A tightening Panama Canal is once again forcing shipowners to weigh longer routes around South America, but marine insurer the Swedish Club warns in a new member alert that Cape Horn and the Strait of Magellan are far from straightforward substitutes.

The latest Panama restrictions are being driven by a strengthening El Nino and a growing water deficit across the canal watershed. Rainfall from May through August has been running about 34 percent below historical averages, while inflows have been roughly 44 percent below normal, according to the Club.

The Panama Canal Authority has progressively reduced the maximum allowable Neopanamax draft to 48 feet of Tropical Fresh Water and cut the number of available transit slots as it moves to conserve water. A further reduction to 47.5 feet planned for October 1 was postponed this month after a review of Gatun Lake levels and weather forecasts. Neopanamax slots were cut to nine per day beginning September 3, while Panamax capacity was set at 25 daily slots and is scheduled to fall to 23.