For a recent presentation at the Equipment Leasing and Finance Conference (ELFA), we have had the opportunity to review the current status of the international and domestic shipping markets. While the international marine industry seems to attract the majority the headlines with its direct exposure to trade wars, IMO regulations, and even negative freight indices (the Baltic Capesize Index has turned negative for the first time in its history), the domestic marine industry is an even more formidable, yet seemingly understated market: there were 42,542 shipping assets in the Jones Act market at the end of 2018 according to the U.S. Army Corps of Engineers, an outstanding number given that the world fleet of commercial vessels is just 38,000 assets, in absolute terms. However, there are “only” 9,411 self-propelled vessels in the Jones Act market, almost equivalent to the Panamanian register of ships, world’s largest. Inland assets consist 79% of the total Jones Act market, 85% of the Jones Act non-self-propelled and 58% of the Jones Act self-propelled market. Importantly, almost 25% of the Jones Act fleet is older than 30-years old. Almost 10% of the tank barges, whether for domestic inland or coastal trade, are older than 30% years old. In short, a great deal of the Jones Act market will soon to be renewed, forcing the owners to make sophisticated financial decisions given the high replacement cost of Jones Act vessels.
We have been invited to present at the ‘Tugs, Towboats, Barges’ (TTB) Conference hosted by the magazine MarineLog in Mobile, AL, March 23rd – 25th, 2020. Our presentation will focus on shipping financing options and structures for domestic shipowners active in the Jones Act market, with especial focus of small and medium owners (mom-and-pop) that are most challenged in accessing capital. Structural changes are taking place in the market place, and accessing shipping finance is required to not only renew one’s fleet but also grow one’s fleet and build upon economies of scale and efficiencies.
We are looking forward to joining a cadre of high caliber speakers and experts in this industry, for this very topical and sharply focused conference in Mobile, AL, about 'Tugs, Towboats, Barges’.
We sincerely hope to see you there and have the opportunity to get more knowledgeable and wiser about this irreplaceable and so vital industry to daily life and critical to the industrial might of the USA.
To learn more about the conference, the agenda and venue, and to register, please click here!