By Jack Wittels (Bloomberg) –
Although the German summer is officially only two weeks old, the water level on the Rhine – a vital artery for the country and other parts of inland Europe – is already so low that trade is being restricted.
The measured water level at Kaub, a major bottleneck, was 1.43 meters on Friday afternoon, government data show. It is forecast slumped another 16 centimeters by early Tuesday morning. That’s well below the seasonal norm, but a far cry from last August’s low, when readings reached about 30 centimeters and caused widespread disruption.
Still, all barges wanting to haul diesel fuel via Kaub were only allowed to load 60% of their maximum loading capacity, according to Mitchell van der Hoeven, a Riverlake broker who arranges the haul upriver. This may limit supplies to upstream importers, including Switzerland.
Winding its way for hundreds of kilometers from the Alps to the North Sea, the Rhine is used to transport millions of tons of oil products and other essential goods, including gravel, coal and iron ore, across Europe. Last yearWater levels dropped so much that trade was severely affected, affecting oil refining, power generation, and more.
“I expect that from August it will be even worse than last year,” said van der Hoeven.
Already this year, the euro-per-ton price for transporting fuel by barge on the river has skyrocketed, with the current cost of transport between Karlsruhe in south-west Germany and the Netherlands almost double the five-year average.
“For the last week of June we expect some precipitation, which could probably at least temporarily stop the downward trend in water levels,” said Dennis Meissner, forecaster at the Federal Institute for Hydrology. He doesn’t anticipate “critical flow conditions” until the end of July at the earliest.
Normally, the Rhine is at its lowest in the August-November period, he said, adding that the outlook is uncertain and depends on rainfall and summer temperatures.
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