No Bull | Panama Part Three

November 2

Welcome to the third part in a lengthy series of updates detailing my recent trip to the Panama Canal.

If you missed Part One, click HERE. For Part Two, click HERE.

This trip was not only interesting and educational but it is highly relevant given the Canal’s importance in global trade and worsening drought conditions impacting its operations.

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Drought 2023

Last week, we discussed the significance of water in relation to the Panama Canal, particularly focusing on Gatún Lake.

Not only does Gatún Lake account for more than 20 miles of the canal's 50-mile length, but it also supplies the millions of gallons of water required for every transit, making water levels and ample rainfall critically important to the Canal’s operations.

Lake levels remain near a ten-year low, and at the lowest during a rainy season since 1965.

Panama just wrapped up its driest October since 1950, with precipitation falling more than 40% below normal leaving 2023 as the country’s second-driest year on record.

Long-range forecasts are not calling for an improvement in conditions either which has caused the Canal Authority to announce additional restrictions as the end of the rainy season draws near.

Restrictions include further reductions to the number of allotted daily transits. Under normal conditions, 38 to as many as 40 vessels are allowed to transit the canal each day.

The Canal has been operating at reduced capacity for months though, with October most recently restricted to 32 transits per day.

Earlier this week, the Canal Authority revised the number of allowed transits lower again, stair-stepping it lower through the end of 2023’s rainy season and into the start of 2024 - the dry season.

Additional water-saving measures have been implemented in recent weeks including simultaneous lockages for smaller vessels, the use of water-saving basins in the Neopanamax locks and cross-filling in the Panamax locks (reusing water from one lock chamber for use in the other, saving the equivalent of the average consumption of five daily transits).