Panama’s worst drought for 70 years has prompted shipping restrictions (as of 13th June) through the Panama Canal, with new regulations reducing the capacity of some container vessels by 40%. The outcome is likely to be an increase in the price of imported goods.
Under normal conditions, the maximum draught limit for ships using the canal is 15.24m, but the limit has now been cut to 13.41m. This is likely to see more goods travelling between the US West Coast and Europe via the lengthy route of Cape Horn.
The Panamanian Government has declared a climate emergency as water levels could fall to 78.2ft by late July, exceeding all previous records. If that happens, the Panama Canal Company says it will have to limit the daily number of vessels using the route from 36 to 28 and the maximum draught limit might be cut to 13.26m on 25 June, according to shipping experts.