Page 10: of Marine News Magazine (April 2018)

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BY THE NUMBERS

Barge Transportation Market Report: 2016 - 2024

Barge transportation comprises an extensive network, government. For instance, in 2015, the government allo- ideal for carrying seaborne cargo to inland destinations cated USD 281 million for few priority projects that was and exports alike. Responsible, in part, for the worldwide a 12% rise from the fund allocated in 2014.

trade of bulk transport, the industry is of great signi? - cance to the agricultural sector. In North America, The

Army Corps of Engineers maintains and operates over 12,000 miles of canals, rivers, and inland waterways. The

Illinois Waterway and Mississippi River are the major waterways in the region that are responsible for moving agricultural and farm products through barges. Shifting preferences toward marine transportation, especially for liquid cargo across the region, will fuel barge transporta- These projects will contribute signi? cantly to the en- tion market growth. hancement of ef? ciency and navigation capacity of inland

The North America barge transportation market ac- waterway systems. For instance, Chickamauga project counted for USD 22.2 billion in 2016 and is predicted to expects the construction of 110-foot-by-600- foot lock reach USD 31.1 billion by 2024 with around 5% CAGR located immediately downstream of Chickamauga dam from 2017 to 2024. Rising petrochemical shipments and riverward of existing lock. This project is expected across the region have contributed to the industry growth to enhance navigation capabilities and ef? ciency, simul- in the region. The extensive usage of inland waterways by taneously allowing the movement of nine jumbo barges various farm belts for the transportation of agricultural where only one (at present) can transit at a time.

chemicals and farm products will further propel the re- As the industry is capital-intensive, it requires a huge ini- gional growth. The strong interconnectivity of rivers and tial investment. Owing to the capital-intensive nature of this canals will positively impact the industry and will lead industry, it becomes dif? cult for a new player to enter this to an increased demand for petrochemical transporta- market. The operational costs of the participants increase tion. This could result in an increased production of tank their CAPEX due to the extra expenditure such as mainte- barges, further impacting the industry positively. That nance & repairs, insurance, and the return on investments.

said, industry has only recently all but completed its lat- The demand for the petrochemical shipment is witness- est recapitalization program with the elimination of the ing a continuous rise across the region. This rising demand last non-double hull barge. will fuel the barge transportation market growth over the

The advantages of barges in terms of capacity, emissions, coming years as the import and export of these petro- and fuel usage in comparison with trucks and railcars are chemicals are heavily dependent on the marine transpor- the major factors responsible for industry growth. The ris- tation. Operators are ? nding ways to optimize shipment ing demand for petrochemical shipments across the globe costs for the rising petrochemical and gas production.

and huge investments from industry players for the mod- Industry stakeholders have made huge investments to ernization of the existing ? eet will further propel the barge increase the capacity of barges and to expand their barge transportation market growth over the forecast timespan. portfolio owing to the increasing petrochemical demand.

In North America, the production of shale oil is en- In 2014, Kirby Corporation invested USD 135 million hancing the barge transportation market size for the liq- to construct 66 new inland barges. Similarly, in 2016, uid cargo. The main advantage of the shale oil over off- the company spent USD 231 million for its expansion shore is that it has a short lead time from development to along the U.S. Gulf Coast. Later in the year, the com- production initiation, resulting in time reduction. pany purchased a 155,000-barrel articulated tank barge

The barge transportation industry is witnessing chang- and a tugboat unit for the ethanol transportation from ing government support for the development and mod- the Great Lakes to Northeast region. The import and ex- ernization of inland waterways across the region. The port of petrochemicals contribute to almost half of the rivers including Ohio, Mississippi, Illinois, etc., are un- revenue of the major industry players.

dergoing modernization. The Inland Waterways Users The rising demand for crude oil in North America ow-

Board has reported an increased fund support from the ing to technological advancements in hydraulic fractur-

April 2018

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