Ø  The Panama Canal is currently facing the worst drought since records began in 1950, which the capacity has been drastically reduced, waiting times for ships to navigate the canal have reached more than 20 days, and congestion continues to worsen.

Ø  The Panama Canal is now experiencing major problems, with operators reducing the number of ships allowed to navigate the canal due to the prolonged drought, resulting in longer waiting times. In addition, ships transiting the waterway are now paying about eight times the normal toll for passage.

Ø  It is in the midst of one of the driest periods in its 100 years of operation. Officials in charge of the canal are hopeful that this drought, which began in mid-2023, will be alleviated by the end of the dry season in May of this year.

Ø  Global Port Tracker (GPT), published monthly by the National Retail Federation (NRF) and Hackett Associates, indicated in its newly published March report that US imports for the first six months of the year will be up 7.8% compared with the first half of 2023. That is an upward revision from the forecast of 5.3% first-half growth in February’s GPT. 

Ø  It is also the second month in a row that retailers have raised their forecast for import growth during the first half of 2024.

H2 Import Performance Forecast

Ø  GPT issued its first forecast for July, projecting that imports will increase 3.8% from July 2023. Retailers and industry analysts have acknowledged that forecasting import volumes for the second half of the year is tricky given unknowns in the global economy and geopolitical uncertainty, so the forecast for growth in July as the second half kicks off shows confidence that consumer demand may remain strong. 

Ø  “Fear of an inflationary impact due to the raised cost of transportation should be alleviated by now,” Ben Hackett, founder of Hackett Associates, said in Friday’s GPT. “Retailers and their carrier partners are adjusting to the reroutings and new schedules.