Published 					Jun 4, 2023 12:46 PM        		by                                       The Maritime Executive                              Con

Panama Canal’s Continuing Draft Reductions Pose Threat to Trade

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2023-06-04 18:30:07

Published Jun 4, 2023 12:46 PM by The Maritime Executive

Concern is growing that a significant climate event is unfolding at the Panama Canal, with the potential of impacting one of the world’s most important shipping routes. Last week, the Panama Canal Authority (ACP) said drought conditions in the region persist, affecting water availability for passage through the locks and raising the potential of further restrictions.

The Panama Canal Authority reports that May 2023 was the driest since 1950. Climatologists are saying that this is expected to worsen due to the arrival of the El Nino phenomenon, which is associated with warmer weather conditions across the Central American region. In this case, water-saving measures will continue to be a priority for the ACP.

It is not the first time the Panama Canal has experienced these problems. In the 2015-2016 season, extreme weather conditions and efforts to reduce water consumption reportedly cost the ACP approximately $40 million in revenues. Three years later in April 2019, the ACP notified customers that it was imposing a draft restriction of 44 feet, lowing it a full foot in just one month.  

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