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Panama Canal Increases Ship Transits Amid Persistent Water Shortage

The Panama Canal increased its daily number of ship transits this Thursday, although the water deficit that led to the restriction of crossings and ship draft last year persists, authorities reported.

This interoceanic route, which handles 6% of global maritime trade and was inaugurated by the United States in 1914, began imposing restrictions in April 2023 due to the scarcity of rain caused by the El Niño phenomenon.

But now it has increased the daily crossing of vessels from 27 to 31, thanks to the rise in the levels of the two artificial lakes that supply freshwater to the 80 km long channel that connects the Pacific Ocean with the Atlantic.

“We can now announce with some pleasure to the international maritime community that we are moving to 31 transits,” confirmed the Canal’s Vice President of Operations, Boris Moreno. “It is good news for the Canal and for the users as well,” he said.

The measure was notified to shipping companies on April 15 but took effect now. From June 1, 32 ships will be able to navigate the channel daily. Additionally, starting June 15, the maximum allowed draft for ships crossing the larger locks, inaugurated in 2016, will be 13.71 meters (45 feet), instead of the current 13.41 meters (44 feet).

“In the coming months, we will be announcing gradual increases in capacity, and we believe that by the end of this year 2024, we could be at normal transit levels,” Moreno said.

Record in Auction

The Panamanian route does not use seawater like the Suez Canal, and for each ship crossing, about 200 million liters of freshwater are poured into the sea, stored in Gatun Lake (450 km²) and Alhajuela Lake (50 km²).

Before the crisis, an average of 39 ships crossed daily. At the most critical moment in 2023, the number fell to 22, resulting in up to 160 ships waiting to cross. Now the number fluctuates between 50 and 60, Moreno said.

The reduction in transits led some shipping companies to pay more money to secure a crossing slot in the auctions organized by the Panama Canal Authority (ACP). One ship paid up to four million dollars for a slot, in addition to the toll.

The main users of the Canal are the United States, China, Japan, South Korea, and Chile.

Waiting for More Rain

The Canal’s watershed, with eight main rivers, also supplies drinking water to 58% of the country’s 4.4 million inhabitants. From an average of 2,800 millimeters of rain falling each year, it dropped to just 1,800 mm in 2023, explained hydrologist Ricardo Güete to AFP during an inspection of monitoring stations at Gatun Lake.

However, sporadic rains and the restrictive measures adopted by the ACP to save water have allowed the lake levels to rise, although they have not yet reached the levels needed to operate normally. “We are four or five feet (1.2 to 1.5 meters) below the conditions or levels we should have,” noted Güete.

The situation should improve during the rainy season, which runs from May to November, as the La Niña phenomenon, which brings more precipitation to the country, is forecast, the hydrologist said. “We hope that during this month… the rains will begin to fall, and the situation will normalize,” Güete indicated.

He explained that “while last year was not the most critical El Niño, it was in terms of water availability, due to the operation of the new locks, the population increase, and greater evaporation due to global warming.”

Selling Certainty

The ACP is studying incorporating new water sources into the Canal to prevent future water crises, but these works require time and significant investments.

“Before, we always had water… This crisis taught us that now managing water is paramount,” said Moreno, an electromechanical engineer with 41 years of experience in the Canal.

The drought led the ACP to create a reservation system, similar to airlines, so that ships do not waste time waiting. “This Canal water crisis has helped us change our business model and be able to sell that certainty… because for our customer, time is money,” said Moreno. “Selling certainty through the reservation system… has been one of the great gains of this time,” he added.

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