Panama Canal Reduces Slots in May for Maintenance as Tariffs Slow Traffic

HOUSTON: The Panama Canal will close the west lane of the Pedro Miguel lock for five days later this month for maintenance, but reduced traffic because of the trade war between the US and China should mean smooth sailing for shippers. In an update, analysts at shipping broker NETCO said the trade war between the US and China has led to reduced traffic, shorter wait times and lower auction prices at the vital waterway, which likely means disruptions because of the maintenance will be minimal.

TARIFF IMPACT ON TRANSITS

The analysts said the number of unbooked regular-size vessels is slowing with fewer than 50 arrivals projected over the next week. Previously, the availability of auction slots was limited to two per day for regular-sized vessels. With slowing demand for slots, auction prices are coming down, NETCO said, with the highest bid last week coming in at $65,000, down from the previous week’s highest bid of $101,000. NETCO said this indicates that the situation at the canal is improving. Average waiting times are also falling, with southbound vessels waiting 0.4 days and northbound vessels waiting 1.2 days over the past week. NETCO said the improved situation at the canal is because of the softer market conditions as well as the PCA’s operational adjustments. “However, this stability is fragile and closely tied to subdued traffic levels – particularly in container, liquefied natural gas (LNG), and tanker segments,” NETCO said. “As global trade demand begins to rebound in the second half of 2025, increased pressure on the canal could reintroduce bottlenecks and cost volatility. Ongoing monitoring of transit slot availability, auction pricing, vessel queues, and rainfall patterns will be key to anticipating whether current efficiencies can be sustained or if renewed congestion is likely.”

MAINTENANCE

Other restrictions during the maintenance period are that no more than seven supers can be booked in each direction, and of these, no more than two with daylight restrictions in each direction. The Panama Canal Authority (PCA) will conduct a dry chamber maintenance on the west lane of the Pedro Miguel lock from 27-31 May, at which time the east lane will remain open, but passage will take additional time. Available slots in the Panama locks will be reduced to 16 for the maintenance period. Per the PCA’s Transit Reservation System, four booking slots will be offered to supers in the second tiebreaker competition from 13-17 May for booking dates during the maintenance period, with no booking slots available for regular vessels. No booking slots will be offered during the third booking period for supers or regular vessels. The following table shows the reduction of slots for the maintenance period.