Record-low water levels on the Rhine are disrupting freight transport in Germany and increasing the risk of higher prices for raw materials, economist Veronika Grimm has warned.

Grimm, a professor at the Technical University of Nuremberg and a member of the German Council of Economic Experts, told the Kölner Stadt-Anzeiger that inefficient allocation of limited transport capacity could push prices up unnecessarily.

“Low water can also drive prices up unnecessarily if rationing is inefficient,” Grimm said, according to the report. She said the effects were particularly visible in the chemicals and energy markets, adding that low river levels were also affecting oil shipments to refineries.

The warning comes as conditions on the Rhine have deteriorated sharply. Data from Germany’s inland navigation authorities showed the gauge at Kaub, a key bottleneck near Koblenz, fell to 6 centimetres late on Friday before rising to 8cm early on Saturday. The previous record low at the gauge was 25cm in 2018.

The gauge reading does not represent the river’s full depth, but it is widely used as an indicator of navigability at the location. The Rhine is one of Europe’s main transport routes for chemicals, fuel, grain, minerals and manufactured goods.

Companies are already facing higher costs and reduced transport capacity. Chemical producer Covestro has declared force majeure for certain products from its Dormagen site, while other industrial companies have reported production and logistics difficulties. Some cargoes are being shifted to rail and road transport, although those alternatives are more expensive and have limited capacity.

Shipping costs have also risen directly. Maersk introduced low-water surcharges on Rhine transport in July and warned that conditions could deteriorate to the point where barge transport becomes operationally unfeasible.

Grimm said the impact on prices would vary between commodities and companies, depending partly on the amount of storage capacity they have available.

She also criticised Germany’s preparedness for increasingly frequent climate-related disruptions. Relaxing the Sunday ban on heavy goods vehicles could help in the immediate situation, she said, but policymakers should have contingency plans in place before such crises occur.

Grimm rejected the idea that simply deepening rivers would provide a comprehensive solution. She said deeper shipping channels could be justified at specific points, but any such projects should be assessed against their environmental effects because “deepening does not create additional water”.

She called instead for plans to prioritise essential freight when waterways become difficult to navigate.

The pressure on German industry is continuing to grow. According to the latest WSV data, Rhine levels at Kaub remain far below the previous record, while companies are increasingly relying on road and rail transport to compensate for the loss of river capacity.