Panama Canal to reduce shipping over El Niño-fueled drought

Panama City - Starting September 3, the Panama Canal will reduce the number of ships passing through from 36 to 34 per day due to drought caused by the El Nino phenomenon, according to the canal's operator. The decrease will continue to 32 ships per day starting September 15. El Nino has caused a 34% drop in rainfall in the canal's watershed area from May to August compared to historical averages, according to the authority.

The canal handles 5% of global maritime trade and 40% of U.S. container traffic, making water levels crucial for its operation. The canal has already implemented water conservation measures, such as lowering the maximum draft for large ships. In 2023, the water level was so low that the daily ship transit number was reduced from 38 to 22.

With the upcoming reduction, waiting times for ships without reservations will increase. While nine out of ten ships use the canal with a reservation, the remaining slots are auctioned. The U.S.-built canal's main users are the United States, China, Japan, Chile, and South Korea. El Nino is expected to be one of the strongest on record this year, leading the government of Honduras to place 80% of the country under a drought alert.