Drought-hit Panama Canal reels under traffic jams with over 200-ship backlog

The drought-hit Panama Canal is suffering from an issue of traffic as a flotilla of ships is reportedly stuck on both sides. The vessels have been waiting for weeks to cross after the authorities reduced transits to conserve water.

More than 200 ships are currently waiting to pass, data from vessel tracking showed. This number has increased since the canal last month limited daily transits to 32 from an average of 36 under normal circumstances.

The Panama Canal is an artificial 82-kilometre-long waterway in Panama that connects the Atlantic Ocean with the Pacific Ocean. It divides North and South America. The canal cuts across the Isthmus of Panama and is a conduit for maritime trade.

A Reuters report earlier this month mentioned that since the beginning of the year, the Panama Canal instituted a number of depth restrictions as the drought, caused by the El Nino weather phenomenon, put pressure on its water supplies.

In June, the canal postponed further restrictions that would have required ships to lighten their loads to pass more easily.

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The waterway's chief Ricaurte Vasquez told Reuters last week that the economic impact of the restrictions will be felt the hardest in the fiscal year beginning in October.

"There has not been a situation of this level of criticality in the history of the canal. In 1997, which was the driest year on record, we only operated the Panamax locks, and at that time we lowered the draft to the minimum. This time around we are telling them: people, we are going to maintain the draft, the only way to conserve water is to reduce the number of crossings," Vasquez told Reuters.

A WSJ report stated that the waterway's entrances on the Pacific and Atlantic oceans are dotted with ships that are backed up for more than 20 days.

Most are frequently hired last-minute bulk cargo or gas carriers and to get around the backlog, some shipowners are rerouting traffic.

As quoted by WSJ, Tim Hansen, who is the chief commercial officer at Dorian LPG, said: "The delays are changing by the day. Once you make a decision to go there is no point to return or deviate, so you can get stuck." The report mentioned that Dorian LPG operates more than 20 large gas carriers.

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