Panama Canal restrictions to extend throughout 2024, authority cautions

Posted on April 15, 2024   |  

The Panama Canal Authority (ACP) is optimistic about improved conditions as steady rainfall is expected by late April, paving the way for a gradual easing of transit restrictions towards full normalization by 2025.

Severe drought, worsened by El Niño, led to reduced drafts and transits, causing global merchant fleets to avoid the canal due to long queues and high toll fees.

The situation worsened when the Suez Canal became dangerous due to Houthis targeting merchant ships, further discouraging canal usage.

Recently, the ACP increased daily maximum transits to 27 by adding three extra slots at Panamax locks, indicating a positive shift.

Maersk's decision to reinstate services previously diverted to rail land transit indicates improving water levels along the canal.

The ACP updated ship operators on auction prices for extra slots, which had spiked dramatically but have now stabilized.

Tonnage transits through the Panama Canal, accounting for 2.5% of global trade, have declined by one-third due to transit restrictions.