Weak December Takes Panama 2020 Bunker Volumes to Record Drop

Last year's fall for Panama bunker volumes was the sharpest in at least a decade. Image Credit: Ship & Bunker / Data Credit: AMP

A sharp decline at the end of the year took Panama's 2020 bunker volumes to the biggest annual drop on record.

Total volumes for December saw a 19.8% decline from the same month a year earlier to 413,230 mt, according to preliminary data from the Panama Maritime Authority (AMP). 

December's year-on-year decline will partly reflect an artificially high level at the end of 2019, when shipping companies were rushing to stock up on the new VLSFO blends before the 0.50% sulfur limit came into effect.

That left total demand for 2020 at 4.7 million mt, down by 11.4% from the previous year, in the biggest annual decline in the decade's worth of data the AMP keeps on its website.

Demand Drops Bulkers and Tankers

Panama's dependence on bulker and tanker activity is likely to have been behind much of the drop in its volumes last year, with shipping activity from these segments the worst-hit by the pandemic and the subsequent economic turmoil.

Higher fees for using the Panama Canal may also have prompted some to avoid it altogether where possible in favour of longer routes.

The number of ships arriving at Panama's ports for bunkers last year saw a steep decline, losing 13.2% to 6,625. This took the average stem size 2.1% higher on the year to 716 mt.

December Data

In December 552 ships came to the country for bunkers, down by 33.3% from the same month a year earlier, and the average stem size jumped by 20.3% to 748 mt.

VLSFO sales were 296,006 mt, up by 13.9% from November's levels, and HSFO sales gained 15.2% on the month to 74,762 mt.

HSFO represented 18.1% of total demand in December, and 11.7% of demand for 2020 as a whole, compared with 88.6% in 2019.

MGO sales gained 19.8% on the month to 12,134 mt in December, and low-sulfur MGO rose by 5.7% to 30,328 mt.