Week 28
AlbionDesign GmbH week 28/2022
Economically Ecological
€/$ 1.004 ↘ $/₽ 59.08 ↘ black market rate between 100-115 Rubles to the Dollar
EUA Dec 22 €85.81 ↗ API 2 Front month $370.00 ↗
Coal is higher on more demand. Oil is lower on lower demand. Rhine is low, so can Germans burn coal? Drax is told to buy coal. Drax signed up for sail assisted bulker to lower GHG. Anyone else confused by the news?
Equally confusing is what is happening with flows out of Kazakhstan to Europe. Banned, halted, good to go? For the moment it seems this is feasible. Like everything now, it could turn on a dime.
Overview:
· King Coal is set to make a comeback across Europe this year as Europe braces for a complicated Winter.
· Oil at $75 or $250 a barrel. Every analyst has a view on energy going forward. High prices -> demand destruction or not. Supposedly we are seeing in in transport fuels.
Demand:
· Check your hedging book on EUA, power, etc. Then look at biomass again. Expensive but a cheaper option.
· If power and coal could be a little less volatile purchasing managers could make rational decisions.
· Many heating markets are captive to A1 pellets. If you have them, name your price. Buyers have little choice.
Freight:
· Baltic Coaster – ARA ↘ on week 27 €30/31on 3kt
· Black Sea Coaster ↗ on week 27. $50/52 on 3kt
· Azov-Marmara Coaster ↗ on week 27. $44/48
· Handys/Supras ↘ on week 27. About $20k on a 4 month time charter. Panamax and larger coming off highs
Prices:
· Sunflower Husk Pellet - European Production: ↗ FCA €250+
· Non-sanctioned Russian origin Sunflower Husk Pellet CIF Med €180/190
· SBP Wood pellet CIF ARA: ↗ higher on week 27 Industrial quality & volume $350
· Wood pellet A1 FOB Baltic non Russian/Belarus feedstock ↗ €320
· Certified PKS FOB Indo/Malay flat $150
· Spent olive wastes ex Works Spain flat to higher €78
Into ARA on the densified biomass deduct $1+- for every additional 1kt as there is a freight saving.
Links and interesting reading:
· https://thecoalhub.com/?report-presentation=european-power-markets-6-months-review
· https://biomassmagazine.com/articles/19134/mol-drybulk-drax-launch-green-shipping-initiative
· https://www.reuters.com/business/french-power-group-edf-requests-its-shares-be-suspended-2022-07-13/
· https://www.ft.com/content/22821ad5-fc78-4b37-8995-df113b340473
· https://www.ft.com/content/659437c7-dcc5-4756-821d-12d56d569732
Numbers subject to change. These figures are indications and in no way a confirmation on tradable prices. For reference only.
