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PANAMA - Transport

Jared Zerbe

CEO, Panama Ports Company

Bio

Before coming to Panama as the CEO of Hutchison Ports PPC, Jared H. Zerbe was the CEO for Tanzania International Container Terminal Services Limited. He has worked in a number of senior commercial roles and legal roles, and he is licensed as a solicitor in England and Wales. With a JD from Boston University, he is a licensed attorney in the US. Zerbe also has a master’s in international corporate management from the University of Pittsburgh and studied law in the UK, obtaining his qualified foreign lawyer certificates at BPPE in London.

"2024 has brought significant growth for Hutchison Ports PPC, with both terminals experiencing a remarkable year-over-year increase."
TBY talks to Jared Zerbe, CEO of Panama Ports Company, about an uptick in maritime traffic, rail transportation, and meeting industry demand.
What factors have contributed to the increase in ship calls since 2023, and how have Balboa and Cristobal terminals responded to changes in the shipping industry?

Since 2023, Panamanian ports have experienced a shift in vessel traffic. While overall port growth declined in 2023, Hutchison Ports PPC was the only port operator that had an overall increase in volumes and Balboa specifically had 6 percent growth in container volumes. This can be partially attributed to issues with fewer transits through Panama Canal as well as our strategies put in place to increase partnership with our customers. Our strategic competitive advantage lies in the on-site railway connections at both Balboa and Cristobal, the only terminals in Panama to offer such direct access. We are actively collaborating with one of our key customers, Maersk. By aligning our operating model with Maersk’s vision of a one-stop service similar to FedEx or DHL, we have successfully positioned Balboa as a crucial flexing point in their logistics network. This allows Maersk to catch up on delays, store cargo in case of issues at subsequent ports, and ultimately, optimize their overall efficiency and reduce costs. This strategic partnership has demonstrably increased cargo volumes moving through Balboa. We have changed how we work to put our teams into joint planning. We have spent thousands of man-hours on this new business model with Maersk, demonstrating our dedication to exceeding customer expectations. Notably, Balboa’s unique railway access plays a vital role; it serves as the sole entry and exit point for all cargo on the Pacific side, further solidifying its importance within the regional infrastructure.

What investments are being made to accommodate potential growth in rail transportation?

2024 has brought significant growth for Hutchison Ports PPC, with both terminals experiencing a remarkable year-over-year increase. Overall port volume is up around 20%, with Cristobal even seeing over 25% growth. The biggest challenge currently is handling significant overflow volumes on almost all services and over a 40% increase in rail volumes. Maersk as well as other lines have been doing much more land bridge model of sending cargo via rail and truck between Pacific and Atlantic sides. The success of the increase in rail volumes is that all parties involved (Balboa, the Panama Canal Railway Company (PCRC), and Manzanillo) need to be prepared to make the necessary investments and operational changes to handle the increased volume and streamline the process. Furthermore, this system has attracted the attention of other shipping lines who want to do something similar, Four to five companies have express interest in significantly increasing moving cargo from one ocean side to the other side. This promising new model also presents challenges. Increased rail volumes necessitate significant investments and capacity enhancements across the entire supply chain. Hutchison Ports PPC has proactively expanded its capabilities by acquiring new equipment, hiring additional operators, and increasing truck availability, every link of the chain needs to work perfectly, success hinges on robust communication, coordinated efforts and investment from all stakeholders. We see immense potential for significant growth, and we must all work together to expand our capabilities. The Panama Canal is heavily reliant on rainfall, which is becoming more erratic due to climate change, this presents a unique opportunity for Panamanian terminals and strengthens our position as a vital link in the global supply chain.

How are you adapting environmentally and technologically to meet industry demands?

Hutchison Ports isn’t just keeping pace with environmental regulations; we’re actively leading the charge towards a sustainable future. We recognize that the industry is shifting towards sustainable practices, and we’re at the forefront of this movement.
Our commitment extends beyond simply adapting. Our commitment to sustainability is exemplified by our recently approved Science Based Targets initiative (SBTi) targets. SBTi validated our ambitious group-wide greenhouse gas (GHG) emissions reduction goals and our 2050 net-zero target. We’re actively implementing a range of initiatives to enhance energy efficiency and integrate renewable energy sources: EV Charging Infrastructure: We’re investing in a network of EV charging stations to power our electric vehicle fleet, including existing electric Empty Container Handlers (eECHs) and future additions like reach stackers and forklifts. This project, with a capacity for 24-30 units, aims to significantly cut diesel use per TEU and propel us towards our net-zero target by 2050 or sooner. Harnessing Solar Power: We’re installing solar panels on numerous buildings to generate clean energy for our operations. This transition will lessen our dependence on traditional energy sources, minimizing our carbon footprint and promoting a more sustainable energy consumption approach. Electrifying Yard Operations: Over 75% of our yard areas are now electrified, powering our Electric Rubber Tyred Gantry Cranes (ERTGs). This shift from diesel-powered cranes to electric ones significantly reduces emissions and creates a cleaner yard environment. LED Lighting Implementation: We’ve implemented energy-efficient LED lighting solutions across our ports’ yards and docks. This not only reduces energy consumption but also enhances visibility and safety within our operational areas. In addition to our environmental leadership, we prioritize customer satisfaction. We understand the customer requests for a more efficient billing and communication approach. As a result, we’ve implemented new digital systems to streamline these processes, ensuring a more responsive and user-friendly experience.

How does Panama Ports Company contribute to the community through initiatives?

We believe art and culture should be accessible to everyone. We believe everyone deserves access to enriching experiences. That’s why one of our main efforts is to enable children from socially vulnerable areas to visit museums and art shows, providing enriching experiences and exposing them to new ideas and possibilities that would broaden their horizons and expose them to new possibilities. We want to ignite a passion for the arts and inspire future generations to explore diverse career paths. We are deeply committed to fostering the development of Panama’s youth. Our sponsorship of “Golerinas” and “Mundial del Barrio” youth football programs has impacted over 9,000 boys and girls from socially vulnerable areas. We see the profound impact these initiatives have on young athletes, fostering not just their physical skills but also their character, independence, and self-esteem. We believe in the power of sports to promote inclusion, diversity, and healthy competition, building a more equitable society. Our commitment extends beyond social responsibility. We’re a leader in sustainable practices, actively involved in beach clean-up, and ocean conservation efforts through mangrove restoration and tree planting projects. This commitment aligns with the UN’s Sustainable Development Goals (SDGs), and we’ve adopted high-level Science Based Targets (SBTi) to drive impactful environmental change.

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