Panama Canal eases limits that caused global shipping bottleneck
Panama Canal is lifting restrictions that caused a global shipping bottleneck as water levels normalize after a severe drought.
The Panama Canal Authority increased the draft in the waterway to a maximum 50 feet and will allow 36 vessels a day to transit after recent rains lifted water levels at an artificial lake that forms part of the canal system, administrator Ricaurte Vasquez told reporters Monday. The agency expects rains to continue through November, further lifting water levels, he said.
The canal handles about 3% of global maritime trade volumes under normal circumstances, and 46% of containers moving from Northeast Asia to the US East Coast. The channel is Panama’s biggest source of revenue, bringing in nearly $5 billion last year.
About 30 to 32 vessels are currently transiting the waterway, below pre-drought capacity. The canal restricted daily transits to as few as 24 at the height of the drought. Vasquez said it’ll take about five to six months for shippers to return in full. Rainfall is expected to lift Lake Gatun’s water levels to 88 feet by November from current levels of around 85.8 feet, he said.
Last year’s El Niño caused a significant drop in rainfall and forced the canal to implement daily transit restrictions for the first time in history. The authority even held auctions in which shippers could bid for transit slots. Some shippers, especially time-sensitive vessels carrying liquefied natural gas and liquefied petroleum gas, opted for alternative routes.
“Creativity was taken to its limit
