BajaNomad - Megaport at Colonet Scaled Down

Megaport at Colonet Scaled Down

ElFaro - 10-23-2009 at 11:59 AM

Saw this today in SDUT...

http://www3.signonsandiego.com/stories/2009/oct/23/mexican-m...

Below a certain # of containers/year of transport the port is not viable...

[Edited on 10-27-2009 by ElFaro]

surfer jim - 10-23-2009 at 12:57 PM

Considering some of the "projections" for boat traffic for Escalera Nautica....I have to wonder how accurate these ship numbers are.......

estebanis - 10-23-2009 at 01:27 PM

I am thinking it will help the folks at Erendira if it ever happens...
Esteban

BajaNews - 10-23-2009 at 01:40 PM

http://www.upi.com/Business_News/2009/10/23/Plans-for-Mexica...

Oct. 23, 2009

ENSENADA, Mexico, Oct. 23 (UPI) -- A decline in trans-Pacific trade has prompted plans for a megaport near Ensenada, Mexico, to be scaled back, officials said.

Mexican Secretary of Communications and Transport Juan Molinar Horcasitas said while the infrastructure project will move forward, "world economic realities" mean it will be smaller, The San Diego Union-Tribune reported Friday.

"It has become necessary to adapt to world economic realities," Horcasitas said. "There is no doubt the project remains viable, but it needs to be redesigned."

The Punta Colonet megaport is now expected to handle at least 1 million 20-foot-long shipping containers annually. That total is less than half the amount of containers the site was originally intended to hold, the Union-Tribune said.

Jose Rubio Soto, who is supervising the megaport project for the state of Baja California, told the Union-Tribune project officials remain committed to the long-term benefits of the port.

"This project is very much alive,"Soto said. "We cannot allow this to be stopped … . We're thinking about the next 50 years."

Bajahowodd - 10-23-2009 at 02:00 PM

They're doing the smart thing. Move forward with the infrastructure. It will take several years for the Long Beach- LA ports to get back to anywhere near their peak. By the time that happens, Colonet can start vying for trade. Makes no sense to build out the whole thing early so it can be basically idle.

BajaBruno - 10-23-2009 at 02:36 PM

I have been past the Port of Oakland a few times recently and it has been deserted.

Although US-financed manufacturing is diversifying out from China, it is still moving to Pacific countries, which requires sea transport through West Coast ports. In all likelihood, shipping traffic will start to rebound in a couple of years, though 2006 levels are unlikely for many years.

http://4.bp.blogspot.com/_pMscxxELHEg/SW_r638zvxI/AAAAAAAAES...

The real question may be, if California ports are not running at full capacity, can Mexico be competitive to steal away some of their business? Mexico can challenge on price, but that has to be balanced by the extra days it will take to get the containers to the border and then through US Customs.

This would prohibit time sensitive or perishable products, which in this era of last minute inventory management includes most shipments.

However, I'm sure the Mexican planners have thought this all out....

Punta Colonet project moving forward

BajaNews - 10-23-2009 at 02:37 PM

http://kxoradio.com/content/view/6242/2/

by George Gale
23 October 2009

(Plans for Mega Port moving forward)…..It just won’t be so big.

The Mexican Government has announced they are moving forward with plans for development of Punta Colonet. The development is planned to create a Mega Seaport, about 150 miles south of San Ysidro. It had appeared the plans had come to a halt. Juan Molinar Horcasitas says that is not the case. The Secretary of Communications and Transportation in Mexico says the project has just been scaled back. He says reduced trade forced the change in plans. The Mega Port is expected to take some of the cargo load off of Long Beach and Los Angeles. The plans are to construct the seaport, and a rail line that will transport the over-seas cargo into the United States through the East Calexico Port of Entry. The Mexican Government had said bids for construction were to be opened in December 2009.

ElFaro - 10-23-2009 at 03:02 PM

This is a quote from the SDUT article...

"Molinar said that in its initial phase, Punta Colonet should have the capacity to handle at least 1 million 20-foot-long shipping containers annually — about half the originally proposed capacity. "

And further on down in the article...this quote:

“I think that the cargo will take time to come back, maybe five years, maybe eight years, but it will come back,” said Ernesto Ruffo, a former Baja California governor who is participating in the bidding process.

Ruffo's group, Consortium Seaport Services, is led by a Spanish company, Globalvia, with participation of Watco, a subsidiary of Union Pacific Railroad, and a terminal operator, TraPac.

Ruffo said his group cannot make the project break even with fewer than 2 million containers annually. The initial challenge will be building the rail line to the border. “That investment doesn't change, whether the port is big or whether it's small,” said Ruffo"

So Ruffo says "his group cannot make the project break even with fewer than 2 million containers annually"

If that's the case with this group and probably the others who would want to build infrstructure only to lose money ?? How many years will it take in contracts diverted to Colonet from Long Beach / LA to get to 2 million / yr just to break even? How about cost overruns ?

woody with a view - 10-23-2009 at 06:08 PM

Quote:

However, I'm sure the Mexican planners have thought this all out....

BajaGringo - 10-23-2009 at 07:15 PM

I had a one on one interview with Dr. Rubio a short while back and was given the complete overview of the project. This is much more than just a new shipping port. Plans are in place to create a large assembly plant community in the Valle de Trinidad area. Why do you think Ford, Chrysler and GMC have already bought large land parcels there?

Car parts can be manufactured in China, shipped to Mexico, assembled and shipped to US markets for thousands less than current manufacturing costs. This is all part of the new global economy and why Colonet will happen IMHO...

David K - 10-24-2009 at 07:51 AM

Wow, good luck for Valle de Trinidad! The mid way point in the trans Baja railroad line from Colonet to Mexicali. The English had that same route mapped out a hundred years ago to bring all the flour they were going to grow/ mill in San Quintin to the U.S.

This is a great book...

[Edited on 10-24-2009 by David K]

books 043.jpg - 40kB

In the yumasun today

desertcpl - 10-24-2009 at 08:12 AM

http://www.yumasun.com/news/rail-53717-yuma-project.html

DENNIS - 10-24-2009 at 08:40 AM

Quote:

Originally posted by BajaGringo
Plans are in place to create a large assembly plant community in the Valle de Trinidad area. Why do you think Ford, Chrysler and GMC have already bought large land parcels there?

The dope farmers won't like that. I doubt the UAW will look kindly on it either.
Is this why some of these manufacturers were bailed out? So they can bail out? Doesn't make sense to me.

durrelllrobert - 10-24-2009 at 09:06 AM

Quote:

The dope farmers won't like that.

all the new assembly workers will be potential customers :lol:

Bajahowodd - 10-24-2009 at 12:24 PM

Ford, Chrysler, GMC, Volkswagen, Nissan, Toyota (in TJ), all have manufacturing plants in Mexico already. The UAW has never been happy with that. With speculation as noted by BajaGringo, it should also be noted that Nissan already considers its US factory to be among the most efficient in the world. And VW is currently building a factory in the US. Their particular reason for coming back to the US is currency fluctuations. They haven't been able to compete in the US marketplace since the Euro took off years ago. That said, despite cheaper labor in China, it would appear to me that if prognositcators are correct, and the value of the dollar continues to decline, US based factories are essential. So, I'm not so sure the plans for Valle de Trinidad will ever come to fruition.

elgatoloco - 10-24-2009 at 01:46 PM

Quote:

Originally posted by lencho

Quote:

Originally posted by BajaGringo
Car parts can be manufactured in China, shipped to Mexico, assembled and shipped to US markets for thousands less than current manufacturing costs.

Interesting. Why is that cheaper than assembling the whole vehicle in China (where I assume labor costs are lower)?

--Larry

You have to be able to maximize the amount of things you can get in a container and on a ship to make the numbers ($$) work. The difference in labor can be eaten up in freight. Shipping large items takes up more space.

arrowhead - 10-24-2009 at 08:53 PM

Quote:

Just another BS rumor by the real estate mavens working on their next land swindle. None of those companies own any land down there. They are all public companies and such a purchase would be reported in their SEC filings available for anyone to read on EDGAR.

Furthermore it makes no economic sense. The US car makers have assembly plants in Mexico for cheap labor because the NAFTA and maquiladora laws allow them to import parts from the US, assemble them in Mexico, and then reexport the cars back to the US or Canada duty free. They also sell those cars into the Mexican and Latin American market. Chinese content parts assembled in Mexico aren't duty free when imported into the US. Unless they cut some deal, they will probably have a double duty: when they land in Mexico and when they are exported to the US/Canada as finished cars.

A better port location would be Guaymas. It already has a 4-lane highway and railroad directly into the US. Colonet is just a dream.

Crusoe - 10-24-2009 at 09:24 PM

By the time the Mexicans get their port built it will be underwater because of GLOBAL WARMING! Not to worry. ++C++

Old is good

wessongroup - 10-25-2009 at 08:08 AM

Quote:

Originally posted by Crusoe
By the time the Mexicans get their port built it will be underwater because of GLOBAL WARMING! Not to worry. ++C++

Funny how environmental issues get pushed to the side... just saw in a paper the other day at the Doctors office that overall concern for Global Warming is waning in the U.S.

Big surprise with eating becoming more important, with the continued and growing shortage of water in many areas of the "globe".

Also saw where Mexico is "suffering" extreme drought too... lack of normal rail fall. In the same article the head of Mexico's Federal Water Board was saying we need to look back at how our ancestors did it... they collected rainwater in "cisterns" and saved it..

Kind of wonder why that was or has not been done down on the Southern tip... with the water you folks get down there... a few well placed damns across many of the "natural" flood control arroyo's seems like a bit of water could be retained, rather than just rushing down to the Sea of Cortez or the Pacific Ocean.

We could measure the negatives impacts a bit later, after we have enough water to make iced tea to drink while we review the environmental impacts reports on the event.

But, this is not MY country and I don't really think we in the U.S. have all the answers, but did like the simple suggestion for one of Mexico's leaders to say... "Why don't we just do what our people have always done”?

Comes to mind, "if it ain't broke don't fix it"...

Not sure how long the Aztecs and Mayan's were here before, "modern" irrigation techniques were introduced to the people of origin that were doing ok, before the Europeans showed up and "helped" them become "civilized". But, seems to me some one here was putting up cave pictures from something like 10,000 years ago.

I wish the Mexican people best wishes in just doing things their way. To me these peoples had a good thing going (of course I'm not into getting my heart ripped out for a God" but, some of the other methods, which evolved, by the native peoples should be studies for practical applications today.

Older methods of how to live in an environment should not be discarded out of hand as many ideas still have very practical application today....

BajaGringo - 10-25-2009 at 08:26 AM

Quote:

Originally posted by arrowhead
Colonet is just a dream.

Yes Nancy, if you say so...

:rolleyes:

wilderone - 10-26-2009 at 10:01 AM

The announcement of this planned megaport was over four years ago. At that time, the land grab among those believing they could profit began.

“The project already has prompted business activity in the area. Prices for land at Colonet, owned mostly by small ejido communal groups, reportedly have soared from 5 cents a square meter to $5.”

http://www.signonsandiego.com/news/mexico/20050814-9999-1n14...

So who bought the worthless land in 2005, and who's putting pressure on the pundits and politicians now so they can unload their holdings? That's all this story is about.
When has Mexico ever pulled off something of this magnitude with success? And its success requires the cooperation of the US border towns which will bear the brunt of truck traffic, demands of industrial storage, housing, roads, security and inspections of all types, federal approval of port of entry construction, staffing, etc.
Bajagringo, do you believe everything you hear from Mexican politicians?

wilderone - 10-26-2009 at 11:24 AM

And:

http://banderasnews.com/0604/re-bajafrenzy.htm

arrowhead - 10-26-2009 at 02:34 PM

Quote:

Originally posted by wilderone
Bajagringo, do you believe everything you hear from Mexican politicians?

Now be careful, wilderone. Bajagringo is going to call you a name. "Nancy" is already taken.

fishbuck - 10-26-2009 at 03:22 PM

Is the new hoarhouse/hotel on the highway in Colonet finished yet?
Now that's what I call progress!

Skipjack Joe - 10-26-2009 at 03:40 PM

:lol:

Bajahowodd - 10-26-2009 at 03:40 PM

Funny. I thought sort of the same thing. Getting in on the ground floor. That place is kinda in the middle of nowhere.

Evaluation of Punta Colonet Multimodal Project Plan

bryanmckenzie - 10-26-2009 at 04:28 PM

For anyone interested in a thorough understanding of the project, I have spoken with of the project reviewer who authored THIS REPORT --- Energy and Environmental Research Associates, LLC of Pittsford, NY.

The TWO most important items of note are:

(1) “[t]he expansion of the Panama Canal almost single-handedly kills Punta Colonet.” <<< from the "DAN" report

(2) project proponents EXCLUDE "planned and ongoing developments and expansions at existing West Coast ports (including Prince Rupert, LA/LB, Vancouver, Oakland, and SEA/TAC). Current capacity estimates used in the plan only account for expected expansions through 2010, though most
expansions are scheduled to be complete in 2011 or later."

The critique is actually quite interesting and informative. If you do not want to read the entire document, at least read the executive summary for highlights and scan the table of contents for interests you.

There are various other reports available HERE in both Spanish and English.

[Edited on 10-26-2009 by bryanmckenzie]

Bajahowodd - 10-26-2009 at 04:39 PM

Geez. After getting to the Conclusions and Recommendations, I just have to wonder how much these folks were paid for this. Sorry, but I really didn't learn much. Just more economic hoars.

arrowhead - 10-26-2009 at 05:24 PM

Quote:

Originally posted by Bajahowodd
Geez. After getting to the Conclusions and Recommendations, I just have to wonder how much these folks were paid for this. Sorry, but I really didn't learn much. Just more economic hoars.

I don't understand what you are talking about, Howard. I have read a lot of reports and studies in my career, and this one covers a lot of ground not covered by anyone else, as near as I can tell. It raises some very important points, for instance:

1) The existing West Coast ports are under capacity now and still have expansion plans that make Punta Colonet totally superfluous for the next 20 years.

2) The West Coast ports can expand faster and cheaper than Colonet because they already have the road/rail infrastructure in place.

3) The total shipment time from the Orient will still be faster and cheaper to a West Coast port because the sea shipping distance is shorter via the great circle route. Even Vancouver is a shorter shipping distance than Colonet.

4) No border crossing delays into the US market.

5) Colonet is not a good location for shipment to the interior of Mexico because the land route is circuitous.

The report summarizes it best:

Quote:

Even with conservative assumptions regarding West Coast port capacity improvements, projections suggest that Punta Colonet will be unnecessary—and thus likely unprofitable—for the foreseeable future.

bryanmckenzie - 10-26-2009 at 05:24 PM

Actually, it's very beneficial --- showing how flawed the government's assumptions are upon which the need/economics are based.

Quote:

Megaport, not Megapart

bryanmckenzie - 10-26-2009 at 05:27 PM

You should correct the typo so that this post will show up when searching "port".

fishbuck - 10-26-2009 at 10:17 PM

So is that hotel finished or not? I mean you guys can fantisize all you want about a giant port. But have they even finished a simple hotel yet?

It's dead. Scaled down to zero.

arrowhead - 2-2-2010 at 12:59 AM

Quote:

Originally posted by BajaGringo

Quote:

Originally posted by arrowhead
Colonet is just a dream.

Yes Nancy, if you say so...

Quote:

Le pierden la fe a puerto en Colonet

Tras las declaraciones del titular de la SCT, advierten que no pueden seguir atados a un proyecto de fe por los próximos 8 ó 10 años.

http://elvigia.net/noticia/le-pierden-la-fe-puerto-en-colone...

In today's El Vigia. Now the government minister is saying that the project is not viable and cannot move forward without the rail line and the permission to cross into the US. He says they expect that permission to take 8 to 10 years to get from the US. In the meantime, the Colonet ejidatarios are mad because they are prohibited from starting any other projecst on the property.

I'll bet BajaGabacho can pick up that land he says the Big Three automakers have down there for one centavo on the peso.

fishbuck - 2-2-2010 at 03:01 AM

I did notice the hotel south of town is coming along.
Maybe 6 months to a year and it might be finished.
Looks like they might have a restuarant too.
It's a start.
Megaport 2020?

fishbuck - 2-2-2010 at 03:51 AM

This MegaPort Colonet was a good idea!
You cannot fault the Mexican people and their investors for thinking of this.
If you have ever looked at a satelite photo of Punta Colonet and whatever the nearby point is, you would see that it looks just like LA Harbor before it was a harbor.
The La Harbor breakwater is at least 10 miles long. It is a true wonder. I've flown over it many times. Many large ships waiting to unload cargo.
All the granite bolders that make the breakwater came from the east end of Santa Catalina island by barge. And they barely made a dent. They are still mining granite there.
The harbor is the FAA designated practice area for Long Beach airport. Lots of trafic.
Someday, Colonet will be the same.

Thanks

wessongroup - 2-2-2010 at 09:11 AM

Bryan, thanks for the link.. aahhh would say the "review" brings up some very salient points which would have to be in place, prior to any movement on this project.. and suspect those point/issues have been the "deal breaker" on this project.

You can't get the funding if you can't answer all the questions to satisfy the "money" side of the equation..

And another issue which was not discussed, or I did not see it, (I just skimmed it) was what market will be left in the United States after the re-indexing of our way of life in the next 8-14 months.. when all the numbers really start to set in.. like "where's the BEEF".. who and/or how is the United States going to finance it's debit.. print more money??? :lol:

Quote:

Originally posted by bryanmckenzie
For anyone interested in a thorough understanding of the project, I have spoken with of the project reviewer who authored THIS REPORT --- Energy and Environmental Research Associates, LLC of Pittsford, NY.

The TWO most important items of note are:

(1) “[t]he expansion of the Panama Canal almost single-handedly kills Punta Colonet.” <<< from the "DAN" report

(2) project proponents EXCLUDE "planned and ongoing developments and expansions at existing West Coast ports (including Prince Rupert, LA/LB, Vancouver, Oakland, and SEA/TAC). Current capacity estimates used in the plan only account for expected expansions through 2010, though most
expansions are scheduled to be complete in 2011 or later."

The critique is actually quite interesting and informative. If you do not want to read the entire document, at least read the executive summary for highlights and scan the table of contents for interests you.

There are various other reports available HERE in both Spanish and English.

[Edited on 10-26-2009 by bryanmckenzie]

k-rico - 2-2-2010 at 09:23 AM

Plus, the Colonet port would increase competition for the Port of Lázaro Cárdenas and the Mexican politicians in that area (Michoacan) think it would be best to expand what is already Mexico's largest Pacific ocean deep water port.

And the operators of US Gulf of Mexico ports (New Orleans, Mobile AL) of course want the business but the Panama Canal's insufficient lock widths are a problem. I suppose they could be widened.

[Edited on 2-2-2010 by k-rico]

wilderone - 2-2-2010 at 09:40 AM

"Now the government minister is saying that the project is not viable and cannot move forward without the rail line and the permission to cross into the US. He says they expect that permission to take 8 to 10 years to get from the US. In the meantime, the Colonet ejidatarios are mad because they are prohibited from starting any other projecst on the property."

Now really - isn't that what I said? I'm glad they took my advice! HA!!
Fishbuck - any viability of the port is not dependnet on the port site itself - it's the rail line, the entry point into the US, and all ramifications thereof. Just not feasible or that necessary.

chippy - 2-2-2010 at 10:22 AM

Quote:

Originally posted by k-rico
Plus, the Colonet port would increase competition for the Port of Lázaro Cárdenas and the Mexican politicians in that area (Michoacan) think it would be best to expand what is already Mexico's largest Pacific ocean deep water port.

That would be Manzanillo, Colima.

And the operators of US Gulf of Mexico ports (New Orleans, Mobile AL) of course want the business but the Panama Canal's insufficient lock widths are a problem. I suppose they could be widened.

[Edited on 2-2-2010 by k-rico]

mulegejim - 2-2-2010 at 10:36 AM

Quote:

Originally posted by k-rico
Plus, the Colonet port would increase competition for the Port of Lázaro Cárdenas and the Mexican politicians in that area (Michoacan) think it would be best to expand what is already Mexico's largest Pacific ocean deep water port.

And the operators of US Gulf of Mexico ports (New Orleans, Mobile AL) of course want the business but the Panama Canal's insufficient lock widths are a problem. I suppose they could be widened.

[Edited on 2-2-2010 by k-rico]

I believe the Panama Canal is being widened at this time.

k-rico - 2-2-2010 at 11:34 AM

Quote:

Originally posted by chippy

Quote:

That would be Manzanillo, Colima.

Thanks, I didn't know about Manzanillo

The Port of Manzanillo

The Port of Manzanillo, located on the Pacific coast, is one of the busiest ports in Mexico, with impressive growth over the last 5 years. The expansion of the Port of Manzanillo has received priority in the National Program for Infrastructure announced by President Calderon in July 2007.

The Port of Lazaro

The Port of Lazaro Card##as is the only port in Mexico with capacity to receive ultra large container vessels of up to 12,500 TEUs. The port is hoping to capitalize on the overcrowding of U.S. west coast ports by offering a viable alternative for shipping products into the central United States. To do so, the port is developing infrastructure projects and making agreements with carriers and transportation companies to become an intermodal corridor to receive Asian containers going to the U.S.

http://www.buyusa.gov/mexico/en/transportation.html

wessongroup - 2-2-2010 at 11:43 AM

Contract awarded to:

http://www.mediargus.be/flanderstoday.admin.en/rss/22548040....

Quote:

Originally posted by mulegejim

Quote:

Originally posted by k-rico
Plus, the Colonet port would increase competition for the Port of Lázaro Cárdenas and the Mexican politicians in that area (Michoacan) think it would be best to expand what is already Mexico's largest Pacific ocean deep water port.

And the operators of US Gulf of Mexico ports (New Orleans, Mobile AL) of course want the business but the Panama Canal's insufficient lock widths are a problem. I suppose they could be widened.

[Edited on 2-2-2010 by k-rico]

I believe the Panama Canal is being widened at this time.

k-rico - 2-2-2010 at 12:20 PM

West Coast ports band together to fight global competition

http://www.oregonlive.com/business/index.ssf/2009/11/west_co...

Bajahowodd - 2-2-2010 at 12:45 PM

The Panama Canal expansion will undoubtedly be a game changer. It probably won't be finished for 4-5 years. Right now, what are known as panamax class ships, the largest allowed to pass through, do so with minute clearances and thus transit the canal slowly, and are limited to daylight transit only. Ships that size will speed up with the revised canal, as well as allowing a class of post-panamax ships, many already plying the seas, to use the canal. In fact, at present, US Navy Nimitz class carriers are too big to transit the canal.

k-rico - 2-2-2010 at 01:19 PM

A bit off-topic, but David McCullough's The Path Between the Seas is a fascinating book about the building of the Panama Canal. An incredible task at the time. McCullough is a Pulitzer Prize winning historian.

torch - 2-2-2010 at 04:52 PM

I personaly hope the colonet port never happens. the polution alone would be unbelieveable