The Paraná River is reaching lows not seen since January 2023, with the average level for the first week of September being the second lowest since 1970. Average cargo in August was 6% lower than in the same month last year.

In recent weeks, the water volumes of the Paraná River have come back into focus. The river’s flow levels are essential for the waterway and its logistics, which are predominantly agro-industrial. In this regard, a decreasing water flow results in higher costs, particularly for those engaged in export activities in the Up River region, responsible for 76% of Argentina’s grain, flour, and oil shipments in 2023.

The costs associated with lower water levels in the Paraná may include the need to adjust cargo volumes for certain types of vessels in the Gran Rosario for both incoming and outgoing goods; increased costs due to the necessity of completing cargo at other ports; and losses suffered by the local agro-industrial complex due to lower export prices, with downward pressure on FOB premiums, among other factors.

After peaking above three meters last May—an amount exceeding historical averages—there has been a marked decrease in the Paraná’s level. Currently, the river height at Rosario is just above half a meter. Furthermore, for the first week of September, current levels are 74% lower than in the same week of 2023. Only 2021 had levels lower than those currently observed. To find another first week of September with levels below the current ones, we must go back to 1970.

At these levels, the average cargo for Up River ships has been just above 34,000 tons in the last two months. This figure is below the more than 36,000 tons recorded both in August last year and in April this year, considering only bulk dry cargo vessels transporting grains and vegetable flours.

These differences are especially significant as the season for higher rainfall in Argentina approaches, particularly in the basins that feed the Paraná’s flow. While average cargo levels are still far from the volumes below 32,000 tons per vessel observed in 2021 and 2022, expectations are not promising. As highlighted by forecasts from the National Water Institute (INA), no significant improvements in Paraná’s flow at Rosario are expected in the coming months. Even in the most optimistic forecasts, the river level is unlikely to exceed one meter by mid-November. Moreover, the minimum hydrometric projections estimate values very close to zero. As the INA noted in one of its recent reports, contributions from the upper basin, primarily from Brazil and Paraguay, are expected to remain below normal. In this sense, the Paraguay River basin, a significant contributor to the Paraná, is experiencing critically low conditions with no prospects for significant improvement.

Focusing only on wheat, soybean meal, and corn, a logistical volume of about 13.8 million tons is expected from the Up River between September and December of this year. If this volume were to be dispatched at the August average, 406 vessels would be needed for the remainder of the year, which is 23 additional bulk carriers compared to last year’s average.

The downward trend in Paraná’s water levels is a relatively recent phenomenon. Considering the low water parameter set by the INA for Rosario, the Paraná has been persistently low since mid-June. However, the forecasts for the coming months raise concerns as we approach the logistical peak for wheat. The persistence of these water levels could start to generate notable losses for the agro-industrial sector.