Box ship transits through Panama Canal hold steady, despite drought limits

Despite the well-publicised drought that hampered its capacity, container vessel transits through the Panama Canal this year barely showed a dip, thanks to the carriers’ deep pockets.

According to the Panama Canal Authority (ACP)’s full-year 2024 results, while movements of all vessel types fell 29.4% year on year, to 9,926 up to the end of September, containership transits were basically unchanged, at 2,733 – a reduction of just 14, equating to a 0.5% drop.

However, these figures are for both the original locks and the neo-panamax locks which opened in 2014 – and containership movements through the latter increased, to 1,787, a gain of 2.1% over 2023. This meant the proportion of containerships to total vessels increased from around 20% to 26%.

Shipping analyst Alphaliner explained that the newer locks were proving increasingly popular with container carriers, which over the past few years had introduced scores of neo-panamax vessels (of up to 14,000 teu) to services that transit the waterway, particularly on the Asia-US east coast strings. Of all the box vessels transiting the canal, 63% passed through the neo-panamax locks, compared with 48% in 2023.

“Cash-rich container carriers were able to take advantage of a stricter reservation system introduced by the canal authority during the drought, including expensive auctioned slots, while other ship types, particularly dry bulk, opted to re-route leaving more slots open,” Alphaliner writes today.

The drought from a lack of rainfall began to impact water levels in the canal in the early months of last year, reached a nadir towards the end of 2023 and the authority warned transits could be slashed by as much as 50% by February this year.

However, careful water management and a welcome return of rain this year has seen ACP now offering 35 daily transits, slightly below its design capacity of 36 to 38.

Meanwhile, in a speech given to the New York Maritime Forum yesterday, ACP administrator Ricaurte Vasquez said the organisation’s efficiency measures in response to the drought had resulted in 1% reduction in vessel wait times. That translated to an average of 15 hours less wait, a 1% reduction in transit times from when a vessel arrives at the first lock until it exits the last one, a 4% reduction in time spent in the canal, with an average decrease of 16 hours, and a 5% reduction in water usage per transit for neo-panamax vessels.

And despite the reduced traffic, ACP saw 2024 revenue increase 9%, to $3.5bn, up from $3.2bn the year before.

Last month, Mr Vasquez told the Panama Stock Exchange’s 2025 Investors Forum: “We designed a different pricing structure based on the locks used by ships, thereby establishing a value for water usage.

“Other countries place an economic value on oil or minerals, and we have established the economic value of fresh water from the lake. This way, our strategy, adapted to the environmental reality, allowed us to optimise revenues, reduce operating costs and maintain our competitiveness in the market.”