Shipping hit in Germany as Rhine water levels drop

HAMBURG • The water level of the Rhine River at the key waypoint of Kaub dropped to a critical 40cm mark as Europe's blistering summer shrivels the artery.

At this level and below, it becomes uneconomical for many barges that haul commodities like diesel and coal to sail through that part of the river, according to Germany's Federal Institute for Hydrology.

About 160 million tonnes of goods and commodities were hauled along the Rhine in 2020, ranging from chemicals to iron ore to oil products. Low water levels restrict the transport of goods along the waterway by limiting how much barges can carry without scraping against the riverbed.

Elsewhere, the Danube, which snakes its way about 2,900km through central Europe to the Black Sea, is gummed up too, hampering grain and other trade.

In the United Kingdom, the source of the River Thames has dried up further downstream than ever before, as England looks set to enter a drought that some experts say the country is unprepared for.

Economists estimate Rhine disruption could knock half a percentage point off Germany's economic growth this year. The reference waterline level at the chokepoint of Kaub WL-KAUB near Koblenz was at 42cm earlier yesterday, down about 5cm on the day and down from 51cm on Monday. Vessels need about 1.5m of Kaub reference waterline to sail fully loaded.

There is no specific level at which shipping stops, said Mr Roberto Spranzi, director of the DTG shipping cooperative that operates about 100 cargo vessels on the Rhine. "We are continuing to sail today and we will continue sailing until we reach the nautical technical impossibility."

Some larger vessels and barges can no longer pass Kaub and, in Duisburg, the large pusher-tug/ barge units which in normal times carry 3,000 tonnes a barge can no longer operate, Mr Spranzi said. Loads are being transferred to larger numbers of smaller canal barges able to operate in the shallow water, increasing costs for cargo owners.

Spot prices for a liquid tanker barge from Rotterdam to Karlsruhe south of Kaub were unchanged on the day at about €110 (S$155) a tonne yesterday, but up €16 this week and up from only around €20 a tonne in June, brokers said.

Low Rhine water will hit output at two German coal-fired power stations. Chemicals group BASF said it could not rule out production cuts if low water disrupts logistics.

Meanwhile, Britain officially declared a drought in parts of England yesterday as households faced new water usage curbs during a period of prolonged hot and dry weather that has already severely tested the nation's infrastructure.

Parts of southern, central and eastern England are now in drought status, meaning water companies will step up efforts to manage the impact of dry weather on farmers and the environment, the Environment Agency said.

"All water companies have reassured us that essential supplies are still safe, and we have made it clear it is their duty to maintain those supplies," Water Minister Steve Double said, following a meeting of the National Drought Group.

"We are better prepared than ever before for periods of dry weather, but we will continue to closely monitor the situation, including impacts on farmers and the environment, and take further action as needed."

The meeting followed what was the driest July in England since 1935. Only 35 per cent of the average rainfall for the month fell, and parts of England and Wales are now in the middle of a four-day "extreme heat" alert. The last drought in England was in 2018.

When the dry weather breaks early next week, rain and thunderstorms mean there is a small chance of flooding in some parts of the country, the Met Office - the national forecaster - said yesterday.

BLOOMBERG, REUTERS