SK Gas Pays Record $5.3 Million to Jump Panama Canal Queue
Key Takeaways
- •SK Gas secured a Panama Canal transit slot for $5.3 million, a new auction record, to move the LPG carrier G. Spirit northbound on September 1.
- •The previous record for expedited canal access was $4.6 million, set earlier this month, compared with a pre-crisis median auction price of about $55,000.
- •Ships without reservations are currently facing delays of up to 11 days as congestion increases.
- •Panama will cut daily booking capacity from 34 ships to 32 from mid-September, with additional changes to available neopanamax and panamax slots.
- •Panama’s government declared a nationwide state of emergency over El Niño, citing rainfall deficits of up to 60% on the Pacific side and water stress in 11 watersheds.
SK Gas has set a new record for securing expedited passage through the Panama Canal, paying $5.3 million for a transit slot as drought restrictions and surging demand continue to strain the waterway.
Bloomberg reported that the South Korean company won an auction this week to send the LPG carrier G. Spirit northbound through the canal on September 1. The previous record of $4.6 million was set only earlier this month.
The figures show how quickly the cost of guaranteed canal access has risen. Before the Iran war erupted, the median auction price was about $55,000, according to the Panama Canal Authority. For shippers, that gap reflects how sharply a route that normally moves global cargo on tight schedules is being reshaped by water availability.
Vessels arriving without reservations are now facing waits of up to 11 days.
The congestion is worsening just as Panama prepares to tighten capacity further.
As Splash reported last week, daily booking capacity will fall from 34 ships to 32 from mid-September as insufficient rainfall forces the canal to conserve freshwater. From September 3, nine neopanamax and 25 panamax slots will be available, with panamax availability falling to 23 from September 15.
The canal has also been adjusting allowable drafts, although some planned reductions have recently been postponed as officials respond to rapidly changing water levels. Those operational changes matter because they affect not only how many ships can transit, but also what kinds of cargoes and vessel sizes can pass through without delay.
"Tighter booking limits could increase congestion and push more tanker tonnage toward alternative, longer routes if water conditions continue to deteriorate," broker BRS warned in a new tanker report.
Dry bulk shipping could also benefit from the disruption. MB Shipbrokers said tighter transit availability and draft restrictions could encourage bulk carriers to route around Africa or Cape Horn, extending voyage times and supporting tonne-mile demand. The effect could become more pronounced with a strong US grain harvest and the prospect of increased American grain exports to China following recent trade deals.
Panama’s government added to the urgency on Tuesday by declaring a nationwide state of emergency over El Niño.
Authorities said rainfall deficits on the Pacific side have reached as much as 60%, while 11 watersheds are already under water stress. El Niño is currently classified locally as very strong and is expected to continue well into 2027.
