Panama Canal Cuts Ship Traffic Again as El Niño Drought Deepens

The Panama Canal is trimming its daily slot count again. From 15 September, only 32 ships will transit each day, down from 34 since early September and 36 in August. The canal has also cut the maximum permitted draft from 15.2 to 14.6 metres, which means ships must load lighter.

The driver is a drought tied to El Nino, a weather pattern that the canal authority says is on course to be the strongest since the region began keeping records. The reservoirs that feed the lock chambers, Gatun Lake and Alajuela Lake, are well below where they need to be. Panama declared a national emergency over the drought on 26 August, according to Al Jazeera.

The canal carries about 5% of world maritime trade and roughly 40% of US container traffic, so any restriction tends to get noticed quickly. Shipping companies that have already rerouted around the Strait of Hormuz now face a second major chokepoint tightening at the same time.

Ilya Espino de Marotta, the first woman to head the Panama Canal Authority, took the job on Monday and moved straight to managing expectations. She told AFP that further cuts were possible. "We do not rule out the possibility that in February or March we may have to lower the limit, probably not to 24 slots per day, but it could be reduced to 29 or something similar," she said.

The canal has been here before. During the 2023-24 drought, daily crossings fell from 38 to as low as 22, and rates on alternative routes spiked in response.