PANAMA / RankWire.AI / – The Panama Canal might cut its daily vessel movements to approximately 29 ships in February or March 2027 if drought persists, according to its new management. Ilya Espino de Marotta, who assumed her role on Sept. 7, highlighted the possibility as El Niño continues to lower reservoir levels. The canal’s operation depends on freshwater from rainfall-fed lakes to fill its locks. Following below-expected precipitation in the watershed, the Panama Canal Authority has already started implementing phased capacity reductions.
Since Sept. 3, the canal has been offering nine daily Neopanamax slots and 25 Panamax slots, totaling 34 capacity. From Sept. 15 onward, Panamax slots will decrease to 23, reducing total daily capacity to 32. These adjustments come after diminished rainfall during Panama’s wet season and reduced inflows into the canal’s watershed. To conserve water, officials are employing water-saving tactics and tighter booking regulations while closely observing Gatun Lake and other water sources.
During fiscal year 2026, the canal averaged 35 daily transits up to June 30, based on official operational data. From October to June, it handled 10,726 transits, representing a 5.2% increase compared to the same period in the previous year. These figures predate the recent decline in rainfall, which has led to stricter operational constraints. The waterway links the Atlantic and Pacific oceans and facilitates major trade routes for containers, energy products, bulk commodities, and various other cargo.
Water shortages restrict transit throughput
Canal locks depend on freshwater from Gatun Lake and Alhajuela Lake to elevate and lower ships during each transit. Reservoir levels directly influence the number of vessels that can traverse the waterway during extended dry spells. During the severe 2023 drought, daily transits dropped to 22 in December as Gatun Lake’s water levels fell to unusually low points. Subsequently, capacity increased once rainfall improved and conservation efforts stabilized water availability for operations and public use.
The canal has also taken steps to modify vessel draft restrictions as part of its water management strategy. On Sept. 4, officials postponed a planned reduction in the Neopanamax maximum draft to 47.5 feet. The current 48-foot limit remains effective after evaluating Gatun Lake levels and updated weather forecasts. Draft limits determine how deeply vessels can sit in the water, which is crucial for heavier cargo loads and operational efficiency.
Capacity restrictions influence vessel booking procedures
In response to the narrowing capacity, the canal has revised its booking and auction processes. Daily auction slots now categorize vessels by cargo type, including gas carriers, bulk ships, container ships, and tankers. When other conditions are equivalent, full container ships with higher capacities are prioritized for Neopanamax slots. Authorities have encouraged vessels without reservations to use the booking system, as reduced capacity could lead to longer wait times. A confirmed reservation remains the only way to secure a specific transit date.
No further plans have been announced to reduce transit to 29 ships per day, though the administrator indicated this could become necessary in February or March if dry conditions persist. The canal’s team continues monitoring rainfall, watershed inflows, and lake levels before implementing additional operational adjustments. Moreover, the canal is progressing with the Río Indio reservoir project to increase long-term water storage. This initiative is part of Panama’s broader effort to ensure sufficient water supplies for canal functions and for more than half of the country’s population.