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US-Asia LPG Cargoes Rerouting Via Cape of Good Hope Amid Panama Squeeze

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The Cape of Good Hope accounted for 43% of the LPG voyages from the US to Asia in April 2026, the highest level since October 2016, according to a report by shipping and energy analytics firm, Vortexa.

This has been attributed to soaring Panama Canal auction prices and rate charged to vessels without bookings, with the squeeze expected to intensify through June, as longer voyage times delay vessel returns.

The report noted that for cargoes without pre-booked transit slots, shipping economics have become increasingly challenging.

Auction prices for unbooked Neopanamax passages climbed from roughly $150,000-$350,000 earlier in the year to nearly $1.7 million in April and approached $2 million in May, while waiting times stretched to as long as 11 days.

It blamed recent policy changes at the Panama Canal for compounding the crisis, with daily Neopanamax slots being reduced from four to three for the rest of 2026, as LNG carriers get priority.

As a result, voyage distances and timelines have expanded significantly, with a very large gas carrier, which previously took 26 days to travel from Houston to Chiba in Japan via the Panama Canal, now taking 45 days when transiting the Cape of Good Hope, reducing fleet availability.

For Asian buyers, this introduces additional risks, as cargoes now arrive several weeks later than they previously did, often in materially different market conditions, leading to more pressure on margins.

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