As the rain becomes less and less…
The Panama Canal connects the Atlantic Ocean to the Pacific Ocean. The creation of the canal was a huge boon for global shipping. Before the canal was completed, ships had to sail around the southern tip of South America, a much longer and more dangerous route.
Ships passing through the Panama Canal are being restricted due to their draft being reduced to 13.4 meters. Photo: DW
The stormy waters around Cape Horn have been a graveyard of shipwrecks for centuries. Thousands of sailors have died there and countless ships have been lost. But going through the Panama Canal instead of going around the tip of South America has shortened the trip by more than 13,000 km, saving a lot of money, time and lives.
Since the Americans built the Panama Canal in 1914 and the Panamanians later expanded the waterway, international shippers have cut their time at sea from two months to 10 hours. More than 10 million ships have passed through the canal since it opened.
Currently, about 6% of global shipping volume passes through the canal, mainly from the US, China and Japan. And the canal has become a major source of revenue for Panama. In 2021, 517 million tons of cargo passed through the canal, contributing $2.1 billion to the Panamanian National Treasury. The corresponding figures last year were 518 million tons of cargo and $2.5 billion.
But now climate change is threatening this vital waterway. The Panama Canal uses a lot of fresh water because ships have to pass through dozens of locks that lift them up and down 26 meters deep. Every time the canal’s gates open, millions of liters of fresh water are poured into the sea to lower the water level in the canal, allowing ships to enter. Millions of liters of water are then pumped back in to lift the ships.
According to consulting firm Everstream, which monitors and assesses supply chains for international companies, it takes about 200 million liters of water for each ship to pass through the Panama Canal. Yet residents, conservationists and meteorologists are now observing a decrease in rainfall in Central America as a result of climate change.
That means the Panama Canal’s water supply is running low. And if the fresh water flowing out of the canal’s locks can no longer be replaced with enough water, it will become increasingly difficult for large ships to pass through. The lack of rain has forced the Panama Canal to reduce traffic. For the fifth time this dry season, which runs from January to May, the Panama Canal Authority (ACP) has restricted the passage of its largest ships.
Draft reduced…
A ship's draft is the distance between the waterline and the bottom of the ship. This measurement determines how much water a ship needs to move safely. If a ship is loaded with heavy cargo, it will sink deeper, creating a greater draft. The normal operating draft of the Panama Canal is 15.24 meters.
In early May, authorities issued a draft advisory to adjust the Neo-Panamax locks—a term that limits the size of some of the largest ships that can pass through the canal—based on projected water levels. Starting on May 24, the ACP set the draft limit for the largest ships to 13.56 meters. A week later, on May 30, that number was reduced to 13.4 meters.
It is estimated that 200 million liters of water are needed to fill the locks to get a ship through the Panama Canal. Photo: PBS
Analysts do not expect the situation to improve for the rest of the year. In fact, things could get worse for the shipping industry. Hapag-Lloyd, the world’s largest container shipping group based in Hamburg, Germany, and many other international shippers have responded by loading fewer containers to reduce the draft of their ships.
To compensate for the loss of revenue, Hapag-Lloyd will impose a $500 (€465) surcharge on each container passing through the Panama Canal starting in June. Trade experts fear that supply chain disruptions and longer transit times will further impact prices.
“Shortering is definitely the first choice for shipping companies at the moment,” said Dr Vincent Stamer, an analyst at the Kiel Institute for the World Economy in Germany. “They could also use smaller vessels. Alternatives are not yet well established on the route between Europe and the US west coast.”
What is the solution for the canal?
The challenges facing the Panama Canal are similar to those facing Europe. Low water levels have caused shipping headaches for authorities in recent years.
Last summer, the Rhine, a vital inland shipping artery, was at record lows in stretches. That affected shipping and deliveries to factories. It also caused gasoline and heating oil prices to rise. A lack of snow in the Alps threatens to create similar problems again this year.
Maritime authorities are considering measures to deal with the Rhine, such as deepening the riverbed in some places. Another, much more expensive solution is to build dams that could be used to maintain or raise water levels in key stretches of the river.
Former Panamanian Environment Minister Emilio Sempris believes that protecting forests and planting more trees is an extremely important solution. Photo: Forbes
For the Panama Canal, other solutions are being considered. These include water-saving sluices that would collect freshwater in basins for reuse. Finally, possibilities are being considered to develop and exploit other water sources near the canal. In addition, solutions include the construction of reservoirs and desalination plants.
“The Panama Canal is the only transoceanic trade route that depends on the availability of fresh water, making it the most vulnerable to the adverse impacts of global climate change,” said Emilio Sempris, Panama’s former environment minister from 2017 to 2019.
The Panama Canal sits amid the Central American country’s rainforests, which cover 68% of the country’s land area, or about 5 million hectares. That figure was much larger in 1947, at about 7 million hectares. “There is no better natural solution to ensuring water in the Panama Canal basin than to protect the forests and plant more trees,” Sempris said.
“Since the adoption of the Paris Agreement in 2015, Panama has worked to build legal and institutional frameworks to phase out deforestation and restore forest cover. Forests prevent soil erosion and regulate the water cycle,” Sempris stressed. “That is why Panama protects its forests. Otherwise, the Panama Canal would be affected and 6% of global maritime traffic would be affected.”
Nguyen Khanh
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