Week 26 2023

AlbionDesign GmbH                                                      week 26/2023

Economically Ecological                               

€/$ 1.08925                        ↗                                       API 2 Front month $116.38    ↗

EUA DEC 23 €87.75          ↘                                          EUA DEC 24 €92.33                  ↘

From the Pacific to the Atlantic, power generation from biomass is lacklustre and dragging on the value of larger ships. The less often spoken about but equally important market for residential pellets seems to be bucking the trend, at least on smaller parcels of light pellets. Agri markets in Europe are focused on grain harvests with lower value biomass taking a backseat in agri-traders’ minds.

Drax is properly saying goodbye (good riddance) to coal. Thanks. Wonderful news. Only 1 left in the UK.

 Prices:

·                     Sunflower Husk Pellet - EU Production: flat: €105

·                     Russian Sunflower Husk Pellet CIF Med ↘: €125/130

·                     SBP Wood pellet CIF ARA  flat on week 25 $180                  

·                     Wood pellet A1 FOB Baltic ↗ on week 25 €195+

·                     Certified PKS (dura) FOB Indonesia Q2 flat $130

·                     Spent olive wastes ex Works Spain slightly lower  €120/€124

·                     Baltpool Woodchips Lithuania  €22.65/MWh ↘ Latvia/MWh €23.06 ↗ Estonia €15.23/MWh ↗  

Freight:

·                      Baltic Coaster – ARA  ↗   on week 25 €22/23 on 3kt                           

·                     Black Sea Coaster  slightly lower on week 25 $21.5/22.5 on 3kt                    

·                     Azov-Marmara Coaster  ↗ on week 25 $35/39 on 3kt                      

·                      Handys/Supras  slightly lower on week 25.                                                                           

Overview:

·                     Industrial biomass sentiment  is driven by the UK. Without the UK there is little to support large cargoes.

·                     Industrial activity in the EU is cooling

Demand:

·                     Personally, optimistic about demand in the near-ish term. Less bullish on prices for industrial vs residential

·                     Purchasing patterns are changing as local markets adapt to overly dry or overly wet farm conditions

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

Links and interesting reading:

·         https://www.montelnews.com/news/1507818/finland-installs-439-mw-wind-power-capacity-during-h1

·         https://www.hellenicshippingnews.com/low-water-again-hampers-rhine-river-shipping-in-germany/

·         https://agriculture.ec.europa.eu/system/files/2023-05/olive-oil-dashboard_en.pdf

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

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