The Panama Canal Authority will skip any toll increases this year and proposes to overhaul its toll structure starting Jan. 1, 2011.
The canal authority said Tuesday it will forego the toll increases scheduled to take effect May 1 and keep tolls at the level of the previous increase on May 1, 2009.
The canal authority’s board approved a proposal on April 26 that would modify the canal’s pricing structure to charge tolls on the basis of a vessel’s capacity and on whether or not that capacity is loaded.
The overall toll increase amounts to about 12 percent above the current level, Alberto Aleman Zubieta, the canal authority’s administrator and CEO, said in a conference call with reporters on Wednesday.
The canal authority decided to freeze tolls at the current level and adjust its pricing structure in response to concerted pleas from the shipping industry for relief from toll increases at a time many carriers are still reporting losses.
It said it will continue to allow the reductions in additional fees charged to vessels with a reservation that fail to arrive by their required arrival time but ask to keep their transit on the same date.
“We have heard the issue of the economic downturn that has affected everyone and we decided that this year was not the right time for a toll adjustment,” Aleman said.
The canal authority’s proposal modifies the pricing structure for all vessel segments, including container ships, dry bulkers, liquid bulkers, vehicle carriers, reefer ships, passenger ships, general cargo ships, and others. The new tolls would remain in effect for a year and could be raised in future, Aleman said.
For container ships, the authority is proposing a change in the way tolls are calculated, with a slight price adjustment to the capacity charge, and an additional new charge that would only apply to the number of loaded containers aboard the vessel at the time of transit.
Under the present toll system, full-container vessels are charged according to their capacity, whether its containers are laden or in ballast (empty). Under its proposal, the authority would charge a toll per 20-foot equivalent unit of a vessel’s capacity, plus a toll on the actual number of containers on board during transit.
The authority proposes to charge a toll of $74 per TEU of capacity for a ship carrying laden containers plus $8 per laden container. It would charge a toll of $65 per TEU of capacity for a ship carrying containers in ballast, with no toll on empty containers.
At present the canal charges a toll of $72 per TEU of capacity on laden containers and $57.60 per TEU of capacity on ships with empty containers.
The change in the canal’s toll structure announced Tuesday is the second modification the canal has made since the global trade downturn decimated carriers’ balance sheets. In June 2009, the ACP provided temporary measures to help users mitigate the effects of the economic crisis. Once these measures reached their term, they were extended until April 30, 2010, at the industry’s request.
“In view of the current world economic situation, the ACP has decided not to proceed with a tolls adjustment in 2010 and set January 2011 as the new date for implementing the tolls presented in this proposal,” the canal authority said in its announcement.
The authority’s decision to freeze tolls raises the question of how it will raise the revenue it had previously anticipated to pay the debts it has assumed to finance the $5.25 billion project that is underway to build a third set of canal locks by 2014 that will enable much bigger ships to transit the canal.
Aleman said the authority plans to pay off the $2.3 billion it has borrowed from a consortium of international banks over 20 years out of toll revenues, which he expects to continue to increase in line with the recovery in world trade.
The canal authority said the expansion project, approved through a national referendum, continues to move forward – on time and within budget.
It said it will receive formal written comments and opinions from interested parties until May 27. A public hearing on the change in the toll structure will be held in Panama on June 1.
The canal authority said Tuesday it will forego the toll increases scheduled to take effect May 1 and keep tolls at the level of the previous increase on May 1, 2009.
The canal authority’s board approved a proposal on April 26 that would modify the canal’s pricing structure to charge tolls on the basis of a vessel’s capacity and on whether or not that capacity is loaded.
The overall toll increase amounts to about 12 percent above the current level, Alberto Aleman Zubieta, the canal authority’s administrator and CEO, said in a conference call with reporters on Wednesday.
The canal authority decided to freeze tolls at the current level and adjust its pricing structure in response to concerted pleas from the shipping industry for relief from toll increases at a time many carriers are still reporting losses.
It said it will continue to allow the reductions in additional fees charged to vessels with a reservation that fail to arrive by their required arrival time but ask to keep their transit on the same date.
“We have heard the issue of the economic downturn that has affected everyone and we decided that this year was not the right time for a toll adjustment,” Aleman said.
The canal authority’s proposal modifies the pricing structure for all vessel segments, including container ships, dry bulkers, liquid bulkers, vehicle carriers, reefer ships, passenger ships, general cargo ships, and others. The new tolls would remain in effect for a year and could be raised in future, Aleman said.
For container ships, the authority is proposing a change in the way tolls are calculated, with a slight price adjustment to the capacity charge, and an additional new charge that would only apply to the number of loaded containers aboard the vessel at the time of transit.
Under the present toll system, full-container vessels are charged according to their capacity, whether its containers are laden or in ballast (empty). Under its proposal, the authority would charge a toll per 20-foot equivalent unit of a vessel’s capacity, plus a toll on the actual number of containers on board during transit.
The authority proposes to charge a toll of $74 per TEU of capacity for a ship carrying laden containers plus $8 per laden container. It would charge a toll of $65 per TEU of capacity for a ship carrying containers in ballast, with no toll on empty containers.
At present the canal charges a toll of $72 per TEU of capacity on laden containers and $57.60 per TEU of capacity on ships with empty containers.
The change in the canal’s toll structure announced Tuesday is the second modification the canal has made since the global trade downturn decimated carriers’ balance sheets. In June 2009, the ACP provided temporary measures to help users mitigate the effects of the economic crisis. Once these measures reached their term, they were extended until April 30, 2010, at the industry’s request.
“In view of the current world economic situation, the ACP has decided not to proceed with a tolls adjustment in 2010 and set January 2011 as the new date for implementing the tolls presented in this proposal,” the canal authority said in its announcement.
The authority’s decision to freeze tolls raises the question of how it will raise the revenue it had previously anticipated to pay the debts it has assumed to finance the $5.25 billion project that is underway to build a third set of canal locks by 2014 that will enable much bigger ships to transit the canal.
Aleman said the authority plans to pay off the $2.3 billion it has borrowed from a consortium of international banks over 20 years out of toll revenues, which he expects to continue to increase in line with the recovery in world trade.
The canal authority said the expansion project, approved through a national referendum, continues to move forward – on time and within budget.
It said it will receive formal written comments and opinions from interested parties until May 27. A public hearing on the change in the toll structure will be held in Panama on June 1.