Rhine River’s low water levels harm Germany’s economy

Here are some statistics demonstrating the significance of Rhine river shipping to Germany’s economy. Due to the abnormally hot and dry weather, the Rhine river’s water levels are extremely low. This is making it difficult for many ships to travel the vital European shipping route fully loaded. Here are some statistics demonstrating how the Rhine River’s low water levels harm Germany’s economy.

It serves as a crucial connection between industrial manufacturers and international export terminals. North Sea ports like Rotterdam and Amsterdam. While canals and other rivers connect the Rhine to the Danube and enable shipping to the Black Sea.

To avoid hitting land when water levels drop, cargo ships must sail with a lighter load. According to some shippers, in recent days, they only loaded roughly 25%. This results in the need for additional ships to transport cargo that could formerly fit on a single ship.

This results in raising the cost of freight. Typically, shipping companies can pass on increased expenses to cargo owners, who then pass those prices forward to customers. Authorities do not restrict the river, and shipping does not halt at any particular water level.

At the Kaub chokepoint near Koblenz, the reference waterline level was 32 centimeters on Monday (8 August), down from 42 centimeters on Friday(5 August) and 51 centimeters a week earlier. To sail fully loaded, vessels require around 1.5 meters of Kaub reference waterline.

The German economy is already struggling with high inflation, supply chain delays, and skyrocketing gas costs as a result of Russia’s invasion of Ukraine in February. Shipping bottlenecks are an additional burden on the German economy.

According to economists, the Rhine shipping slowdown might reduce this year’s overall economic growth in Europe’s biggest economy by as much as 0.5 percentage points. Low Rhine water levels could result in production reductions and higher costs for chemical manufacturers like BASF.

Coal power plants, which are once again popular as a substitute for Russian gas, are also experiencing a shortage of fuel because vessels can’t transport enough coal.

Two of the utility Uniper’s plants, which account for 4% of Germany’s capacity for coal-generated power, have issued a production reduction alert. To make up for the Rhine’s lack of capacity, businesses are shipping more goods by truck or train.

If the Rhine’s low water levels continue to drop, Germany intends to give the movement of supplies and machinery necessary for energy generation priority on the nation’s rail networks, a draught law revealed on Sunday. We can only hope that both the Rhine’s water level and Germany’s economy will soon normalize.

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