Things are looking "up" for the tugboat industry, at least in the eyes of Bob Beegle, president of Marcon International, which sells and charters tugs, barges and other vessels around the world. Beegle spoke Tuesday afternoon at....surprise!--a tug and barge conference in sunny Stamford, Connecticut, where a cool breeze blew through downtown from the nearby Long Island Sound, home to, one would think, no shortage of tugs. (The conference: MarineLog Tugs & Barges Conference/Expo 2007).
Up, up and up was the good word from Beegle. Demand for new and used tugboats is up--494 tugs are on "order" around the world, to add to the current 11,760 "ocean-going" tugs now operating, Beegle said. Rates tugs charge for their services--escorting barges, anchoring vessels, docking vessels, salvaging ships in distress, fighting vessel fires---are up.
Sales of Beegle's own Marcon International are up, thank you very much. And the power of tugs--their horsepower, that is--is up, as it must be to handle the increasingly larger barges and commercial vessels on the world's waterways. (Up from what levels for each of these items was not detailed.)
But not everything's coming up roses as thorny issues hang tough--like a "critical shortage of marine personnel" in the United States--not to mention the U.S. labor force is getting old. The average age of the American worker is now a ripe old 41, Beegle lamented, referencing U.S. Bureau of Labor statistics, and will hit "45 and older" by next year.
A nation of geezers seems ill-suited to provide the staff needed to populate America's tugboats in the early years of the new millennium, it would seem (this is just opinion of the Barrel, so the AARP should not boycott Marcon International over the comment).
"Everyone is facing manpower issues, but even as wages are rising we can't solve the problem by just throwing money at it," Beegle said. It wasn't made clear just what the problem is with getting fresh bodies on deck to operate the nation's vessels is, other than there's a lot of old people out there who have no interest in working on a boat or might not have the skills to do the job.
Age appears a recurring issue for the tugboaters. Not only are our workers old, but so are our tugs, on average 10 years older than the average age of the rest of the world's tugs, Beegle added. Most U.S. tugs are thirty-something workhorses (34-36 years old).
Rather than being scraped, many were rebuilt and refurbished during the 1980 and 1990s as demand for tug services remained unremarkable: "Although charter rates and revenues improved from the 1980s slump, owner confidence and day rates remained below the level required to justify most newbuildings," Beegle noted. By the late 1980s, demand for new units surged as demand for tug services surged, owner confidence re-emerged and now nearly 20 years later tug builders are playing catch-up, with shipyard back orders forcing owners to wait several years for new tugs to arrive.
Another tugboat downside on the upside is the ballistic price of marine diesel (MDO), now about $560/metric ton in Houston (plus delivery charges), up from $217.50/mt in 2000, and $529/mt in Rotterdam, up from $200 seven years ago, Beegle said. "One European operator commented that fuel costs are killing many medium-to-long towages for MDO/MGO (marine gasoil) burning tugs and in fact only the offshore market seems willing to pay those exorbitant consumable costs," Beegle noted.
A bit of nostalgia crept into Beegle's speech, which included takes from a well-detailed research paper handed out to conference goers. "Rebecca" is her name, and she's the oldest operating tug in the U.S., an ironclad workhorse built in 1874, ensconced somewhere in Maine. "I'm happy to report she's still earning her keep, docking a cement barge" and performing other work, Beegle said of Rebecca.
Like Rebecca, the tugboat industry chugs along as demand to ship everything from crude oil to consumer goods to industrial equipment in a global economy skyrockets.
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