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Market Dynamics Report

March 2018: Broker bilateral volume gains in Euro Gas, TTF and France Hubs set record monthly volumes and Emissions see price and volume jump.

March 2018 saw 8.181 million monthly contracts traded, up 9.8% vs. February and although March had one more trading day than February, this is still the first time since March 2017 that monthly contracts have broken the 8 million mark. UK Power, Emissions and Euro Gas contributed to the MoM growth, up 13%, 49% and 13% respectively, offset by small declines in the remaining groups. YTD we have seen 23.304 million monthly contracts traded, up 3% vs. YTD 2017.

Euro Gas had a good month of volumes as four of the seven commodities in the group recorded volumes in their top five monthly traded volumes since Jan-11. TTF continued its run in 2018 with another record volume month at 2,490 TWh, up 191 TWh vs. February and pushing TTF up 17% vs. YTD 2017. Interestingly broker bilateral was responsible for the MoM growth as broker cleared and exchange executions market share declined 1% and 5% respectively giving the remaining 77% of the market to broker bilateral. This record month accompanied by a 2% MoM decline in NBP resulted in TTF's value being 200% of NBP volume for March and 180% YTD. TTF has solidified itself as the benchmark European virtual trading hub. PSV also had a solid month of volumes, up 26 TWh to 94 TWh in March, the third highest volume on record (since Jan-11). Austrian VTP was the only commodity in the Euro Gas group to see a MoM decline in March, down 4% to 55 TWh.

Even with all this activity in TTF, France Hubs are the highlight of the month posting its largest volume on record (since Jan-11) at 151 TWh, up 150% MoM. As with TTF the jump in volume came largely from broker bilateral which saw a 16% shift in market share to end the month at 84%, at the cost of exchange execution. To put this in perspective, March's broker bilateral volume (128 TWh) was 56% of the full year of broker bilateral volume traded in 2017. How much of this jump in volume is a result of the regulators requirement to increase French Gas reserves? Can any of the shift to broker bilateral in TTF be a result of France hubs being traded as a spread to TTF?

The Power markets did not follow the trend seen in Gas with most commodities recording a MoM decline. German Power saw 516 TWh traded, down 9% vs. YTD 2017 and 23% down YoY. Spanish Power saw a 10% drop in front month baseload price with volumes following suit, down 29% to 11 TWh. Dutch Power offset the downward trend with a 13 TWh increase over February to end the month at 35 TWh. UK Power was not far behind seeing a 10 TWh increase to end the month at 89 TWh traded.

Coal continued the trend of declining volumes, down 25 tonnes vs. February as exchange execution becomes the favoured form of trading gaining a further 7% market share at the cost of broker cleared. gC Newcastle was the only commodity in the group to show a MoM gain up 13% although down 51% YoY.

Emissions was another interesting story for the month. EUA volumes were up 49% MoM to 947 tonnes, their third highest volume on record. Meanwhile, end of month prices for Dec-18 EUA contracts increased 31% to €13.28, which is 2.8 times higher than prices seen in March 2017.

Downloadable Content

File:
Euro Commodities Report


12.03.18

February 2018: February 2018: Volumes up YTD; broker bilateral gives up market share; Euro Gas volumes robust, TTF volumes 180% of NBP

February 2018: Volumes up YTD; broker bilateral gives up market share; Euro Gas volumes robust, TTF volumes 180% of NBP.

Volume growth across the Euro Commodities markets was varied this month as monthly traded contracts grew 6% YTD 2018 vs. YTD 2017 but declined 2.8% MoM to settle at 7.454 million monthly contracts traded (February had 20 trading days vs. January’s 23). Euro Gas, Emissions and Euro Power were positive...


13.02.18

January 2018: Volumes up with mixed segment performance; Euro Gas second largest month since records start; broker bilateral gains in five of six commodity groupings

January 2018: Volumes up with mixed segment performance; Euro Gas second largest month since records start; broker bilateral gains in five of six commodity groupings

Volume growth in the Euro Commodities markets in January 2018 was mixed. Total volumes grew 2% YTD 2018 vs. YTD 2017, to 7.67 million monthly contracts traded. Euro Gas and Emissions were positive contributors to this growth, up 17% and 3% YTD 2018 vs. YTD...


17.01.18

December 2017: Recap on 2017, total volume down 8% vs. 2016, numerous events affecting gas markets in December.

December 2017: Recap on 2017, total volume down 8% vs. 2016, numerous events affecting gas markets in December.

Monthly volumes in December 2017 were down 20% to 6.280 million monthly contracts vs. November 2017. All commodity groupings contributed to the monthly decline following a similar trend to previous years. Coal had the largest decline, down 50% while UK Gas declined 27% and Euro Power 24%. Total market volumes...


14.12.17

Gas drives MoM growth, French Power supply constraints linger and Coal continues shift to exchange execution.

November 2017: Gas drives MoM growth, French Power supply constraints linger and Coal continues shift to exchange execution. 

What a start to December it has been with a gas explosion at Baumgarten gas facility and the North Sea crack likely to drive trading activity in the normally subdued last month of the year. December promises to bring an interesting report, not only our annual summary and discussion on Mifid II market...


21.11.17

Volumes down MoM, French Power prices continue to rise driven by supply constraints and ICE winning in Coal.

October 2017: Volumes down MoM, French Power prices continue to rise driven by supply constraints and ICE winning in Coal.

October saw monthly contracts decline from their high in September to 7,053m, down 9.8% MoM. Gas markets were the main driver, accounting for two thirds of the total MoM decline. In contrast, strong YoY performances from Emissions (up 33% YoY) and UK Gas (up 5% YoY) have helped reduce the YTD...


12.10.17

Strong volume growth across the board, Gas shifting to bilateral and French Power prices surge

September 2017: Strong volume growth across the board, Gas shifting to bilateral and French Power prices surge. 

September marked the first month of autumn with higher volumes. Monthly contracts traded up 22% MoM to 7,817m. The growth in contract volume came from the Continent with Euro Gas and Euro Power accounting for 81% of the increase. The strong performance reduced the YTD deficit by 1% to end the month down 10% at...


13.09.17

Power volumes increase while NBP makes a comeback amid slow gas market volumes.

August 2017: Power volumes increase while NBP makes a comeback amid slow gas market volumes.

August ended the summer months with a strong performance in monthly contracts traded, up 12% MoM to 6,405m. The improvement is largely driven by UK Gas (up 18% MoM), which accounted for almost 40% of the total MoM increase in contracts traded. The growth did not spread to UK Power, dropping 9% MoM to 139m monthly contracts....


10.08.17

German Power drags down monthly volumes despite continued growth in gas markets.

July 2017: Gas Market volume growth stalls, German Power extends MoM decline.

July 2017 produced the lowest monthly volumes since August 2015 with 5.715m contract traded. Individual market growth was hard to find with only UK Power, Austrian VTP and EUA providing any MoM volume growth. Euro Gas was responsible for the majority of the MoM decline with UK Gas and Euro Power also lower, dragging total volume down 11%...


16.07.17

German Power drags down monthly volumes despite continued growth in gas markets.

June 2017: German Power drags down monthly volumes despite continued growth in gas markets.

With half of 2017 completed, the trend of lower volumes continues. June produced MoM and YoY declines as total contracts traded retreated 2.8% from May levels settling at 6.454m contracts. Modest MoM volume growth in the gas markets were offset by significant declines in the power markets in particular the German and...