Transport costs rise sharply as Rhine levels drop

HAMBURG, July 28 (Reuters) – 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)