The salvage industry experienced a drop in revenue in 2022 due to the COVID-19 challenges Ship’s crew

The International Salvage Union (ISU) has reported a sharp drop in revenue for international salvage companies in 2022 as the overall impact of the COVID-19 pandemic posed significant challenges to the sector.

According to the ISU’s 2022 annual statistics, its members saw an impressive 38 percent drop in income compared to the previous year. The emergency services generated a total of $166 million, including $66 million from Lloyd’s Open Form (LOF) cases and $100 million from non-LOF cases. Wreck removal revenue had nearly halved, falling from $108 million last year to $55 million in 2022.

“Economic conditions are challenging and our industry’s activity and revenues have fluctuated from year to year,” said Capt. Nick Sloane, ISU President. “The overall trend toward fewer, larger, more complex cases reinforces this annual variability.”

ISU statistics for 2022 showed a historically low level of LOF cases, with only 26 reported among its members, accounting for $66 million in revenue. These revenues accounted for 40 percent of all emergency response and 21 percent of the year’s emergency response. In addition, SCOPIC (Special Compensation P&I Club Clause) sales also declined to US$21 million in 2022 compared to US$42 million in the prior year.

“The numbers in this survey reflect the time when the world was still fully grappling with the Covid pandemic, making operations and logistics more difficult,” Sloane said. “During these difficult times, ISU members have consistently demonstrated their problem-solving ability and willingness to overcome obstacles in order to offer services to their customers, the shipowners and their insurers. And together with the ISU pollution prevention statistics, these figures show a dynamic industry that performs about 200 salvage services most years.”

Revenue from operations conducted under contracts other than LOF was $100 million in 2022, averaging $813,000 per non-LOF contract.

For the ISU members, the wreck removal is an important source of income; However, 2022 saw a dramatic decline, totaling $55 million from 32 operations, compared to $108 million from 56 operations in 2021, accounting for 28 percent of total revenue.

“Professional salvage workers protect the environment, reduce risks and mitigate damage. They also ensure that trade keeps moving – which is particularly evident in the case of large container ships. We continue to work closely with key stakeholders to ensure professional salvage services continue to be provided globally,” added Sloane.

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