Smoke is the engine telling you something. Meredith Anderson, writing in 48° North, says to consider smoke the result of something going on within the engine that needs to be addressed, and quotes "smoke is normal for these engines" as a survey remark to be wary of. The colour narrows it down.
Reading the colour
White. Normal for a minute at a cold start. Steve D'Antonio, in Cruising World, calls persistent white smoke one of the most difficult symptoms to diagnose: overcooling, worn rings, failed glow plugs, poor fuel or, at worst, a blown head gasket or cracked head. Anderson says the most common cause on small sailboat engines is a wet exhaust mixing elbow rotted on the inside. D'Antonio warns that steam from the wet exhaust can be mistaken for smoke, and that the exhaust water should be below 200°F.
Blue. Burning oil. D'Antonio names worn valve stems or guides, or worn piston rings, told apart with a leak-down test at a yard. Safe Skipper adds an overfilled sump and a leaking turbocharger seal. Anderson says oil pouring from the exhaust needs addressing no matter what.
Black. Unburned fuel. A puff when manoeuvring is normal. Constant black smoke under load is overfuelling, which D'Antonio usually traces to a propeller with too much pitch or diameter, or a fouled one. Dirty or dripping injectors and a clogged air filter are the other usual causes.
How a surveyor checks it
Watch the exhaust at the cold start, then again fully warm and under load. Safe Skipper's rule: only be concerned if it's smoking once fully warmed up. Check oil and coolant levels before and after the trial. Note the full-throttle RPM against the rating: Safe Skipper says an over-pitched propeller stops the engine reaching full RPM. Look at the air filter and, if hauled, the propeller.
What decides the grade
Smoke plus loss is an A: oil or coolant going down, oil from the exhaust, or an engine well short of its rated RPM. Persistent smoke once warm is a B. Smoke that clears after a cold start is a C.