Low water levels on the Rhine are restricting navigation and reducing barge cargo capacity, hitting the logistics of the German steel industry hard. The sector reports a drop in transport capacity of up to 40 percent and a clear increase in freight rates.
In the Ruhr region, where most of Germany’s steel production capacity is located, river transport is of immense 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 transport on this stretch of the river.
The Central Commission for the Navigation of the Rhine (CCNR) reports that in 2024, 234 million tonnes of goods were transported via the lower Rhine waterway, which connects the major steel production hub of Duisburg with the port of Rotterdam. The Rhine waterway, stretching over 1,200 km from Basel in Switzerland through Germany to the Dutch ports, is a crucial shipping route.
Barges run at 40 percent capacity, costs soar
Due to the size and weight of steel products, river transport is particularly attractive for the industry. The same applies to raw materials needed for steel production. According to EU data, in 2024, metal ores accounted for 23.2 percent of goods transported on rivers, while coke and petrochemical products made up 16.3 percent.
However, this mode of transport is heavily dependent on weather and hydrological conditions. According to the German Federal Waterways and Shipping Administration (WSV), water levels in the Rhine dropped significantly in early July. At the key gauge in Kaub, the level fell from 118 cm on July 5 to 78 cm on July 9. Low water forces barges to reduce their draft, which can only be achieved by cutting their load. According to an industry representative cited by Eurometal, barges can now use only 40 percent of their capacity. This drastically reduces delivery volumes while raising transport costs. Eurometal reports that river freight rates have increased by 40–60 percent.
Railway woes compound the crisis
Market participants do not expect a quick improvement. After heatwaves, drought has set in. Weather forecasts for Germany do not predict prolonged rainfall in the second half of July that could sustainably improve the hydrological situation, only heavy downpours causing local flooding.
– The low loading level of barges is very costly for our company, and with low inventory levels it causes problems with the availability of raw materials – said a representative from one German steel mill, quoted by Eurometal.
The situation is made even more difficult by Germany’s persistent problems with rail freight. According to the German press, these are primarily due to the poor state of railway infrastructure. The number of train movements is decreasing, and freight trains have to compete for track space with passenger traffic. Germany has launched a rail infrastructure modernisation programme that is expected to improve the situation in the long term, but for now it is an additional reason for reducing the number of trains and causing delays, as successive sections of track are closed during construction work.
Recently, German industrial 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 65 million euros.
Źródło: WNP.PL, Fot. Materiały prasowe / Thyssenkrupp Steel
