PANAMA / RankWire.AI / – The Panama Canal may reduce daily ship traffic to about 29 vessels in February or March 2027 if drought conditions continue, its new administrator said. Ilya Espino de Marotta took office on Sept. 7 and raised the possibility as El Niño pressures reservoir levels. The canal needs freshwater from rainfall-fed lakes to operate its locks. The Panama Canal Authority has already begun staged capacity cuts after below-expected precipitation across the watershed.
Panama Canal transit limits tighten as drought reduces water available for ship crossings. (AI-generated image)
From Sept. 3, the canal offered nine daily Neopanamax slots and 25 Panamax slots, bringing total capacity to 34. Starting Sept. 15, Panamax availability will fall to 23 slots, lowering the combined daily total to 32. The reductions follow weaker rainfall during Panama’s wet season and lower inflows into the canal watershed. Officials are using water-saving measures and tighter booking controls while monitoring Gatun Lake and other water sources.
The waterway averaged 35 daily transits through June 30 during fiscal 2026, according to official operating data. It recorded 10,726 transits from October through June, up 5.2% from the same period a year earlier. Those figures came before the latest rainfall deterioration led to tighter operating limits. The canal links the Atlantic and Pacific oceans and serves major trade routes for containers, energy shipments, bulk commodities and other cargo.
Water shortages tighten transit capacity
Canal locks rely on freshwater from Gatun Lake and Alhajuela Lake to raise and lower ships during each crossing. Reservoir levels therefore directly affect how many vessels can use the waterway during prolonged dry periods. During the severe 2023 drought, daily transits fell to 22 in December as Gatun Lake reached unusually low levels. Capacity later increased after rainfall improved and conservation measures helped stabilize available water for canal operations and public consumption.
The canal has also adjusted vessel draft limits as part of its water management measures. On Sept. 4, officials postponed a planned reduction in the Neopanamax maximum draft to 47.5 feet. The current 48-foot limit remains in place after a review of Gatun Lake levels and updated weather projections. Draft limits determine how deeply loaded vessels can sit in the water, making them an important operating constraint for ships carrying heavier cargoes.
Booking rules change as capacity narrows
The canal also changed booking and auction rules as available capacity tightened. Daily auction slots now group vessels by cargo type, including gas carriers, bulk ships, container vessels and tankers. Full container ships with the highest carrying capacity receive priority in Neopanamax allocation when other conditions are equal. Officials have urged vessels without reservations to use the booking system because lower capacity can increase waiting times. A confirmed reservation remains the only mechanism that guarantees a transit date.
No further reduction to 29 ships a day has been ordered. The administrator described that level as a possible restriction for February or March if dry conditions fail to ease. Canal specialists continue monitoring rainfall, watershed inflows and lake levels before making additional operating changes. The canal is also advancing the Río Indio reservoir project to expand long-term water storage. The project forms part of Panama’s effort to secure water for canal operations and more than half of the country’s population.