Continued Drought Forces Panama Canal to Further Reduce Daily Transits

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The Panama Canal Authority (ACP) is implementing measures to address delays and ship backlogs caused by drought conditions. The ACP will offer a new schedule for the Neopanamax and Panamax locks, allowing customers to adjust their itineraries and reduce waiting times for vessels without a daily transit schedule. The ACP Administrator has stated that if the drought persists, additional transit reductions may be necessary. However, he emphasized that the draught will not be reduced, as this would negatively impact 70% of shippers. The canal administration has assured that water levels are currently normal, despite long queues of waiting vessels.

The restrictions imposed by the drought are expected to result in a revenue reduction of up to $200 million by 2024 for the Panama Canal. Experts have warned of potential disruptions to maritime trade in the coming year due to the El Nino phenomenon, which has been particularly severe. The ACP is preparing for the possibility of a drier period in the absence of significant rain. Long-term solutions are being sought to manage water levels and ensure the smooth operation of the canal.

Overall, the ACP is taking proactive measures to address the challenges posed by the drought and potential future dry periods. By offering a new schedule for locks and allowing customers to adjust their itineraries, the aim is to reduce waiting times and minimize disruptions to maritime trade. However, the severity of the drought and the impact of the El Nino phenomenon on water levels remain concerns for the canal’s operations in the coming months and years.

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