An aerial view of the Panama Canal expansion project on the Atlantic side of the Panama Canal

Drought conditions force Panama Canal to lower maximum depth limit for ships

Image credit: Reuters

The Panama Canal will impose lower draft restrictions on the largest ships passing through the key global trade route due to falling water levels at nearby lakes that form part of the waterway, the canal authority announced yesterday (Tuesday).

The restrictions, which will take effect from today (Wednesday), mean that so-called neo-Panamax container ships seeking to cross the canal connecting the Atlantic and Pacific Oceans must comply with a maximum depth of 47.5ft, down from 50ft (technically 49.9ft), obliging them either to weigh less or otherwise transport fewer goods.

The new measures are due to recent drought conditions, the canal authority said, prompting the fifth adjustment of its kind since the start of the year.

Officials did not provide an end date to the measure, described for now as temporary, but said they hope it can "be lifted as soon as possible" once the Central American rainy season starts.

The Panama Canal Authority (ACP) oversees the operation of the world-famous trade route that cuts through the Isthmus of Panama and connects the Atlantic Ocean with the Pacific Ocean. The Canal effectively divides North and South America and is one of the world's busiest shipping routes, handling approximately 5 per cent of total world trade.

An aerial view of the Panama Canal expansion project on the Atlantic side of the Panama Canal

Image credit: Reuters

The ACP monitors the maximum allowable draft, currently set at 39.5ft (12.04m) in Tropical Fresh Water, using the nearby freshwater Lake Gatún as a reference. The salinity and temperature of water affect its density and hence how deep a ship will float in the water.

When the water level in Lake Gatún is low during an exceptionally dry season, the knock-on effect for the Panama Canal is that the maximum permitted draft is often reduced. Ship loading plans must then be adjusted to compensate for the lower weight limits.

For example, when the new locks opened in June 2016, the ACP limited draft to 43ft – over 4ft lower than today's limit. The 2016 low was increased a few months later after monitoring Lake Gatún and with the weather forecast predicting that the rainy season was due to begin in earnest.

Erratic rainfall levels, caused by climate change, affect operations at the Panama Canal, with prolonged and increasingly severe drought periods in between periods of heavy rain impacting the canal's watershed and adversely affecting the supply of water from Lake Gatún.

The ACP is now regularly forced to impose the temporary maximum depth limits on ships seeking to cross the waterway, as well as cutting daily slot reservations due to drought conditions and imposing a 'freshwater' charge on ships.

The ACP imposes the limits and requirements applicable to vessels passing through the Canal: Panamax and Neopanamax (aka New Panamax) are used to describe size limits for the ships travelling through. NeoPanamax ships are enormous and can carry 120,000 deadweight tonnage (DWT) – half as much again as a typical Panamax cargo ship (65,000-80,000 DWT).

The impact of climate change is being felt deeply in Panama, with torrential rains and hurricanes causing widespread flooding and landslides. Twenty people were killed during extreme weather events in 2020. In recent years, the country has moved to tackle deforestation, in order to stabilise its levels of rainforest cover, as well as other government policies for shifting to a greener economy, such as increasing the electric vehicle offer in the local market, phasing out fossil fuel-powered government cars, shifting to electric buses in its towns and cities, and doubling down on renewable energy.

About 70 per cent of Panama's electricity is already generated from hydropower, but less than 10 per cent of energy used by the private sector comes from wind and solar. The country's ambition is to generate up to 95 per cent of its electricity needs from renewable energy by 2050.

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