The Panama Canal will become congested again starting in September. The reason is simple: there is a shortage of water.
The Panama Canal Authority is reducing available transits. From September 3rd, nine slots per day will be available for Neopanamax vessels and 25 for Panamax vessels. This totals 34 transits. From September 15th, Panamax slots will be further reduced to 23. This leaves only 32 slots per day in total.
The background is an unusually dry rainy season. According to Reuters, rainfall from May to August was approximately 34 percent below the long-term average. Water inflow into the canal system was even 44 percent below average. The canal requires large quantities of freshwater for its locks. When this water is lacking, the authority must restrict vessel draft or the number of vessels.
For maritime freight, this is particularly important on the Asia–US East Coast route. This route is one of the most significant traffic corridors through the Panama Canal. LNG, LPG, bulk cargo, RoRo, and refrigerated cargo also compete for available slots.
Those with a confirmed slot are significantly better positioned. The canal authority explicitly points out that only a confirmed reservation guarantees a specific transit day. Vessels without a reservation must expect longer waiting times when capacity is tight.
For container traffic, this could trigger diversion movements again. Cargo destined for the US East Coast could increasingly be routed through US West Coast ports and subsequently transported by rail or truck. Initial market reports already show increasing pressure on Asia–US West Coast rates. However, this does not automatically mean that every shipment will be rerouted.