Market Insight
SPRING 2017

Annual report
Year 2017

Market Insight
FALL 2017

Market Insight
WINTER 2017-2018

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Focus on coal transport

 

  • In this segment, inland shipping is used for delivering steam coal to power plants, and coaking coal to steel plants. 82 % of all coal transport performance in the EU takes place in Germany. Rotterdam is the main port and the Rhine is the main artery for providing the steel industry and the energy sector with coal in Germany. A smaller part of German coal imports crosses the German border via German seaports, in particular Hamburg.
  • In 2016, 29 million tonnes of coal crossed the German border on inland vessels, mainly on the Rhine. This import traffic represented 81 % of total coal transport by IWT in Germany (36 million tonnes).
  • Due to the heavy traffic of coal on the Rhine, Rotterdam and Amsterdam are the two main coal ports in the Hamburg-Le Havre range, with a total coal transshipment volume of 48.4 million tonnes (= share of 2/3 in the Hamburg-Le Havre range). (Source: Port of Rotterdam – Brochure Facts & Key Figures)
  • Coal transport on inland waterways is statistically closely linked with coal imports, but the underlying drivers are the energy sector and steel production: 2/3 of all coal is used for generating electricity (and on a minor scale heat), and 1/3 for producing iron and steel.
  • The following figure reveals that coal transport by IWT and by rail is clearly linked with coal consumption in the energy sector, and to a lesser extent with steel production. The rising share of imported coal is in principle beneficial to IWT and rail transport, as it creates additional long distance transport, but this effect is offset by the energy transition towards renewables.

 

Coal consumption and coal transport by inland vessels and by rail in Germany (million tonnes)

Source : CCNR based on Destatis, German Working Group on Energy Balances and Oxford Economics

 

Coal consumption and coal transport by inland vessels and by rail in Germany

Source : CCNR based on Destatis, German Working Group on Energy Balances and Oxford Economics

 

 

Forecast Model and Results

Volumes of coal transported on the Rhine and Forecast Model [in 1000 tonnes] (quarterly)

Source : CCNR

 

  • Transport of coal on the Rhine is positively correlated with coal imports and with energy consumption. Electricity generation now plays a larger role than the heating market, as most of the coal in Germany is used by power plants for generating base load power.
  • The transport of coal on the Rhine is expected to decrease in 2017 and 2018, due to the ongoing trend of energy transition towards renewables in Germany. Coal’s share in primary energy consumption dropped from 13.3 % in 2014, to 13.0 % in 2015, and to 12.3 % in 2016. (Source: ARGE Energiebilanzen (German Working Group on Energy Balances)).
  • According to data provided by the German Working Group on Energy Balances, coal primary energy consumption continued to decrease also in the 1st half year of 2017, by 6.7 % compared to the 1st half year of 2016.
  • The forecast takes into account a 7 % decrease of coal imports in Germany, between the average quarterly coal import level in 2016 and the end of 2018 (Q4 2018).
  • According to this forecast model, coal transport on the Rhine is expected to decrease from 31 million tons in 2016 to 30.7 million tonnes in 2017 and 30.4 million tonnes in 2018.

 

 

World trade outlook and transport trends

RWI/ISL Container throughput index

Source : Computations of RWI and ISL based on data from 82 ports; July 2017: flash estimate

 

 

  • The RWI/ISL Container throughput index is based on data from 81 world container ports covering 60 % of worldwide container handling. This index is an early indicator for world trade and maritime container shipping.
  • The index data for 2017 reveal an acceleration of container throughput in the 2nd half of the year. The index reached an all-time-high value in August 2017.
  • In the following months, a slight reduction took place, but this should be understood as a cooling or counter-reaction to the unusual growth in the previous months.
  • In November 2017, no trend reversal in the evolution of world trade is expected.

 

Trends in demand for transport in 2018 in Rhine countries
Main drivers Trend in demande for transport in 2018 vs 2017
Agricultural products Harvest results Increase
Iron ores Steel production Increase
Metals Steel production Increase
Coal Weather & energy Policy, partly steel production Decrease
Sand, soil & building materials Construction activity Increase
Containers World trade Increase
Mineral oil products Oil prices & refinery output Stable
Chemicals Chemical production Stable

Source: CCNR analysis based on macroeconomic and sectorial data.

 

  • For the steel segment, production figures for the 2nd quarter 2017 were very positive, and the further outlook for the steel industry is far more favourable than in 2016, thanks to a synchronised global upswing (see chapter 1).
  • The consumption of coal is declining further. In Germany, the use of coal decreased by 6.7 % in the first half year 2017. Coal consumption in the energy sector decreased by 9 %. The underlying trend of the energy transition towards renewables, will certainly continue.
  • The upward movement in the building industry is continuing, as new figures confirm, especially for the Netherlands. The transport of sands, stones and building materials will be promoted further by this development.
  • The World trade indicator (RWI/ISL index) accelerated in the 2nd half of 2017, in line with industrial production. Although the latest data expressed a slight reduction, the world trade outlook for 2018 is fundamentally positive.
  • Oil prices are expected to remain rather stable or increase in a limited way in 2018. Transport demand for mineral oil products is expected to remain stable in 2018, with a positive short-term trend offsetting a negative long-term trend.
  • It is expected that chemical production will grow only very modestly in 2018. Therefore, the outlook for chemical transport is also stable, with the possibility of a slight increase.

 

Market Insight
WINTER 2017-2018

A project co-financed byEuropean Commission

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