Worldwide shipping repercussions expected as El Nino chokes Panama Canal

PANAMA CITY, Panama (AFP) — The Panama Canal will restrict the number of vessels transiting the crucial waterway from Friday for the second time ever due to drought caused by the El Niño climate phenomenon. Five per cent of global trade passes through the canal that connects the Pacific Ocean with the Atlantic. The waterway is set to reduce daily traffic from 36 to 32 ships a day in an effort to conserve water amid a severe drought likely to last until mid-2027.

Canal authorities are also reducing the permitted draft of vessels -- how deep they sit in the water -- from 15.24 to 14.63 meters. Panama has declared an emergency over El Niño, which raises surface temperatures in the central and eastern equatorial Pacific Ocean and causes global changes in winds and rainfall as well as erratic weather conditions. The canal's incoming administrator Ilya Espino de Marotta has acknowledged the current "challenging" conditions.

The 80-kilometre (50-mile) canal draws on freshwater that comes mainly from rainfall and is stored in artificial lakes. Without water, its locks that lift and lower ships at the beginning and end of the journey would not function. Each transiting ship requires about 200 million litres of water, which is then discharged into the sea.

Water "is the most important resource for operations," but "between April and August the accumulated rainfall deficit was 35.8 per cent below the historical average," the canal's water manager Erick Cordoba told AFP. And there are "no signs of recovery in the short term," Cordoba added. Forecasts indicate that the 2027 dry season, normally between January and April, will start a little earlier than usual and extend into May.

In 2023 and 2024, El Niño forced a reduction in daily transits to 22 and the maximum draft to 13.41 meters. That led to 20 per cent fewer vessels and a 17 per cent drop in tonnage, not to mention longer lines of ships queuing up. Further restrictions could follow those imposed on Friday.

"If we don't manage to fill the lakes in November, we're going to have to tighten our belts," former canal administrator Jorge Quijano told AFP. Long-lasting restrictions will lead to "higher shipping costs and longer waiting times" and therefore higher prices for consumers, Rebecca Bill Chavez, president of the Inter-American Dialogue, told AFP. A ship loses around 200 containers for every 30-centimetre draft …