Utilization of U.S. Vessels and Mariners Initiative | MARAD

Professional Mariner Forum
#1

From a couple months ago.

Ultimately, the employment of highly trained, skilled, and licensed U.S. mariners will help to alleviate the growing worldwide shortage of professional mariners confronting the international energy shipping industry. It will also serve to support the industry’s excellent safety record by maintaining the number of qualified mariners in the officer pool. The Maritime Administration and deepwater port operators understand the importance of mariner training to the growth of the global energy trade.

#2

Training is all fine and dandy, but it still doesn’t help if there are no ships to sail on…

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#3

That is the provision of the Jones Act that needs repealing. Repeal that and you’d have more US ships with more US mariners.

#4

Is this an old article? (Yes I see the Latest update 18. March, 2020)
The content appears to be a bit out of date;
“Increased global demand for natural gas and oil”.
Not sure if that is and will be the trend in the market.
“Advances in tanker size”.
The age of ULCCs were in the 1970/80s. Many of those went directly from the building yard to layup and hardly ever carried any cargo before being scrapped. Few if any ULCCs has been built since.
The size of LNG Carriers HAS increased in the last decades though.
“U.S. mariners are highly skilled in the operation of steam plants used on the majority of oceanborne vessels”.
Yes in last century.
“Placing the transportation of LNG and oil under the control of U.S. mariners, who are subject to strenuous security checks, will add an additional layer of security to our nation’s energy supply chain”.
First there have to be some US flag vessels of the type and size required to perform this transportation, as jbtam99 says:

#5

I’m not sure this is true. Most of the time when I see politician defend the Jone’s act, it is usually because they have a shipyard in their district. The point I want to make is that politicians are more likely to defend the Jone’s act for their local population, but bluewater sailors benefit from this because the protection of the local shipyards is stronger than that for bluewater sailors. I could see heavylift ships loaded with cheaply built river tugs being shipped over from China if they ever did repeal the domestic built requirement. Wasn’t the statistic like 95% of US merchant mariners were from inland or brownwater sectors?

The question as to why the ship’s are so much cheaper overseas is a better question to answer. Yes, Chinese labor is cheap cheap. But what about their shipyard subsidies? Same thing with South Korea. These shipyards are such huge objects of national pride and recognition for these countries that they swoop in and rescue them.

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#6

A lot of that has to do with the economies of scale along with standardization of design. When you built a lot of ships the infrastructure and supporting manufacturing develop to support that industry.

Six or seven years ago I was asked by a Private Equity company to go to China and evaluate the ability of several shipyards. They were considering investing in a company looking to build a series of Handysized Bulkers. The company ended up ordering 19, 38,000 DWT Handysized Bulkers at the yards I looked at. The price was around $25 million each if I remember correctly.
The closest thing to that in the States were those tankers built at Phillyship.

#7

And how much of those ships were actually “American”? Take the “Jones Act” tankers as an example:
The yard that built them are foreign owned. (Part of the Aker/Røkke system)
The MT50-class is based on a design licensed from a S.Korean shipyard.
The Main Engines are of European brand, made on licence in S.Korea.
The cargo pumps are from Framo, a Norwegian based company.(But possibly made at one of their overseas plants)
Much of the other equipment on board were imported from various sources.
I don’t know were they got the steel from, but probably of US origin.(??)
I don’t know how much direct subsidies were paid to Philly Shipyard when building those tankers,(??) but they have now received order to build 5 ships for the US Navy, which is as good as receiving direct subsidies,
What I do know is that the shear holders in Philly Shipyards ASA on Oslo Børs were smiling all the way to the bank when those ships were built. (Not so much now)

Link to the MT50-class tankers:
https://www.motorship.com/news101/ships-and-shipyards/philly-yard-delivers-lng-ready-us-tankers.

PS> I don’t say there is anything wrong with this. It is the way Shipyards around the world operates today.

#8

What difference does this make? I’m assuming they complied with the applicable regulations for foreign content whatever. In the meantime fitters, welders, outside machinists, electricians, etc from Philly and Jersey took a paycheck home, paid their bills, paid their taxes, raised their kids.

If you don’t know why bring it up? In this case the trail leads to this pseudo shipowner. With these shareholders even you can appreciate the irony of tnaming this organization the American Shipping Co. No? So even though I applaud the fact the yard was kept open and people employed it’s a shame it has come to such complex arrangements that allow “non-citizens” to reap the benefits.

One might make the argument that not only is the Jones Act a net good thing for the USA but perhaps undoing the tweaking that redefined what a citizen is might even be of more benefit.

#9

Foreign capital is brought in to save US jobs, but you want to find something wrong with that too??

Do you want to ban US investors from investing in foreign countries and US citizens from living and working abroad?

Maybe build a wall, not only on the Mexican border, but on the Canadian border as well?
(No neither Mexico nor Canada will pay for it)

Banning all foreigners from coming to USA may be a good idea. (??) That will solve all ailments, stop pandemics and exploitation of innocent Americans by scrupulous foreigners.
Of course Americans will have to stay home, but with a large and diverse country, that will be no hardship.
Who wants to go to “sh*thole” foreign countries full of foreigners anyway?

#10

Couldn’t disagree with you more.

Make the replacement costs for a Jones Act shipowner cheaper and he just may replace ships. So no new jobs just new ships and in the meantime one would have benefited the few and thrown some fellow citizens under the bus.

If a certain amount of gravel, sand, petroleum moves coastwise now (presumably in the accordance with supply and demand) then how does allowing a shipowner to replace his tonnage with new ships all of a sudden create new demand for the cargo and the net increase in trading ships you envision?

Unless the our elected pubic servants got off their collective butts and somehow addressed the infrastructure mess in the country maybe demand for bulk items would increase and an extra tug/barge unit or small bulker would be required here and there. But even so I’d say tough build it in the US and comply with the original intentions of the Jones Act.

Someone brought up cars and airplanes and for me I don’t get the analogy. Each for different reasons but lets take cars. If you choose to buy a foreign built car and your usage is the same, commuting to the same job say. Do you keep the old car, crew it and operate it even though you have no need of it?

#11

Good morning ombugge. Was your breakfast of red herring served by a strawman this morning?

3 Likes
#12

Oh, you lack sensible answers again?

#13

Uh oh now I’ve been truly chastised. Answer what? Your misrepresentation of what I wrote? No thanks you take it from here. Perhaps if you take a few more round turns you can troll yourself. As a parting thought though I would only remind you of something Albert Einstein wrote - “Whoever undertakes to set himself up as judge in the field of truth and knowledge is shipwrecked by the laughter of the gods”.

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#14

There is in economics a debate about the minimum wage. A simple supply and demand graph shows that an increase in the minimum wage decreases employment but empirical data shows in some cases no loss of jobs.

This seems like a similar debate. Simple economics would indicate protectionism is harmful to the economy. The real question is what are the effects in the actual real economy? Maybe in real life things don’t follow simple rules.

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#15

Bingo, that’s why the US shipbuilding requirement still exists.

I can imagine a regulatory scheme where the USCG/ABS go to these shipyards to certify that the vessel meet’s US requirements prior to entering US service. Hell, the USCG already boards foreign ships in the US to ensure they meet US requirements already while doing work in the US. I am very confident that the FAA does so with planes and the DOT with planes, cars, and trains. Further, we assume that the entirety of shipbuilding would just evaporate from the United States. I believe this to be misguided. I would be more inclined to believe that shipbuilding would be stretched across the globe for the final product. I referenced America’s Finest before. It is ridiculous that that vessel had to go through what it did to get approval (that may get removed down the line) to conduct US work.

If any American shipbuilder is worried about competition from, say, the ROK, Japan, Canada, or the collective EU they are both rent seeking and inept at their job. I don’t think anyone can call it unfair competiton between workers in, say, Japan and the United States.

Hell, there can even be a well of asterisks in that part of the repeal. Only US shipyards may build US military vessels. Only US built ships may contract with the US government. There is something called the Fly America Act that regulates something similar for airliners doing US goverment work.

I want to know if all the pro-US shipbuilding requirement of the Jones act guys here only drive American made cars. Only fly on Boeing planes? Only ride on GE trains? I would posit not.

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#16

Vessels moving into US flag are inspected by the USCG prior to service. Class also does the same.

#17

I have to echo what @cmakin posted. I was involved in newbuildings in Korea that were put under US Flag and the Coast guard reviewed plans and performed inspections. I read what you (@DutchHarBro) wrote several times and have to say you don’t know what you are talking about. It doesn’t matter if a ship is built foreign for US Flag, reflagged US, or built in the US for Jones Act or trading internationally; the Coast Guard is always involved to fulfill their role as a regulatory body.

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#18

Yes. and “Class” doesn’t mean ABS only
(@DutchHarBro) IFAIK several Classification Societies are approved to carry out inspections and issue certification on behalf of USCG:

#19

Interesting article in gcaptain newsletter today:

I can see why so many foreign shipping companies wants to set up US subsidiaries to be part of this bonanza.

Take some older ships and put them under US flag, hire American crews and cash in generous subsidies while bidding for lucrative government contracts.

If you don’t get the contracts, or preferential cargo required. the ships can either be re-flagged then scrapped, or sold to MARAD for the Strategic Reserve Fleet.

#20

Why would they need a ship dedicated to government cargo only?

Is there any reason a company can’t carry household goods for the government and commercial cargo with the same ship, or even on the same voyage for that matter?