The low water level on the Rhine is restricting navigation and reducing barge cargo capacity, hitting the logistics of the steel industry in Germany. The sector reports a drop in transport capacity of up to 40 percent and a clear increase in freight charges.
In the Ruhr region, where most of Germany’s steel production capacity is located, river transport is of enormous importance. Nearly one-third of all cargo for the German steel industry is moved by barges. Steel and related raw materials, including scrap, account for a quarter of all traffic on that section of the river.
The Central Commission for the Navigation of the Rhine (CCNR) reports that in 2024, 234 million tons of goods were transported along the Lower Rhine waterway, which connects the major steel production hub of Duisburg with the port of Rotterdam.
40 percent capacity, 60 percent higher costs
Low water forces barges to reduce their draught, which can only be achieved by cutting their load. According to a sector representative cited by Eurometal, barges can now use only 40 percent of their capacity. This significantly reduces delivery volumes while pushing up transport costs. Eurometal reports that river freight rates have risen by 40 to 60 percent.
Market participants do not expect an improvement in the near term. After heatwaves, drought has set in. Weather forecasts for Germany in the second half of July do not predict prolonged rainfall that could sustainably improve the hydrological situation – only violent downpours causing local flooding.
– The low loading level of barges is very costly for our company, and with low inventories it causes problems with the availability of raw materials – said a representative of one of the German steel mills cited by Eurometal.
Rail woes compound the crisis
The situation is made even more difficult by the fact that Germany has been experiencing major problems with rail freight in recent months. According to the German press, these are primarily due to the poor state of rail infrastructure. The number of train runs is declining, and freight trains have to fight for track space with passenger traffic.
Germany has launched a programme to modernise its rail infrastructure, which in the long term is supposed to improve the situation, but for now it is an additional reason for the reduction in the number of trains and for delays, as successive sections of track are closed during works.
Recently, German industry associations also raised alarms about track access charges, describing them as 'rising and unpredictable’. In the draft budget for next year, the German government plans to cut subsidies for track access charges by EUR 65 million.
In Poland, this type of transport has lost much of its importance, but in north-western Europe river transport remains a vital part of the logistics system. For the German steel industry, the combination of low Rhine levels and rail bottlenecks is creating a perfect storm that threatens production continuity and raises costs across the value chain.
Źródło: WNP.PL, Fot. Materiały prasowe / Thyssenkrupp Steel
