Brownsville Marine’s “aha” moment came last summer, the time of year when the barge maker’s customers decide how many new river-going vessels they will order for the coming year.
After the company built 190 barges in 2015 and 120 last year, customers said they only wanted about 60 in 2017, according to Ted Stilgenbauer, vice president of operations.
He traced the sharp decline to a slump in one of the company’s biggest markets: coal producers who use rivers to barge their product to electric power plants. Coal accounted for 30 percent of electricity generated last year, down from nearly 49 percent in 2007, according to the U.S. Energy Information Administration. Cheap, abundant natural gas caused that decline.
Responding to the oversupply of coal barges, barge owners converted coal-carrying barges into covered vessels that can carry corn and other agricultural commodities.
That led to a surplus of barges in that market — despite a record corn crop and near-record soy bean crop last year, Mr. Stilgenbauer said.
Brownsville Marine responded by slashing its workforce from a peak of 425 to about 200 currently.
But the company is also taking more proactive measures by adapting its barge-making prowess to other markets that require the same kinds of skills, including infrastructure and heavy construction. To reflect the new business plan, the company changed its name to Heartland Fabrication.
Mr. Stilgenbauer said Heartland’s target markets include fabricating girders and other structural steel components for bridges and highways; pursuing projects involving the U.S. Army Corps of Engineers as well as construction, energy and equipment companies; and applying coats of primer on structural steel used by fabricators.
Those services involve bending, cutting, welding and painting steel, processes Mr. Stilgenbauer said Heartland must master to make a 200-foot-by-35-foot-by-14-foot barge.
“The core backbone of what we can do here is marine and structures, large structures,” Mr. Stilgenbauer said.
He said the company has received industry certifications to produce bridge components. Certifications for building fabrication, painting and other processes should be obtained by the end of the year, Mr. Stilgenbauer said.
Heartland Fabrication is owned by Columbia, Ill.-based Heartland Cos., a privately owned holding company whose other interests include operating fleets of barges and rail cars, and commercial real estate.
Barges have been built on the 43-acre Brownsville site since the 1940s — first by Hillman Barge, then by a succession of owners who ran into problems. They included Wilhelm & Kruse, which fabricated steel beams and columns for PNC Park and Heinz Field at the plant and then shipped them by barge down the Monongahela River to the North Shore construction sites.
Heartland bought the site in 2005 and began making barges the following year.
The new business model was made possible by $25 million the company spent in 2012 to revitalize the plant. The project included adding a rail spur and purchasing plasma torches used to cut steel plate, as well as a press that bends steel.
“We’re going to continue to invest in the facility,” Mr. Stilgenbauer said.
He expects barge demand will rebound in the next two years. When it does, Heartland plans to limit output to 120 barges a year so that it can strengthen the new businesses it is pursuing.
Len Boselovic: email@example.com or 412-263-1941.