The Panama Canal: Fewer Ships Mean Higher Prices
Hello everyone, I’m Alice from Sunny Worldwide Logistics. Today I want to talk about something big. Let me start with a simplified explanation of “El Niño”—it’s when the waters along the equator warm up abnormally, like placing a hot pan over the atmosphere, causing global weather to go haywire. This time, it’s the Panama Canal’s turn to suffer. Just how severe is the drought? The canal relies entirely on rainwater for its freshwater supply, but from May to August this year, rainfall was more than 30% lower than usual, causing water levels to hit rock bottom. The consequences are clear: Starting September 15, the daily number of ships allowed to pass will be cut from 34 to 32—down from the usual 40-plus per day. In October, restrictions on ship “draft” may also be imposed, meaning ships will have to carry lighter loads or carry less cargo. How does this affect our logistics operations? When ships can’t pass, congestion ensues—ships either have to wait in line (w...
