Germany-headed European Energy Exchange AG (EEX), a European energy exchange which develops, operates and connects secure, liquid and transparent markets for energy and related products has revealed that it has registered the first trade on Industrial Wood Pellets Futures on its platform. The trade, which took place on January 15, is 10 lots in the February 18 delivery - equivalent to 1 000 tonnes. It was brokered by Tradition on behalf of Vattenfall Energy Trading and Total Gas & Power Ltd.
EEX launched this contract to give market participants an opportunity to manage their price risk and to deliver a clear and transparent price signal for this fast-growing commodity. We welcome the support of brokers and their cooperation in establishing an exchange market for wood pellets, said Steffen Köhler, COO of EEX.
According to the European Energy Exchange (EEX), the contracts complement its product portfolio of energy-related, globally traded commodities and allow market participants an effective price hedging tool with financially settled futures.
As part of EEX Group, a group of companies serving international commodity markets, EEX offers contracts on Power, Emission Allowances, and Coal as well as Freight and Agricultural Products. EEX is part of Deutsche Börse Group.
Vattenfall is committed to reducing the use of fossil fuels and is a strong supporter of sustainable biomass use in both our own operations and our customers’ fuel portfolios. Therefore we welcome the EEX Wood Pellets Futures initiative, since new financial instruments like these are valuable tools to effectively hedge biomass price and credit risk in this growing sustainable energy market segment, said Christian Joore, Lead Trader for Vattenfall Energy Trading.
Quoted in US dollars, the product offers access to a wide range of existing EEX market participants, from utilities and producers to traders. For settlement, EEX uses the Argus cif ARA monthly index as published in “Argus Biomass Markets”.
Tradition is once again at the forefront of the development of these new and exciting environmental markets. We have a proud history of being ahead of the curve in environmental products and we’re committed to helping build a robust and dynamic biomass market in the coming years, said David Jenkins, Director of Biofuels at Tradition.
