The Rhine curves slightly to the left near Kaub, two small islands lie at the narrow point between Bingen and St. Goar south of Koblenz even when the water level is normal.

On Thursday, the level there fell to 47 centimeters, according to the Waterways and Shipping Authority (WSA) Rhine, the fairway is no longer 1.60 meters deep.

For barges, this means that they can only take 30 to 40 percent of their normal cargo with them.

For the same transport volume, two more ships are needed than usual.

Jonas Jansen

Business correspondent in Düsseldorf.

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The situation is tense because there has been no rainfall for weeks.

The Association of Coal Importers still calls it the "calm before the storm".

This is because the coal-fired power plants have to have a reserve for 30 days of full load.

Although the coal-fired power plants are running at full capacity, the warehouses are still well stocked - also because Russian coal was still allowed to be shipped until recently.

“This winter the reserve power plants will be added, we will certainly import over 30 million tons.

That will squeak," says Alexander Bethe, Chairman of the Association of Coal Importers.

Levels continue to fall

In 2016, significantly more steam coal was imported at 41 million tons, but since then the political situation has changed - and with it the transport situation on the Rhine.

In addition, a mid-double-digit number of barges have been diverted to Romania to help unload Ukrainian grain.

"That's around 80,000 tons of transport space, i.e. around 400,000 tons of coal a month, which are no longer shipped between Amsterdam and Duisburg," says Bethe.

However, companies like RWE still see no effect of the low water - neither in the coal nor in the cooling for the remaining nuclear power plant, which the Essen-based group still has on the grid.

Nevertheless, the water levels have fallen in recent days - and they could fall further.

The WSA Rhine expects the water levels on the Middle and Lower Rhine to drop by 10 to 15 centimeters over the next three to four days.

Below a water level of around 40 centimeters at the Kaub gauge, which corresponds to a water depth of around 1.50 meters in the fairway, it becomes too shallow for many common types of ship, explains Jörg Uwe Belz, geographer and head of department at the Federal Institute for Hydrology.

The industry is preparing for difficulties: "We are assuming that transport on the Rhine will be very difficult in the next few days," says Tilman Benzing, transport infrastructure expert at the VCI chemical association.

While it is uncertain which ships will still be able to navigate the Rhine in the next few days, one thing is already clear: it will be even more expensive.

Spot prices for transport ships from Rotterdam to Karlsruhe had already risen to around 110 euros per ton on Wednesday.

In June, before the water levels dropped, only about 20 euros per ton had to be paid.

The companies learned from the extreme low water in 2018 and made plans to distribute the goods to more ships, says Benzing.

"But if that is no longer possible either, they have to switch to rail and truck, which is also difficult because of the well-known bottlenecks, especially on the rails," says Benzing.

In addition, the situation is of course the same for other sectors and as a result fewer wagons meet increased demand in a tight transport network, which in turn drives up prices.

Low water costs economic output

Inland waterway vessels are an important means of transport for the German economy, especially for energy sources and chemical products, important primary products for German industry.

Of the almost 70 million tons of chemicals that the industry has transported each year, 11 percent come by inland waterway.

A shock in a small sector - the share of inland shipping in the total gross value added in Germany is less than 0.2 percent - could have such a significant impact on other sectors, warns Stefan Kooths, head of economic activity and vice president of the Kiel Institute for the World Economy (IfW).

In 2018, the low water in the Rhine cost around 0.4 percent of economic output.

Low water in Europe's most important inland waterway is likely to slow down the economy again this year.

Deutsche Bank economist Marc Schattenberg expects that the low water could reduce economic output by around a quarter of a percentage point, so that economic growth this year should only reach just under 1 percent.

The situation is unlikely to improve in the foreseeable future, says Jens Schwanen, Managing Director of the BDB Association of Inland Waterways.

"We need several days of sustained precipitation in southern Germany and it doesn't look like it."