A water crisis in the Panama Canal is causing ships to circumnavigate continents; alternatives to bypass the drought issue in the canal add costs at a time when governments worldwide are trying to control inflation
Lake Gatun, a crucial part of the canal system that provides fresh water to its locks, has received little rainfall this year as El Niño triggered a devastating drought. As a result, the Panama Canal Authority reduced the number of authorized ships passing through from an average of 36 to 38 per day in the past to an expected 18 in February, half the normal volume.
🔼 If canal restrictions worsen, other major grain exporters like Brazil, Ukraine, and Russia are likely to seek to fill the gap in U.S. products in Asia. Brazilian grains have already been traded more actively due to the growing canal restrictions.
🇺🇸 The United States is a major exporter of grains – soybeans, corn, wheat – to Asia, many of which typically exit the Gulf Coast and travel through the Panama Canal.
🔽 However, low water levels in the Mississippi River have prompted some American producers to transport their grains by train to the Pacific Northwest and then ship them to Asia.
Awake Media 