Wanhua Pays $4 Million for LPG Transit at Panama Canal Neopanamax Auction

A new record was set at the Panama Canal’s Neopanamax auctions on Wednesday with China’s Wanhua paying $4 million for a liquefied petroleum carrier (LPG) transit, data from shipping agents showed.

Wanhua booked a southbound transit slot at the Neopanamax auction on Wednesday, securing passage for the 86,000 cubic meter Very large Gas Carrier (VLGC) Gas Virgo on April 15.

The fee is highest paid for an LPG transit, breaking the previous high of $3.975 million back on Nov. 8, 2023, OPIS data showed. At $4 million, the transit equates to around $90/metric ton on a standard 44,000 mt basis.

The number of vessels waiting to transit the Panama Canal’s old and new locks surpassed Wednesday’s level on Thursday morning.

As of 10:00 a.m. BST on Thursday, the number of vessels across all segments awaiting transit through the Neopanamax and Panamax Locks reached 120, up from 116 on Wednesday and 74 a week earlier.

The vast majority of the vessels – 100 – are queuing for the Panamax Locks, of which 75 have booked a transit while the other 25 have not. The number of carriers queuing is now at its highest since Nov. 28, 2023, when there were 143 vessels at anchor.

The queues and delays for transit through the Panamax Locks have lifted the Panamax-vessel premium on the LPG market, shipbrokers noted.

Typically, a Panamax-class VLGC trades at around $2-3/mt above the rate for a Neopanamax-class VLGC, given the flexibility to use both locks as well as the lower port and handling fees associated with the carriers.

However, due to waiting times and elevated fees, the premium is currently around $5/mt, according to one London-based shipbroker, but could rise further amid such demand.

Reporting by Jamie Aldridge, jaldridge@opisnet.com; Editing by Rob Sheridan, rsheridan@opisnet.com