The 85-year-old ship that Stephen Mnich and his eight siblings grew up on is considered small by today’s standards.
Yet for the hundreds of family-run businesses that annually ferry more than 100mn tonnes of dry cargo such as coal, steel and grain on the Rhine, using nimbler vessels such as the MS Salisso, which can carry a maximum 866 tonnes, is starting to make more sense.
Not only do they allow families such as Stephen’s to operate without a crew, lighter ships also make it easier to glide up and down the Rhine during the summer, when water levels are at their lowest.
“This is how we live, it’s how my parents lived,” the 31-year-old Mnich said, sitting in the marine-themed living room, lined with family portraits.
Drought is a growing problem for the international shipping industry, threatening the supply chains that underpin the global economy.
The sector, which delivers up to 90 per cent of goods worldwide, became increasingly dependent on large vessels as globalisation spread.
Such vast ships facilitate the delivery of millions of euros worth of goods every day. But their practicality is increasingly challenged by low water levels in the Rhine and other important waterways as global warming takes hold.
One of the driest years on record forced operators to restrict the number and depth of ships passing through the Panama Canal this summer, leaving some waiting up to two weeks longer than normal to enter this vital trade artery between the US and Asia.
Shipping represents about 3 per cent of total greenhouse gas emissions, according to the OECD.
The constraints facing businesses such as the one the Mnich family have run for three generations also highlight how the industry is ill-equipped to cope with more extreme weather conditions.
When Mnich and his brothers decided to expand by buying two new boats, they approached a bank to pitch building modern vessels small enough to be operated by two people.
“They just laughed,” he said. “They want at least 3,000 tonnes of capacity.”
Yet boats of such a size struggled during the summer of 2018, when a heatwave caused enough water to evaporate from the shallowest parts of the middle river — which runs from Bonn to Bingen — for the “decisive” measuring station outside the village Kaub to read below 78cm for 107 days.
With most ships on the Rhine stranded, that in turn led the value of German industrial output to drop by almost €5bn in 2018 as companies scrambled to secure raw materials and gas via alternative routes.
“The impacts of the low water period in . . . 2018 should not be underestimated,” the Strasbourg-based Central Commission for the Navigation of the Rhine said in 2021 report.
While shipping companies could turn towards smaller vessels, analysts emphasise that this is likely to raise transport costs. Moving to midsized ships will “lose the economies of scale”, said Jonathan Roach of analysts Braemer.
To address the transport bottleneck on the Rhine while protecting European manufacturers’ margins, Berlin has proposed a €180mn project to deepen the Rhine’s shallowest parts by 20cm — partially by shaving off rocks jutting from the river bed — which experts say will translate into additional ship capacity of about 200 tonnes.
But the project, which is scheduled to be completed in 2030, has faced criticism from many inhabitants along the Rhine. They worry that new hydraulic structures diverting water towards the channel will create an eyesore.
For Uwe Arndt, head of integrated logistics in Emea at German chemicals group Covestro, these types of projects are instrumental for the future of factories in Leverkusen, Dormagen and Krefeld-Uerdingen. Nearly a third of products made in these factories are shipped to customers along the Rhine.
“We need bulk transport capacity,” Arndt said, adding that with driver shortages and railway strikes, there were no real alternatives to shipping.
His company partnered with HGK Shipping, which is ultimately owned by the City of Cologne, to build special low-water tankers MS Curiosity and MS Courage, which can sail when water levels are as low as 40cm and have a capacity of 1,419 tonnes each. “These ships would have been able to operate in 2018,” Arndt said of the year that became a wake-up call to many industries.
Steffen Bauer, HGK Shipping’s chief executive, said he expected demand for low-water vessels to grow as climate change was likely to increase the frequency of “extreme situations” on the Rhine, but his real focus was on more long-term solutions.
Tankers such as those custom-built for Covestro can run partially on electricity, reducing emissions by 30 per cent. But as companies prepare to meet stricter emissions rules, Bauer said he expected ships would at some point need to be refitted to run on hydrogen rather than diesel.
“We have to think about the engine, by 2030 we expect there will be a possibility to use hydrogen fuel cells,” he said.
Such a change would be a much greater challenge for family-run businesses that dominate the dry-cargo sector, such as the one Mnich and his three brothers inherited from their parents.
When the bank refused to finance the newer vessels, the brothers bought two older ships, without engines that can easily be upgraded to run on hydrogen.
Mnich was not certain if it was worth investing in hydrogen-friendly technology just yet, saying liquid natural gas had been pitched as the future just a few years ago. “If we would have built a ship five years ago to run on LNG, we would have had a big problem,” he said, pointing to Germany’s race to wean off itself off gas following Russia’s invasion of Ukraine.
For now, he believes his future in the industry is not too dissimilar from that of his parents. He and most of his siblings have little inclination to leave the industry. “Most of us could make the same money easier [somewhere else],” he said. “This is about passion.”
Additional reporting by Oliver Telling