Panama Canal Transit Slot Auction Prices Surge 16-Fold

Middle East War, El Niño Push August Price to $1.1 Million

Panama Canal ship transit slot prices have climbed to a record as the U.S.-Iran war coincides with El Niño.

The average auction price for an August transit slot at the canal’s main locks reached $1.1 million, the Financial Times reported on August 11. That was more than 16 times the average in the same period a year earlier. The price for locks used by large vessels rose as high as $2.5 million, setting a record.

Transit through the Panama Canal increased after the war shut the Strait of Hormuz. At the same time, drought conditions emerged after El Niño began in June. That lowered water levels at Gatun Lake, the artificial reservoir that supplies the canal, restricting cargo volumes and vessel traffic. Data analytics firm Argus said this year’s decline in water levels is steeper than in 2023, when severe drought hit.

Demand for Panama Canal transit has remained firm as more Asian countries source energy from the U.S. The canal is the shortest route linking the U.S. Gulf Coast and Asia.

The Panama Canal Authority said the recent auction prices reflect temporary market volatility rather than official canal tolls. Additional restrictions could be imposed depending on conditions.

Han Myung-hyun, Hankyung.com reporter, wise@hankyung.com