Lloyd’s Open Form (LOF) cases numbered 16 in 2023 (26 in 2022) generating LOF revenue of $29m (down from $66m in 2022). Wreck removal income was $193m from 30 services, compared to $55m from 32 services in 2022, according to just published statistics from the International Salvage Union (ISU).
Gross revenue for ISU members was $398m, up from $241m in 2022 – from 184 services provided, up from 149 services the previous year.
The ISU said that the numbers were gross income, from which all the contractors’ costs must be paid, and were for income in the year received, not the year when the service was provided.
ISU President John Witte said that “the 2023 ISU statistics show a modest recovery compared with the historically low level in 2022. Emergency response services generated $196m split between LOF, $29m and other contracts ($167m).
“Wreck removal income has rallied rising to $193m from the very low level of $55m in the previous year. Wreck removal income is important for our members and this is a welcome increase. It brings the split of the industry’s income back to the typical levels of approximately 50:50 between emergency response and wreck removal income”, Witte observed.
The low level of LOF cases was by some degree the smallest number of both LOF cases and income in the past 30 years. Revenue from LOF cases amounted to 15% of all emergency response revenue and LOF cases accounted for 10% of emergency response cases in 2023. SCOPIC revenue in 2023 – $9m – was down from $21m previously.
Witte said that the very small number of LOFs for ISU members in 2023 was “extremely disappointing, but sadly reflects a long-term downward trend that most observers are well aware of”. He said that the ISU had worked closely with Lloyd’s and other stakeholders in the past three years to find ways to revive LOF. “We promote its use and we believe that income based on awards under Article 13 of the Salvage Convention must remain the cornerstone of funding for our industry but this is increasingly difficult as these statistics so dramatically demonstrate”, Wittes said.
Revenue in 2023 from operations conducted under contracts other than LOF was $167m. The average revenue from each non-LOF contract was $1.2m.
Wreck removal is an important source of income for members of the ISU and in 2023 there was US$ 193 million from 30 operations.