The Panama Canal plans to reduce average daily vessel transits to 29.5 from October, according to a draft plan submitted to Panama’s parliament. That would be an 18% fall from the 36 vessels allowed through each day in August. Officials had already reduced the limit to 32 in September as drought conditions worsened.
The canal depends on fresh water flowing into Lake Gatun, whose levels determine whether its lock system can safely lift ships about 26 metres above sea level and lower them on the opposite side. The canal authority imposes restrictions when lake levels become unsafe for larger vessels or when water must be conserved.
The Guardian reported that the canal carries about 5% of global maritime trade and roughly 40% of US container traffic. Its route is widely used by companies trading between China, Asia and the US because it generally cuts both transport costs and journey times. Further limits could therefore increase pressure on shipping networks already facing logistical disruption and higher costs.
In August, vessels reportedly waited as long as 10 days to enter the canal, the longest waiting period since May. One container ship reportedly paid about $4m to move ahead in the queue. Shipowners normally pay a flat fee to reserve a transit slot, while a daily auction allows them to bid for priority; prices tend to rise when demand is high.
The Guardian said shipping logistics have also been complicated by the US and Israel’s war on Iran and disruption to the Strait of Hormuz. Canal restrictions could become more severe because El Niño is expected to peak later this year, with the weather pattern forecast to be the strongest in four decades.
The canal faced even tighter limits in 2023, when low water levels led authorities to cut daily transits from 38 to 22. The resulting bottleneck forced companies to seek alternative routes. The current drought is part of wider extreme weather affecting Central America and northern South America, while an Agence France-Presse analysis of Copernicus meteorological data found that 52 countries recorded their hottest June-August period on record this year.