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Norfolk Southern Corporation Message Board

  • patient_lt_investor patient_lt_investor Jun 9, 2013 10:21 PM Flag

    Big Things will happen for NSC with the Panama Canal Expansion

    As an owner of both CSX and NSC, I have also posted the following info on the CSX board:

    The expansion is scheduled to be completed in about 20 months. Eastern rails (CSX, NSC) will see much more new business from this expansion. Bigger ships will pass through the canal, bypassing the West Coast and picking up and delivering their goods directly to the East Coast. The Eastern rails will haul these goods and they are currently investing large amounts of capital in preparation for the completion of the expansion. They will hit the ground running. Long term shareholders need only to exercise patience.

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    • from what i've read the railroads aren't seeing any change in demand by the shipping lines, which is good because the last thing you need is the freight bound for new york city, philly, or boston coming into baltimore and either being trucked to it destination or having to charge rates 20% of what they get now just to keep it on the rails, not to mention a rate war with bnsf/up for traffic going east just to keep it on the west coast, so far it looks like business as usual.

    • I am not so sure that the widening of the Panama canal will help that much. It will mean more freight coming around to the East Coast, but the majority of it will be for the coastal cities and will move by truck. The eastern rails will pick up freight going into the eastern mid-west (OH, IN, IL, KY), but will lose some of the West Coast freight that is now handed off to them from the Western rails.

    • In early 2015, an additional new lane will open for larger ships that will accommodate ships that are 250% larger than the maximum sized ship that can cross using today's Panama Canal. These new ships will be able to carry 12,500 containers whereas the current Canal can only accept ships carrying 5,000 containers. Assuming 12,500 containers were on a train that train would be over 20 miles long. Imagine that, 20 miles long!

      When the project is completed in 2015, ports on the East Coast and Gulf Coast will be able to compete for business that until now has been dominated by West Coast ports. Experts at the U.S. Army Corps of Engineers (USACE) call the Panama Canal expansion a likely “game changer” for U.S. trade, potentially redistributing the market share of each coast’s ports, as well as opening up new import and export markets for agricultural and other products along inland waterways.

      • 2 Replies to patient_lt_investor
      • "150% larger" or "250% the size of". 12,500 is 150% larger than 5,000.

      • Maryland’s Port of Baltimore has a deep harbor, but its old railroad tunnel exiting the port terminals is not tall enough for today’s double-stacked trains to pass through.16 As a solution, the major railroad company CSX is planning to build a new intermodal rail transfer facility that will facilitate moving double-stacked trains away from the port.17 The Port of Miami, in Florida, has starting boring twin tunnels that would allow big-rig trucks entering or leaving the port to bypass downtown Miami streets, at a cost of $607 million.

        Ports have also partnered with railroad companies to build new rail corridors to move containers inland more quickly from EC/GC ports. As one example, the railroad company Norfolk Southern has built the Heartland Corridor, which makes more rail tracks available, allows the loading of double-stacked containers on its trains, and increases freight rail capacity between Virginian ports and the Midwest.19 Norfolk Southern had to blast through more than two dozen Appalachian Mountain passes in West Virginia, Virginia, and Kentucky so these double-stacked trains could pass through with a higher vertical clearance.

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