Photo: evenfh / Shutterstock
Ship transits through the Panama Canal remain significantly lower than historical averages, with capacity down 10% between September 2024 and January 2025 compared to the 2019-2022 average, according to BIMCO’s latest analysis.
The decline continues despite the lifting of transit restrictions that were implemented between June 2023 and September 2024 due to low water levels in Gatun Lake amid a severe drought during the 2023-2024 El Nino.
“Transit fees, changes in trade patterns and the establishment of a new normal could all be keeping ships from fully returning to the canal,” explains BIMCO Shipping Analysis Manager Filipe Gouveia. “For the sectors which haven’t fully returned, this has resulted in increased tonne mile demand as sailing distances have increased. Instead of transiting through the canal, ships sail around the Cape of Good Hope or Cape Horn.”
The LNG sector shows particular reluctance to return, citing safety concerns and limited transit slots. Additionally, BIMCO points out that no overnight transits are permitted for LNG vessels.
In the dry bulk sector, changing U.S. grain trade patterns have contributed to reduced canal usage, with West Coast grain exports to Pacific ports up 21% year-over-year, while Gulf shipments have decreased by 6%, according to BIMCO.
Despite these challenges, BIMCO reports that containerships, LPG carriers, and car carriers are operating above historical levels and may continue to grow.
“Although a return to the canal has been slow for some sectors, we still expect ship capacity transiting the waterway to increase. Transits of container, LPG and car carriers are already above historical levels and could continue growing. However, the medium-term outlook for the dry bulk sector looks cloudier amid strong competition for grains shipments between the US and Brazil and a poor demand outlook for coal,” says Gouveia.
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