The Panama Canal is being hit by a severe drought that is forcing container ships to downsize and pay higher fees, with the cost of transporting cargo expected to increase this summer. From 24 May, the largest ships will have to reduce their draft, either by carrying less cargo or reducing the weight of their cargo. A further reduction will follow from 29 May. Some shipping companies have also announced new fees in response to the channel restrictions. These measures could result in delays and higher costs for goods being shipped through the canal, which typically handles 5% of annual world maritime traffic.
Water levels in Lake Gatun, the largest of the two lakes that feed the canal, are expected to reach historic lows by July, limiting ships’ draft and the amount of cargo they can carry. This shortfall is related to 2019 and the lowest rainfall in two decades. The dry spell has caused falls of less than 50% of normal near the canal and the lakes that feed it from February to April. There are no signs of the rainy season, which typically begins before summer. Shipping routes from Asia to the US can be transported via alternative routes or ports in Southern California, where containers can be loaded onto trucks or trains bound for population centers in the Midwest and East Coast.
Tags: Panama Canal,Draft restrictions of the Panama Canal