Supply & Tug Supply Boat Market Report - November 2016

Following is a breakdown of available supply and tug supply vessels we currently have as shipbrokers officially listed for sale worldwide. Not included are those available on a private and confidential basis.

Of 13,111 vessels and 3,847 barges tracked by Marcon, 3,249 are supply and tug supply boats, with 270 officially on the market for sale. 75.74% of foreign and 98.53% of U.S. flag supply / tug supply boats Marcon has officially listed for sale are direct from Owners. In 2016 to date, actual sales price of all vessels and barges sold by Marcon International averaged 94.15% vs. 2015's 84.95% and 2014's 86.42%.

Market Overview
Tug supply boats officially on the market for sale in total is 141, eight fewer than as in November 2015, the date of our last report. Composition has changed with the biggest shifts being eight fewer 6-7,000HP, five more 3-4,000HP and four less 4-5,000HP 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. The good news for potential serious buyers, if there are any out there, is that vessels now offered for sale generally average several years newer than those last November. This is due partially to continued scrapping of older tonnage and primarily because Owners are laying-up and looking to dispose of select idle / under-utilized tonnage or non-core assets because of the present and potential future market conditions. At the time of this report, 71 tug supply boats officially for sale were either built within the last 10 years or are newbuilding re-sales. Only 31.91% of tug supply boats currently for sale are 25 years of age. Counter-balancing today's "old ladies" are 11 newbuilding AHTS resales, in the 4,400-12,000+BHP range, scheduled for delivery in 2016 and 2017. One year ago, 34.87% of AHTSs for sale were built before 1990 and five years ago 65.79% of the tug supply boats were built prior to 1986. These decreases in percentage of the fleet over 25 years of age further support the younger ages referred to above. In addition to our published listings, other vessels not officially on the market may be developed on a private and confidential basis.

There has been a lot of activity with all sizes of PSVs coming officially on and off the market over the last year as the number of platform supply vessels for sale decreased by 13 boats since November 2015. The greatest changes are five fewer 180'-190' with an average year built of 1983 vs 1984 last year, four more 200'-220' (2002 vs 1999) and four fewer 190'-200' (2004 vs 2004) PSVs presently on the market. Like the anchor handling tug supply boats, PSVs now being offered are generally several years newer than those offered back in November 2011. As of the time of this latest report, Marcon International officially has available 37 supply boats built within the last ten years, which includes eight newbuilding re-sales scheduled for delivery in 2016. 41 PSVs, or 31.78%, are 25 years of age or older, with the oldest PSV listed built in 1964 - compared to one year ago when 45 PSVs (31.69%) were older than 25 years and the oldest two were built in 1969. Five years ago, the oldest PSV on the market for sale had been built in 1969, but 77 PSVs (70.64%) were older than 25 years. As with the AHTSs discussed above, PSV owners have found themselves in the same unenviable situation of too many boats and too little work.

The dominant location for second-hand tonnage on the market November 2016 is the U.S. with 28.0% (up from 25.4% one year ago and 14.7% five years ago) followed by Southeast Asia with 23.5% (up from 23.0% one year ago and down from 21.1% five years ago), the Mid-East with 11.6% (up from 11.0% last year and down from 18.7% in 2011) and the Far East with 10.4% (down from 15.8% last year and up from 9.7% five years ago). Where location is unknown is 1.9%. The rest of the globe makes up the final 25.2% of locations.

CAT is the principal main engine suppliers to this sector powering 84 of the supply & tug supply vessels listed for sale, followed by EMDs in 34 and Cummins in 26 vessels. Niigata leads foreign manufacturers with 24, then Wartsila with 19, 12 each in MAK and Yanmar, Bergen in 11 and 48 units powered by various other manufacturers. The biggest shift in engines over five years ago is that MAK and Cummins have swapped places. Then MAK were in 24 and Cummins in 12 vessels, respectively.

In addition to those for sale, Marcon has 145 straight supply and tug supply vessels listed for charter worldwide, 11 more than in November 2015 - plus there are many more in today's market idle and hungry for employment.

Commercial Marine Brokers since 1981

Supply Boat - November 2016 Market Report.pdf