The prolonged heat is leading to low water levels in rivers. This year has been marked not only by low water levels, but also by their remaining below the minimum navigable level for an extended period.

This, in turn, is developing into a combined transport, industrial, agricultural, and water-management crisis. The immediate problem is that ships must reduce their cargo as navigable depth falls.

That raises freight costs and can interrupt supplies of fuels, chemicals, ores, coal, grain, and industrial raw materials. The secondary effects include more truck traffic, higher consumer prices, production cuts, saltwater intrusion, poorer water quality, irrigation restrictions and pressure on electricity generation.

Rhine, Meuse, Scheldt

The situation is not identical everywhere. The Rhine and its Dutch branches, including the Waal and IJssel, are the most important economic bottleneck for Belgium, the Netherlands and Germany.

The Meuse is especially important for freshwater availability and lock management. Around the Scheldt, the main concern is currently salinization and the Ghent-Terneuzen Canal rather than closure of the tidal Scheldt itself. Farther east, the Danube is disrupting shipping, fuel supplies, and electricity production on an exceptional scale.

In the Netherlands, the Twente Canal has already been closed due to low water levels in the major rivers. The Rhine in the Netherlands has now officially reached its lowest point ever. Historically low water levels in the Rhine had already been recorded in Germany, causing the navigable depth to decrease further.

Only 25% of normal cargo

Falling water levels are already disrupting freight transport: because vessels cannot sit as deep in the water, they can carry less cargo, meaning more vessels are required. This drives up transport costs.

Transport vessels on the Rhine, Waal, and IJssel can transport only about 25 percent of their normal cargo. As a result, the depots in Hengelo and Enschede are no longer being supplied. Fuel suppliers are now forced to cover much greater distances and source gasoline and diesel from depots in the west of the country.

The extra kilometers are costing fuel suppliers a great deal of money. Added to this is the fact that fuel at the depots is also more expensive due to low-water surcharges for transport by barge to the fuel depots.

The consequences are predictable: pump prices are rising. Hopefully, there will be plenty of rain soon; otherwise, it cannot be ruled out that fuel shortages will eventually force gas stations to close.

National drought consultation

A water shortage has officially been in effect in the Netherlands since July 16. A national drought consultation takes place in The Hague every week, and all regions are now in a state of high readiness. 

Measures are being taken everywhere to distribute available water as efficiently as possible and, where feasible, to retain it. There is also a risk of embankments subsiding due to the low water levels.

Farmers in large parts of the Netherlands are already experiencing the effects of water shortages. In some areas, bans on withdrawing water from rivers, lakes, and ditches – and sometimes even groundwater – apply to them. These bans limit irrigation options.

In principle, consumers may continue to water their gardens or wash their cars, although the Ministry of Water Management does ask people to “use water consciously, all year round.”

Belgium

In Flanders (Belgium), we see a significant water shortage requiring active coordination and water-saving measures, but it is not at the highest emergency level.

The most important immediate economic risk is the Ghent-Terneuzen Canal, which connects the industrial Ghent port zone with the Western Scheldt and the North Sea.

For North Sea Port companies, the consequences include uncertain deliveries, higher freight costs, and possible problems with water used for cooling or industrial processes. High chloride levels can also damage freshwater ecosystems and restrict agricultural water use.

Wallonia describes the situation on its navigable rivers as concerning. Eight Walloon municipalities have introduced restrictions on water use. Drinking-water plants and distribution systems are highly stressed by elevated consumption, although there is no general Walloon drinking-water failure.

Belgium is not yet facing the same degree of inland shipping paralysis as parts of Germany or eastern Netherlands. There is currently no evidence of a general Belgian fuel or drinking-water shortage.

Germany

In Germany, the most critical Rhine bottleneck is around Kaub, between Koblenz and Mainz. Cargo traffic continues, but some operators report ships sailing only around 20% loaded.

One Kiel Institute scenario suggests that persistent low Rhine levels could reduce German third-quarter economic output by as much as 0.2%. That is a stress estimate rather than a certain outcome, but it illustrates how a transport problem can become a macroeconomic one.