Panama Canal Authority postpones planned price hike following calls from shipping industry

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The Panama Canal Authority (ACP) has announced that it will postpone price increases on canal transit fees which were due to come into effect on April 15, 2021.

The announcement follows a joint letter sent by the International Chamber of Shipping (ICS), Asian Shipowners Association (ASA) and European Community Shipowners Association (ECSA), expressing concerns over the speed of price increases, said a release.

The proposed changes, representing a minimum cost increase per transit reservation of $20,000 (up 57%) and a maximum cost increase of $58,500 (up 167%), will now start on June 1, 2021.

The letter, sent in March, expressed concerns over the significant increase of the fees and stated that the April 15 start-date given by the ACP was too short for the maritime industry and canal users to be able to adjust. ACP has linked the increased fees to changing supply and demand conditions for the service it offers.

Panama Canal is one of the worlds busiest shipping routes; nearly 14,000 transits were made last year.

On April 13, 2021, the ACP announced the postponed date for the new booking tariffs. This change in the implementation date will provide the maritime industry more time to prepare for the adjustment to the new booking fees.

ICS Secretary-General Mr Guy Platten said, We are reassured to see that ACP has responded to industrys calls to postpone its proposed transit reservation price increases until 1 June, giving industry time to fully prepare for these changes. The increases represent a significant rise in cost, especially considering the ongoing economic impact of the Covid-19 pandemic.

We appreciate that the fee change is designed to adapt to changing supply and demand for the Panama Canals service and we look forward to establishing a productive dialogue with the ACP to develop a long-term pricing strategy to provide industry with predictability on transit cost.

We hope to be able to hold a virtual meeting with the ACP to discuss and gain further clarity on these issues.

This announcement comes as a relief to the shipping industry that has been navigating the crew change crisis and other Covid-19 pandemic related disruptions. The industry has commended the ACPs decision and welcomes ongoing communication on issues central to preserving the global supply chain, the release added.