Just some facts about the barge business. This business has a large footprint. Kirby in this business is principally a liquid operator. We have a small dry cargo sector of this business, but it really is de minimis when you look at our total revenues. It is protected by the Jones Act, very little obsolescence in the business. This is not the kind of business that you wake up and somebody has invented something that changes the equipment that's used in the.
Basic barge design, basic tug design is the same as it was 30, 40 years ago. Of course barges are mobile. On the coastal part of our business, we can move a barge from the East Coast to the Gulf Coast very easily. We can shift a barge from a canal movement under the river really without much effort also. And the waterway system is an environmentally friendly way also to move things around. Our carbon footprint is the lowest of all modes of transportation.
Looking at the demand drivers, as I said about 60% of what we do is in the petrochemical area that's followed by black oil, refined products and agricultural chemicals. This looks at really the drivers for both the costal and inland sector with respect to chemicals, really driven by consumer durable non-durable goods.
The thing about chemicals is about 70% of domestic chemical production goes into consumer durables, which makes it a little more indifferent to the cycles that other things that people move around are more exposed to. Because of who we work for and what we use or what we carry, safety is a major concern. It's something that we think we're really good at. We think we also lead the industry in that area.Just drilling down to the inland tank barge business, on the supply side there is about 3,100 tank barges operating in the industry. This is a fleet that does have some age to it. About a third of it is in excess of 30 years old. There is some significant replacement ahead of it. Just one of the reasons that we're not all that concerned about the number of barges that are being built and/or had been built in 2011 or 2012. We think with retirements and capacity expansion, principally for chemical cargos and crude oil coming out of South Texas that the capacity that's going to be added in 2012 will be absorbed easily.Read the rest of this transcript for free on seekingalpha.com
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