2. OPERATING CONDITIONS

• Waterside goods handling in main Upper Rhine ports followed an upward trend in the first six months of 2024, after a low point in late 2023. This upward movement continued also in the third quarter of 2024, and points to a recovery of Rhine transport in the course of 2024.
• Freight rates for the transport of all types of cargo experienced a downward trend in the first half year of 2024. This was particularly visible in the case of dry bulk transport and to a lesser extent for liquid bulk and container transport.
• Average fuel prices in inland navigation decreased during the first half of 2024. For the rest of 2024 and for 2025, a further downward trend of fuel and oil prices is foreseen. The downward trend of oil prices is explained by an expected appreciation of the US Dollar compared to the euro, which makes crude oil purchases more expensive for European consumers, thereby lowering the demand and the price for oil.

WATERSIDE GOODS HANDLING IN MAIN UPPER RHINE PORTS

• Monthly data for waterside goods handling in major Upper Rhine ports are representative of the transport on the Upper Rhine. They show that cargo handling in Upper Rhine ports and related transport demand on the Upper Rhine saw a steep downward trend between March 2023 and October 2023, followed by an upward trend from November 2023 onwards. In the first ten months of 2024, this upward trend continued.
• The reason for this upward trend is a general recovery of the economic situation and of global trade. This can also be seen in the development of the index for container handling in the North Range seaports.¹⁰ This North Range Index gives an early indication of economic development in the northern eurozone and Germany. During the first ten months of 2024, this index rose sharply, indicating a recovery of economic activity and trade.

 

FIGURE 1: MONTHLY WATERSIDE GOODS HANDLING IN MAIN UPPER RHINE PORTS (IN MILLION TONNES)


Sources: CCNR analysis based on data provided by the ports
 
 

FREIGHT RATES IN THE RHINE REGION¹¹

• The first freight rate index under study is a spot market index for liquid cargo which is based on surveys of shipping companies involved in the transport of liquid goods between the ARA region and the Rhine region (hinterland in Germany, France and Switzerland). This freight rate index for liquid cargo experienced a high degree of volatility between mid-2022 and mid-2023. The main reason was the low water period in summer 2022. In the first half of 2024, freight rates normalised on an average level. It can be observed that they were higher than before the low water periods of 2021 and 2022.

 

FIGURE 2: SPOT MARKET FREIGHT RATE EVOLUTION FOR GASOIL FROM THE ARA REGION TO RHINE DESTINATIONS (INDEX 2015 = 100)


Sources: CCNR calculation based on Insights Global
* Insights Global collects spot market freight rates (in euro per tonne) for ARA-Rhine trade of liquid bulk. The CCNR transforms these values into an index with base year 2015.
Lower Rhine: Duisburg, Cologne. Upper Rhine: Karlsruhe, Basel. Main: Frankfurt/Main

 
• A second freight rate index is based on data collected by the statistical office of the Netherlands. Statistics Netherlands (CBS) collects freight rate data from a panel of Dutch IWT companies. These data are studied twice quarterly and include fuel and low water surcharges.

 

FIGURE 3: DEVELOPMENT OF FREIGHT RATES FOR INLAND SHIPPING COMPANIES IN THE NETHERLANDS BY MARKET SEGMENT (INDEX 2021 = 100, QUARTERLY DATA)


Sources: Centraal Bureau voor de Statistiek (Binnenvaartdiensten; prijsindex), Table 85817 2021=100
 
• The dry bulk spot market index rose steeply in summer 2022 but then decreased continuously in the following quarters. The normalisation of water levels, the end of the boom in coal transport and the general economic recession can explain this development.
• In the first half year of 2024, all components of the CBS index followed a slight downward trend. This trend was most obvious for dry bulk spot market freight rates. But it was even visible for liquid bulk, despite the more positive development of transport demand for liquid bulk.

FUEL COST EVOLUTION

• In the first half of 2024, fuel prices followed a downward trend, while oil prices followed a horizontal trend. Apart from these diffferent trends, the comparison of fuel prices in inland waterway transport (gas oil prices) with oil prices shows a rather close correlation, which serves as the basis for a forecast of fuel prices, using oil price forecasts.
• The historical data for fuel prices in inland waterway transport of western Europe were taken from the market research company Insights Global in the Netherlands. In the following graph, the curves for the oil price and for the fuel or gasoil price are roughly at the same level, but it should be noted that the oil price is given in euro per barrel (= 159 litres), while the fuel prices are given in euro per 100 litres of gasoil.

 

FIGURE 4: AVERAGE FUEL PRICES IN IWT AND BRENT CRUDE OIL PRICES INCLUDING FORECAST


Sources: Insights Global (fuel price based on gasoil bunker prices observed on a daily basis in northwest Europe), US Energy Information Administration (oil price), Federal Reserve Economic Data (historical exchange rate US dollar/euro), CCNR analysis
1 barrel (bbl) = 159 litres
 

• The outlook for fuel prices in 2025 is based on the oil price outlook in conjunction with assumptions regarding the exchange rate between the euro and the US dollar. For the exchange rate, a value of 1.00 US dollar per euro is assumed in 2025. This assumption is based on an expected appreciation trend of the US dollar, due to higher economic growth in the US than in the euro area. For the oil price, a decrease is predicted for the year 2025. The reasoning behind this prediction is described below.
• An appreciation of the US dollar makes crude oil imports to Europe more expensive. This leads to a lower demand for crude oil and a related drop in the oil price.¹² It is from this viewpoint that a decreasing oil price in 2025 is expected.¹³ Another reason for a decreasing oil price is the development of the supply side of the oil market. On the supply side, there has been a sharp increase in oil production from non-OPEC countries (primarily Canada, the USA and Guyana).
• Based on these assumptions and forecasts, fuel prices in inland shipping are currently expected to be around 67 € /100 litres gasoil in 2025. The conflicts in the Middle East pose a risk to the oil price trend. An escalation of these geopolitical conflicts would lead to an increase in oil prices and thus fuel prices.