A deep water port behind a peruvian flag flying in the foreground.

Chancay: Peru’s New Megaport

(Image generated with AI)

Quietly, Peru (more specifically, the coastal town fo Chancay) is preparing to expand its trade capabilities and become a regional hub for transpacific commerce. For five years now, the country has been building a new international terminal just 50 miles away from the capital city of Lima. When completed in November of this year, it will help fuel Peru further into the global stage.

The port itself, called Chancay, is designed to be a major international terminal. The main force behind its construction is Chinese transportation giant, Cosco, which currently operates 1,417 cargo vessels with a total carrying capacity of 116 million DWT—the largest of any company. Since 2019, Cosco has invested some $3.5 billion to construct the port, hoping to use it exclusively for its own shipments—although, since then, Peru’s National Port Authority has ruled that Cosco must open the port to competitors as well.

Chancay would add a total operational capacity of 1.5 million TEUs to Peru’s commerce sector, putting it above the neighboring ports of Buenaventura (Colombia), and Guayaquil (Ecuador), while being tied with the port of San Antonio (Chile). In turn, this would increase Peru’s total TEU capacity from a current 3.1 million TEUs to over 4.6 million TEUs— a 48% increase in total capacity. With this estimated size, Chancay would be one of the largest ports in Latin America’s West Coast, where the bulk of shipments concentrate in Mexico’s Manzanillo and Lazaro Cárdenas ports or head to the Panama Canal through the Port of Balboa.

TEUs Handled by Top LATAM West Coast Ports (2023)

A sideways bar graph showing the number of TEUs handled in the most important ports of Latin America's West Coast.

(Data from Transporte.mx, Georgia Tech, Puerto de San Antonio, Colombia’s Ministry of Transportation, and the Guayaquil Port Authority)

However, the true value of Chancay is not in the TEUs it will be able to handle. As the above figures suggest, the port will be comparable with other ports in the region, but still falls behind neighboring terminals. Instead, Chancay’s real merit is in its increased depth that will allow it to host larger vessels than any neighboring port in South America.

According to current estimates, Chancay will have a total port depth of some 18.28 meters (60 ft). This, in turn, would allow it to service larger vessels than the neighboring Callao Port (currently Peru’s most important container ship terminal) and even the larger ports of San Antonio and Balboa. As it stands, Chancey’s intended depth would make it the deepest port in Latin America’s West Coast, surpassing Manzanillo and Bahia Quintero. Only the port of Huasco in Chile would have deeper anchorage capabilities but, even then, it is classified as only a “very small” port by the World Port Index, suggesting its inability to handle large cargo quantities. So, Chancay will be alone in its combined ability to host deep water vessels and host a large enough terminal to manage prominent cargo quantities.

Port Depth in Latam’s West Coast

A map showing the depth at a selection of West Coast ports in Latin America

(Data from World Port Index)

At the moment—before Chancay’s opening—large vessels have one of two choices to reach the Latin American market. They can either transfer cargo to smaller vessels in Mexico’s Manzanillo port or cross the Panama Canal to access better equipped ports in the region’s Eastern Coast. Chancay, on the other hand, will allow large vessels—many of them operated by Cosco—to enter the South American continent without need to transfer cargo. It is estimated that cargo could reach as far as Brazil through inland trade after being unloaded at Chancay.  All of this while keeping a transit time of 35 days between the Asian continent and Peru. While we do now know precisely what products will be exported to Chancay, Peru’s trade data might help us gain a better understanding of this topic. In 2023, the top imports in Peru from China were all in the electronics, manufacturing, automotive or plastic sectors. Meaning that Chancay could help introduce needed manufactured products to South America.

With this new port, Peru could soon become a bigger power in regional trade, reaching as far as Brazil Most importantly, it could further open the doors to China which already has increased investments in Mexico hoping to avoid US tariffs and sanctions. Though, it is still unclear if the port would bring more trade to the region or merely redirect vessels currently headed to Panama. Regardless, at Auba, we will continue analyzing the impact of this new port and its effects in trade across the Americas.