PANAMA / RankWire.AI / – The Panama Canal might see its daily ship traffic reduced to around 29 vessels in February or March 2027 if drought conditions persist, according to its new head administrator. Ilya Espino de Marotta assumed her role on Sept. 7, highlighting the potential impact of El Niño on reservoir levels. The canal depends on freshwater from rainfall-fed lakes to operate its locks, and the Panama Canal Authority has already initiated phased capacity reductions after receiving less precipitation than usual across the watershed.
Starting September 3, the canal provided nine daily Neopanamax slots and 25 Panamax slots, totaling 34 slots. From Sept. 15 onward, Panamax capacity will decrease to 23 slots, reducing the total to 32. These adjustments follow diminished rainfall during Panama’s rainy season and decreased inflows into the canal’s watershed. To conserve water and manage demand, officials are implementing measures such as tighter booking policies and water-saving techniques, while closely monitoring Gatun Lake and other key water sources.
In fiscal 2026, the canal handled an average of 35 daily transits up to June 30, according to official data. From October through June, it recorded 10,726 transits, which is a 5.2% increase compared to the same period last year. However, these figures predate the recent decline in rainfall that has led to stricter operational restrictions. The waterway links the Atlantic and Pacific oceans, facilitating major trade routes for containers, energy shipments, bulk commodities, and various other cargo types.
Water shortages push transit capacity downward
The locks of the canal depend on freshwater from Gatun Lake and Alhajuela Lake to raise and lower ships during crossings. Reservoir levels directly influence how many vessels can transit during extended dry spells. During the significant 2023 drought, daily transits dropped to 22 in December as Gatun Lake’s levels fell to unusually low levels. After rainfall improved and conservation measures helped stabilize water supplies, capacity increased again, allowing for more vessels to pass.
Additionally, the canal has modified vessel draft restrictions as part of its water management strategy. On Sept. 4, officials postponed implementing a reduction in the Neopanamax maximum draft to 47.5 feet. The limit remains at 48 feet following a review of Gatun Lake’s levels and updated weather forecasts. These draft restrictions control how deeply ships can sit in the water, serving as a key operational constraint, especially for vessels carrying heavier loads.
Changes in booking procedures as capacity shrinks
As available capacity becomes more limited, the canal has revised its booking and auction policies. Now, daily auction slots are organized according to cargo type, such as gas carriers, bulk ships, container vessels, and tankers. When other conditions are equal, full container ships with the highest capacity are prioritized for Neopanamax slots. Authorities have urged vessels without reservations to utilize the booking system because reduced capacity can lead to longer wait times. Having a confirmed reservation remains the only guarantee for a transit date.
A further reduction to 29 ships daily has not yet been ordered. The administrator indicated that such a limit could be implemented in February or March if drought conditions do not improve. The canal’s experts continue to monitor rainfall, watershed inflows, and lake levels before making additional operational decisions. Meanwhile, the Río Indio reservoir project is progressing as part of Panama’s efforts to secure a long-term water supply. This project is vital for maintaining canal operations and supporting more than half of the country’s population.