Shipping of rapeseed and biodiesel hit by low Rhine water levels
December 10, 2018
Record low water levels since summer along the Rhine river, the main European shipping artery, have jeopardised shipments of commodities, including rapeseed and rapeseed biodiesel, as well as chemicals and coal.
On 22 October, the water level at Kaub – the key choke point for inland shipping on the Rhine – dropped to 25cm, the lowest level since records began in 1880, Montel reported. Full barge loading requires 1.5m.
The low levels had prevented rapeseed from being shipped to crushing plants and finished rapeseed methyl ester (RME) from being moved, as well as filling up storage space and pushing up freight rates, according to S&P Global Platts.
There had been an ongoing struggle to move inland rapeseed to ARA (Antwerp, Rotterdam, Amsterdam) for crushing and biodiesel production, with some producers sourcing rapeseed from the Black Sea to alleviate pressure.
The difficulties in moving biodiesel, coupled with winter demand for RME’s superior cold properties, had pushed up prices, one source told Platts.
RME prices rose to an all-time high on 9 November to US$1,422/tonne FOB ARA.
“With the water levels hindering many commodities, alternative methods of moving product such as rail and truck are fully booked and did not appear to be able to offer much help to the situation,” Platts said.
Robin Girmes, a meteorologist at Energy Weather, told Montel that with the start of the cold – and dry – winter season, the outlook for rain in relevant areas had declined, making recovery relatively unlikely for December.
He added that it would take five days of rain to make the Rhine fully shippable again.