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Anyone who hasn’t passed on their increased energy costs can get into trouble – the Portfolio Corporate Energy Procurement conference is coming!

In the panel discussion on March 21, the leaders of two large agricultural groups also revealed what (different) energy procurement strategy they pursued in spite of the soaring prices of the past period, and then they discussed the possibilities together with experts representing the renewable energy sector. As our colleague reported on it: Péter Ábrahám, purchasing and IT director of Bonafarm Zrt., spoke about how they they purchased the expected energy consumption two years in advance, so they essentially averaged the cost of the purchase. However, by now there is only a small amount of energy left, so they have to think about whether to continue this energy cost averaging strategy in the next period as well. In order to do this, in addition to the current drop in energy prices, the market offers will be assessed, but it is obviously impossible to know in advance what the prices will be months later, so it is worth taking advantage of the current opportunities offered by the market he said.

Portfolio’s next conference entitled Corporate Energy Procurement on April 18 will cover more comprehensively how the energy prices that have just fallen may develop in the future, and in light of these, what energy procurement options are available, as well as what energy efficiency and renewable energy directions are worth considering. Register now for our conference!

Makai Szabolcs, the CEO of Talentis Agro Zrt., spoke about, among other things, that instead of buying in advance and averaging rather, they continued the strategy of commercial hedging in addition to the increased energy costs, i.e. they tried to validate these costs in their product sales prices. He warned that those who did not pass on the increased energy costs of the past period and postponed the decision, now, in addition to the falling energy and input prices, can no longer pass this pass on due to market competition, so they may find themselves in a financially strained situation. The declining gas and electricity prices on the stock exchange can be seen in the graph below, as well as the fact that the current price levels are still significantly higher than those of 2 years ago or the levels typical of the energy crisis.

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Among other things, Gábor Bali, the managing director of ENERGIQ Kft., spoke about energy procurement decisions, saying, “If we find a dealer who offers a product in such a way that it follows the market, then it might be worth attacking. The offers run day by day at nominal prices, but paying in advance has become a common thing. If the prices on the market go up, you can “catch” them by fixing them, but if they go down, you can wait – the decision is in our hands.” He added:

It can be a daily decision whether to use the formula price or to fix it. However, you cannot avoid paying in advance.

In the panel discussion, the CEO of Talentis Agro Zrt. spoke, among other things, about the fact that during the period of increased energy prices energy efficiency and renewable energy projects jumped from the bottom of the investment list to the top, since, for example, solar panels are placed on the roofs of almost every factory and building. In this regard, Gergő Kovács, the operational director of Solar-Express Kft., emphasized: the solar panels installed on agricultural land, which help the plant to be self-sufficient, clearly indicate the future and help energy independence. According to his words, in the coming months, the picture will clear up in Hungary regarding the solar grid connection stop, which does not even apply to previously approved industrial-scale projects, but only to new plans and the household segment.

Zoltán Gőgös, managing director of G-reál Kft., highlighted, among other things, that during the round table discussion, it is also worth opening up to biogas, since manure is available on many livestock farms, so it can play an important role in energy consumption aimed at self-sufficiency, either in electricity production or in gas consumption. Referring to the expected new rural development tenders, he also advocated that all agricultural enterprises think about what kind of investments and developments they want to make in the next period, so that they are properly prepared when these opportunities open up.

Cover image source: Márton Mónus, Portfolio