Renewed investment in US ports and harbors will boost demand for dredging services
Los Angeles, CA (PRWEB) September 13, 2012
While lacking in prominence, the Dredging Services industry is an essential part of the US economy. This is because two vital sectors of the US economy – maritime tourism and international trade – depend heavily on dredging services. Additionally, dredging services play an important role in restoring and preserving wetlands, coastlines and maritime habitats. As such, the industry benefits from public and private restoration projects. According to IBISWorld industry analyst Kevin Boyland, strong underlying demand for dredging services is expected to grow industry revenue 2.8% to $2.2 billion in 2012.
The Dredging Services industry has a low level of market share concentration. The US dredging industry is highly fragmented and is characterized by its many small operators. Larger operators focus on capital dredging projects that are usually awarded through competitive bidding. Smaller dredging firms tend to service inland areas and focus on rivers and lakes. The majority of dredging services are privately held. Federal funds allocated toward dredging services are provided by Congress through the Harbor Maintenance Trust Fund (HMTF) and administered by the US Army Corps of Engineers. Over the past five years, funds allocated toward dredging services have been insufficient to meet demand, even though the HMTF is operating at a surplus, says Boyland. While $1.9 billion in stimulus funds earmarked for dredging services benefitted the industry in 2009, US ports, harbors and waterways have been insufficiently dredged due to a weak economic environment and a budgeting deadlock on Capitol Hill. Consequently, industry growth has not been as strong as it could have been over the past five years. Nevertheless, over the five years to 2012, IBISWorld estimates that industry revenue will increase at an annualized rate of 4.6%.
As ocean freight lines develop and incorporate enormous cargo vessels into their fleets to improve shipping efficiencies and economies of scale, the need for dredging services will increase. Maintenance dredging in ports and harbors will be paramount to ensure that US ports and harbors remain competitive and accessible to these large vessels. According to the American Association of Port Authorities, US seaports and their private-sector partners are expected to invest $46.0 billion in capital improvements (including dredging) over the next five years. Consequently, over the five years to 2017, industry revenue is forecast to increase. Industry operators are also expected to invest in newer, more powerful and fuel-efficient dredging fleets to meet increasing demand. For more information, visit IBISWorld’s Dredging Services in the US industry report page.
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IBISWorld industry Report Key Topics
This industry provides dredging services, which include moving deep-water sediment to keep waterways open for commerce and to replenishing beaches and other maritime and wetland environments.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.