There appears to have been some improvement in vessel waiting times, but the Panama Canal Authority announced on Sunday it will take additional steps in an attempt to to clear the backlog of ships at the Central American waterway.
The queue of ships waiting to pass through the Panama Canal and the time ships without reservations must wait to pass through the waterway climbed after a shutdown for maintenance in September, but the line of ships waiting to get through the canals seems to be improving somewhat in recent days.
On Sunday, the Panama Canal Authority announced it was taking additional steps in an attempt to reduce waiting time.
Joe Walden, vice president for Panama operations for the ship agent Norton Lilly, said that delays began to build after locks were shut down for routine maintenance in late September, which limited capacity.
Walden said the maintenance work and resulting lane outage was originally scheduled for 9 days, from Sept. 22 through Sept. 30, and affected the west lane of Pedro Miguel locks with intermittent lane outages in the east lanes of both Miraflores and Gatun locks. The work was completed one day early on Sept. 29.
More generally, Walden noted that traffic at the canal has increased and that there are more large ships — what the Panama Canal Authority calls “supers” — whose transit times are restricted to daylight hours.
In October, more than 74 percent of the vessels transiting the canal each day on average were “supers,” vessels with a beam of 91 or more feet, according to the authority.
“The increased demand from daylight restricted vessels coupled with the reduction in overall transit capacity as a result of the maintenance period has resulted in a backlog of vessels waiting for transit,” explained Walden.
In a notice published Sunday, the authority noted larger, deep draft ships “require more time to transit the locks, thus reducing the total number of vessels that may be scheduled for transit in a day.”
The Panama Canal Authority said that in its fiscal year, which ended Sept. 30, it “set a new historical tonnage record, welcoming 340.8 million Panama Canal tons (PC/UMS) through the Canal,” a year-over-year increase of 4.3 percent.
“The previous record was set in FY2012 when the Canal experienced 333.7 million PC/UMS tons. This year’s record surpasses that amount by more than 7 million tons,” the agency added. Panama Canal tons are a unique measurement used by the canal to calculate tolls.
In a notice published Sunday, the authority also said fog has negatively impacted transits of the canal, delaying 107 vessels. It also said a low water level of water in Gatun Lake (three feet below the expected average this time of year) has increased lockage process time.
According to a Panama Canal Authority advisory, normal transit capacity is 34-36 vessels per day, depending on the mix of ships and other factors, but during maintenance that capacity is reduced. In a Sept. 7 advisory, the authority estimated that during the lock closures later that month capacity would be reduced to 22-24 vessels.
The authority normally sets aside 25 transit slots for ships with reservations — 17 for “supers” and 8 for smaller “regulars.”
But as of Oct. 12, the authority implemented what it calls “Condition 1a,” reducing the number of reservations it is handing out to 13 “supers” and 8 “regulars,” saying it was continuing to experience “an increase in vessel backlog, and despite measures taken, the number of vessels awaiting transit has not been reduced to acceptable levels.”
The reduced number of reservation slots meant ships without reservations will not be waiting as long to get through the waterway.
On Sunday, it went even further, saying that “despite all these measures, the in-transit time (currently averaging 12.23 hours), the number of vessels awaiting transit and the waiting time for many of these vessels, have not reduced to acceptable levels. Although there have been three vessels that had 11 days of waiting time, 96 percent of the arriving vessels have waited eight or less days for transit and 36 percent of these have waited four or less days.
“The usual waiting time for ‘regular’ non-booked vessels does not normally exceed three days, while for non-booked ‘supers’ it may reach higher levels,” the authority added.
As of Sunday, the authority said there were two northbound non-booked “supers” that had waited for seven days and three southbound non-booked “supers” that had waited for six days.
The agency said that it would suspend some additional booking slots for “regular” ships and on vessels of less than 300 feet in length starting this Thursday, Nov. 12 “until an acceptable level of waiting time was reached.”
When awarding reservations, the authority gives preference to the heaviest users of the canal. The customer ranking shows that the companies at the top of the list are: NYK, MSC, Mitsui O.S.K. Line (MOL), CMA CGM, Maersk, Hamburg-Sud, Hapag-Lloyd, COSCO, Wilhelmsen Lines, and the Chilean tanker owner SONAP. Some of the large liner companies like NYK and MOL are also major operators of dry bulk ships, tankers, and roll-on/roll-off ships that are heavy users of the Panama Canal.
Normally, ships without reservations must wait two or three days in a queue to pass through the canal. Late last week, delays for ships without reservations reached seven to eight days.
Walden said booked vessels transit on the date of booking, while non-booked vessels queue and transit in turn of arrival.
The backlog of ships seems to be improving, he noted. There were 121 vessels waiting on Nov. 6 in the early morning just after midnight, but just 103 on Nov. 8 and the number is projected to fall to 91 by early Tuesday morning.
Another metric called “canal waiting time” is measured by the Panama Canal Authority and combines waiting time and time to pass through the canal. It ranged from 71 to 89 hours between Nov. 1 and Nov. 7. According to advisories from the Panama Canal Authority, canal wating time has been climbing in recent months from an average of 23.94 hours in July to 29.87 hours in August, 37.24 hours in September, and 62.67 hours in October. Those are averages and the actual wait times in October, for example, ranged from 41.05 to 79.41 hours.
However, when the ACP calculates average canal wait time, it combines times for both booked and non-booked ships, said Walden, and for this reason “the number seems relatively low.”
Working down the number of ships in queue for transit is important because the ACP announced Friday in an advisory that it is planning a five-day shutdown of the west lane of the Pedro Miguel locks from Dec. 15 to Dec. 19. That closure is also expected to reduce capacity from 35-37 slots to 22-24 slots.
The agency said it plans even stricter reduction in the number of reservations to 16 — 10 for “supers” and six for “regulars.”
Shipowners who do not want their ship to wait for a slot to transit the Panama Canal do have an opportunity to buy their way to the front of the queue.
Each day, if all normal booking slots have been taken, which has been the case in recent weeks, a single booking slot is auctioned off to the highest bidder.
The minimum daily bid is $35,000 for a “super” and $15,000 for a “regular” ship. So far in November, the prices bid for one of those coveted slots have been much higher, ranging from $99,000 to $410,000.
Panama Canal wait times up after September maintenance
