JANUARY 2019 ENERGY EXCHANGE: TRADE OVERVIEW

In January, prices at the Baltpool biomass exchange continue to drop and turnover grows

The weighted average price under transactions at the Baltpool biomass exchange in January decreased by 9% (and amounted to 171.05 EUR/toe) compared to one month earlier and by 22% compared to the same period last year. With the prices continuing to decrease consistently, the trade turnover in January, compared to December 2018, increased by 2% – from EUR 5.40 million to EUR 5.49 million, and the sales of woodchips grew by as much as 10% (31,332 toe).

The number of short-term transactions is on the rise

In January this year, the number of one-week transactions at the biomass exchange was 54% higher compared to December. In January, short-term transactions accounted for one half of the total number of biomass supply transactions at the exchange; 46% accounted for one-month transactions, and the remaining share accounted for the first half-year transaction concluded for the summer 2019 supply. Heat producers from Tauragė County purchased 1,560 toe of biomass for the weighted average price of 140 EUR/toe.

“Last month, the number of short-term acquisitions increased considerably, and it is natural. We are in the middle of the winter season. Heat buyers have already purchased more than 80% of the amount of biomass required for the heating season, and are now supplementing the remaining share by short-term transactions. With low prices prevailing at the exchange, it is very likely that biomass will further be purchased under one-week contracts,” said Andrius Smaliukas, Director General at Baltpool.

By the end of January, the value of the Baltpool Wood Chips Spot Lithuania index dropped by 13% compared to the end of December and amounted to 161.50 EUR/toe, i.e. was nearly one third lower compared to the index value in the same period last year (221.22 EUR/toe).

The value of transactions concluded in January in Latvia is over EUR 100 thousand

In January, Latvian heat producers purchased SM2 biomass products for the weighted average price of 185.78 EUR/toe under one-week transactions. The value of the concluded transactions is over EUR 100 thousand, and the amount purchased during the first month of the year accounts for 66% of the total amount of biomass traded in Latvia in 2018.

The results of the trading sessions held in January show that the weighted average SPOT market prices in Latvia are 12% higher compared to Lithuania. Under the transactions concluded in the exchange, Latvian sellers sell biomass to Latvian buyers for a price that is 9% higher compared to their prices in Lithuania.