Box ship movement through the Panama Canal holds steady, even with drought limits

Despite a well-publicized drought that impacted capacity, container vessel transits through the Panama Canal this year remained relatively stable, thanks to carriers’ financial strength. According to the Panama Canal Authority (ACP), total vessel movements fell 29.4% year-on-year to 9,926 by the end of September, while container transits declined slightly, from 2,747 to 2,733—a mere 0.5% drop. Notably, transits through the neo-Panamax locks, which opened in 2014, increased by 2.1% to 1,787, raising the proportion of container vessels from 20% to 26% of total transits.

Shipping analyst Alphaliner noted that the newer locks have gained popularity among container carriers, particularly those introducing neo-Panamax vessels (up to 14,000 TEU) for Asia-US east coast routes. In 2024, 63% of container vessels used the neo-panamax locks, up from 48% in 2023.

Alphaliner explained that financially robust container carriers took advantage of a stricter reservation system during the drought, including costly auctioned slots, while other ship types, especially dry bulk, opted to reroute, leaving more availability.

The drought, which began affecting canal water levels in early 2023, reached a low point at the end of the year, prompting warnings of a potential 50% reduction in transits. However, improved water management and increased rainfall have allowed ACP to offer 35 daily transits, just shy of the designed capacity of 36 to 38.

In a recent speech at the New York Maritime Forum, ACP administrator Ricaurte Vasquez announced that efficiency measures implemented during the drought led to a 1% reduction in vessel wait times, translating to an average decrease of 15 hours. Overall, transit times improved by 1%, with a 4% reduction in time spent in the canal, and a 5% decrease in water usage for neo-panamax vessels.

Despite decreased traffic, ACP reported a 9% increase in 2024 revenue, reaching $3.5 billion, up from $3.2 billion the previous year. Vasquez stated at the Panama Stock Exchange’s 2025 Investors Forum that a new pricing structure based on lock usage has established a value for water, allowing for optimized revenues and reduced operating costs while maintaining market competitiveness.