The water levels in the Rhine river are expected to rise this week and will likely ease supply chain pressure in the European petrochemical market. Water levels at key chokepoint Kaub have been declining from 207 cm in early July to 108 cm on August 3, according to data from the German waterways authority.
The declining water levels have forced upstream barge operators to reduce their loads by around 30-40% in recent weeks. A Cologne-based petrochemical producer said the low water levels have not affected barges in the area for now but expected the impact to occur soon if dry weather continued.
However, rain is forecast to fall over the Alps this week and expected to increase the water levels in the Rhine river despite hot, dry weather. According to a forecast by the German waterways authority, water levels at Kaub would stabilize at around 200 cm after rising above that level by this Thursday evening.
Low water levels have affected logistics in the methanol market, with barges unable to load fully. The slowdown in barge activity is expected to increase inventories in Rotterdam, market participants said. Higher stocks in Rotterdam typically drag European methanol spot prices. However, the expected higher water levels are not expected to disrupt spot activity.
