Another Supply Chain Crisis Is Brewing In Europe

A section of Europe's most important inland waterway for transporting fuel and other industrial goods has fallen to levels not seen in three decades for this time of the year and might be an ominous sign of incoming supply chain disruptions on the inflation-battered continent if hot weather and dryness persist through summer.

The Rhine Waterways and Shipping Authority (WSA) has yet to issue any alerts for the Rhine River, but data from the closely watched Kaub chokepoint shows the water level around 1.26 meters on Wednesday.

On a seasonal basis, Kaub water levels haven't been this low in three decades, indicating that barge disruption could be ahead for the second year. 

We followed the chaos last summer as German shippers halted barge operations due to low water levels at Kaub. 

• Germany's Energy Crisis About To Get Even Worse As Rhine Water Levels Plummet
• Germany's Uniper Warns Of Possible "Irregular Operation" At Major Power Plant As Rhine River Runs Dry
• Shipping Halted On Rhine Near Kaub Chokepoint Due To Distressed Barge Blocking Waterway

Already, barges hauling heating oil fuel from the Rotterdam area beyond Kaub have seen cargo loads nearly halved from 2,000 tons of fuel to 1,200 tons in a week, according to Riverlake Barging data. 

Declining Kaub water levels have begun to push up barge prices. 

If Rhine supply chain woes materialize later this summer, then this will be bad news for the European Central Bank's fight against inflation. At the same time, the continent entered a recession earlier this year. 

By Zerohedge.com

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