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Market Dynamics Report

May 2017: Coal- broker bilateral volume updated due to incorrect contributed data. German Power shifts to broker bilateral.

In contrast to last year, May saw a MoM jump in monthly contracts traded, up 13% to 6.640m, almost on par with the volume achieved in May 2016. Increased volume in the gas market drove the MoM increase, as Euro and UK Gas buoyed by the increased number of trading days in May accounted for 61% of the total MoM change. Even so, it was not enough to overcome the YTD deficit, as 2017 was 13% down vs. YTD 2016.

As mentioned the Gas market drove the MoM change in monthly contracts, so understandably MoM volumes are up across the board with one exception. Gaspool saw the month's only MoM drop, down 5% to 79 TWh in May. However, the big story with Gas this month is NBP, who with a 14% jump in MoM volume, ended May 85 TWh shy of regaining the crown from TTF, closet they have been since May last year. Even with the strong performance, NBP was down 12% YoY; meanwhile TTF was flat YoY further highlighting how the dynamics between these two mature hubs has changed over the past year. France hubs saw a 52% increase in volume YoY to end the month on 72 TWh. Broker bilateral drove most of the change achieving its third highest market share to date (since Jan-11), up 7% to 80% of the months volume. YTD volumes remain a bleak picture as the Austrian VTP sees the only positive change, up 5% vs. YTD 2016.

In Power, even an 11% (57 TWh) YoY jump in the dominant German Power was not enough to change the groups' fortunes as declines in all other contracts other than CEE (up 27% YoY), saw a double figure decline. Although German Power is experiencing overall volume growth, its market dynamics are shifting. Exchange executed volumes have been declining over the past year, dropping 84 TWh YTD (11%) vs. 2016 while over the same period broker cleared volume declined 43 TWh (9%) vs. 2016 YTD. Total volumes YTD remained slightly up (0.5% vs. 2016 YTD) as broker bilateral made up the shortfall jumping 141 TWh (9%) YTD. This jump in volume drove broker bilateral market share to 64% in May-17, up 8% from May-16. Can this shift be attributed to the splitting out of Phelix Power into separate German and Austrian contracts? YTD was not a rosy picture for the rest of the group with UK Power, French power and Nordic Power down 21%, 36% and 20% respectively vs. YTD 2016.

This month LEBA, from whom we source broker bilateral data, discovered incorrect contributed data for Coal from 2016 into 2017. All cleared volume (broker cleared & exchange executed) is sourced from the exchanges and is not impacted. The over representation of broker bilateral overstated total volume by 6.5% in 2016 and 7.4% in 2017. Due to this broker bilateral market share moved from 7% in 2016 to 1% and 7% YTD 2017 to almost zero.

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Market Dynamics Report


15.05.17

The high volumes seen in March were not a sign of things to come.

April 2017: Volumes down across the board after a strong March, YTD Power focus highlighting declines in French Power.

The high volumes seen in March were not a sign of things to come. April starts the second quarter with 5.879m total month contracts traded, down 29.6% over Mar-17 and the lowest number of monthly contracts traded since Sep-15. YTD total monthly contracts traded were 28.358m, down 14% vs. 2016.

Power...


18.04.17

Spotlight on Coal. Volumes rebound from a slow start to 2017. PolPx volumes added to CEE Power.

March 2017: Spotlight on Coal. Volumes rebound from a slow start to 2017. PolPx volumes added to CEE Power.

March closes the quarter with a brighter tone as volumes across the board see largely double-digit MoM growth. Monthly contracts traded across all commodities was 8.344m; this is up 24% vs. February and is the highest number of monthly contracts traded since June 2016. Euro Gas was the largest contributor, accounting for...


13.03.17

Volumes down YoY; German Power & Austrian VTP buck the trend; Emissions sees a dynamics shift.

February 2017: Volumes continue to decline, prices cool off but UK Gas swims against the tide.

February picked up January's trend and ran with it as the majority of commodity groups continued MoM and YoY declines in volume. Monthly contracts traded across all commodities totaled 6.674m in February 2017, down 10% from January 2017 and 25% below that of February 2016. The declines in volume were across the board with...


10.02.17

Volumes down YoY; German Power & Austrian VTP buck the trend; Emissions sees a dynamics shift.

January 2017: Volumes down YoY; German Power & Austrian VTP buck the trend; Emissions sees a dynamics shift.

In contradiction to last year, 2017 has started without a bang with all commodity groupings posting a YoY decline in volume. Monthly contracts for January 2017 were 7.434m, down 16% vs. 2016 but up 26% MoM. Coal led the downward trend seeing a 52% drop in monthly contracts vs. Jan-16, although up 55% vs....


13.01.17

Recap on 2016, broker bilateral share continues to fall driven by Gas and Power, spotlight on Power markets.

December 2016: Recap on 2016, broker bilateral share continues to fall driven by Gas and Power, spotlight on Power markets.

Now the year has drawn to a close, let's recap on some key themes seen throughout 2016. The Coal market showed a significant shift away from broker cleared; starting the year at 97% market share and ending it at 72% with exchange execution being the main benefactor. TTF took the crown from NBP as...


13.01.17

Recap on 2016, broker bilateral share continues to fall driven by Gas and Power, spotlight on Power markets.

December 2016: Recap on 2016, broker bilateral share continues to fall driven by Gas and Power, spotlight on Power markets.

Now the year has drawn to a close, let's recap on some key themes seen throughout 2016. The Coal market showed a significant shift away from broker cleared; starting the year at 97% market share and ending it at 72% with exchange execution being the main benefactor. TTF took the crown from NBP as...


13.12.16

Volumes up, broker bilateral share down driven by Gas, spotlight on Gas markets

November 2016: volumes up, broker bilateral share down driven by Gas, spotlight on Gas markets

November 2016 saw total market volumes grow 7% vs. October 2016, to 8.09 million monthly contracts traded. All commodity groupings saw an increase in volumes this month. Emissions grew by the largest percentage, up 23% MoM to 666 million monthly contracts traded, contributing 24% of total market volume growth. All other...


10.11.16

TTF further solidifies position as largest market.

October 2016: TTF further solidifies position as largest market; Euro Power volumes up; Coal exchange executions at record levels; broker bilateral market share on the rise

October saw overall market volumes drop 1% vs. September to 7,572 million monthly contracts traded. Volume growth was mixed across the commodity classes, with the Power (up 16% MoM) and Emissions (up 10% MoM) markets seeing large volume gains but...


13.10.16

September was a month of increasing volumes and prices across the board.

September was a month of increasing volumes and prices across the board as every Power, Gas and Coal commodity (except PSV) posted their highest month end price for the year to date. Volatility was up, particularly in the power markets – UK Power volatility as measured by LEBA was 814% during September (vs. 113% in August), and French Power prices were volatile in the last week of the month. Total market share was fairly stable for the...