BIOMASS EXCHANGE: TRADE Overview for the year 2016
The turnover of BALTPOOL Biomass Exchange in 2016 totalled EUR 56.1 million, which is a 43% increase compared to 2015. Another major change in the biomass market is the growing number of Latvian suppliers: 5 suppliers of biomass from this country have registered with the exchange.
2016 saw not only a turnover increase but also an improvement of all the indicators of performance of the exchange: the number of concluded contracts increased by 72% and amounted to 4,320; 11 new buyers and 37 new sellers, of which five sellers account for Latvian companies, registered with the exchange. The participation of Latvian sellers in auctions promotes a fiercer competition and evidences the simplicity of the trading process: it is as easy for a foreign company to conclude a contract as it is for a local company. The first two Latvian sellers registered with the exchange in 2015.
In 2016, the absolute majority of participants of the biomass exchange used mixed biomass purchase strategies, whereby buyers combined contracts with terms of average duration (half-year, one-quarter and one-month) with short-term (one-week) contracts (Fig. 3). Over 55% of the total quantity of biomass supplied in 2016 was supplied under long-term (half-year and one-quarter) contracts. The use of a mixed strategy to purchase biomass is beneficial both to buyers and sellers. Thanks to long-term contracts, sellers can better plan their work volumes, prepare cheaper materials, and offer competitive prices. For buyers, long-term contracts guarantee reduced risks connected with possible price leaps in the short run, in particular at times of high demand for biomass.
From January to November 2016, regulated producers of thermal energy acquired 88.17% of all the required biomass at the biomass exchange.