Carriers Suspend Balboa Services Following Panama Port Dispute
Chinese carriers Cosco and OOCL have suspended all services to and from Balboa Port, a move widely viewed as a retaliatory response from Beijing following the forced takeover of Chinese owned CK Hutchison’s terminal assets
In a customer notice, Cosco confirmed that vessels from both carriers would immediately stop arriving at and departing from the terminal and that all confirmed bookings would be cancelled. In addition, the carrier will no longer accept empty containers at the port and shippers will be required to return them to the opposite side of the Panama Canal.
Balboa sits at the Pacific entrance of the canal, meaning that redirecting empty containers to the Atlantic side of the canal will require additional logistical planning and will likely increase operational costs significantly for exporters and importers.
Although Cosco did not publicly state a reason for the suspension, the timing is notable. The decision came just one day after Chinese authorities summoned representatives from Maersk and MSC to discuss “international shipping business conduct.” The meeting request follows their takeover of facilities previously operated by CK Hutchison last month, after Panama’s Supreme Court voided the company’s long-standing terminal concessions.
Meanwhile, much of the cargo that previously trans-shipped via Balboa is now being diverted to Lázaro Cárdenas port. The Mexican port has already been handling increasing volumes as a regional hub for Central America and has been experiencing heavy congestion, a situation likely to worsen as additional cargo is redirected there.
Envío International is monitoring developments closely.
