---
title: every ship spends water the forest gathered
canonical_url: https://ensurance.app/guide/every-ship-spends-water-the-forest-gathered
markdown_url: https://ensurance.app/guide/every-ship-spends-water-the-forest-gathered.md
subtitle: "the Panama Canal's dry year, and what a lock runs on"
category: ecosystem-services
---

# every ship spends water the forest gathered

*the Panama Canal's dry year, and what a lock runs on*

The **Panama Canal drought** was the dry spell of 2023 that left Gatun Lake, the lake that fills the canal's locks, unusually low for the season. October 2023 was the driest October on record for the canal's watershed, with rainfall 41% lower than usual. The Panama Canal Authority (ACP) cut daily transits and planned deeper cuts for the dry months ahead.

A canal that had handled 34 to 36 ships a day was capped at 32 by August 2023, and the authority planned steps down to 18 for February 2024. On October 3, 2023, the lake took in about seven million cubic meters from rain and rivers, less than half the 15 million expected on that day in a typical year. On December 15 the authority said it would instead raise transits to 24 a day from January 16, 2024, as November's rainfall and lake levels proved less adverse than expected and its water-saving measures paid off.

Where does the water the canal spends come from? Not from the locks. The locks worked. It comes from a forested watershed of hills, rivers and soil around the lake, which gathers the rain the canal spends. In 2023 that rain fell short, and no watershed makes rain. That watershed was doing its work before the first lock was poured, and it does it whether or not anyone pays. The canal depends on it, and so does more than half of Panama, which drinks from the same lake system. **[Ensurance](/explore?from=guide)** is built to give a living place like that an account, so the ones who depend on it can pay for its keeping. The account is not the watershed, and no account makes it rain.

## what a lock runs on

A lock is a staircase made of water. A ship enters a chamber, the gates close, and fresh water from Gatun Lake flows in by gravity to lift it toward the lake, then flows out again to lower it on the far side. NPR, reporting in February 2025, put it at more than 50 million gallons of fresh water to move one vessel through the locks.

So the canal's working capital is a lake, and the lake's income is rain. Rain falls on the hills and reaches the lake through soil and rivers, some at once and some slowly. The authority already works on its side of that line: water-saving measures at the locks, a booking system that rations slots, and draft limits that let ships carry less and sit higher.

*Every ship that crosses spends fresh water the forest gathered.*

That sentence is about the ordinary year, not the drought. In 2023 the rain itself fell short. No forest makes rain that the sky does not send, and keeping the watershed would not have filled the lake. What a watershed does is shape what happens to the rain that does fall: how much soaks in, how slowly it reaches the lake, how much soil comes with it.

## the rare map that already reaches the hills

Here the owner's map already reaches the hills. The authority holds a constitutional responsibility for the water resources of the canal watershed, and it acts on it. Its Environmental Economic Incentives Program (PIEA) had reforested 10,846 hectares by January 2023, through agroforestry, trees on cattle farms and conservation plantings: about five million trees in 21 years. The authority describes the work as protecting the environment "and, consequently, the water resource."

The map that stops short belongs to the next link in the chain: everyone who depends on the canal.

## who depends on the canal

The chain is three links long.

| link | who | what reached them in 2023 |
|---|---|---|
| The source | The forested watershed around Gatun Lake | The second driest year in its recorded history, by the authority's count |
| The property | The canal and its locks | Fewer transits a day; in August 2023 the authority was reported to expect its income for the year could fall by as much as $200 million |
| Those who depend on it | Shippers, gas and grain exporters, buyers in Asia | Longer waits, surcharges, and longer routes around it |

The International Energy Agency (IEA) reported that US liquefied natural gas (LNG) cargoes through the canal fell sharply in 2023, down 16% year on year in the second quarter, as shippers moved to the Suez Canal or the Cape of Good Hope. By mid-December, waits for unreserved slots averaged about 15 days for LNG tankers, against a normal two to three days.

Grain felt it too. Agricultural economists writing in farmdoc daily in January 2024 counted the canal as an important route for US soybean and corn exports to Asia, noted that the authority and ocean carriers had announced transit surcharges, and said ships that went around the capes faced roughly two to four more weeks at sea.

The documents a shipper works from name a canal, a slot and a toll, a route and an alternative. A watershed is rarely among them, though what reaches the lake shapes the pace for all of them.

## gray and natural, on one desk

| | gray source | natural source |
|---|---|---|
| What it is | Locks, water-saving measures, the booking system, and a new lake planned on the Indio River | The forested hills, soils and rivers that feed Gatun Lake |
| Who keeps it | The authority, with engineers and contractors | The authority's incentive program, farm families in the watershed, and the forest itself |
| How it shows on the bill of those who depend on the canal | The toll, surcharges, and the price of a slot at auction | Nowhere |

In February 2025 the authority's board approved the resources to build a new lake in the Indio River watershed, a project it expects to take about six years, to secure water for the canal and for more than half of Panama's people. The approval also covers compensation and resettlement for affected families. NPR reported that the authority's own estimate was more than 2,000 people displaced, and spoke with residents who are rallying against the project. The new lake will still be filled by rain falling on a watershed.

## it came back in 2026

On August 20, 2026, the authority reduced daily slots again, to 34 for bookings from September 4 and 32 from September 15, with May-to-August inflows 44% below average against rainfall 34% below. Its advisory called it "a substantially reduced hydrologic response" and gives no cause. That advisory, the incentive program, and the same drought read from a shipper's desk are in [when the supply chain stops, look upstream](/guide/when-the-supply-chain-stops-look-upstream?from=guide).

Soil moisture, ground cover and how the rivers run can shape a gap like that, and some of that people can tend over years. The rain they cannot.

:::johnson
**a canal can engineer its locks. it cannot engineer the rain.** What it can keep is the land that shapes how much of the rain that falls reaches the lake, and those who depend on the canal can help pay for keeping it.

[see the water cycle account →](/water-cycle.syndicate?from=guide)
:::

## the bill and the source

| | the Panama Canal, 2023 |
|---|---|
| The property | The Panama Canal and its locks |
| The source | The forested watershed that fills Gatun Lake, alongside the gray sources the authority builds and runs |
| Which bill the event landed on | Protected earnings, as transits fell and the authority said in August 2023 that its income could fall by as much as $200 million; and capital spend, in the new lake whose funding the authority's board approved in February 2025 ([the four bills](/guide/what-ensurance-saves-you?from=guide)) |
| Who else leaned on the same source | More than half of Panama's people, who drink from the lake system; shippers, LNG and grain exporters, and their buyers |
| What keeping the source looks like | The authority's incentive program for reforestation and agroforestry in the watershed (10,846 hectares by January 2023), with farm families in the basin |

What that dependence is worth paying for, and how to split it among everyone the same lake serves, is the question in [what a source is worth paying for](/guide/what-a-source-is-worth-paying-for?from=guide).

## where ensurance fits

Ensurance is not insurance and pays no claim when a slot is lost ([what ensurance cannot do](/guide/what-ensurance-cannot-do?from=guide)). It is built to let those who depend on a living place fund its keeping before the dry year, alongside the work already there.

The canal watershed has no account. The [water cycle](/water-cycle.syndicate?from=guide) and [water abundance](/water-abundance.ensurance?from=guide) accounts are live, and one for this place can be suggested: [co-create a Panama Canal watershed account](/specific/create?mode=suggest&agent=water-cycle.syndicate&name=Panama%20Canal%20watershed&from=guide). A person or group keeps the land and signs; an account is not title to it, and it does not speak for the people who live in the basin. Who else draws on one watershed is its [serviceshed](/guide/what-is-a-serviceshed?from=guide).

For a port, a fleet or a supply chain that crosses the isthmus, see [infrastructure operators](/solutions/infrastructure-operators?from=guide&topic=outside-the-property-line) or [corporations](/solutions/corporations?from=guide&topic=outside-the-property-line), or [talk it through with us](/contact?from=guide&topic=outside-the-property-line).

## frequently asked questions

### what caused the panama canal drought restrictions?

Too little rain on the canal's watershed. October 2023 was the driest October on record there, and 2023 the second driest year in the watershed's recorded history. With Gatun Lake unusually low, the authority cut daily transits to save water in a lake that also supplies drinking water.

### how much water does a ship use in the panama canal?

NPR put it at more than 50 million gallons of fresh water to move one vessel through the locks. The water comes from Gatun Lake and moves through the locks by gravity.

### who pays to keep the panama canal watershed?

As of January 2023 the canal authority did, through its incentive program for reforestation and agroforestry, with the farm families who do the work. The shippers, exporters and buyers who also depend on the lake have no account for its keeping today; ensurance is built to give them one.

## sources

[Panama Canal Authority, "Navigating Change: A Timeline of Recent & Future Progress at the Panama Canal" (February 14, 2024)](https://pancanal.com/en/?p=43183) — October 2023 rainfall 41% lower than usual; Gatun inflow of seven million cubic meters on October 3, 2023, against 15 million in a typical year; the planned steps from 32 to 24, 22, 20 and 18 transits; the January 2024 increase to 24

[Panama Canal Authority, "Panama Canal to increase daily transits to 24 starting in January" (December 15, 2023)](https://pancanal.com/en/panama-canal-to-increase-daily-transits-to-24-starting-in-january/) — Driest October on record; 2023 the second driest year in the watershed's recorded history; lake system serves over 50% of Panama's population; 24 transits from January 16, 2024, as November rainfall and lake levels proved less adverse than expected

[Waterways Journal, "Panama Canal Restrictions Extended, Deepened" (November 15, 2023)](https://www.waterwaysjournal.net/2023/11/15/panama-canal-restrictions-extended-deepened/) — Locks operated by gravity; slots planned to fall to 18 a day from February 1, 2024

[The Maritime Executive, "Panama Canal Expects Declining Revenues Due to Ongoing Draft Restrictions" (August 4, 2023)](https://maritime-executive.com/article/panama-canal-expects-declining-revenues-due-to-ongoing-draft-restrictions) — Maximum of 32 ships a day, down from 34 to 36; income for the year could fall by as much as $200 million

[NPR, "The Panama Canal needs more water. The solution is a dam that could displace thousands" (February 24, 2025)](https://www.npr.org/2025/02/24/g-s1-49456/water-panama-canal-shortage-dam) — More than 50 million gallons of fresh water per vessel; the Río Indio project; more than 2,000 people displaced by the authority's estimate; local opposition

[Panama Canal Authority, "Rio Indio Lake Project Established as a Top Priority for National Water Security" (February 21, 2025)](https://pancanal.com/en/rio-indio-lake-project-established-as-a-top-priority-for-national-water-security/) — Board approval of resources for a new lake in the Indio River watershed; about six years to build; resettlement plan; water for over 50% of the population

[Panama Canal Authority, "The Panama Canal celebrates 21 years of reforestation" (January 9, 2023)](https://pancanal.com/en/the-panama-canal-celebrates-21-years-of-reforestation-a-tree-for-every-panamanian/) — PIEA: 10,846 hectares reforested, about five million trees, tied to the authority's constitutional responsibility for the watershed's water

[Panama Canal Authority, Advisory to Shipping A-29-2026 (August 20, 2026)](https://pancanal.com/wp-content/uploads/2026/08/ADV-29-2026-Additional-Measures-to-Address-Reduced-Precipitation-in-the-Canal-Watershed.pdf) — May to August 2026 rainfall 34% below average and inflows 44% below; daily slots to 34 and then 32; water-saving measures, booking system and draft limits

[Oil & Gas Journal, "IEA: Panama Canal congestion to slow US-Asia LNG trade" (February 13, 2024)](https://www.ogj.com/general-interest/article/14305676/iea-panama-canal-congestion-to-slow-us-asia-lng-trade) — US LNG cargoes via the canal down 16% year on year in the second quarter of 2023; 15-day waits for LNG tankers by mid-December, against two to three days normally

[farmdoc daily, "Ripple Effects of Shipping Lane Disruptions on U.S. Agriculture" (January 29, 2024)](https://farmdocdaily.illinois.edu/?p=36168) — The canal as a route for US soybean and corn exports to Asia; transit surcharges; two to four more weeks at sea around the capes

## the series

1. [the loss started outside the property line](/guide/the-loss-started-outside-the-property-line?from=guide) — **read first:** one flooded factory, and every hospital that depends on it
2. [a hospital cannot store a watershed](/guide/a-hospital-cannot-store-a-watershed?from=guide) — fifty-four days on tanker trucks
3. [a chip fab still waits for rain](/guide/a-chip-fab-still-waits-for-rain?from=guide) — the year no typhoon reached Taiwan
4. [the factory was sound. the floodplain was full](/guide/the-factory-was-sound-the-floodplain-was-full?from=guide) — the 2011 Thailand floods and the ground under a lease
5. [the office park stands where the marsh was](/guide/the-office-park-stands-where-the-marsh-was?from=guide) — Chennai's 2015 flood and the shutdowns no policy covered
6. [a lot is not a home until the water is promised](/guide/a-lot-is-not-a-home-until-the-water-is-promised?from=guide) — Arizona's 2023 pause and the aquifer under the plan
7. [the resort never owned the trees](/guide/the-resort-never-owned-the-trees?from=guide) — a ski area, a national forest, and the season a wildfire took
8. [every ship spends water the forest gathered](/guide/every-ship-spends-water-the-forest-gathered?from=guide) — this post: the Panama Canal's dry year, and what a lock runs on
9. [what a source is worth paying for](/guide/what-a-source-is-worth-paying-for?from=guide) — how an avoided loss becomes the most you should pay
10. [how to map what your property depends on](/guide/how-to-map-what-your-property-depends-on?from=guide) — draw the map one ring wider than the deed