Arcosa Eyes Barge Market Recovery
Infrastructure-related products and solutions provider Arcosa said it is seeing signs of improvement in the U.S. barge building business following several years of low order levels.
The Dallas-based company said in its second quarter earnings report that it received approximately $81 million in new barge orders, including mostly hopper barges scheduled for delivery in 2024.
Arcosa's barge backlog at the end of the quarter was $287.1 million, up from $131.8 million at the end of the second quarter of 2022. The company said it expects to deliver approximately 45% of its current backlog in 2023.
"We were pleased to obtain sufficient second quarter orders to maintain our barge backlog and extend our production visibility further into 2024 with improved pricing," said Antonio Carrillo, Arcosa's president and chief executive officer.
Arcosa said its barge business revenues increased 35% in the second quarter driven by higher volumes and pricing.
The recent uptick has been spurred by substituting lower priced hot-rolled coil and securing favorable plate pricing, Arcosa added.
It is expected that barge demand will continue to increase following a period of underinvestment since 2016. Barge deliveries fell sharply in 2017 and have remained low, causing the fleet age to rise.
According to Arcosa, forecasts indicate a potential average need for roughly 750 annual barge builds industry-wide through 2026.