Drought is causing problems in the Panama Canal

From next month, fewer ships will be allowed to pass through the Panama Canal. The reason is the drought, which has been made worse by the El Niño weather phenomenon.

From 3 September, the number of ships permitted to pass through the canal each day will be reduced from 36 to 34, before being reduced by a further two a couple of weeks later. In addition, ships will not be allowed to draught as deeply, which limits how heavily loaded they can be.

The restriction is expected as water levels have been falling steadily due to the drought. Prices for transiting the canal have reached record levels.

In mid-August, auction prices for a transit reached $1.1 million – equivalent to just over ten million kronor – for the canal’s most common locks. This is 16 times higher than during the same period last year.

Five per cent of global maritime trade passes through the canal, which links the Atlantic and the Pacific Oceans.