PANAMA / RankWire.AI / – The Panama Canal might cut back to approximately 29 ships per day in February or March 2027 if drought conditions persist, according to its new head. Ilya Espino de Marotta assumed her role on Sept. 7 and raised concerns about El Niño impacting 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 following below-average precipitation across the watershed.
Starting Sept. 3, the canal provided nine daily Neopanamax slots and 25 Panamax slots, totaling 34. From Sept. 15 onward, Panamax availability will drop to 23 slots, reducing the total daily capacity to 32. These cuts come as a result of decreased rainfall during Panama’s wet season and reduced inflows into the canal watershed. To conserve water and regulate bookings, officials are employing water-saving strategies and closely observing Gatun Lake and other water sources.
During fiscal 2026, the canal averaged 35 transits per day through June 30, based on official operational data. It recorded 10,726 transits from October through June, marking a 5.2% increase compared to the same period last year. These figures predate the latest rainfall decline, which has led to tighter operational constraints. The waterway connects the Atlantic and Pacific oceans and facilitates key trade routes for containers, energy shipments, bulk commodities, and other cargo.
Water shortages restrict transit throughput
Canal locks depend on freshwater from Gatun Lake and Alhajuela Lake to elevate and lower ships during crossings, making reservoir levels directly influence how many vessels can transit during dry spells. During the severe 2023 drought, daily transits dropped to 22 in December as Gatun Lake reached exceptionally low levels. Capacity later increased following improved rainfall and conservation efforts that stabilized available water for operations and public use.
The canal has also modified vessel draft limits as part of its water management measures. On Sept. 4, officials postponed plans to reduce the Neopanamax maximum draft to 47.5 feet, with the current 48-foot limit remaining after reviewing Gatun Lake levels and updated weather forecasts. Draft limits control how deeply ships can sit in the water, serving as a critical operational constraint for heavier cargo vessels.
Capacity reductions lead to booking adjustments
As capacity shrinks, the canal has revised its booking and auction procedures. Daily auction slots now categorize vessels by cargo type, including gas carriers, bulk ships, container vessels, and tankers. When conditions are equal, full container ships with higher capacity are prioritized in Neopanamax allocations. Officials advise vessels without reservations to utilize the booking system because limited capacity can cause longer waiting times. A reservation remains the only way to guarantee a specific transit date.
No further order has been issued to reduce traffic to 29 ships daily. The administrator indicated that this level could be a potential restriction for February or March if drought conditions do not improve. Canal authorities continue monitoring rainfall, watershed inflows, and lake levels before implementing additional operational adjustments. The canal is also progressing with the Río Indio reservoir project to increase long-term water storage, part of Panama’s broader effort to ensure water availability for canal operations and over half the country’s population.