The largest shipping container ship to ever visit the east coast of the United States docked in Bayonne, New Jersey, on July 8 th . The MOL Benefactor measures 1115 feet long and 158 feet wide. It has a capacity of 10,000 twenty foot container equivalents according to the data sheet provided by Mitsui O.S.K. Lines. Until June 26th of this year, no ship of this size had ever passed through the Panama Canal for one very simple reason- the Panama Canal wasn’t big enough.
A multi-year canal expansion project, however, is now complete allowing a new class of larger container ships known as Neo Panamax Vessels to cross between the Pacific and Atlantic Oceans. Last year, the average number of containers on ships docking at Bayonne, New Jersey was 3000. That number should increase dramatically as the larger class of vessels begin streaming through the newly expanded Panama Canal. The MOL Benefactor arrived with 6000 containers, a typical load for a 10,000 TEU ship.
The capacity of container ships is measured in twenty foot equivalent units (abbreviated TEU). A ship rated 10,000 TEU means that if it were loaded entirely with twenty foot shipping containers, it could hold 10,000 of them. Since shipping container vessels are typically loaded with containers of various sizes ranging from twenty to as much as fifty-three feet long, the actual number of containers on the ship is generally much less than its rated TEU capacity.
The goal of the larger ships and the expanded capacity of the Panama Canal is to reduce shipping costs. It is far more efficient and therefore cheaper to send 6000 containers on one ship than it is to send them on two of the older, smaller container ships. The problem with the use of larger ships is that few ports are equipped to handle them. Even Bayonne’s Bayonne’s Global Container Terminals needs upgrades. In addition to the already completed dredging done to increase the depth of the canal leading into the docks, The Bayonne Bridge is too low for the biggest of the new container ships. The bridge, currently 151 feet high, was expected to have been raised to a height of 215 feet by the opening of the Panama Canal Expansion. Delays, however, have pushed back its anticipated completion date until late 2017 according to The Record.
Even as the expanded capacity of the Panama Canal enables the use of very high capacity container ships, however, there is already a glut of container ships available to carry shipping containers. The cost to ship a forty foot container from Asia to the west coast of the United States has fallen from $2000 in 2010 to just $800 today according to the Wall Street Journal’s Logistics Report. Shipping analysts quoted in the Report, say that these prices represent the bottom in container shipping prices and anticipate a slow rise in coming years.
Since most shipping containers are built in Asia before converted to storage containers, these low shipping prices are currently helping to lower costs for storage containers. As transportation costs increase over the next decade, storage container prices may also see an increase.