Severe Drought Impacts Panama Canal Shipping

The Panama Canal has recently been reducing the capacity aboard larger ships that pass through the waterway, which connects the Atlantic and Pacific Oceans.

The Panama Canal Authority (ACP) have reduced the maximum draft for ships, meaning carriers have to lighten the loads to use the canal, and some have already implemented a PCC (Panama Canal Charge) of around $500 per container, which will be effective from June.

The reduced capacity affects vessels travelling between the Western Coasts of North and South America, and the UK. However, the largest impact falls on services from Asia that travel on all water services to the US East Coast.

Around 14,000 ships use the canal every year, which is the only major gateway between the world's two largest oceans. The alternative route is to pass either north or south of the continent.

The drought season has hit the region hard and the Panama Canal gets its water supply from 2 lakes that are around 25 metres above sea level. Rainwater flows down from the lakes through a series of tiered locks to operate it and water levels have fallen by almost ten metres during recent months.

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