El Nino effects force Panama Canal to cut daily ship transits

The Panama Canal Authority will reduce the number of vessels allowed to pass through the waterway each day as low rainfall and a potentially severe El Nino raise concerns over water supplies.

The authority, known as the ACP, said daily transit slots would be reduced in two stages, falling from the current 36 to 34 for transit dates beginning Sept. 4 and then to 32 from Sept. 15.

The changes will affect both the older Panamax locks and the larger Neopanamax locks.

The ACP said cumulative rainfall across the canal watershed between May and August was 34% below the historical average, while inflows into the watershed were 44% lower than usual.

Despite the arrival of the rainy season and the introduction of water-saving measures, the authority said further action was needed to support the long-term sustainability of canal operations.

Forecasts indicating that the developing 2026-27 El Nino could become particularly severe may further reduce rainfall and runoff during the remainder of the wet season, it added.

The authority said the measures were intended to preserve the reliability of canal services, protect water supplies for human consumption and provide shipping companies with sufficient time to plan voyages and manage supply-chain operations.

The canal depends on fresh water from surrounding lakes to operate its lock system. Each vessel passage requires large volumes of water to raise and lower ships between sea level and Gatun Lake.

The ACP also postponed previously announced reductions to the maximum permitted draft for vessels using the Neopanamax locks.

It said it would continue to monitor weather conditions, lake levels and water inflows and could introduce further operational changes if necessary.

The restrictions come as the global shipping industry is already facing disruption from the war in Iran, which has sharply reduced vessel traffic through the Strait of Hormuz, another of the world's most important trade routes.

Connecting the Atlantic and Pacific Oceans, the Panama Canal allows vessels to avoid the much longer journey around the southern tip of South America and is a critical route for international trade.

The waterway faced similar restrictions during the 2023-24 El Nino, when an extended drought forced the ACP to progressively reduce daily transits and impose draft limits.

The latest reductions will increase the importance of advance reservations, with the ACP warning customers that a confirmed booking is the only way to guarantee a specific transit date.