Week 29 2023

AlbionDesign GmbH                                                      week 29/2023

Economically Ecological                               

€/$ 1.121467                     ↗                                         API 2 Front month $106.01    ↗

EUA DEC 23 €88.98          ↗                                          EUA DEC 24 €93.31                  ↗

It is so quiet that I feel something must be bubbling under the surface. Whether it is noise of MGT becoming more than just a name, residential consumption increases, or some new sector somewhere believing in biomass, it does feel like we’re poised for a breakout – verdict is still out which way it’ll move.

Low ash wood pellets are finding homes in ever more fragmented markets. Liquidity remains poor and with holidays in full swing. Expect another few quiet months.

Agri biomass is under the same strains. Low demand and volatile markets make buyers think twice before purchasing

 Prices:

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

·                     Russian Sunflower Husk Pellet CIF Med ↘: €120/125

·                     SBP Wood pellet CIF ARA  flat on week 28 $180                  

·                     Wood pellet A1 FOB Baltic flat on week 28 €195+

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

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

·                     Baltpool Woodchips Lithuania  €22.21/MWh ↗ Latvia/MWh €23.38 ↗ Estonia €18.00/MWh flat  

Freight:

·                      Baltic Coaster – ARA  flat  on week 28 €22/23 on 3kt                         

·                     Black Sea Coaster  slightly lower on week 28 $21.5/22.5 on 3kt                    

·                     Azov-Marmara Coaster  ↘ on week 28 $36/$40 on 3kt                   

·                      Handys/Supras  flat on week 28.                                                                               

Overview:

·                     It is hot in the South of Europe while the North is cooler and hydro seems pretty good.

·                     EU energy demand is the lowest it’s been in 2 decades

·                      

Demand: no change on week 28

·                     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.euronews.com/my-europe/2023/07/19/eu-electricity-demand-set-to-drop-to-lowest-level-in-twenty-years-international-energy-age

·         https://splash247.com/canada-dockworkers-ordered-to-end-strike/

·         https://www.rhineforecast.com/

·         https://www.theguardian.com/business/2023/jul/17/olive-oil-industry-in-crisis-europe-heatwave-threatens-another-harvest-spain-prices

·         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.