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NextFrontier Africa is a media platform spotlighting Africa’s emerging opportunities in technology, tourism, aviation, agriculture, health, logistics, real estate, trade, education, and e-commerce.

February 07.2025

2 Minutes Read

Panama Canal Sees 10% Drop in Vessel Transits Amid New Shipping Reality

Aerial view of ship in the Panama Canal with green landscape.

Panama Canal Transits Decline: A Closer Look

Recent data indicates a worrying trend in the maritime industry, particularly concerning the Panama Canal. Transits through this vital waterway have dropped by 10% compared to the averages recorded from 2019 to 2022. Between September 2024 and January 2025, ship capacity measured in deadweight tonnes has not reached the expected levels, according to a report from BIMCO. This decline raises significant questions about the factors affecting global shipping routes.

Understanding the Decline

This notable drop in transit numbers occurs despite the absence of formal restrictions on vessel movement. Filipe Gouveia, Shipping Analysis Manager at BIMCO, notes that various sectors, including dry bulk and LNG, are failing to bounce back to historical averages. During the past months, low water levels in Gatun Lake curtailed activities, limiting both the number of transits and the draft capacity, which is the distance a ship's hull is submerged. The effect has been a competitive scramble for a diminished number of available slots.

Shifting Trade Patterns and Costs

With modifications in trade patterns and rising costs associated with transit fees, ships have had to adapt. Gouveia emphasizes the emergence of a 'new normal' that may prevent some vessels from fully returning to the canal. Increased shipping distances now lead to routes around the Cape of Good Hope or Cape Horn, thus raising tonne-mile demand—where cargo is shipped over longer distances.

The Future of the Panama Canal

Despite the struggles, there’s optimism regarding certain sectors of shipping. Container, LPG, and car carrier transits have exceeded historical levels and are anticipated to continue their upward trajectory. However, turbulence in the dry bulk sector looms, characterized by fierce competition in grain shipments between the U.S. and Brazil and a soft demand outlook for coal. The overall recovery of the Panama Canal transits remains uncertain, signaling potential shifts in global maritime logistics.

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Panama Canal Sees 10% Drop in Vessel Transits Amid New Shipping Reality

Panama Canal Transits Decline: A Closer Look

Understanding the Decline

Shifting Trade Patterns and Costs

The Future of the Panama Canal

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