Lack of rainfall threatens Panama Canal’s shipping traffic

The Panama Canal-an important maritime route linking the Atlantic and Pacific oceans is forced to reduce shipping traffic due to lack of rainfall.

The canal which allows the passing of around six per cent of all global maritime shipping, mostly from the US, China and Japan. For the fifth time this drought season, which lasts from January to May, the Panamanian Canal Authority (ACP) has had to limit the largest ships passing through.

Panama canal is fed up by two artificial lakes Alajuela and Gatun which are dependent on rainwater, however as per reports these lakes have less water every day. As per ACP from 21 March to 21 April, water levels in Alajuela fell by seven metres – more than 10 per cent.

The lack of rainfall impacts several things, the first being the reduction of our water reserves and even businesses. It also affects business, with the reduction of the draft of Neopanamax vessels, which are the largest vessels transiting the canal and the ones that pay the most tolls.

In 2022, more than 14,000 vessels with 518 million tonnes of cargo passed through the waterway, contributing $2.5 billion (€2.3 billion) to the Panamanian treasury.

The Canal administration has acknowledged that the water shortage was the main threat to shipping in the canal. Earlier in 2019, fresh water supplies dropped to just three billion cubic metres – a long way short of the 5.25 billion needed to operate the canal.

Ringing alarm bells for the authorities, worrying them of losing shipping companies to other routes, authorities are now looking to find solutions for this water crisis.

As a solution, the authorities highlight the need to look for new water sources.

Jorge Quijano, Former canal administrator said that the climate change that we are seeing not just in the country but all over the world demands us to find new water sources. He says, “Without a new reservoir that brings new volumes of water, this situation will remove the canal’s capacity to grow.”

Not only affecting the canal, the water crisis have also led to supply problems in several parts of Panama and provoked a number of protests. Experts worry the shortage of water can lead to conflict between the canal and local population.

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