The frequency of extreme storms has increased, fueling demand for industry services
New York, NY (PRWEB) October 07, 2014
Performing an instrumental role within the overall water transportation sector, the Marine Salvage Services industry is involved in the salvaging, patching and the refloating of grounded vessels. In the past five years, the industry has been subject to a high degree of revenue volatility due to fluctuating demand conditions. Marine incidents may be the result of grounding, mechanical breakdown, fire and collision, as well as the weather. Weather across the United States, in particular, has been the main catalyst for growth and the elevated level of revenue volatility. In recent years, storms such as Hurricane Irene and Hurricane Sandy have resulted in a sharp spike in marine incidents. Consequently, federal and local governments dramatically increased spending during those storm-specific years. Unfortunately for the industry though, revenue contracts afterwards following extreme storms as illustrated by the expected decrease in 2014. Luckily for the industry, upwards movements in revenue have generously compensated for the downward contractions. In the five years to 2014, revenue is expected to increase at an annualized rate.
While they overall benefit from extreme storms, industry operators have been adversely affected in recent years by rising oil prices, which have kept industry profitability in check. According to IBISWorld Industry Analyst Omar Khedr, “Oil prices increased significantly in 2010 and 2011, and have remained relatively high, putting downward pressure on margins.” Increase in profitability has encouraged companies in the industry to expand their operations during the past five years. As a result, over the five years to 2014, the number of industry establishments is expected to increase at an annualized rate.
“While the industry will continue to be subjected to volatility, the industry is looking to enter calmer waters as total trade volumes continue to accelerate over the five years to 2019,” says Khedr. On the heels of this growth in trade activity, waterborne freight is expected to increase and the number of marine incidents is likewise expected to grow. As a result, industry revenue for salvage services is expected to widen, growing over the next five years. However, oil prices will remain a threat for the industry and is expected to profit growth in check.
For more information, visit IBISWorld’s Marine Salvage Services in the US industry report page.
Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld
Friend IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189
IBISWorld industry Report Key Topics
This industry provides retrieval and repair of vessels or cargo following a marine accident. Companies often work on a contract basis, whereby they are hired to conduct salvage operations on stricken ships.
Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios
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.