El Niño is ramping up, but that means traffic through the Panama Canal is slowing down and becoming more expensive. For you, that could show up as higher prices.

Millions of gallons of water from Panama's Gatún and Alajuela lakes fill manmade locks, raising and lowering ships as they pass through the canal.

The canal depends on rainfall to fill the two lakes that act to move shipping traffic from the Atlantic to the Pacific and vice versa. 

Weather in your inbox

Forecast Location

Sign Up

By signing up you agree to the Terms & Privacy Policy. Unsubscribe at any time.

(EL NIÑO EXPLAINED: Regional impacts to expect this winter)

When water isn’t available, the authorities reduce the number of transits through the locks to conserve water. 

The Panama Canal Authority (ACP) has cut the number of vessels that can pass through the canal from 36 to 32 daily.

Get More of Our News on Google

Set The Weather Company as a 'Preferred Source' to get quicker access to the news you value.

As the demand for passage increases, the price to pass through the Panama Canal is also increasing. 

Shippers can bid to get an expedited slot. Earlier this season, a new record bid price was set when South Korea’s SK Gas Ltd. reportedly paid $5.3 million to pass through the canal on Sept. 1. 

Ships that have not made reservations with the ACP were delayed by more than 10 days, on average, in August. 

The main alternative to passing through the Panama Canal — taking the longer trip around South Africa’s Cape of Good Hope — can add two to three weeks to the trip. 

El Niño’s effects over the Panama Canal

El Niño dries out the wet season, then hastens the dry season. 

The lakes around the Panama Canal need the rainy season to fill the watershed so that it doesn’t run too low on water in the drier winter months. 

Panama’s rainy season peaks in October to early November, often boosted when a large area of circulating winds called the Central American Gyre spins over Central America. 

El Niño causes air to descend from high over the tropics into the Caribbean. Sinking air is dry, warming air that leads to less rainfall. This is the same effect that has squashed tropical storm and hurricane development in the Atlantic hurricane season. 

(MORE: How to prepare your wallet and home for El Niño)

Effects of the 2023 El Niño 

During the 2023 El Niño, water levels at Gatún Lake fell substantially during the driest October on record. The lakes that drive the locks dropped to record lows for that time of the year, forcing the canal to cut its daily transits by a third. 

Transits through the canal dropped as low as 22. 

World Weather Attribution found El Niño roughly doubled the likelihood of 2023's low rainfall. Seven out of the eight months that make up the rainy season in Panama brought less rain than usual. 

The 2023 El Niño peaked at 1.4 degrees Celsius warmer than average at the end of 2023. 2026’s El Niño is expected to be substantially warmer. 

Jonathan Belles has been a digital meteorologist for weather.com for 10 years. His favorite weather is tropical weather, but also enjoys covering high-impact weather and news stories and winter storms. He's a two-time graduate of Florida State University and a proud graduate of St. Petersburg College.