SIMIC

SHIPPING companies are bidding ever-higher amounts to get through the Panama Canal faster with a Japanese company paying a record US$4 million on top of normal fees, Bloomberg reported.

A shipping company paid a record $3.975 million to jump the line at the Panama Canal as the crucial waterway struggles through an ongoing drought, according to Bloomberg.



Documents seen by the outlet show that Japan's Eneos Group made what amounts to the world's largest-ever bid in an auction to expedite passage through the canal.



The company will also still pay the regular passage fee, which is in the hundreds of thousands.



Oystein Kalleklev, CEO of Flex LNG, said that such rates are "pricing out a lot of ships," the outlet reported.



As of August, more than 200 vessels were clustered at either end of the canal, The Wall Street Journal reported.



A screenshot from ship-tracking website vesselfinder.com showing numerous ships, represented by dots and arrows, clustered either side of the Panama Canal on a map, as of November 9, 2023.



The Panama Canal Company is blaming a severe instance of the El Nino climate pattern, CNBC reported.



"This will be the worst El Nino recorded in recent history," company administrator Ricaurte Vasquez Morales said.



This has seen bids for quicker access climb rapidly. An August bid by AP Moller-Maersk reached $900,000, on top of the ordinary toll of $400,000, the Journal reported at the time.



And in September, one company paid $2.4 million to skip the line.



The delay is expected to last well into the future.