- Maersk is set to reinstate its OC1 service, connecting Oceania to the North America east coast, through the Panama Canal starting next month.
- This decision marks a shift away from utilizing the Isthmus rail land bridge link due to increased transit slots by the Panama Canal Authority (ACP).
- The move is expected to reduce costs and lead times for shippers and forwarders utilizing the service.
Maersk is scheduled to reintroduce its OC1 service, facilitating the connection between Oceania and the North America east coast, through the Panama Canal, commencing in May. This move signifies a departure from the recent use of the Isthmus rail land bridge link, as the Panama Canal Authority (ACP) has expanded its daily transit limit to accommodate more vessels.
Increased Transit Slots by Panama Canal Authority
As the rainy season approaches and water levels in Gatun Lake improve, the Panama Canal Authority has raised its daily transit limit from 24 to 27. This adjustment comes after a period of reduced capacity due to low water levels caused by a particularly dry year attributed to the El Nino phenomenon.
Return to Normal Rotation
With the increase in transit slots, Maersk’s OC1 service will revert to its traditional rotation, including ports such as Philadelphia, Charleston, Balboa, Tauranga, Sydney, Melbourne, Port Chalmers, Manzanillo, Cristobal, and Cartagena, starting from May 10th.
Utilization of Isthmus Rail Land Bridge Link
Maersk had temporarily utilized the Panama “land bridge” via the rail network earlier in the year when the ACP planned to reduce daily canal transits significantly. This alternative route resulted in the omission of the port of Cartagena, impacting transhipment operations in Colombia.
Challenges of Land Bridge Option
While the land bridge option presented an alternative, it posed challenges for carriers due to its cost-effectiveness. Other carriers expressed reservations about the high costs associated with land transport compared to traditional Panama Canal transits, leading to concerns about its viability.
Anticipated Benefits for Shippers and Forwarders
The reinstatement of Maersk’s OC1 service via the Panama Canal is expected to bring about cost savings and reduced lead times for shippers and forwarders utilizing the route. By returning to the traditional Panama Canal route, both rates and transit times are anticipated to decrease, providing a more efficient and cost-effective transportation solution.
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Source: The Loadstar
