Analysis by Clarksons Securities suggests owners of wind turbine installation vessels will see rates rise significantly in the next couple of years
The broker said leading owners such as Cadeler and Eneti “are poised to benefit from expected record tight supply-demand balance.” The broker says it expects “near full utilisation in 2026 as supply-demand balance tightens.”
Clarksons Securities said vessel supply is struggling to keep up with the fast pace of growth in the offshore wind market and, if projects in the pipeline maintain schedule, it expect peak season utilisation of high-spec wind turbine installation vessels to reach record high levels in 2025.
Clarksons’ modelling indicates peak season utilisation of 98% in 2025 (full-year utilisation of 85%), and potentially as high as 100% during peak-season 2026 (full-year utilisation of 95%).
Apart from demand growth, a key reason why rates will rise is that only a limited number of newbuilds will become available in the near-term, and the cost of building vessels remains on an upward curve.
Clarksons Securities noted whereas the 2025 delivery window for newbuilds is now effectively closed, 2026 utilisation remains subject to the number of newbuild orders being placed. “However,” said the broker, “newbuild prices have soared, and now stand at US$355M for fourth-generation vessels.”
Clarksons Securities said the ‘equity ticket’ for a single wind turbine installation vessel is now as high as US$125M, assuming 65% loan to value, which is a meaningful hurdle limiting the number of players financially equipped to enter the market.
“Coupled with longer lead times on newbuilds, we believe the wind turbine installation/foundation installation segments could constitute a major bottleneck in the offshore wind value chain, more so than for the lower barrier C/SOV space,” analysts at Clarksons Securities said in a 4 May 2023 note.
“The negotiating power of operators with vessels on the water and advanced newbuilds underway is reflected in rates, as exemplified by a ~U$300,000/day contract for Eneti’s Nessie in 2025, and a shorter contract of €375,000/day awarded to Cadeler in Denmark, with start-up in 2026.
“This trend is in line with our modelling assumption,” said Clarksons Securities. “It indicates rates for open high-spec units will increase significantly over the next few years.
“In 2023 and 2024, we model rates at US$225,000 per day. However, by 2025, we anticipate a significant jump to US$300,000 per day, with a further increase to US$325,000 per day by 2026.
“For the subsequent period 2027-2029, we model rates of US$275,000/day, as we expect incremental newbuild orders to help ease some of the supply-demand imbalance of the preceding years.”
The broker said it assigns an additional premium to foundation installation jack-ups, as only a limited number of vessels are equipped to handle the largest monopiles.
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