Business Round-Up: Mærsk will produce green fuel for its ships
Danish container shipping company Mærsk and Danish green energy producer Ørsted have signed an agreement to produce green marine fuel in the US.
To do so, Ørsted will build a so-called power-to-x plant using wind power to produce hydrogen gas. It will then be converted into liquid green fuel for Mærsk.
This green fuel will be used for the 12 methanol-powered container ships ordered by Maersk as part of its goal to become carbon neutral by 2040.
Other green projects
In Denmark, Maersk is also involved in several power-to-x projects.
In Esbjerg, the company is working with Copenhagen Infrastructure Partners to build Europe’s largest power-to-x plant to produce green ammonia.
In Copenhagen, Maersk is working with many partners such as – among others – Ørsted, Københavns Lufthavn or SAS to build a power-to-x plant to produce green fuel for ships, planes and trucks.
The number of people receiving cash benefits at its lowest in 15 years
According to Danmarks Statistik, the number of people receiving cash benefits fell last December to its lowest level since January 2007. In fact, during the fourth quarter of 2021, the number of cash assistance recipients in Denmark fell by 4,900 people. This means that at the end of December there were 95,400 people on cash assistance. The number of recipients peaked in August 2015 at 175,100. Since then, it has fallen continuously.
Diesel more expensive than petrol
On Wednesday March 16, a litre of diesel cost more than a litre of petrol – for the first time since 2006. According to petrol station chain OK, a litre of diesel cost 17.59 kroner on Wednesday while a litre of petrol costed 17.29 kroner. However, there is an ongoing price war between the different petrol stations, and it is therefore possible to find lower prices.
Businesses hit by record import price rises
Over the past year, it has become significantly more expensive for Danish companies to buy goods from abroad. According to Danmarks Statistik, between February 2021 and February 2022, average import prices for goods rose by 17.4 percent. This is the largest increase measured in one year. Producers are also experiencing price increases – up 31 percent over the year. Tore Stramer, the chief economist at the Dansk Industri, called the increases currently hitting Danish businesses staggering. He expects prices to continue rising in the coming months because of the war in Ukraine, which has triggered large price increases for energy and a number of raw materials.
Denmark’s consumption of natural gas at its lowest since 1990
Danish consumption of natural gas has been falling for years. In 2020 it reached its lowest point since 1990. According to Danmarks Statistik, the total energy consumption in Denmark in 2020 was more than 650 petajoules (one petajoule equals a 278-gigawatt hour). This was distributed between energy sources such as petroleum products, renewable energy and natural gas. This very large amount of energy was, for example, used to heat houses. Natural gas accounted of 13 percent of the consumption. It is more than half of what it was at its peak in 2004. Danmark produced 59 percent of its natural gas consumption, while the rest came from aboard. In the same year, 41 percent of the natural gas imported into the EU came from Russia.
Companies risk being paid in Monopoly money in Russia
It could cost a Danish company a lot to send an order to Russia right now. This is due to a new measure introduced in Russia in early March that allows Russian companies to choose to pay an invoice from foreign companies in roubles – even if the invoice is issued in euros or dollars. The same measure also allows the Russian central bank to determine the exchange rate of the rouble. This means that it is in effect the Russian Central Bank that decides how much a foreign company should pay for its order to Russia. Mia Amalie Holstein, the deputy head at SMVdanmark, sees a risk that Danish companies will not be paid properly when they send order from Russia.
Rising interest rates prompt more people to switch mortgages
According to Finans Danmark, rising interest rates have prompted even more people to restructure their mortgages. In February, Danish homeowners have obtained 15,404 loan offers for conversions and additional loans. This is 42.5 percent more than the same month last year. In Denmark, you can redeem your mortgage and take out a new one at market rates. Because interest rates have risen, this has opened up the possibility for homeowners with fixed-rate mortgages to cut a good part of their outstanding debt. However, the interest rate on a new fixed-rate loan will be higher than the old loan. Therefore, an up-conversion will mean a higher payment and thus only provide a lasting gain if the homeowner can at some point switch to a lower interest rate again.
Rambøll delivers more records despite the corona pandemic
Rambøll is a Danish engineering and consulting company and, on several parameters, 2021 has been a historically good year. According to its financial statement for 2021, both its revenue and earnings have risen to record levels. A general increase in demand has helped Rambøll to generate revenue of 14.2 billion kroner. This is four percent higher than the previous year and a record for the company. The higher turnover has contributed to higher earnings – 849 million kroner – from operations. This is also a record. Rambøll’s CEO, Jens-Peter Saul, is very pleased with the result achieved on operations in 2021. He expects to have another great year in 2022. Since it was founded in 1945, the company has grown into one of the largest engineering and consulting companies in Denmark.
More get caught in insurance fraud attempts
According to new figures from F&P, insurers are getting better at detecting fraudsters trying to cheat their way to financial gains. In 2020, the number of insurance fraud cases detected increased by 41 percent. In total, companies uncovered cheating to the tune of over a billion kroner. This is thanks to better IT tools to detect fraud. Typical examples of fraud include the fabrication and reporting of a burglary that never happened, or making a claim worse than it is. Among the Danish public, there is overwhelming resistance to insurance fraud. In a survey conducted by Epinion for F&P, 98 percent said it is not okay to exaggerate or make up damages in order to get more compensation.
SAS must raise prices 10 percent to offset higher oil prices
SAS will need to raise fares by more than 10 percent on 2019 prices. This is to compensate for fuel price rises that are costing the company an extra approximately 3-3.5 billion Swedish kroner (2.1-2.5 Danish kroner). This is the assessment of Sydbank’s head of equity analysis and SAS analyst, Jacob Pedersen. He expects SAS to have an activity level in the region of 70-80 percent of normal – 21-24 million passengers instead of 30 million – in the current financial year 2021/22. The large increase is due to the fact that SAS has not hedged its fuel purchases as usual because of uncertainty about traffic. “This leaves SAS with a larger additional bill than its competitors: many of whom have hedged part of their fuel consumption,” said Pedersen. On the other hand, SAS’s customers are not quite as price-sensitive as those of low-cost carriers. However, the company should not be able to pass the whole bill on customers and will have bigger losses than planned. SAS already has a debt of about 35 billion Swedish kroner which is to be reduced via an announced capital increase expected to dilute existing minority shareholders dramatically.
The largest crypto exchange in the Nordic countries entering Denmark
The Norwegian cryptocurrency exchange Firi, which has become very successful in its home country with more than 140,000 customers, will soon be coming to the Danish market.”In recent years, we’ve noticed tremendous growth in Norway, where we saw the need for a crypto exchange that is locally anchored and based on local regulations and cultural differences. We haven’t yet had one in Denmark, so this is an exciting market,” said Karina Rothoff Brix, the company’s new country manager who spoke with Finans. Firi is scheduled to launch in Denmark in the summer of 2022.