A record bid of $5.3 million has been made by a shipper to transit the Panama Canal, according to sources familiar with the situation.
SK Gas Ltd., based in South Korea, agreed to pay this amount for passage through the canal on September 1. The fee, reached through an auction conducted by the canal authority this week, surpasses the previous record of $4.6 million that was set earlier this month by another shipper with a South Korean vessel.
The demand to urgently navigate through the canal has increased significantly since the war in Iran disrupted global trade routes, especially to Asia. Currently, vessels that arrive without prior reservations are facing waits of up to 11 days, as reported by Argus Media.
To address this situation, the Panama Canal authority has tightened restrictions on the number of available slots starting in September, along with limiting the cargo capacity of ships, due to expected drought conditions in the area.
The winning bid allows the G. Spirit, a liquefied petroleum gas tanker, to travel northbound through the canal. As of Tuesday, this ship was located on the Pacific side of the waterway, according to Bloomberg's data.
SK Gas has not yet responded to requests for comments.
The Panama Canal Authority has also refrained from commenting on the record auction price through a spokeswoman. They stated that most vessels utilize a reservation booking system and noted that recent auction results indicate “significantly stronger demand,” resulting in prices much higher than the average auction price of around $55,000 before February.
Additionally, the El Niño weather pattern forming in the Pacific is influencing shippers' increasing readiness to pay for reservations. This pattern might lead to severe drought conditions in Panama, posing a threat to the freshwater levels of the canal and impacting shipping availability.