DHL Global Forwarding (DGF) has highlighted the difficulties involved in shifting cargo to rail and road as record-low water levels continue to seriously disrupt navigation on the Rhine—Europe’s most important inland waterway for freight transport.
During an August 12 webinar, Rhine Low Water: What Shippers Need to Know, participants heard how reduced barge capacity is leading to longer transit times, higher transportation costs and mounting pressure on alternative rail and road networks.
Long Lead Times for Bookings
“The current availability [of capacity] on road and rail is already very tight,” Florian Wöbb, DGF’s Head of Intermodal ICC in Germany, said.
“Finding a truck can currently take up to two weeks in advance and for rail even longer, indeed, getting longer still, because many customers are deciding to switch modes as rail offers a certain security.”
He continued: “Shippers and forwarders are facing six-week pre-notice times for rail bookings, so it’s a case of showing some patience here. If rail is the future—currently its modal share of inland freight going in and out of the ports of Rotterdam and Antwerp-Bruges is estimated at approximately 15%—then capacity must be made available.”
Commenting on rail options at the ports of Rotterdam and Antwerp-Bruges, DGF’s Vice President and Global Head of China Rail/Multimodal and ICC Europe said:
“Of course, these exist, but at the moment it is all about the availability of rail capacity, and ramping up more is proving something of a challenge. It’s not just about adding more trains. Obtaining new slots in these ports is tough. There’s a run on capacity, and everybody is impacted and seeking options before going to trucks.”
Wöbb added: “The key message here is that an early booking saves the space. We now have lead times of six weeks [for rail bookings], and this could rise further next week.”
Additional Rail Connection
In a service update issued August 12, trimodal freight transport operator Contargo said it continued to rely on additional landbridge solutions and rail services while working on further alternative transport concepts to minimize the effects of low water on shippers’ supply chains.
To expand transport capacity, the company has implemented and initiated several measures. Beginning August 17, Contargo will offer an additional rail connection and add truck capacity to provide a landbridge among the Lower Rhine, Middle Rhine and Upper Rhine regions.
Surcharges on the Rise
As water levels continue to fall, further disrupting barge traffic on the Rhine, transportation surcharges are rising significantly.
Switzerland-based container shipping group MSC is reported to be charging €1,350 per TEU for shipments passing the Kaub gauge section of the river, a critical navigation chokepoint near Koblenz.
The navigable water depth at Kaub had fallen to 12 centimeters on August 12, effectively halting most north-south cargo navigation through the area. According to an industry source, cargo shipments could no longer be booked beyond Kaub.
MSC’s reported surcharge at the Cologne gauge is €895 per TEU.
MSC has also introduced “traffic congestion surcharges” for truck, rail and combined rail-truck transportation to and from Antwerp and Rotterdam via Andernach, Frankfurt, Germersheim, Munich, Nuremberg, Neuss, Strasbourg, Trier and Wörth.
Effective August 20, the surcharges will be €44 per container transported by truck for all origins and destinations. Rail and combined rail-truck shipments to and from Germany and Alsace will be subject to a surcharge of €50 per container.
Shippers are consequently turning to alternative transportation modes, only to find that road-haulage and rail-freight capacity is also limited.
Specialized Low-Water Vessels
German chemical producer BASF’s industrial complex in Ludwigshafen is located directly on the Rhine. Freight moving to and from the site is distributed among rail, river and road transportation.
The company indicated that it has so far limited the effects of persistently low water on its operations.
“We continue to monitor developments very closely and proactively implement any measures that may become necessary,” the company stated.
“So far, inland waterway transportation has been largely maintained through the use of a greater number of low-water vessels. We are making every effort to support the supply of key raw materials by using alternative modes of transport such as trucks and rail. In isolated cases, the continuation of the current weather conditions has led to supply constraints.”
Increased Pressure on Overland Networks
From the freight-forwarding perspective, Kuehne+Nagel has warned that the combination of record-low Rhine levels, restricted rail capacity and limited road alternatives has increased pressure on overland freight networks across Germany, the Netherlands and Switzerland.
“The overlap of major renovation work on Germany’s rail network and low-water conditions means that lost inland shipping capacity cannot be offset quickly through additional rail services,” the forwarder recently noted.
Trucks Permitted on Sundays and Public Holidays
In response to the disruption caused by low water on the Rhine, several German states have temporarily relaxed restrictions that prevent most trucks from using motorways on Sundays and public holidays.
Switzerland’s economy also depends heavily on inland water transport via the Rhine, notably for imports of petroleum products, which have largely dried up. However, it is unclear whether the country has replicated Germany’s measures with regard to truck transport.
Ripple effects
With little in the way of significant rainfall on the horizon the Rhine’s freight transport ecosystem and the supply chains it supports remain under serious pressure.
The ripple effects of the disruption triggered by the low water levels were starting to appear – box traffic congestion at the ports of Rotterdam and Antwerp-Bruges and potential detention and demurrage charges, participants in the DH webinar heard.
