Marcon has sold three tugs totaling 12,700BHP as of end first quarter 2019, after selling or fixing tows for 22 tugs totaling 77,280BHP in 2018. Marcon has 547 tugs officially on the market for sale worldwide, down 38 or 6.50% from one year ago, February 2018, and down 140 or 20.38% from February 2014. While today's average age of tugs on the market is 25 years, almost 13% of the tugs listed today are 50+ years old. The three tugs sold to date 2019 went for an average $904.22/BHP (avg 31 years old), which were under special circumstances and we do not expect this price level to continue. In comparison, the 18 tugs sold in 2018 averaged $84.39/BHP (avg 37 years old).
Marcon's view is that the various markets remain a mixed bag. Whipsaw oil prices continue to bring uncertainty to the offshore market. Just about anyone we speak with has given up trying to predict a turn around. Owners have taken a duck and cover approach. Buyers are usually only hunting for "deals". The decline may be over, but the new normal is painful.
Marcon has 28 sales and charters so far in 2018, compared to 19 in 2017. Even with this increase, we cannot provide a blanket description of today's market. Some sectors are obviously doing well while others remain in the doldrums. Needless to say, the sectors tied to offshore oil continue to be depressed. Offshore service vessels have been selling, but only at bargain prices.The tug and barge market is brighter, subject to the sector and region. The US inland barge market is steady with presently good demand for both hopper and tank barges.
Most of us have struggled the last eight years with a lackluster, start & stop recovery wondering if there would ever be a light at the end of the tunnel. With growth and trade now off to good starts in 2018, the light may have arrived and the future appears great for global growth, trade and Marcon's sales.
There two options for documenting compliance with the requirements for Subchapter M to obtain a USCG Certificate of Inspection for a towing vessel, either through the USCG or through the Towing Safety Management System (TSMS).
I have always believed in a version of the trickle-down theory, at least in tracking markets, by following summary of global growth and trade down to transportation, utilization and earnings.
Nobody in business likes uncertainty. That is not reality. The reality is that uncertainty is the only thing that is certain.
What is coming down the pipe in 2017 and 2018? I am more clueless than normal, but see 2017 to be a volatile and uncertain period.
Recent months' MGO activity has resembled a rollercoaster ride with all the ups and downs seen in all regions that we report on.
Oil & Gas companies slashed projects around the world during 2015 and 2016 with everyone running for cover as oil prices slid from over $100/BBL to less than $30/BBL.
Six and a half years have passed since June 2009, the official end of the latest Great Recession. The global recovery has been slow and erratic, and economies are still fragile.