The Panama Canal set a new monthly record for LNG carrier transits in January, despite laden transits falling, as returning carriers buoyed demand at the waterway.
A total of 58 LNG carrier transits were undertaken in January, more than the previous record of 54 transits set in January 2020.
But 38 of these transits were by empty carriers returning to liquefaction facilities in the US, and only 20 were by laden carriers en route to Pacific basin demand markets, despite ample demand in northeast Asia for Atlantic LNG.
Congestion at the Panama Canal in recent months instead forced more US LNG to sail out of the Atlantic basin through Suez, instead of the shorter Panama route.
Around 55 of the 87 cargoes loaded in the US in January are scheduled to leave the Atlantic basin for south and northeast Asia, although up to six more could follow. Of these 55 cargoes, only 21 have transited through Panama, compared with around 29 of the 76 cargoes loaded in January 2020. And 31 are due to transit through the Suez Canal, up from just four a year earlier, while transits around the Cape of Good Hope are unchanged at three.
But while many charterers have switched to deliver into the Pacific through Suez over Panama, demand for Panama transit by carriers returning to the US to load again has held strong.
This is likely to be, in part, a result of the Panama Canal's own booking protocol. The canal offers two daily transits for LNG carriers, either two northbound — Pacific-to-Atlantic — or one each way. This suggests that charterers would more easily attain a transit slot on the return journey than on the outbound voyage.
And the Panama Canal has also made more transits available to LNG carriers, either in the form of near-term bookable slots or by accommodating additional transits. The canal in January began offering under auction spare slots to Neopanamax vessels within four days of transit. A total of 27 slots have been offered under these auctions, nine of which were awarded to LNG carriers.
The canal has also been able to accommodate additional transits for carriers that have not been able to secure bookable slots, leading to the waterway equalling its record of four daily transits on 31 January — two carriers sailing each way — having already undertaken three northbound transits earlier in the month.
