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Aug 8, 2017

Market Comments

PIX Bioenergy - Forest Biomass Finland

Copyright©FOEX Indexes Ltd

Copyright©FOEX Indexes Ltd

The PIX Forest Biomass Finland index value is based on trading prices of June 2017 of forest residues and wood based industry by-product bioenergy components in Finland, excluding pellets and liquid bio-fuels.

The EU Commission has announced new emission restrictions which require power plants to decrease their sulfur dioxide, nitric oxide and particulate emissions. The restrictions for wood and peat consuming plants are significantly stricter than those for coal plants. This will impact about 60 power plants in Finland, and according to Pöyry, will require over 400 million euro investments.

The Finnish Sawmills Association will complain about the current forest chip production support system to the European Commission. They say that the support system creates unfair market conditions as the side product sawdust and bark are not subsidized the same way as forest chips.

According to the Luke statistics, the wood trade from privately owned forests amounted to 2.99 Mm³ in June 2017. The volume decreased by as much as 1.35 Mm³ (28%) from May 2017, and by 1.76 Mm³ (37%) from a quite high volume in June 2016. The volume in the first half of 2017 is a bit over 20 Mm³ which is about the same as in H1/2016.

After the cold spring, summer also started rather chilly as the temperatures in June were much lower than on average. After removing 10% of the extreme values, the PIX Forest Biomass Finland Index lost 51 cents, i.e. 2.85%, and landed at 17.43 EUR/MWh.