Week 13

AlbionDesign GmbH                                                      week 13/2022

Economically Ecological                               

€/$ 1.109 ↗                      $/₽ 89.01 ↘

EUA Dec 22 €80.43 ↗     API 2 Front month $260.00  ↘

After 2 weeks on the road, I expected to find a lessening enthusiasm for biomass given the logistic and supply constraints currently facing the market. Instead, I left my 10 country tour surprised by the continued interest, even with high prices. From Central European sunflower, Balkan wood, and Asian PKS there is a growing acceptance and understanding of the products available. Positive return from the Ukraine Moldova border, given the situation there.

Overview:

·         The market is short volume and where the supply will come from is anyone’s guess

·         Pellet producers dependent on large amounts of electricity are counting the cost in certain areas

·         Cold weather coming through this week, increasing demand in an already short market

·         Difficulties create opportunities and creativity – alternative biomasses are coming in strong

Demand:

·         Demand is there if the price is right. Unfortunately some operators are living in the past and aren’t adapting

·         People with deep pockets will survive, but the volatility and high costs force people to ask about viability

Freight:

·         Baltic Coaster - ARA <-> flat week 12. €39/40 on 3kt                        

·         Black Sea Coaster MIXED on week 12. $39             very much depends on the port of origin and destination                   

·         Azov-Marmara Coaster  ↗   on week 12 +- $50 Azov Marmara                     caution: massive uncertainty

·         Handys/Supras  ↗ on week 12.                                 

 Prices:

·         Sunflower Husk Pellet Baltic Sea: ↗ FCA €200+

·         Olive Wastes S. Spain FOB: ↗ €N.A. FOB Sfax €125/tonne             

·         Wood pellet CIF ARA:  ↗  higher on week 12                                       

·         Wood pellet FOB Baltic non Russian/Belarus feedstock ↗ €225

·         PKS FOB Indo/Malay  ↗ $125

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.telegraph.co.uk/business/2022/03/13/end-russian-wood-pellets-mean-soaring-bills-biomass-boiler-owners/

·         https://www.montelnews.com/

·         https://seekingalpha.com/news/3818473-counting-barrels-russias-transneft-caps-production-kazakhstan-down-290kbd

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