Volumes down MoM, NBP shift away from brokered market, CME gain market share in coal
Consistent with the general seasonal slowdown during summer, July was a quiet month in the European Energy Market with volumes down MoM and YoY across the majority of commodity classes covered in this report. Overall total monthly contracts traded were down 2% MoM, and 490k (8%) lower than July 2014's 5.9m monthly contracts traded. July 2014 was a seasonal anomaly with record TTF volumes seen that month.
The Euro Power market was down 11% MoM. This was largely driven by Nordic Power and Spanish Power. July has traditionally been a quiet month in Nordic Power, with the lowest monthly volumes for the calendar year observed at this time over the past 3 years. July 2015 was no different with volumes down 58% MoM, falling to a record low since we began recording Nordic Power volume back in Jan‐12. Having sustained second spot over the past couple of months, Nordic Power was the fourth largest power market by volume in Euro Power, behind German, French and Italian Power. Spanish Power volumes were down 42% MoM and 71% YoY. The July‐15 volumes were the third lowest recorded in Spanish Power over the past 18 months. Only August‐14 and March‐15 have seen volumes drop to lower levels than we saw in July.
The battle for market share took an interesting turn in NBP, Nordic Power and Spanish Power this month. Brokers lost 9% market share to exchanges in NBP, and now make up 49% of the total market. July's split reverses a strong couple of months for brokers in NBP. Having fallen to 48% in February‐15, brokers rallied pushing their market share up just below 60% between April‐June. In Nordic Power, brokers lost 11% market share in a market that is entirely cleared. July's broker cleared volumes were the lowest we have recorded in Nordic Power since we began reporting on the region and almost 50% lower than July‐14 volumes. In Spanish Power, there was a shift towards the cleared market this month. This was driven by a large decrease in bilateral volume traded whilst the cleared market remained relatively constant vs. June 2015.
Coal market volumes fell by 1% MoM and 4% YoY. It was a strong month for CME which further strengthened its presence in the coal market gaining 17% and 11% of ICE's cleared market share in API2 and API4 respectively. CME now has 82.2%% of the overall cleared market share in the total cleared API2 & API4 market with ICE making up the remaining 17.8% this month.