by Lloyd's List

10 January (Lloyd's List) - TRAFFIC via the Panama Canal continues to rise amid an increasingly hostile geopolitical backdrop.

As the Panama Canal Authority (ACP) goes about its daily business, serving international shipping customers, US president-elect Donald Trump has stated that America could invade Panama and take the waterway back by military force. Panama president Jose Raul Mulino has countered that his country will defend its property.

Mulino spoke Thursday at the Martyrs Day ceremony to commemorate the events of January 9, 1964, when anti-American riots erupted over US control of the canal. Twenty-one Panamanians and four US soldiers were killed.

Mulino praised the actions of the 21 Panamanian “martyrs” and said that “thanks to what began [with the riots], we have a Panama Canal and complete sovereignty at the national level, which will remain so, even if we have to fight to continue maintain the canal and full sovereignty. The canal is and will continue to be Panamanian.”

Highest transits since before the drought

According to data released Friday* by the ACP, the Panama Canal handled a total of 1,059 vessel transits in December, up 6% from November to the highly monthly tally since April 2023, prior to the drought.

There were 780 transits via the older panamax locks, up 7% versus November to the highest number since March 2023.

The larger neopanamax locks handled 279 vessels in December, up 3% from the month before. Neopanamax transits have been relatively steady since August, hovering around levels last seen in October 2024, just prior to drought restrictions.

Containerships and VLGCs buoy neopanamax transits

The neopanamax locks, built by the ACP (not the US) at a cost of over $5bn, are vital to US containerised imports from Asia and US exports of propane to Asia. US businesses benefit from the shorter transit time afforded by the canal “short cut”.

There were 160 transits by larger containerships through the neopanamax locks, up 11% from November.

Containership transits are now much higher than they were pre-drought. December transits were 23% higher than in December 2022. Over the past two years, newbuilding deliveries have increased average vessel size on the Asia-US run, pushing more containership traffic toward the neopanamax locks.

US propane is carried though the neopanamax locks aboard very large gas carriers. There were 93 VLGC transits in December, down 11% from the peak in November but still extremely elevated. December’s VLGC count was the second-highest since July 2023.

Total neopanamax transits are still not back to pre-drought levels for two reasons.

First, liquefied natural gas carriers are opting to take the longer Cape of Good Hope route given extremely cheap freight rates. Only two LNG carriers transited in December, down from an average of 27 per month pre-drought.

Second, wide-beam panamax bulkers previously used the neopanamax locks and have not returned in significant numbers. There were 57 bulker transits through the neopanamax locks in December 2022 versus just six last month.

Bulker transits continue to lag in panamax locks

In the panamax locks, traffic has rebounded to pre-drought levels for chemical tankers, containerships, liquefied petroleum gas carriers, ro-ros, refrigerated cargo ships and general cargo ships.

The laggard – which is the most important segment for the panamax locks – is dry bulk.

December is usually the peak for bulker transits of the panamax locks, given the timing of the US grain export season and shipments to Asia. As with container trade and propane through the neopanamax locks, the panamax locks help US businesses, in this case agricultural businesses, by providing a shorter route.

There were 171 bulker transits this December, down to 9% from November and on par with transits in August. Last month’s bulker transits were down 29% from December 2022, pre-drought.

 Looking at the figures across both locks systems highlights the extent of the decline for dry bulk. There were a total of 177 bulker transits in either the panamax or neopanamax locks last month, down 92 transits or 34% from December 2022.

* The ACP does not release monthly transit statistics by segment or statistics on total monthly transits. It releases fiscal-year-to-date transits by segment and fiscal-year-to-date total transits since October, the beginning of its fiscal year. Lloyd’s List calculates monthly transits by comparing each month’s cumulative fiscal-year-to-date statistics, and derives transits per day from this data.