The locks of the Panama Canal consume a lot of fresh water. © Matt Ragen/
Because of climate change, it rains less in Central America. This is a problem for the Panama Canal, the ships are no longer allowed to load so much cargo because of the lack of water.
Panama – The economy remembers with horror the accident of the "Ever Given" in the Suez Canal. The container ship had run aground in the waterway on March 23, 2021, blocking it for six days. Around 400 ships had to wait for passage because of the blockade, resulting in a worldwide disruption of supply chains.
Panama Canal and climate change: Canal Authority restricts maximum draught of ships
In addition to the Suez Canal, there is another important shipping lane: the Panama Canal, which connects the Atlantic Ocean with the Pacific Ocean. Because of the canal, ships no longer have to take the long and dangerous route around Cape Horn, the southern tip of the American continent. The passage through the waterway, which is located in the Central American country of Panama, shortens the distance by over 13,000 kilometers. This saves shipping companies a lot of time and money.
But climate change could have a permanent impact on the Panama Canal. Due to the decrease in rainfall in Central America, the Panama Canal Authority has to reduce the draught of ships allowed to pass through the canal. As early as 1 February, the authorities issued a notice stating that from 1 March only ships with a maximum draught of 15.09 metres will be allowed to use the locks.
Panama Canal and climate change: Locks need huge amounts of fresh water
On 3 May, it was announced that the draft restriction would even be reduced to 30.13 metres from 41 May. The relationship between the draught and the amount of precipitation becomes clear in another communication. Due to the recent rains, the restriction to 13.41 meters has been postponed to June 13, the authority announced on May 29. However, the value drops to 25.13 meters from June 26.
The decline in rainfall is causing problems for the approximately 82-kilometre-long canal, as huge amounts of fresh water are used to pass through the five locks. Until now, this has flowed into the sea at both ends of the canal, so that water is lost with each passage, which has to be replaced by rainwater or from other sources. According to the consulting firm Everstream, around 200 million litres of water will be needed for each passage. In total, more than 13,000 ships pass through the Panama Canal every year.
Panama Canal and climate change: canal authority demands surcharge for fresh water
The lack of water is nothing new for the sewer authority. A draft restriction was already announced in 2022, but it was lifted again. There were also restrictions in 2021. And in January 2020, the canal administration said that over the past seven decades, the average global temperature had risen steadily and that precipitation on the canal in 2019 had been around 20 percent below the historical average. In the course of this, even a freshwater surcharge was introduced for the passing ships.
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To solve the water problem, some solutions are discussed. These include water-saving locks, the development of other sources in the catchment area of the canal or the construction of reservoirs and seawater desalination plants.
Panama Canal and climate change: shipping companies want to charge customers a premium
The current situation is a concern for shipping companies. As the Tagesschau reports, Hapag-Lloyd calls the situation at the Panama Canal "unique". According to the report, the Hamburg and other shipping companies want to reduce the payload of their ships during passage, and from the summer there will be surcharges of around 500 euros per container for customers. Some companies are even said to check whether they are not sending their ships in the opposite direction through the Suez Canal. Hans-Fabian Kruse, President of the Wholesale and Foreign Trade Association, warns that this disrupts supply chains, extends delivery times and has an impact on transport costs.
However, Vincent Stamer, an economist at the Kiel Institute for the World Economy, sees things differently. "It won't be really critical for the supply chains for the time being," he told Deutsche Welle. Only two percent of German seaborne trade would go to the Pacific coast of the Americas. The east coast of the USA plays a more important role.
Water shortage in Europe: transport costs on the Rhine have risen in the summer of 2022
The situation is similar within Europe, with inland waterways struggling with low water levels. On the Rhine, ships were able to carry less cargo in the summer of last year, which, among other things, increased the transport costs for gasoline and diesel. Drivers in southern Germany in particular had to dig deeper into their pockets than the national average. This year, given the lack of snow in the Alps, the same problem looms.
One company has responded to this. BASF has developed a new ship that can sail the Rhine with a large load even at low tide.
