The Panama Canal Authority proposed a comprehensive restructuring of its toll system on Friday, which would increase rates charged on cargo such as vehicles, oil and gas and soybeans that cross the waterway as ocean shippers rake in record profits.

The changes would reduce the current structure to fewer than 60 tariffs from 430 now and focus on vessel capacity and fixed tariffs per transit. Ships would also pay different fees depending on which sets of locks are used, according to a statement from the canal authority.

A liquid petroleum gas carrier transporting 46,000 tons of propane through the canal’s expanded locks, for example, would pay $5.20 more per ton by 2025, representing roughly 0.9% of each unit’s final market price. Oil tankers carrying 450,000 barrels of crude through the original locks would see an increase of $0.20 per barrel, boosting final market unit price by 0.4%, according to the statement. Car carriers, chemical and LNG tankers and vessels carrying bulk such as grains and coal would also see higher tariffs, affecting market prices by roughly 0.1% to 0.7%.

Among the most affected segments would be passenger vessels and container ships. A 2,200-berth passenger ship transiting the original set of locks would see a total increase of $77 per person, increasing final ticket prices by about 4% per passenger. Container ships, the canal’s largest customer, would see hikes of around 8% versus current tolls. A vessel carrying 9,000 containers and loaded to 90% capacity transiting the expanded locks would see a total increase of $6 per container by 2025, according to the canal authority.

The canal authority will hold a public hearing on the changes May 20 in Panama and consider feedback sent via email by May 17. Once approved, the new toll structure would be gradually implemented from January 2023 to 2025.

Source: Bloomberg