Picture by Luis Gonzalez for Unsplash
June 19, 2024
Last week, the Panama Canal Authority announced an increase in the number of vessels able to cross its canal. This marks a considerable shift in expectations for one of the busiest trade routes in the world which continues to suffer a historic drought that inhibits all crossings. As of writing, the Canal Authority expects that 34 vessels will be able to cross the country per day—still below the past average of 36 daily crossings but well above the 24 daily limit imposed in 2023.
For over a year now, Panama has experienced a significant decrease in precipitation which, together with warmer climates, has resulted in the steady decline of water levels at the country’s world-renowned canal. This, in part, is a matter of geography. Despite common conceptions of the Canal being a single straight line across Panama, it actually consists of a series of cuts and artificially created bodies of water. This means that its water levels are highly sensitive to weather disruptions and any decrease in the depth of Lake Gatún—the main lake in the canal—can significantly decrease the number of vessels able to cross at a time. More so when considering that, at the time of building the canal, multiple trees were submerged under the newly created waterways. When water levels decrease, these trees resurface and make the coasts of Lake Gatún difficult to transit for most vessels.
Now, Panama is used to a naturally fluctuating water level based on the country’s rainy season. In fact, over the last five years, water levels in Lake Gatún have shifted from a high of 86.9 ft in January to a low of 82.5 ft in May. But even then, only three months of the year have water levels below 83 ft.
Gatún Lake Average Water Levels (Past Five Years)
(Data from the Panama Canal Port Authority)
The problem is that, over the last two years, water levels in Panama have steadily decreased. In fact, Lake Gatun reached a low of 79.24 ft in height in 2023, only recovering towards the end of the year. But even then, the highest water level recorded in 2023 was a mere 81.23 ft—still lower than the historical average for the lowest month in the dry season (May). In fact, water levels remained at a historical low until around October, when they began a steady increase that still put them way below 2022 and 2021 water levels.
Daily Water Levels at Lake Gatún (2021-2024)
(Data from the Panama Canal Port Authority)
The drought of 2023 continued into the first months 2024, although, starting roughly in the month of May, water levels at Lake Gatún began a steady increase, reaching up to 81.96 ft. This means that the Panama Canal now has more water than it did in the last 17 months. However, water levels remain well below the average for the dry season in Panama.
These numbers, however, were enough to enable the Canal Authority to increase the number of vessels that can safely cross through the country. This, in great part, because Panama has already passed through its dry season and can expect further rains in coming months that will increase its ability to manage new crossings.
Currently, a total of 32 vessels a day are allowed to cross, with 24 coming from Panamax locks and eight from neo-Panamax locks—a distinction based on the size of container ships. By the end of June, it is expected that the numbers will rise to 24 Panamax and nine neo-Panamax vessels and, by July, they will grow once more to 25 Panamax vessels and nine neo-Panamaxes.
Changes in Vessel Crossings at the Panama Canal
(Data from the Panama Canal Port Authority)
The Panama Canal is still one of the most important trade arteries in the world, with an estimated 14,200 vessels crossing through it every year. That equals roughly 2.8% of all vessel traffic amongst the main trade points in the world. By increasing the capacity of crossings, it will help ameliorate the large stress currently faced in most trade routes around the world.
