• Navigating conditions on the Rhine and Danube were by far less critical in 2019 than the previous year. Nevertheless, on certain stretches of the Upper and the Lower Danube, water levels dropped to below a critical threshold on a relatively high number of days per year.

• Freight rates for dry cargo transport did not show any major upward movements in 2019, due to the absence of low water periods and because of weak macroeconomic conditions. Towards the end of the year 2019, dry cargo freight rates moved downwards, reflecting the deterioration in dry cargo transport demand.

• Freight rates for liquid cargo also settled at lower levels in 2019, but it could be observed that these levels were nevertheless higher than before the low water period of late 2018.

 
 

WATER LEVELS AND AVAILABLE VESSELS’ DRAUGHT AT GAUGING STATIONS ON RHINE AND DANUBE

 


     

     

  • Overall, in 2019, hydraulicity conditions on the Danube and Rhine were much better than in 2018. However, on the German Upper Danube, the available draught of vessels dropped below 2 metres in the second half of the year, and again in April and May 2020.
  •  

    FIGURES 1 AND 2: AVAILABLE DRAUGHT OF VESSELS AT GAUGING STATIONS ON THE AUSTRIAN AND GERMAN DANUBE (IN CM)



    Sources: CCNR based on data from the German Federal Waterways and Shipping Administration, provided by the Federal Institute of Hydrology (BfG); Federal State of Lower Austria.
     

  • On the Rhine the available draught of vessels was above 2 metres during the whole year 2019. The only month which was slightly more critical was September 2019. In the first semester of 2020, water levels fell during a dry month of April 2020 but recovered in the first half of May 2020.
  •  

    FIGURES 3 AND 4: AVAILABLE DRAUGHT OF VESSELS AT GAUGING STATIONS ON THE GERMAN RHINE (IN CM)



    Sources: CCNR based on data from the German Federal Waterways and Shipping Administration, provided by the Federal Institute of Hydrology (BfG).
     

  • Another method of analysing navigating conditions is to count the number of days during which the water levels fell below a critical threshold. For the Rhine and Danube, such a critical threshold is the Equivalent water level, or the Low navigable water level as it is called on the Danube. It is defined as the water level reached or exceeded at a gauging station on an average of 94% of days in a year (= on 343 days) over a reference period of several decades (For the Danube, see: Via Donau (http://www.viadonau.org/wirtschaft/transportachse-donau/schiffbarkeit)). Its value is different for each gauging station.
  • The number of days during which this critical threshold is not reached indicates the length of time over a year with a severe low water situation. From the nine gauging stations along the Danube, it can be seen that for the German Danube, critical low water situations occurred more frequently in 2015 and 2018 (two recent years with low water periods) than on the neighbouring Austrian Danube, which has similar results to the available draught shown previously. Moving downstream on the Danube, from Austria to Slovakia, Hungary, Croatia, Serbia and finally to Romania, the tendency for critical low water situations again becoming more frequent, is noted.
  •  

    FIGURE 5: NUMBER OF DAYS BELOW THE LOW NAVIGABLE WATER LEVEL FOR DANUBE GAUGING STATIONS


    Sources: Danube Commission market observation; CCNR based on data from the German Federal Waterways and Shipping Administration, provided by the Federal Institute of Hydrology (BfG); Federal State of Lower Austria.
     

  • In the following graph, nine gauging stations along the Rhine were also ordered in a geographical way, as well as in a downstream direction (which, for the Rhine, is south to north). The graph shows that 2019 did not have any severe low water situations on the Rhine, compared to the Danube. In addition, as a general tendency, the frequency of severe low water days is higher for gauging stations on the Lower and Middle Rhine than on the Upper Rhine.
  •  

    FIGURE 6: NUMBER OF DAYS BELOW THE EQUIVALENT WATER LEVEL FOR RHINE GAUGING STATIONS


    Source: CCNR based on data from the German Federal Waterways and Shipping Administration, provided by the Federal Institute of Hydrology (BfG).

 
 
 

FREIGHT RATES IN THE RHINE REGION

  • Freight rates for the transport of dry cargo remained on a multiannual average level during large parts of 2019. In late 2019 and early 2020, freight rates for dry cargo on the Lower and Middle Rhine dropped significantly. A major reason for this was hydraulicity conditions, which were characterised by high water levels at the end of 2019 and the beginning of 2020 (see figures above). Another reason was the cooling off in the overall economic situation, which reduced transport demand and freight rates. This is especially seen for the Lower Rhine, where the reduction in coal and iron ore transport had a strongly negative effect on freight rates.
  •  

    FIGURES 7, 8 AND 9: PANTEIA FREIGHT RATE INDEX FOR DRY CARGO TRANSPORT IN THE RHINE AREA (INDEX 2015 = 100)




    Source: Panteia
     

  • Spot market freight rates for the transport of liquid cargo (gasoil) from the ARA region to destinations along the Rhine in France, Germany and Switzerland were also on a downward path at the end of 2019 and at the beginning of 2020.
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    FIGURE 10: PJK FREIGHT RATE INDEX FOR GASOIL FROM THE ARA REGION TO DESTINATIONS ALONG THE RHINE (INDEX 2015 = 100)


    Source: CCNR calculation based on PJK International.
    *Gasoil. PJK collects 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/M.

     
     
     
     

FREIGHT RATES IN THE FARAG REGION (FLUSHING, ANTWERP, ROTTERDAM, AMSTERDAM, GHENT, TERNEUZEN)

  • For the liquid cargo transport within the extended ARA region, a dataset on spot market freight rates and time charter renting prices provided by the tanker barge corporation CITBO was analysed. Within the spot market data, gasoil and components had a share of 50% in 2019, compared to 47% in 2018. Gasoline and components followed on rank 2 with 26% (35 % in 2018), biodiesel on rank 3 with 15% (11% in 2018), and chemicals on rank 4 with 9% (8% in 2018). Heavy and other products accounted for 1%.
  • Regarding all liquid cargo transported in the period under study (July 2017 until April 2020), 94 % was loaded in Antwerp, Rotterdam, Flushing, Amsterdam, or Ghent. For the time charter data, the geographical scope is very similar. The ports of unloading of the cargo are more often outside the FARAG region. For example, 20% of the cargo was unloaded in Belgian cities/ports outside the FARAG region. Frequent destinations were Brussels (5.5%), Liège (3.8%), Roeselare (3.6%), Tessenderlo (2.6%) and Hasselt (2.1%). Destinations in Germany had a share of 4.3%.
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    FIGURE 11: CITIES/PORTS OF LOADING WITHIN THE CITBO DATA (SHARE IN %)


     

    FIGURE 12: CITIES/PORTS OF UNLOADING WITHIN THE CITBO DATA (SHARE IN %)


    Sources: CITBO database, CCNR analysis
     

  • A freight rate index was calculated per product segment, based on the spot market freight rates. For all four cargo segments, freight rates peaked during the low-water period in 2018. When water levels recovered, freight rates abated but settled at a higher level than before.
  •  

    FIGURES 13, 14, 15 and 16: CITBO FREIGHT RATE INDEX FOR LIQUID CARGO SEGMENTS (INDEX AUGUST 2017 = 100)





    Source: CCNR analysis based on CITBO spot market freight rates
     

  • Gasoline and its components had the highest average spot market freight rates in absolute terms (€/tonne) as these trips are on average relatively long. Destinations outside the FARAG region (e.g. cities in Germany such as Cologne, Frankfurt/Main, Karlsruhe or Basel in Switzerland) are more frequently observed for gasoline (and gasoil) than for chemicals. During the return trip of long-distance journeys, vessels are often empty. To compensate this empty return trip and related costs, a compensation in terms of a higher freight rate is paid. The following figure shows this distance effect where the average trip length is seen on the x-axis, and the distance effect on the y-axis.
  •  

    FIGURE 17: AVERAGE DURATION OF TRIPS AND DISTANCE EFFECT ON SPOT MARKET RATE IN THE CITBO DATABASE*


    Source: CCNR analysis based on CITBO spot market freight rates.
    *The distance effect is measured as the ratio of average freight rates per product group and the freight rate for heavy products (heavy products equalling 100).

     

  • As expected, the time charter rates evolved in a less volatile way over time than the spot market rates. But there was also a peak during the low-water period in October 2018, therefore the time charter rates followed the spot market rates to a certain extent. The general movement of the curve reflects an upward trend from August 2017 until September 2019, which was also influenced by variations due to the low-water period. Since September 2019, however, renting prices followed a decreasing trend.
  •  

    FIGURE 18: AVERAGE MONTHLY RENTING PRICE WITHIN TIME CHARTER DATA IN THE CITBO DATABASE (INDEX)


    Source: CCNR analysis based on CITBO data
     

  • On the Danube, freight rates are above all dependent upon bunker fuel prices which, according to the market observation of the Danube Commission, decreased by 4.2% on the Danube in 2019, compared to the average price in 2018. Freight rates for upstream transport (which are in general higher) therefore eased slightly in 2019 (by around 2%). Freight rates for downstream transport eased a little more (by around 4.5%), which also reflects the less dynamic increase in cargo transported downstream compared to strong growth in upstream traffic (iron ore, foodstuffs).
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