There aren't many thing on earth that suck up, wick and hold moisture and water than that damned pink insulation. Those batts are ok inside a nice dry structure but do everything you can to keep it away from ground contact. From the look of your picture something salty did all that damage. If not I wouldn't doubt that the insulation had Isomething to do with it. Fromthe recent contractors bulletin boards they don't even recommend that stuff in basements of your house anymore, mainly due to mold.
I pretty much swore off the pink panter crap when I happened across a HVAC site that pros were discussing the various aspects of roll insulation. I don't remember the numbers but for actual R value goes absolutely to crap in the presence of a 10 mph wind. The pink panther never mentioned that in his ads:thumbdown: