Marine Support Services

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 2,000 marine support services firms in the US include companies that operate ports, harbors, and canals, as well as companies that provide marine cargo handling and storage services. The industry also includes companies providing navigational services, such as piloting or tugboat services, and marine salvaging services.

Dependence on International Trade

Revenue for marine support services is driven by US imports and exports, which in turn depend on global economic conditions and international trade agreements.

Automation of Operations

As cargo volumes increase and ships get larger, marine terminal operators face challenges in quickly loading and unloading cargo to avoid congestion and delays for shippers, truckers and railcar operators.

Industry size & Structure

The average marine support services company operates out of a single location, employs 47-48 workers, and generates $11-12 million annually.

    • The marine support services industry consists of about 2,000 firms employing 96,000 workers and generating around $22.6 billion annually.
    • About 360 commercial ports in the US and its territories handle 2-3 billion gross tons of cargo annually.
    • About 41% of industry establishments provide navigation services, while 13% provide marine cargo handling services and 13% provide port operations services.
    • The top US ports, based on volume of twenty-foot equivalent units (TEUs) handled include Houston, New York/New Jersey, New Orleans, Long Beach, Port of Virginia, Charleston, Miami, Seattle, and Los Angeles.
    • The industry is concentrated, with the 50 largest firms accounting for 67% of industry revenue.
    • Large companies include Ports America, APM Terminals (headquartered in the Netherlands), and SSA Marine.
                              Industry Forecast
                              Marine Support Services Industry Growth
                              Source: Vertical IQ and Inforum

                              Recent Developments

                              May 5, 2023 - Diesel Price Decrease Continues
                              • US diesel prices have decreased to levels not seen since the start of the Russian invasion of Ukraine. The weekly benchmark Department of Energy/Energy Information Administration average retail diesel price was $3.656 per gallon on April 24. The price has declined in 21 of the past 26 weeks as of April 24 and is down $1.264 per gallon since October 24, 2022. It’s also the lowest price since a benchmark posting of $4.104 a gallon on February 28, 2022. Prices reached their highest point during the summer of 2022, peaking around $5.50 per gallon. Experts say that the drop can be attributed to a number of factors, such as higher interest rates, warmer temperatures lowering the need for heating oil, and an overall decline in demand.
                              • Decreasing retail diesel prices have been driven by pump prices catching up with earlier declines in futures and wholesale diesel prices, according to trucking industry news site Freightwaves. Some analysts see price increases ahead, however. Goldman Sachs’ head of commodity research Jeffrey Currie expects higher prices by the end of 2023. “Our conviction in the bull case has never been stronger,” Currie said. He cited a lack of significant spare capacity in markets and low inventories for most crude and products, with the result that “you have no buffer to deal with the rebound in demand that is likely to come out of China. As China starts powering ahead, that is going to tighten up the bull market.” He also cited what he forecast as “strong” economic activity in Europe.
                              • Imports are falling as major US retailers reduce order volumes. Company executives have said on recent earnings calls that consumers are reining in spending on big-ticket items such as furniture and electronics because of rising interest rates and inflation. Experts note that while the decrease in imports is large, it may simply be a return from pandemic-driven record highs to typical pre-pandemic levels. Imports soared during the second half of 2021 and the first half of 2022 due to surging consumer demand. Inventory levels are now balancing out, according to Ben Hackett, author of the National Retail Federation Global Port Tracker report.
                              • World trade in goods is likely to slow more in 2023 than previously expected, according to the World Trade Organization (WTO). Slowing demand in the West and China's economic struggles, driven largely by increasing bad debt levels related mostly to the real estate sector and to continuance of its Zero COVID policy, are weighing on imports and exports. The WTO lowered its forecast for global economic growth in 2023 to 2.3% from 3.3% and warned of an even steeper drop if central banks raise their key interest rates more than expected. A United Nations agency said in early October that raising interest rates to fight inflation could inflict worse damage globally than the financial crisis in 2008 and the COVID-19 shock in 2020. The WTO also noted several long-term trends affecting international trade, including de-globalization — a reversal of decades of ever-closer economic integration, that accelerated during the coronavirus pandemic.
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