What Maritime Workers Need to Know about the Panama Canal Expansion

May 19, 2016

Work on the Panama Canal expansion project is finally expected to be complete on May 31, and authorities now expect the expanded canal to open on June 26, 2016. While it has been a long time coming (the expansion project began in 2007 and was originally slated for completion in 2014), the opening of the Panama Canal expansion represents a world of new opportunities for maritime shipping companies around the globe.

Unfortunately, along with its expected benefits, the opening of the Panama Canal extension is likely to have some negative consequences as well. Among them, it could lead to an increased risk of accidents and injuries for maritime workers.

With this in mind, here is what maritime workers need to know about the Panama Canal expansion:

Key Facts about the Panama Canal Expansion for Maritime Workers

1. The Panama Canal can now handle ships nearly three times the size as compared to its pre-expansion limits.

When it first opened in 1913, the Panama Canal was designed to fully meet the needs of the world’s shipping economy. Those needs have changed, and today’s cargo ships are substantially larger than those from a century ago. The expansion is intended to allow the Panama Canal to service ships carrying up to 12,600 containers – nearly three times the current limit.

2. The extension will lower the cost of shipping between Asia and the U.S. East Coast.

Since larger ships will be able to use the Panama Canal, financial experts expect the cost of shipping between Asia and the U.S. East Coast to decrease substantially. In fact, some experts warn that the opening of the expansion could threaten the viability of the railroads that currently handle the transportation of cargo between California and the eastern United States.

3. Shipping companies are likely to see an increased demand for trade through the Panama Canal.

The reduced cost of transport will make maritime shipping more attractive for many companies. This is likely to lead to a substantial increase in the volume of shipping traffic between Asia and the U.S., including in the Gulf of Mexico.

4. Competition and increased demand may lead to cost-cutting measures by vessel owners and shipping companies.

In order to stay competitive, maritime shipping companies may need to cut costs. Cutting costs often means reducing crew numbers and de-emphasizing the importance of crew safety. These have both been shown to lead to an increased risk of maritime injuries.

5. Houston and the Gulf of Mexico are likely to see the most immediate impacts of the expansion.

Business Insider reports that port cities along the Gulf Coast are likely to see the most immediate impact of the expansion’s opening. In particular, Houston is expected to serve as a destination point for cargo that would have previously been delivered to the West Coast.

6. Expect new challenges as the Panama Canal Authority and carriers adjust to the new expansion.

With the expansion opening two years behind schedule, we don’t expect the project’s challenges to end once the Panama Canal expansion is open for business. Maritime workers should be wary of technical and bureaucratic hurdles that may delay shipments, putting their employers behind schedule and potentially putting workers at greater risk for work-related injuries.

Morrow & Sheppard LLP | Experienced Houston Maritime Lawyers

Morrow & Sheppard LLP is a personal injury and wrongful death law firm that focuses on representing injured maritime workers and their families. If you suffer an injury while onboard a ship in the Panama Canal, we can help you stand up for your legal rights. To learn more about our services, call us at (800) 489-2216 or request a free consultation online today.

Get a Free Case Review by Calling Morrow & Sheppard Now.

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