Monday 25 September 2023

Panama Canal reduces the number of ships daily due to the drought

In recent months, the Panama Canal has implemented a staggered reduction in draft.

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23 September 2023 - At The Banks - Source: BCCR

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Q24N (EFE) The Panama Canal announced that as of July 30 and “until further notice” it will lower the daily transit capacity of vessels to 32 “to reduce the possibility of additional draft restrictions in the coming weeks” due to the drought that affects its basin.

The Panama Canal, through which around 3% of world trade passes, maintains a daily transit average of between 35 and 36 ships, according to what the administrator of the channel, Ricaurte Vásquez, said on June 1, for which reason this measure will result in a reduction of between 3 and 4 ships per day.

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In a notice addressed to all shipping agents, owners and operators, dated July 25, 2023, on its website, the Autoridad del Canal de Panamá (ACP) – Panama Canal Authority – indicated that the reduced transits will be “normally distributed” as “10 ships in the Neopanamax locks (those of the expansion inaugurated in 2016), and 22 ships in the Panamax locks”, which have been operating since 1914 and are smaller.

The ACP clarified that this daily transit capacity “can be further adjusted as deemed necessary, depending on the level of Gatun Lake, weather forecasts, and combination of vessels.”

Vásquez already warned last June that “as an extreme measure”, “the decision would have to be made to limit the number of daily transits” of ships to a minimum of 28 vessels.

The ACP “strongly recommended to all customers that they make use” of the transit reservation system “to reduce the possibility of long delays” due to the reduction in daily transits.

He also said that these measures are necessary “despite the arrival of the rainy season in the Isthmus of Panama and the continuous water saving measures that the ACP has implemented in recent months to mitigate the adverse effects of the prolonged dry season in the Canal Basin.

“The ACP may implement additional measures and establish additional procedures, in accordance with the safe and efficient operation of the Canal,” added the notice to shipping agents, owners, and operators.

Draft Reduction

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In recent months, the Canal has implemented a staggered reduction in draft which, according to a notice issued on June 14, dropped from July 19 to 43 feet (13.11 meters), when the maximum offered by the track is 50 feet (15.24 meters).

The draft is the depth that the submerged part of a boat reaches in the water. In practice, its reduction implies that ships must reduce the volume of cargo they carry when they cross the road, a measure that has an impact on Canal revenues.

In the midst of the severe drought that Panama experienced in 2019, the maximum draft in the Neopanamax locks, those that pass through the expansion inaugurated in 2016, was temporarily reduced to 44 feet (13.4 meters), which meant a drop in revenue from tolls.

The measures adopted by the ACP are due to the prolongation of the dry season that Panama is going through, a situation that has caused water supply problems and has forced the authorities to declare a “state of environmental emergency.”

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The Canal is fed by two artificial lakes of Gatún (1913) and Alhajuela (1935), which also supply water to the Panamanian capital, the metropolitan area and surrounding areas, that is, to about half of the population of the country with 4.2 million inhabitants.

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Q24N is an aggregator of news for Latin America. Reports from Mexico to the tip of Chile and Caribbean are sourced for our readers to find all their Latin America news in one place.

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