Key facts
- Record-low water levels in the Rhine and Danube rivers are severely impacting European industry.
- Industries such as oil refining, chemicals, and heavy manufacturing face disruptions due to reduced cargo transport capacity.
- Low water levels have forced nuclear power plants in Hungary and Romania to reduce output or shut down reactors.
- Essential deliveries of materials like naphtha and LPG are restricted, leading to force majeure declarations.
- Alternative transport options like rail and road are insufficient to compensate for lost barge capacity.
Europe is grappling with significant industrial disruption as severe heatwaves lead to record-low water levels in crucial waterways like the Rhine and Danube rivers. This environmental crisis is directly impacting cargo transport, energy production, and the supply chains of major industries.
The Rhine, a vital artery for transport and industry, has seen its key Kaub gauge drop to critically low levels, preventing most inland vessels from passing. This restriction forces operators to carry smaller loads, split cargo across multiple ships, or shift freight to already strained road and rail networks. The chemical and petrochemical sectors are particularly affected, with reduced navigable depths hindering the delivery of essential feedstocks like naphtha and liquefied petroleum gas (LPG) from North Sea ports. LyondellBasell has declared force majeure on butadiene supplies from its Wesseling plant due to disrupted feedstock deliveries, and BASF has also flagged potential shortages.
Beyond cargo transport, rising water temperatures are reducing the efficiency of industrial cooling systems, posing operational challenges for power plants. The oil and energy sectors are experiencing steep low-water surcharges and increased freight rates for shipping diesel and petroleum products upstream, impacting inland distribution. Coal-fired power stations are also struggling to secure fuel supplies. Heavy manufacturing giant Thyssenkrupp has slightly reduced blast furnace production at its Duisburg plant because barges carrying raw materials face navigation issues on shallow chokepoints.
The Danube river is also experiencing historically low water levels, reaching a record low in Budapest. This has led to the halting of most cargo vessels along the Hungarian section and significantly reduced loads for those still operating. The Paks Nuclear Power Plant in Hungary has been forced to reduce output and shut down one of its four reactors. Similarly, Romania's Nuclearelectrica has shut down both units at its Cernavodă plant due to unprecedented low water levels, increasing reliance on imports and potentially driving up power prices.
Fuel transport in Serbia has been severely affected, with the country receiving only a fraction of its planned fuel imports in July. Agriculture in Serbia and Romania is also impacted, with disruptions to grain shipments and irrigation. While German authorities are planning to deepen the Rhine shipping channel at critical bottlenecks, the long-term outlook for water levels remains uncertain, suggesting continued economic disruption.