the potential realization of an age-old deaam: the year-round, ice-free Northwest Passage above Canada.

Retreating ice packs may well allow another, much shorter lane from certain parts of the Pacific Rim to North American markets.

Long story short: Tomorrow's rail traffic patterns aren't going to be as they are now.

On the bright side, perhaps (after decades of predictions) fuel prices and the truck driver shortage will be severe enough limitations to reopen shorter haul markets to railroads. Oddly enough, I've been reading that fuel prices have been at the root of a certain portion of the recent gain in manufacturing jobs. Manufacturers of certain widgets have found the high fuel prices to be reason enough to reintroduce a small amount of manufacturing into North America.

If fuel prices must be high, I suppose it's nice that there's a small silver lining for someone out there...
 #1034827  by SecaucusJunction
 
I definitely think you are right about the trucks. I'm finding it harder and harder to find trucks in various parts of the country and fuel surcharges seem to be getting worse by the day. Whether it is the Panama Canal or around Canada, it seems more and more likely that the East Coast ports are going to be much more of a factor for many years to come. A lot of my shipments to places east of Chicago are now being routed to NY even before the widening. I think the project will bring big changes very soon after completion.
 #1063628  by Gilbert B Norman
 
Regarding the material immediately submitted by Mr. Secaucus, I wish I could hold the author's optimism that "everybody wins" in a post-PANAMAX shipping environment. I can only foresee the railroad industry as losers. The two Western roads are clearly losers as are their captive West Coast ports, but even the two Eastern roads, while they will be winners, will not win enough ti offset the losses the Westerns are confronted with. The reason is that any of another East Coast ports are expanding (I never thought of Fort Pierce FL as any kind of port - and I think I follow maritime affairs - especially when they interface with those of the railroads = to a fair extent), that there will be less line hauls available and some shipments presently handled by rail will move directly from the port to destination by highway transport.

The material linked below appeared in Sunday's Times and does not directly mention rail, but if Asian shippers are finding it more economical to handle automobiles through East coast ports Trans Canal (in PANAMAX vessels for the moment), it's "curtains" for any appreciable line hauls of autos and other high value traffic.

Warren, you just may have made a bad bet.

http://www.nytimes.com/2012/07/15/autom ... -cars.html

Brief passage:

  • The Andromeda Leader, operated by NYK Line, the Japanese shipping giant, with Panamanian registry, is typical of modern car carriers. Launched in 2004 when global auto sales were booming and shippers raced to keep up with demand from carmakers, the ship is two football fields long and has a cargo capacity of 21,443 tons, greater than some of today’s largest cruise ships.

    More relevant to its mission, perhaps, is the ship’s width of 32 meters, or 105 feet — one of measurements in the requirements known as Panamax because they are the largest dimension that will fit through the locks of the Panama Canal.
Second brief passage:

  • To meet the growing demand, shipmakers are introducing larger car carriers. Wallenius Wilhelmsen Logistics, for instance, operates four new ro-ro ships, commissioned by its parent companies, that carry about 8,000 vehicles each. By sailing larger ships, the company can more efficiently serve the carmakers, who effectively control the size of the shipping fleet
 #1063644  by Ken W2KB
 
Gilbert B Norman wrote:Regarding the material immediately submitted by Mr. Secaucus, I wish I could hold the author's optimism that "everybody wins" in a post-PANAMAX shipping environment. I can only foresee the railroad industry as losers. The two Western roads are clearly losers as are their captive West Coast ports, but even the two Eastern roads, while they will be winners, will not win enough ti offset the losses the Westerns are confronted with. The reason is that any of another East Coast ports are expanding (I never thought of Fort Pierce FL as any kind of port - and I think I follow maritime affairs - especially when they interface with those of the railroads = to a fair extent), that there will be less line hauls available and some shipments presently handled by rail will move directly from the port to destination by highway transport.

The material linked below appeared in Sunday's Times and does not directly mention rail, but if Asian shippers are finding it more economical to handle automobiles through East coast ports Trans Canal (in PANAMAX vessels for the moment), it's "curtains" for any appreciable line hauls of autos and other high value traffic.

Warren, you just may have made a bad bet.

http://www.nytimes.com/2012/07/15/autom ... -cars.html

Brief passage:

  • The Andromeda Leader, operated by NYK Line, the Japanese shipping giant, with Panamanian registry, is typical of modern car carriers. Launched in 2004 when global auto sales were booming and shippers raced to keep up with demand from carmakers, the ship is two football fields long and has a cargo capacity of 21,443 tons, greater than some of today’s largest cruise ships.

    More relevant to its mission, perhaps, is the ship’s width of 32 meters, or 105 feet — one of measurements in the requirements known as Panamax because they are the largest dimension that will fit through the locks of the Panama Canal.
Second brief passage:

  • To meet the growing demand, shipmakers are introducing larger car carriers. Wallenius Wilhelmsen Logistics, for instance, operates four new ro-ro ships, commissioned by its parent companies, that carry about 8,000 vehicles each. By sailing larger ships, the company can more efficiently serve the carmakers, who effectively control the size of the shipping fleet
Here's the link to Google Maps that shows the extensive Port Newark (NJ) auto import business. Even appears to be one of the ships at dockside. From driving by just to the north on the NJ Turnpike Holland Tunnel Extension bridge, it appears that both trucks and rail are used to ship the autos unloaded from the ocean vessels. http://maps.google.com/maps?f=q&source= ... 26157&z=16
 #1063649  by Gilbert B Norman
 
Of course Mr. Brown, I should not imply that railroads will no longer handle automobile traffic; but post-PANAMAX, the pattern of autos being landed at West Coast ports such as LA, with either BNSF or UP enjoying a transcontinental line haul will be upset by the expansion of East Coast ports.

In a post PANAMAX world, rails are going to find themselves short hauled at every possible opportunity and even cut out of traffic presently enjoyed.

Anyone with an inkling of transportation economics knows that ocean transport is the most economical means out there. The last time I checked, God has not imposed user fees for the use of his waterways, and most important, any physicist will tell you that there is least resistance to a hull moving through water (no thrust for lift need be generated) than even a steel wheel atop a steel rail. Never mind where highway transport checks in on this efficiency scale.
 #1063652  by SecaucusJunction
 
I agree that not everyone can be a "winner" and time will tell what happens. But as I have said in the past, the Panama Canal has already been taking traffic off the railroads for many years now. A very high percentage of traffic that comes to the East Coast already travels through the canal. Only very time sensitive merchandise still travels over the land bridge route. It is well known that the more time a container spends on a ship and the less time it spends on the train, the cheaper it becomes. There is little that can be done about it. Traffic destined for NY/NJ, Virginia, South Carolina is already routed via East Coast ports. What the Eastern roads can now compete for is traffic to cities such as Chicago, Cleveland, Detroit, etc. If that traffic can now be routed through the East Coast, then the railroads can run an "inland port" right there. I wouldn't be too worried about more NJ traffic being put through the canal because it is already there. Has anyone seen a unit APL, Hanjin, Maersk/Sealand train in NJ lately? There are certainly more containers being routed out of Asia now than there was 20 years ago, but those trains are really history.

So, yes, it is possible that Warren Buffet made a bad investment, but I think BNSF and UP will survive just fine. Intermodal traffic is currently at a very, very high level all over the country.
 #1063774  by Ken W2KB
 
Though coal as a fuel for electric generation is down some 20% and expected to decline further. That has to have caused a significant dent in revenues for some rail and barge carriers.
 #1064860  by SecaucusJunction
 
Good news on the Bayonne Bridge raising. Looks like it may be done at least a year early.

http://www.joc.com/infrastructure/obama ... t-projects



And to those worrying about coal traffic...

http://www.platts.com/RSSFeedDetailedNe ... al/6484667

http://www.railwayage.com/index.php/fre ... AmOi6AopKI
 #1065435  by Ken W2KB
 
SecaucusJunction wrote:Good news on the Bayonne Bridge raising. Looks like it may be done at least a year early.

http://www.joc.com/infrastructure/obama ... t-projects



And to those worrying about coal traffic...

http://www.platts.com/RSSFeedDetailedNe ... al/6484667

http://www.railwayage.com/index.php/fre ... AmOi6AopKI
That slight increase in coal is mostly from export business which is mine to tidewater, not to multiple routes and locations. And the article mentions that the increase is based on a lower carloadings in the prior year. Many coal fired generating stations will be retired in the next 2 or 3 years, to be replaced by natural gas fuel.

See for example: "According to data from the U.S. Energy Information Administration, coal production nationwide was down 6.2 percent in the first half of 2012, compared with the same period last year. In the Appalachian region, that figure was 7.7 percent and, in Virginia, 14.6 percent." http://www2.tricities.com/news/2012/jul ... r-2074294/
 #1078246  by Ken W2KB
 
michaelk wrote:while natural gas seems it will beat coal on economics and so apparently will take over demand over time- seems the EPA wont be able to rush things:
http://www.scientificamerican.com/artic ... le-on-coal
Economics are a more powerful force, the ruling will likely have little impact. Generating companies likely will not want to risk what rule may be issued on the remand that will pass muster if again appealed.
 #1094339  by SecaucusJunction
 
A few more interesting articles regarding the Panama Canal. There is a very good chance that NY/NJ is going to be the jackpot winners for new container traffic.



http://thetimes-tribune.com/news/busine ... -1.1377342

http://theadvocate.com/home/3978495-125 ... to-capture
 #1171216  by SecaucusJunction
 
Moving along at a slow but steady pace. The fact that it is behind schedule by about 8 months is a blessing in disguise for the area as it gives more time for Port Authority to finish their Bayonne Bridge project.

http://www.miamiherald.com/2013/04/07/3 ... -near.html