Week 10

AlbionDesign GmbH                                                      week 10/2022

Economically Ecological                               

€/$ 1.092 ↘                      $/₽ 127.0 ↗

EUA Dec 22 €70.4 ↗       API 2 Front month $450.00  ↗

How bad is the situation in Russia? McDonald’s closed its shops - the first western brand in Russia, back in 1990. Many Western companies have been more proactive than countries in banning Russian material and ships.

Overview:

·         Sunflower is out of the picture for a while with Russia and Ukraine growing about 80% globally

·          Wood is tight. Portugal is delayed. N. America is delayed. Russia was sending over 2 million tonnes

·          Belarus has effectively given up its sovereignty. Consider their chip and wood persona non grata

·         With limited production capacity in the short term, if demand stays high prices are not dropping

Demand:

·         Material that burns is in demand. Wood, PKS, olive wastes, etc as well as renewed interest in coal.

·         The case for storage is looking strong. Drax, Enviva, etc likely getting plenty of calls for pellets

Freight:

·         Baltic Coaster - ARA <-> flat week  09. €40 on 3kt                              

·         Black Sea Coaster ↘ week 09. N. Black Sea to Marmara $24       Shipowners looking for employment. East closed

·         Azov-Marmara Coaster ↘  on week 07 +- $33 Azov Marmara/E. Med                      $1 down on previous

·         Handys/Supras  ↗ on week 09. this vessel size is getting a lot of attention.            Slow moves higher                

 Prices:

·         Sunflower Husk Pellet Baltic Sea: ↗ FOB €128     This is Russian volume. Unsure if it has become toxic

·         Sunflower Husk Pellet Black Sea:  CIF $161                                                                                 SPOT

·         Olive Wastes S. Spain FOB: ↗ €N.A. FOB Sfax €125/tonne              I cannot find reliable prices in Spain attached to real volume

·         Wood pellet CIF ARA:  ↗  higher on week 09                                        massive spreads. Could be close to $300 on real volume

·         Wood pellet FOB Baltic non Russian/Belarus feedstock ↗ €215

Into ARA on the sunhusk deduct $1+- for every additional 1kt as there is a freight saving.

Black Sea – Greece/Italy expect larger savings for every additional 1kt

Links and interesting reading:

·         https://circabc.europa.eu/sd/a/2c8378ab-c686-449d-9dd1-65371ab30889/Oilseeds-dashboard_en.pdf

·         https://en.ilmatieteenlaitos.fi/ice-conditions                          *Finnish Weather Service for Ice Reports

·         https://www.hellenicshippingnews.com/marine-insurers-widen-high-risk-area-as-ukraine-conflict-escalates/

·         https://www.montelnews.com/

·         https://corporate.mcdonalds.com/corpmcd/en-us/our-stories/article/ourstories.Russia-update.html

Numbers subject to change. These figures are indications and in no way a confirmation on tradable prices. For reference only.