PANAMA / RankWire.AI / – Panama Canal may see its daily vessel count reduced to approximately 29 ships in February or March 2027 if drought persists, according to its new head. Ilya Espino de Marotta, who assumed her role on Sept. 7, highlighted this possibility amid El Niño’s impact on reservoir levels. The canal’s operation depends on freshwater supplied by rainfall-fed lakes, which is crucial for its locks. Due to below-average rainfall across the watershed, the Panama Canal Authority has already initiated phased capacity reductions.
Starting Sept. 3, the canal provided nine daily Neopanamax slots along with 25 Panamax slots, totaling 34 available capacity. From Sept. 15 onward, Panamax slot availability will decline to 23, reducing the combined daily capacity to 32. These cuts are a response to decreased rainfall during Panama’s wet season and reduced water inflows into the watershed. The authorities are implementing water conservation strategies and stricter booking controls while closely monitoring Gatun Lake and other water sources.
In fiscal 2026, the canal averaged 35 daily transits up to June 30, based on official operational data. Between October and June, it handled 10,726 transits, representing a 5.2% increase compared to the same period last year. These figures were recorded before the recent rainfall decline led to more stringent operational limits. The waterway connects the Atlantic and Pacific Oceans and plays a key role in major trade routes involving containers, energy shipments, bulk commodities, and other cargoes.
Water shortages lead to restrictions on transit capacity
The operation of canal locks depends on freshwater from Gatun Lake and Alhajuela Lake, which is used to raise and lower ships during each crossing. Consequently, reservoir levels directly influence the number of vessels permitted to transit during extended dry spells. During the severe drought of 2023, daily transits dropped to 22 in December, as Gatun Lake reached unusually low levels. After rainfall improved and conservation measures were enacted to stabilize available water, capacity was subsequently increased.
In addition, the canal has modified vessel draft limits as part of its water management efforts. On Sept. 4, authorities postponed plans to lower the Neopanamax maximum draft to 47.5 feet. The current 48-foot limit remains in effect following an assessment of Gatun Lake levels and updated weather forecasts. Draft limits control how deeply vessels can sit in the water, which is critical for ships with heavier loads.
Changes in booking procedures as capacity becomes more limited
With capacity tightening, the canal also revised its booking and auction policies. Auction slots are now organized by cargo type, including gas carriers, bulk ships, container vessels, and tankers. When other factors are equal, full container ships with the highest capacity are prioritized for Neopanamax allocations. The authorities encourage vessels without reservations to utilize the booking system because the reduced capacity could lead to longer wait times. A confirmed reservation remains the sole guarantee of a transit date.
No official decision has been made to further cut the daily limit to 29 ships. The administrator indicated that this level could be implemented in February or March if drought conditions persist. Canal officials continue to monitor rainfall, watershed inflows, and lake levels to determine if additional operational adjustments are necessary. Additionally, the canal is advancing the Río Indio reservoir project to increase long-term water storage capacity. This initiative is part of Panama’s broader strategy to ensure sufficient water for canal operations and for over half of the country’s population.