BREAKING – Back in 2021, a cargo ship made a huge splash when it got stuck in the Suez Canal, blocking passage through that strategic waterway.
Well, now a massive flotilla of more than 200 ships is currently stuck in the world's worst traffic jam at both sides of another strategic chokepoint – the 50-mile-long Panama Canal.
And this new watery pile-up could last for weeks. This will be very costly for everyone, including consumers.
The Panama Canal Authority has reduced maximum ship weights and daily ship crossings in a bid to conserve water as drought hits what is usually the world's fifth-wettest country.
The canal relies on rainwater to fill its locks – a lot of rainwater. (RELATED: Meet The Official Behind The Decision To Withhold Water As Maui Wildfires Raged)
When it doesn't rain enough, canal authorities must reduce traffic through it to conserve water, and those ships that are allowed through must pay higher fees to do so. This, of course, will make the goods they're transporting cost that much more.
Lars Oestergaard Nielsen, A.P. Moller-Maersk's head of customer delivery in the Americas, noted: “We had two ships that couldn't book, and it was quite expensive.
“We went to an auction and paid $900,000 on top of the $400,000 normal toll fee for each ship to cross,” he added.
More than 14,000 ships crossed the canal in 2022. Container ships transiting the canal transport more than 40% of consumer goods traded between Northeast Asia and the U.S. East Coast.
Maritime transportation experts fear such events could become the new normal as rainfall deficits are affecting the ocean shipping industry that moves 80% of global trade. (RELATED: Time To Sack Paternity Pete)
As The Wall Street Journal reported:
The canal, which uses three times as much water as New York City each day, relies on rainfall to replenish it. If there isn't enough rain, ship transits are cut and those that cross pay hefty premiums that boost transport costs for cargo owners such as American oil and gas exporters and Asian importers.
The canal's administrator, Ricaurte Vásquez Morales, said in late July that the restrictions could stay in place for the rest of the year. He said the drought is expected to erase around $200 million in revenue from the canal next year if low rainfall levels persist into the fall and winter.
Vásquez Morales added: “We have to find other solutions to remain a relevant route for international trade,” he said during the July press summit. “If we don't adapt, we are going to die.”
Ship owners can carry less cargo, shift to alternate routes adding thousands of miles to their trip or deal with lines that earlier this month backed up 160 vessels and delayed some ships by as much as 21 days and getting worse.
Other companies are deciding to offload containers to lessen their ships' drafts to cross the canal's now shallower water depths. Except for regulars who booked transit far in advance, most shippers are paying much higher transit fees. (RELATED: Iranian Terror Regime To Station Warships Within Striking Distance Of US)
Meanwhile, the Journal notes:
The waterway's entrances on the Pacific and Atlantic oceans are dotted with ships that are backed up for more than 20 days. Most are bulk cargo or gas carriers that are typically booked on short notice. Some shipowners are rerouting traffic to avoid the backlog.
“The delays are changing by the day. Once you make a decision to go there is no point to return or deviate, so you can get stuck,” said Tim Hansen, chief commercial officer at Dorian LPG, which operates more than 20 large gas carriers.
Per the WSJ, Panama has hired the U.S. Army Corps of Engineers, the agency that constructed the canal in the early 1900s, for help. It has also kept $2 billion for the next decade “to divert up to four rivers into the waterway, in addition to the three that already feed it.”
This could alleviate the problem longer term, but won't help any of us right now.
The opinions expressed in this article are those of the author and do not necessarily reflect the positions of American Liberty News.
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No news here on this issue alone
This has got to be a joke or a lie. A man-made canal that connects two salt water oceans uses “rain water” to fill it’s depth leveling locks? Please tell me that the original engineers were not that stupid. How could anybody be that stupid ??
Share with us your own brilliant plan to build a canal across Panama for filling the locks, Maxx. The present system has worked for over 100 years.
The underlying technological / engineering phenomenon sounds non sequitur to me. WHY would a canal work only off rainwater when infinite seawater is available?
What would you propose? Pumping seawater from one of the two oceans up to a huge reservoir to move the ships over the high ground through the locks? Why pump when the freshwater supply has served since 1914 when the canal was first opened? Did you read the part about the huge drought in that part of the world? The rainwater is going to run to one of the oceans anyway, so why not use it in place to flood and lower locks for ship passage?
The “canal” is not really a canal, but rather a series of locks and dams, which allow the vessels to traverse the country above sea level. Once a ship reaches a specific location, the dam behind it is closed and water floods the lock. This raises the ship so it can sail on though the next segment. Much of the canal uses natural bodies of FRESH WATER in the middle of the country. THAT’S why they can’t just use seawater, and why they can’t just pump seawater dozens of miles into the interior of the country.
Perhaps it’s time to look again at the old plan to make the Atlantic/Pacific crossing through Nicaragua.
“The history of attempts to build a Nicaragua canal connecting the Caribbean Sea and thus the Atlantic Ocean and the Pacific Ocean goes back at least to 1825 when the Federal Republic of Central America hired surveyors to study a route via Lake Nicaragua, 32.7 metres (107 ft) above sea level. Many other proposals have followed. Despite the operation of the Panama Canal, which opened in 1914, interest in a Nicaragua canal has continued. With emergence of globalization, an increase in commerce and the cost of fuel, and the limitations of the Panama Canal, the concept of a second canal across the American land bridge became more attractive, and in 2006 the president of Nicaragua, Enrique Bolaños, announced an intention to proceed with such a project.”