AmericasMiddle EastOperations

Panama Canal says it won’t be drawn into price war

The administrator of the Panama Canal Authority (ACP), Jorge Luis Quijano, says his organization will not be drawn into a price war with the Suez Canal, according to EFE news agency.

Suez and Panama are the two most prominent man-made waterways impacting global seaborne trade.

In recent times the Egyptian canal’s operators have been offering substantial discounts in prices, some as great as 65%.

But Quijano says the ACP will not be following suit even though he acknowledges the discounts have lured away some shippers plying routes between the US east coast and Asia.

Nor will the ACP be raising toll fees to make up for the lost business.

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Donal Scully

With 28 years experience writing and editing for newspapers in the UK and Hong Kong, Donal is now based in California from where he covers the Americas for Splash as well as ensuring the site is loaded through the Western Hemisphere timezone.

Comments

  1. What is a rational price difference?

    Is the weather better one way or the other making one route cheaper than the other, what about the other factors?

    If the calculations makes the choice Panama – Suez equal, then a 65 % price reduction would on the margin be profitable for the customers. But if this price reduction would result in congestions, it could still be better to avoid delays by staying on the Panama route.

    That can only an experienced management figure out.

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