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The Panama Canal faces serious challenges when it is hit by drought 0
(Dan Tri) – The Panama Canal Authority (ACP) said it is facing `unprecedented challenges` caused by severe drought.
A commercial ship passes through the Panama Canal (Photo: Port Technology).
The Panama Canal has been hit by drought, causing commercial ships to wait in long lines to pass through one of the world’s most important shipping routes.
Accordingly, in a new demonstration of the impact of the climate crisis on global business and trade, the Panama Canal Authority (ACP) has introduced restrictions on the number of ships transiting due to
The prolonged dry season has reduced the amount of available water needed to allow ships to pass through the canal’s locks, which has caused severe blockages.
The canal is popular with shippers because it helps reduce shipping costs and times, especially for large retailers and energy companies trading between China and the rest of Asia.
ACP said it faced `unprecedented challenges`, adding that the situation was especially severe because of a drought `unprecedented in history`.
In late July, state-owned ACP limited the number of vessels passing through the waterway each day to an average of 32, down from the usual 36.
The restrictions have led to congestion with too many ships waiting to pass through and left companies scrambling to find alternative routes.
Live maritime tracking websites showed about 140 ships near the canal on August 14, a significant increase from the about 90 ships typically seen in the area during the rainy season that runs from May to December.
The number is slightly lower than the 160 ships seen near the canal on August 10 and may be a sign that measures to clear the backlog are working.
Last week, ACP announced it had temporarily changed its booking rules to allow more ships to pass through the canal without reservations.
The measures, which will remain in place until August 21, limit the number of new bookings for ships passing through the canal’s old locks, used for smaller vessels, to create more throughputs for those currently in transit.
The reason for the decrease in congestion is also partly because many shipping companies have chosen to take routes around Africa despite increased costs.
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The Panama Canal is one of the most important shipping routes in the world (Photo: Port Technology).
Ricaurte Vasquez Morales, manager of the Panama Canal, said: `Through regular updates, transparent dialogue and close cooperation with shipping lines and stakeholders, we strive to anticipate and provide information
Weather-related problems have been brewing in the canal for some time, leading ACP to pledge to conserve water during the rainy months, although it says the economic impact is inevitable.
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The Panama Canal helps significantly shorten the travel distance of ships from the Pacific to the Atlantic and vice versa (Photo: Mapsofworld).
The return of the naturally hot El Nino weather pattern also causes Panama and the surrounding area to become warmer and drier.
Peter Sand, principal analyst at freight market analysis firm Xeneta, said disruptions at the canal could push short-term shipping prices higher and `cause shippers to change their supply chains.`
There are also concerns about the impact of dry weather on Germany’s Rhine River, one of Europe’s key shipping routes.
In recent months, water levels measured at Kaub, west of Frankfurt – a particularly narrow point where the traffic channel is shallower than elsewhere on the river – have been lower than normal and, at the end of July, had dropped to
Analysts fear that a repeat of 2022, when some larger ships were forced to offload to continue using the river, could hurt growth in Europe’s largest economy.