Panama Canal backlog could cause trade disruptions
An ag economist says drought conditions have caused some shipping delays along the Panama Canal.
Allendale’s Greg McBride tells Brownfield the agriculture industry is watching the situation closely. “If we are struggling to get product moved through this area, this could be a reason to see some higher prices,” he said. “It also could be a reason to potentially see some lost exports to competition like Brazil.”
The Panama Canal Authority says drought restrictions are in place with more than 100 ships awaiting transit on both sides of the Canal.
McBride says the U.S. is considered the Canal’s biggest user for ag shipments. “This is a big problem for global shipping,” he said. “About 40% of global shipments run through the Panama Canal.”
Officials say transits through the Neopanamax locks have maintained their regular average and have not been impacted by the restrictions.