Affected by drought and drought, congestion in the Panama Canal has intensified, with 264 ships queuing up

The news of the global arterial crisis has attracted widespread attention in recent days. One of the world's most important trade routes, the Panama Canal, has reduced the number of navigable ships, with 264 waiting to be opened. The Guardian reported on the 14th that this indicates the impact of the climate crisis on global business and trade.

The drought caused Panama to declare a state of emergency in May this year, while lowering the draft of passing ships to about 13.4 meters, which means large cargo ships have to reduce their cargo capacity. At the end of July, the Panama Canal Authority also reduced the number of ships that can pass through the waterway from 36 to 32 per day, and stated that the restriction measures will continue until 2024.

These restrictive measures have led large shipping companies, including the German Herbert Group, to announce the imposition of surcharges on routes that rely on Panama, a gateway connecting the Atlantic and Pacific oceans.

According to data from the global ship tracking website "Maritime Traffic", as of August 11th, the number of ships waiting to pass through the canal reached 264, an increase of 16% from the same period last year. According to Norton Lilly, a shipping agency, the average waiting time for large cruise ships transporting natural gas northward through canals has increased from 10 days to 18 days. According to Xeneta, the benchmark and market analysis platform for Norwegian sea and air freight rates, the average freight cost of 40 foot containers transported from China via the Panama Canal to the Gulf Coast of the United States has increased by 36% since the end of June, reaching $2400.

Xeneta analyst Peter Sander said, "As congestion in the Panama Canal intensifies, shipping companies should consider their choices and control risks."

The Financial Times reported that the trade volume of goods through the Panama Canal accounts for approximately 3% of global trade volume, which is also the main source of income for the Republic of Panama. According to MDS Transmodal, a maritime transportation data company, up to 29% of container trade across the Pacific goes through the Panama Canal.

Michael Aldwell, a senior executive in the Swiss shipping logistics business at Dexun, stated that they had suggested to customers that containers transported between Asia and the United States could be redirected to the Suez Canal if necessary, despite experts telling them that this could increase transportation time by one week. More severe delays in the future may make it difficult to transport perishable food from the west coast of South America to Europe in a timely manner. According to MDS Transmodal data, food and beverages accounted for 77% of container transportation between these regions last year. MDS Transmodal consultant Theodoro said that if shipping companies have to find new ways to transport fruits and vegetables, they will have to spend money, which will keep food inflation high.