Drought crisis in the Panama Canal, allowing a reduction in cargo capacity! More capacity is occupied!

05月26日 11:57:09

The Panama Canal is one of the world's three busiest canals, with more than 12,000 ships passing through it each year to transport goods to more than 160 countries, second only to the Suez Canal.

But at present, this important world shipping hub is experiencing the most serious drought crisis in history. The water level of the canal has dropped, and many container ships have been forced to reduce their cargo to pass through the canal-which has a certain impact on maritime trade and freight rates.

Today: New Panamax ship draft limit further reduced


From February to April, rainfall near the Panama Canal and the lakes that feed the canal was less than half of normal, according to the Everstream Analytics, the same rainfall as in 2019, which was the lowest in 20 years. And the rainy season, which usually starts before summer, this year has no signs.

Therefore, in the context of the drought situation continues to worsen, the Panama Canal Authority (ACP) announced that it will further reduce the maximum draft allowed for passing vessels.

According to Canal spokesman Octavio Colindres, starting May 24, new Panamax vessels (the largest ships passing through the waterway) will be allowed a maximum draft of 44.5 feet (13.56 meters). After May 30, the draft limit will again drop to 44 feet.

Before that, the new Panamax had a draft limit of 45 feet.

The canal authority said that the future will continue to monitor the Gatun Lake water level, do not rule out the future will again adjust the draft limit may.

To this end, a number of companies announced June 1 to impose surcharges.

The tightening of draft restrictions has also led major shipping companies to take new actions. From June 1, trans-Pacific carriers will impose hefty surcharges on all waterborne services from Asia to the East Coast of the United States and divert parts of the loop through the Suez Canal.

Maersk said in its monthly market update: "The Panama dry season has caused canal draft problems, reducing the Panama Canal's capacity."

"The water level in Gatun Lake is lower than usual, causing severe draft restrictions on ships passing through the Panama Canal," Hapag-Lloyd said in a client advisory." meanwhile, it said that a 500 us dollars per container PCC (Panama Canal Canal Charge) will be levied on all cargo sailing from Asia to the east coast of the united states via the Panama Canal from June 1.

is understood that at least four shipping companies have announced weight restrictions and will impose container charges of $300 to $500 per container. In the future, more companies may follow suit.

Ships are allowed to carry less and more capacity is taken up

As a result, the freight rate increased, and each case had to be increased by 1500 US dollars.

Although it may seem like little change, the draft limit is only reduced by 1 foot, but Flexport Inc.'s head of marine transportation Nathan Strong (Nathan Strang) said that may mean that some ships are reduced by 40%.

these measures will not only limit the draft, but also cause delays and higher costs, because it means that more ships are needed to carry the same amount of goods, and sometimes the heaviest cargo has to be divided into two containers instead of one. According to analysts' calculations, these measures may cost importers and retailers using the route an additional 1,500 US dollars per container.

"If you ship two containers a week, 12 tons each, and each container is about 3000 US dollars, then you need to ship three containers. So the sea price per shipment has gone from 6000 US dollars to 9000 US dollars. For shippers who usually carry 25 tons per container, they now need three to four boxes."

Panama Canal drought may continue

Meteorologists predict that the Panama Canal may be even less optimistic this summer. Everstream Analytics chief meteorologist Jon Davis said: "Rainfall across Panama will continue to be below normal for the foreseeable future. "As a result, we expect lake levels to continue to fall and the impact on canal shipping to get worse."

understand that during the droughts of 2019 and 2016, the draft limit of the Panama Canal was once lowered to 43 feet. And this year's summer vacation may come soon, and perhaps this year we will see the Panama Canal draft cap lowered again.

Source: China Shipping Network

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