Drought crisis puts Panama Canal’s vital trade route at risk, restricting ship transits

According to the Panama Canal Authority’s announcement, the maximum number of daily transits will be limited to 32 ships until September 2nd.

The restrictions on the waterway, which spans over 80 kilometers, have come after low rainfall in the Central American region.

The bottleneck in one of the busiest trade passages globally has prompted companies that frequently use the route to seek alternative paths.

The Panama Canal reduces costs and transit times for many shippers, including major retailers and energy companies engaged in trade between China and the United States.

Officials stated that as of August 10th, there were 161 ships near the canal.

Due to drought caused by the El Niño weather phenomenon since the beginning of the year, the canal had already imposed a series of depth restrictions on water resources.

However, in June, the canal postponed additional restrictions that would require ships to lighten their loads to facilitate easier passage.