Water levels on the Rhine River in Germany are nearing record lows, an issue exacerbated by recent heatwaves and dry weather. This critical situation is severely impacting German industry, with companies like thyssenkrupp Steel already experiencing disruptions in raw material supplies to its Duisburg plant, leading to a partial reduction in blast furnace production. While customer deliveries are not yet at risk, continued low water levels are expected to exert pressure on production costs and supply chains within Germany's steel and manufacturing sectors.
The shallow water prevents cargo vessels from sailing fully loaded, often limiting them to carrying only about 20% of their normal capacity. This necessitates using four to five times as many ships to transport typical cargo volumes, significantly increasing costs for businesses. For instance, the cost of tanker barge transport from Rotterdam to Karlsruhe surged from $45 at the end of June to approximately $165.84-$171.56 per ton by Thursday. Extra surcharges are also increasing expenses for cargo owners, further burdening German industry which is already showing signs of recovery.
The navigable water depth at Kaub, a crucial chokepoint near Koblenz, was recorded at 29 cm on Thursday, close to the 2018 record low of 25 cm. Vessels generally require a navigable depth of 1.5 meters at Kaub to operate at full capacity. Despite these challenges, freight operators are continuing sailings, often by deploying chartered vessels with lower drafts. The Rhine is a vital artery for transporting commodities such as grains, minerals, ores, coal, and oil products, making its low water levels a significant concern for the entire German economy.
