Bigger May Have Made Panama Canal Better — Panjiva
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Bigger May Have Made Panama Canal Better

Global 772 Mode - Containerized 1037 Mode - Seaborne 1308 Theme - Canals 89

Transits by vessels through the Panama Canal fell 3.5% year over year in May, Panjiva analysis of official data shows. That was down to fewer sailings by smaller vessels, with a record 248 crossing by Neopanamax grade vessels. That may have meant that the tonnage of transfers through the Canal increased by 6.5%.

That’s come despite a restriction in drafts for vessels due to a shortage of water – down to rainfall – through the Canal’s feeder lake as discussed in Panjiva’s research of May 7.

Importantly there’s been increased levels of pre-bookings for Neopanamax slots. Pre-bookings of 73.4% was the highest since Mar. 2018. Only time will tell whether that demand is ongoing or just a reaction to the potential draft restrictions.

RECORD NEOPANAMAX ACTIVITY BACKED BY STRONG BOOKINGS

Chart segments Neopanamax vessels crossing the Panama Canal by booking status. Calculations include Panama Canal Authority data.  Source: Panjiva

The immediate prospects for the Panama Canal Authority though will be a function of the ongoing trade war between China and the U.S. A primary use case for the Canal is to speed exports from Asia to the east coast U.S. and the rest of the Atlantic Basin.

Panjiva data shows that imports from eight major Asian markets to the U.S. rose 1.1% year over year in May, but that shipments from China fell by 1.6%. The diversion effect appears to be intact though with imports to U.S. west coast ports down 4.8% whereas those to the east coast  surged 13.6%.

EAST BEATS WEST THROUGHOUT 2019 SO FAR

Chart segments change in U.S. seaborne imports from eight Asian markets by coast of arrival.  Source: Panjiva

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