Offshore Market Report - March 2022
Of the 13,480 vessels and 3,704 barges Marcon tracked as of mid-March 2022, 2,995 are supply and tug supply boats, with 304 officially on the market for sale. 66.12% of foreign and 76.86% of U.S. flag supply / tug supply boats Marcon has officially listed for sale are directly from Owners. In addition to those for sale, Marcon has 103 straight supply and tug supply vessels listed for charter worldwide, but there are many more in today's market idle and hungry for employment.
1,154 of the vessels tracked by Marcon as of mid-March 2022 are crew, fast supply & pilot boats with 225 officially on the market for sale, plus 40 boats are available for charter worldwide. 36.4% of the boats officially for sale are U.S. flag. 53 crew boats for sale worldwide were built within the last 10 years. 70 boats, or 31.11%, are 25 years of age or older. The oldest boat listed is a 40', 240BHP 1957 built and located U.S. West Coast. This vessel is counterbalanced by a 170.6' LOA foreign 2022 built crew boat in Southeast Asia and nine foreign 2020 built 45.9' to 127.9' LOA crew boats, six located in the Mediterranean and one each in the Far East, Mid East and Southeast Asia.
Tug supply boats officially on the market for sale in total is 158, 12 more than one year ago, March 2020 and 17 more than five years ago, February 2016. Composition in the last year has changed with the biggest shifts being 17 more 12,000-plus HP, three more 8-9,000HP, three more 9-10,000HP and three fewer 7-8,000HP AHTSs offered. In today's market many additional vessels, probably equal to or greater than the number "officially" listed can be developed on a private & confidential basis - just a phone call or e-mail away. In general, serious buyers can pick up relatively newer vessels now than in the past. February 2016, the average age of all AHTSs for sale was 17 years old, where U.S.-flag vessels averaged 29 years and foreign-flag AHTSs averaged 17 year. Today, the average age is 15 years old, with U.S.-flag AHTSs averaging 25 years and foreign-flag averaging 14 years old. At the time of this report, 41 tug supply boats officially for sale were either built within the last 10 years or are newbuilding re-sales. Only 10.13% of tug supply boats are 25 years of age. One 5,150BHP and one 12,240BHP newbuilding AHTS resales were scheduled for delivery in 2020. Five years ago, 32.62% of AHTSs for sale were at least 25 years old; one year ago, 12.33% were at least 25 years old; both more than today's 10.13%, reflecting the purging of older units from the fleets over the past five years. At March 2021, the oldest AHTS available from Marcon was built in 1971.
Compared to one year ago, we have 24 fewer PSVs listed for sale. The greatest changes in the vessel size composition since March 2021 are six less over 240' LOA, four each fewer 150'-160' and 200'-220' LOA and three fewer 180'-190' LOA PSVs presently on the market. On the other hand, we have 66 more PSVs listed for sale now than we did February 2017, with 25 more 220'-240' LOA and 24 more over 240' LOA. Similar to anchor handling tug supply boats, PSVs now being offered are only slightly older than those offered back in February 2017 with the average age of all available for sale increasing from 19 years of age to 20 years old now. U.S.-flagged PSVs increased from 21 years to 23 years, while foreign flagged decreased from 18 to 17 years old. As of this report, Marcon officially has available 29 supply boats (14.57%) built within the last ten years, with zero newbuildings listed. 43 PSVs, or 21.61%, are 25 years of age or older, with the oldest PSV listed built in 1968 - compared to one year ago when 43 PSVs (19.28%) were older than 25 years. Five years ago, 39 PSVs (29.32%) were older than 25 years, but 8 or 6.02% were newbuilds.
The dominant location for second-hand tonnage on the market March 2022 is the U.S. with 43.1% (up from 38.3% one year ago and 28.9% five years ago) followed by Southeast Asia with 17.1% (up from 16.0% one year ago but down from 21.8% five years ago), Far East with 9.2% (compared to 8.7% last year and 10.0% in 2017), Mid-East with 8.2% (8.1% in 2021 and 11.1% in 2017), Africa 5.3% (down from 7.3% last year and from 6.1% in 2017) and Europe with 4.6% (compared to 7.9% last year and 5.0% five years ago). Where location is unknown is 3.6%. The rest of the globe makes up the final 8.9% of locations. CAT is the principal main engine supplier to this sector powering 144 (47.4%) of the supply & tug supply vessels listed for sale, followed by Cummins in 40 (13.2%), 18 (5.9%) each with Niigata and Yanmar, 17 (5.6%) each with Bergen and EMD, Wartsila in 16 (5.3%) and 11 (3.6%) with MAK. 23 (7.6%) units are powered by various other manufacturers. Compared to five years ago, the percentage of available for sale PSVs and AHTSs powered by CATs grew 15.6 percentage points, while those powered by EMDs decreased 5.5 percentage points, Wartsila dropped by 3.0 percentage points and Niigata fell 2.7 percentage points.
March 2022's number of crew boats officially on the market for sale by Marcon at 225 is down 12 from one year ago in March 2021 and up five from five years ago in February 2017. Over the last year, composition of LOA ranges has changed with the biggest shifts being seven fewer 40'-50' LOA, five fewer 30'-40' and three more 50'-60' LOA crew boats offered. As of this report, 23.56% of the crew boats available are less than 10 years old, down from the 25.32% reported one year ago and from the 32.73% reported five years ago. Conversely, 31.11% today compared to 30.38% last year and 29.09% five years ago are 25 years or older. In looking at overall fleet age and then by U.S.-flagged versus foreign flagged , we can see slight changes in ages with those available today a bit older than those offered five years ago. Five years ago, the average age of all on the market through Marcon was 19 years, compared to 21 years one year ago and 20 years as of this report. Older U.S.-flagged vessels remain on the market, aging from 25 years in 2017 to 30 years in 2021 and decreasing to 28 now. Foreign flagged crew boats' age remained fairly steady at 15 years one and five years ago compared to 16 years today, but are still almost half the age of U.S. vessels.
The dominant location for second-hand tonnage on the market March 2022 is the U.S. with 37.3% (down from 43.9% one year ago but the same as five years ago) followed by Southeast Asia with 16.9% (up from 14.3% one year ago but down from 18.2% five years ago), Europe with 10.7% (compared to 10.1% last year and 11.4% February 2017), Mid East 10.7% as well (versus 9.3% March 2021 and 10.9% February 2017) and the Mediterranean with 7.0% (up from 6.8% last year and 4.1% five years ago). Where location is unknown is 2.2%. The rest of the globe makes up the final 15.1% of locations. Of the crew, pilot boats and launches listed, the most popular engine is CAT in 75 of 223 boats where engines are given, followed by 56 Cummins, 47 GM/DD, 12 with MAN-B&W, 10 with MTU, 6 with Iveco, 4 with Volvo/Volvo Penta and 13 under other types, ranging from Baudouin to Yanmar. Compared to one and five years ago, as a percentage of vessels available for sale, there was a significant increase in those powered by CATs and MAN/MAN-B&Ws, offset by decreases in those powered by Cummins and GM/DDs.
The pandemic severely stalled sales activity from the second quarter of 2020 through the end of 2021. In 2021, we completed ten sales, primarily under "best offer" conditions and one charter. The first quarter of 2022 has seen much more activity with eight sales completed and several others in process. In 2021, one sale was at sellers' asking price, while the remaining were heavily negotiated. To date in 2022, we have seen sellers' pricing adjusting to what the market is bearing for vessels of their age and condition or at just above scrap levels in order to get the vessel sold. Three months to date in 2022, five sales were US to US parties, one was US to Canadian buyer and two were between foreign parties into Africa and Europe. In 2021, five of our nine sales were US seller to US buyer, one was US seller to foreign buyer, one was foreign to US buyer and two were foreign to foreign sales. Vessels were sold into the Caribbean and Southeast Asia.Marcon Broker's Comments
Overall, Marcon has seen the number of offshore support vessels listed for sale shrink over the past year and especially when compared to five years ago. Dealing with the past two years of the world in a global pandemic that shut down commerce and economies, vessel owners reacted in a number of different ways. Some shut down operations, selling or scrapping their fleets. Some took advantage of the opportunity to expand, adding to their fleets. Other owners laid up their fleets to just hold on until we could get to the other side of the pandemic. While others scrapped newbuilding plans, including shipyards building on spec. Coming out of fourth quarter 2021 and into first quarter 2022, we finally saw resumption of commerce, reopening of ports and reactivation of fleets, with a corresponding increase in enquiries for supply and crew vessels. We have heard and experienced ourselves that seller's price ideas have been higher than buyer's price ideas, as well as that vessels are often in rougher than normal condition due to lack of supplies, mariners and money the past two years. Recently, we have seen sellers increase asking prices between our initial and follow-up enquiries.
In our enquiries and in watching what is occurring around us, we have definitely seen an increase in vessels being sought out for wind and other non-oil programs. This seems to be gaining traction with the continuing war in Ukraine, which is said to be increasing the rate at which Europe will embrace clean energy.
There are fewer offshore support vessels available for sale through Marcon and in general. While there has been a small uptick in the over 99GT worldwide fleet, this has been negated by lay ups and scrapping of older vessels. While it is not easy to get an accurate count of all U.S.- and foreign flagged offshore support vessels scrapped over the past year, we can obtain an approximation from IHS Fairplay Sea-web, for those greater than 99GT. As of March 21, 2022, 1,019 offshore support vessels and 51 crew boats are shown as scuttled, scrapped or to be broken up. This is compared to one year ago when 932 offshore support vessels (up 87 or 9.33%) and 47 crew boats (up 4 or 8.51%) were noted as scuttled, scrapped or to be broken up. We have heard first and second hand of this same trend with under 99GT or unclassed offshore support vessels and crew boats, primarily due to owners reporting lack of work and purchase interest at above scrap levels.
Commercial Marine Brokers since 1981