Argus the Biomass Conference in Copenhagen.

PelTrade’s director Sergey Larchenko spoke at Argus the Biomass Conference in Copenhagen.

The Topic of the presentation was «Russia’s Future Role in the Nordics and Baltics biomass market»

The most important messages:

1) Residential market is stable and will continue to grow steadily. Growth in the Industrial market continues at a more pronounced rate and is likely to cause volatility and dictate market direction.

2) Baltic/Nordic countries typically use coaster vessels (up to 5000t) to deliver pellets from Russian ports to main consumers.
So far no appetite for bigger vessels

3) Maersk pointed that pellet production volume grows faster than number of sea fleet vessels, which are used to deliver pellets, some price increase for sea freight
is predicted. So far Biomass commodity volume is only 2% of full sea dry bulk volume. Due to this low number, sealines do not pay lots of attention for Biomass
(pellets). In an attempt to improve the fuel efficiency of the vessels, voyages are typically taking longer.

4) Russia is the dominant supplier into the Baltic/Nordic region with a share of 61% of pellet imports. This is followed by Latvia with 16%, third – Poland (13%)

5) To enable Russia to become an exporter of pellets into Asia, investments are required in port infrastructure and capacity as there is currently only one dedicated timber port in the Russian Far East (Slavianka), thus port stevedoring capacity is a real bottleneck in
Russian Far East region