Transport costs in Germany surge as Rhine river water levels fall

Water levels on the river Rhine in Germany have again fallen due to hot and dry weather, the country’s inland navigation agency said on Tuesday, with commodity traders reporting sharply increased transport costs for industry.

• Shallow water after this summer’s heatwave means cargo vessels are often only able to sail about 10% full or less, increasing costs for cargo owners. It also means loads must be spread among several vessels.

• “Vessel owners impose low water surcharges to make it worth their while to sail with such small loads,” one commodity trader said. “Industry is transferring cargo to rail and road transport, but this is also expensive because of the extra demand.”

• The cost of tanker barge transport from Rotterdam to Karlsruhe rose to around €130-€140 ($147.7-$159.10) a ton on Tuesday from around €120-€125 at the start of the week and €45 at the end of June, traders said.

• The water level at the chokepoint of Kaub near Karlsruhe has fallen sharply and with dry weather forecast in coming days more falls are expected. Some rain is forecast by the end of the week which could help.

• Inland navigation agency WSV forecast the navigable water depth at Kaub will fall from about 30 cm on Tuesday to around 27 cm on Friday.

• Vessels generally need a navigable depth of 1.5 metres at Kaub to sail fully loaded. The river is deeper than the navigable depth.

• Traders stressed that sailings on the river continue.

• “There is not a single point where Rhine sailings stop because of low water,” a trader said. “But there comes a point where the small loads are no longer worth it or vessel owners are concerned about damage to their barges.”

• The Rhine is an important shipping route for commodities such as grains, minerals, ores, coal and oil products.

• German companies faced supply bottlenecks and production problems in summer 2022 after a drought and heatwave led to unusually low Rhine water levels.

($1 = 0.8800 euros)

-Reporting by Michael Hogan in Hamburg; Editing by David Holmes/Reuters