The Panama Canal Authority (ACP) has proposed for a new toll structure after more than a year of consultations industry stakeholders.
The proposed restructuring calls for each segment to be priced based upon different units of measurement and modifying pricing for all Canal segments. The ACP explains, for example, containers will be measured and priced on TEUs; dry bulkers will be based on deadweight tonnage capacity and metric tons of cargo; passenger vessels will be based on berths; LNG will be based on cubic meters and tankers will be measured and priced on Panama Canal tons and metric tons.
For the first time, the new proposal includes a customer-loyalty program for the container segment, where frequent container customers will receive premium prices once a particular TEU volume is reached. According to the ACP, the proposed tolls also include significant reductions in the capacity-based charge, and price differentiation based on vessel size ranges, which the ACP says will share the risks associated with fluctuating economic conditions and lower-utilization return voyages.
The new structure will apply to the existing Canal as well as the new lane of traffic when the expansion project begins operation in 2016. The new locks will allow for larger ships and the transit of non-traditional commodities through the waterway, such as Liquefied Natural Gas (LNG), for the first time.
The ACP Board of Directors approved the proposal on December 24, 2014 and starting this week is inviting formal comments on the proposal. A public hearing will take place on February 27, The ACP says that written comments must be received by the deadline of February 9, 2015 at 4:15 p.m., local time. Those interested in delivering remarks at the public hearing have until February 9 to announce their interest to participate in writing.
The adjustments -for all market segments, except for the new “Intra Maritime Cluster Segment”- are scheduled to begin in April of 2016.
“The ACP thoroughly analyzed various alternatives and held conversations with the maritime industry for over a year. The proposal, in its current form, safeguards the competitiveness of the waterway, charges a fair price for the value of the route and facilitates the Canal´s goal of providing impeccable service to the global shipping and maritime community,” said ACP Administrator/CEO Jorge Luis Quijano.
The last tolls modification were put into effect in 2012-2013 for dry bulk vessels, tankers, chemical carriers, gas carriers, vehicle carrier/Roll-on/Roll-off, general cargo and other vessel types segments. Container, reefer and passenger tolls have remained unchanged since 2011.
Additional details of the new toll structure presented by the ACP are below:
The proposed structure provides for differentiated toll rates for bulk carriers carrying grains, coal, iron ore and other drybulk cargoes. These rates have been designed to encourage the deployment of larger vessels through the waterway. Dry bulk vessels transiting the Panamax locks will be charged a capacity price based on the vessel’s deadweight tonnage. Dry bulk vessels transiting through the new locks will use a capacity price based on the vessel’s deadweight tonnage and a cargo charge based on the amount of cargo on-board the vessel in metric tons.
Tankers transiting the Panamax locks will be charged a fixed price based on the Panama Canal Universal Measurement System (PC/UMS) tonnage. Tankers transiting the new locks will be applied a capacity price based on PC/UMS tonnage and a cargo carried pricing scheme based on metric tons. Reduced ballast rates will be provided in the tanker segment to attract vessels on their return voyage.
The proposal substitutes PC/UMS with cubic meters, the widely used industry standard for the transportation of liquefied gases in bulk, such as propane, butane and ethylene.
Vehicle Carriers and Roll-on/Roll-off Vessels
The Panama Canal ton PC/UMS is maintained as the unit of measurement. The proposal incorporates vessel utilization as a factor in the determination of tolls.
The proposal includes a differentiated tolls system based on berths, that varies depending on the locks in which the vessels are deployed. Panamax-sized cruise ships will pay $144 per berth, while ships deployed through the new locks will pay $154 per berth.
General cargo, Reefer and Other
The PC/UMS tolls will continue to apply, regardless of the locks system used.
In addition, the ACP’s proposal includes new toll rates for local canal tour vessels, bunkering service vessels and local container transshipment service vessels, to promote the growth of these activities in Panama. Tolls for this segment will become effective on April 1, 2015.
The proposed tolls structure includes tolls for LNG vessels, a new trade for the Panama Canal. Currently, LNG vessels cannot transit through the waterway due to their beam dimensions, which are too wide to fit the existing locks. The proposed unit of measurement for LNG vessels is the cubic meter, which is widely used in LNG shipping and will ease the calculations of tolls for new customers to the Panama Canal. The new toll structure will also provide an incentive for the new LNG segment, where customers that use the same vessel for a roundtrip voyage through the Canal will have the option of receiving a special ballast fee, if the transit in ballast is made within sixty days after the laden transit was completed.