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Market Discussion: Gallente Ice Part 2

About a month ago, I wrote an article analyzing the Gallente Ice Interdiction campaign by those cuddly, fuzzy band of players you hate to love and love to hate, Goonswarm.  So you don’t have to go digging back to find it, here is a link to it.

You, like I, may have been wondering what the current state is of this ambitious project.  A month ago, I had suggested that some of the price was pure speculation propping up a a price bubble on Oxygen Isos.  I present you with the 3-month trend for Oxygen Isotopes taken today.

 

If you look at what happened to the market for the isos around the time of the article (Oct 14), they had just peaked and were starting to slump into a price that remained stable for about 3 weeks at just under 900 isk/unit.  Roughly where it had been before the Mittani had begun his kugu campaign to raise awareness for the Gallente Ice Interdiction.  So, it is pretty clear that almost 200 isk/unit of the price at the time of my previous article was, in fact, a speculation bubble.  However, this is not to underscore the fact that the Goons had effectively driven the price up nearly 400 isk/unit.  No small feat.

You may have noticed a sharp increase in prices once more, beginning about a week ago.  Roughly two weeks ago, the Mittani announced that Goons would be reimbursed for killing Gallente ice miners in any part of Eve.  I’m sure this may have led to a few Goon excursions out to DRF space to pop ice miners.  They may have killed some.  But, I speculate that the Goons are already running this interdiction at the peak level they can maintain.  So what happened a week ago to drive the price up?  How did the supply and demand destabilize again, driving prices up?  The answer to this question might be found in the sentiment of a statement Chribba had made about an upcoming mechanics change for towers.  Pellets.  People need to stockpile pellets. Pellets will be consumed at a set rate per hour.  Faction towers will no longer have a bonus to reduce their rate of consumption of ice products (a bonus given back to them a few days later).  Also, the consumption of ice products will not vary based on the amount of draw by modules online on a tower.  So there was a guaranteed increase in ice product consumption coming.  You will notice that volume of completed sales have been slumping.  So, ice miners are beginning to hoard ice, Goons are killing some of them, and people with existing market orders are beginning to push them higher in expectation of increased demand.  Maybe…

The easy test is simply looking at other isotopes to see if they also experienced a bump in price/demand around the same time.  So, I did that.

 

 

 

 

 

 

The evidence doesn’t directly back up that hypothesis.  Each of the other isos did spike slightly at the end of October, but that did not coincide with a change to Oxygen prices, so something else is at work here.  Back to the drawing board.  I decided to broaden the search for other ice products that also spiked and quickly happened upon these two:

 

 

 

 

 

 

Now I’m scratching my head.  Liquid Ozone and Heavy Water have what in common with Oxygen Isotopes that they don’t have in common with the other isotopes?  So I turned to Ripard Teg to verify that I wasn’t missing anything.  Liquid Ozone and Heavy Water are tower fuel.  That’s it.  Market manipulation?  Unlikely.  The volume on those is large enough that it would be well known that people were playing with it.

Then it dawned on me. CCP announced changes to POSs a month ago.  It would seem that the isotopes received a bump in demand at that point.  Now that the detailed information about the change was made available, most isos crashed because the change was not dramatic enough to substantiate the speculated prices. Speculators ended up dumping the isos back on the market, balancing the increased demand for initial pellet production as well as an increase in supply from miners reacting to the market.  But like much of the economy in Eve that has such a low barrier to entry, an increased supply that overcompensated, leading to the crash once the detailed info came out.

So why did the Oxygen Isos go up? The supply is distressed, demand is up, and futures speculation that had not been acted on before is now a future certainty.  NCdot, Raiden, Br1ck, MM, and Red Arrow are deploying their supers right now after several weeks of primarily subcap combat, leading to an increased demand.  Goons are still at it, clamping down on supply.  There is an increased risk or perceived risk of the supply being under increased threat with recent statements from Mittani.  The Oxygen Isos were not speculated on when the other isos were because the price is well known to already be temporarily inflated. Speculators knew that Goons could stop the interdiction at any time, so speculating in the other isotopes was a safer bet. Supply was not been able to increase like the other isotopes, due to the pressure from Goons, so the impact of the increased demand for Crucible is visible.

POS managers are forced to start stockpiling now if they want to be able to build enough pellets to keep the towers going in a few weeks.  It is likely that the other isos will rebound to an elevated level from the previous price point once supply and demand sort themselves out after the premature increase last month.  The other ice products, Liquid Ozone and Heavy Water, are usually seen as byproducts of ice mining to most miners.  People probably didn’t think to begin speculating in those two commodities until after the detailed information about pellets was made available.

So, in short, Goons are still having impact on the Gallente Ice market, but as before, the price is only partially their doing.  Keep it up though.  It makes for an interesting economic case study.

Bagehi – Destroyer of Economics

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47 Comments

  1. Former NC Fodder

    What's this, Econ-Online? The price of Ice in China…? "You may have noticed a sharp increase in prices once more…" Not really…was too focused popping and being popped… *Scratches head* Ah,got it, this article isn't for peons like me

    November 16, 2011 at 4:47 am Reply
  2. Renwault

    first….that is all

    November 16, 2011 at 4:56 am Reply
  3. "Bagehi – Destroyer of Economics"

    You caused a two day clusterfuck in the price of PLEX that while hilarious to watch, only really hurt impatient people.

    EDIT: It also made me a handsome profit TYVM

    Then again, I am too tired to read the entire article so I decided to pick apart the last line of the wall of text.

    November 16, 2011 at 5:17 am Reply
    1. Winter Wish List

      1300 pu for oxy topes in Jita is F'ing stupid. Plexes are also at incredibly rediculous prices above 500 M. But thats a separate issue.

      Oh how the non-gallente cap pilots are laughing right now, they still have quite cheap fuel.

      November 16, 2011 at 8:07 am Reply
    2. " "

      futanari and bukkake in the same name so awfully awsome

      November 16, 2011 at 11:04 am Reply
    3. bagehi

      Actually, that was Dsan's doing. I didn't write the PLEX analysis. This article is about ice products.

      November 16, 2011 at 1:14 pm Reply
  4. TheRentistooDamnHigh

    Plex prices are fucking crazy right now

    November 16, 2011 at 5:43 am Reply
    1. Those prices are already on their way back down

      November 16, 2011 at 6:56 am Reply
      1. anatlasgoon

        Winter's coming, i.e. Christmas. I expect a whole lot of PLEX to flood the market in a month or two and drive the prices down again. Plus, if anomalies really are getting buffed, people might be distracted from running their Incursion sites just long enough that PLEX demand drops a bit.

        November 16, 2011 at 10:56 am Reply
        1. MindRanger

          It'll be interesting to see, for sure. The PLEX/GTC prices have had a rather steady increase for a long time now.

          I think its due to the real financial situation, crisis (almost) everywhere. People don't have (or don't want to spend) real $ to play the game, but they still want to play. So they're ratting/mining/liquidating ingame assets (i.e. faction gear, secondary toons etc. – check character bazaar for an example) to buy gametime.

          It went the other way around in 2009, a huge influx of new accounts gave a shortage in ISK availability, and prices for PLEX went down to as little as 280m. Now we're seeing the opposite effect, lots of ISK and a noteable decrease in paying subscribers…

          But lets see…

          November 16, 2011 at 12:49 pm Reply
  5. Blazde

    As I understand it the pellet changes won't increase isotope demand at all, they managed to put back the faction/sov bonuses. There will be a certain pull-forward of demand for pellet production, but that may be partially offset by a running down of stockpiles of old fuel in places where it's not suitable to build pellets. Definetely the shocks will be harder for the market to smooth out in the case of Oxygen if it's supply is already strained, as you pointed out

    The water/ozone usage will increase so that's why they've jumped

    At a guess tho I'd put the new oxygen increase mainly down to alliances moving. Not only is half the average cap fleet made of thanatos/nyx/moros (can anyone pluralise these correctly?) but the Anshar is by far the most popular jf. I don't think the number of gallente pos is that high? Certainly not in 0.0. If so overall Oxygen Isotope demand is very dependant on capital usage

    November 16, 2011 at 5:47 am Reply
    1. Blazde

      Fuck these tiny comment boxes..

      Must say I didn't give goons much of a chance to affect the price longterm, quite impressed the price has been nearly doubled for over a month now. But it's not exactly the biggest griefing ever, so it's hard to see what the point of it continuing it would be now after the initial achievement. Unless we are somehow seeing the begining of a new price point as existing stockpiles run out, then it'll get really interesting

      November 16, 2011 at 5:47 am Reply
      1. bagehi

        As I stated, I believe the current price is due to a short term spike in demand for the same reasons you stated. Stockpiling POS managers and super pilots (the other cap pilots as well). It will likely settle around 900 again once all the activity dies down a bit. Assuming Goons continue their efforts.

        November 16, 2011 at 1:20 pm Reply
    2. Anon

      Thanataii?

      November 16, 2011 at 7:42 am Reply
      1. Anon2

        thanatium?

        November 16, 2011 at 12:17 pm Reply
        1. Marcus_McTavish

          wrong case and or gender

          November 16, 2011 at 7:55 pm Reply
      2. Another anon

        It's Greek, not Latin, so Thanatoses.

        November 16, 2011 at 12:20 pm Reply
    3. Gumpin

      Thanatosi, Nyxi, Morosi

      or

      Thanatoses, Nyxes, Moroses

      I prefer the i ending myself. Makes them sound mysterious instead of fat and green.

      November 16, 2011 at 5:12 pm Reply
    4. hakona

      Initially some people misread the pellet blog and failed to notice that the inputs are per 4 units of output.

      This lead to bad investments and required more manipulation (and forum posts with faulty logic) to get rid off these stocks without too much of a loss again.

      November 17, 2011 at 11:36 am Reply
  6. Cal

    I thought I read somewhere that CCP have changed it so that faction towers do now have the bonus again?

    November 16, 2011 at 8:29 am Reply
    1. RND

      This is correct. Faction towers do again get a bonus to fuel consumption of 10%/20% on ALL FUEL products now depending on their tier. It was amazing to see how quickly people started flogging them off so cheap, just to see the nerf be un-nerfed!

      November 16, 2011 at 1:16 pm Reply
    2. bagehi

      Yes. That change came a few days after the ice product prices began spiking. You can see the impact on ozone and water prices. Water takes a dip and ozone flattens out.

      November 16, 2011 at 1:29 pm Reply
  7. A GOON

    this is actually a decent article on EN24…
    am I on the right website?

    props

    November 16, 2011 at 9:03 am Reply
    1. Mono

      I agree that it is one of the better articles as the topic itself is interesting and the conclusions are intelligent but would be in remiss if I did not mention that the writing itself could be much improved. Looking forward to the thumbs down :)

      November 16, 2011 at 2:36 pm Reply
      1. bagehi

        Don't claim grammatical superiority with a run on sentence.

        November 16, 2011 at 4:14 pm Reply
      2. whoopsee

        can we get mintchip to write the next update?

        November 16, 2011 at 4:45 pm Reply
        1. Gumpin

          Mintchip can write?

          November 16, 2011 at 5:13 pm Reply
          1. Marcus_McTavish

            Hey! that's mean, I bet she can do something right.

            November 16, 2011 at 7:56 pm
          2. Gumpin

            THAT was mean?

            You've either A, never seen one of her videos (understandable), or B, never read the comments those videos get.

            That was pretty tame…

            November 16, 2011 at 11:37 pm
  8. Koll

    >>>>>upcoming mechanics change for towers. Pellets. Pellets will be consumed at a set rate per hour. Faction towers will no longer have a bonus to reduce their rate of consumption of ice products. Also, the consumption of ice products will not vary based on the amount of draw by modules online on a tower. So there is a guaranteed increase in ice product <<<<<

    this is bullshit. 1) Isotopes Consumption is a fixed rate already (its only HW and LO that vary atm) 2) Faction Towers will get their Consumption Bonus.
    Read up on the patch notes before publishing crap.

    btw, from what i see, the price spike is simply from stashes running dry. If been monitoring the oxytopes supply in Jita for 3 weeks now, and supply has dropped from as much as 200m units on market to just below 80m units on market this morning. so stashes running dry, consumption more or less steady, shrugged continuing… prepare for fun times

    November 16, 2011 at 11:02 am Reply
    1. bagehi

      Water. Ozone. Ice Produces. Increased Use.

      November 16, 2011 at 1:26 pm Reply
      1. Temmu

        Koll is right though. If you read through the threadnaught for the pos changes a dev straightened out the consumption bonus for faction towers. Just an FYI. Only reason I saw that was because i get easily bored at work =p.

        November 16, 2011 at 1:52 pm Reply
        1. bagehi

          Yeah. I hadn't been aware of the change for Faction towers and edited the text to reflect that. The change for faction towers doesn't really impact the analysis, since my final explanation is that people are stockpiling fuel for pellets and using it to fuel all the super caps running around right now.

          November 16, 2011 at 2:05 pm Reply
  9. Jarod

    Maybe, just maybe… theres more gallente towers deployed out there than any other type of tower?
    Reactions, anyone?!

    November 16, 2011 at 11:05 am Reply
    1. bagehi

      Meh. I see a lot of Amarr towers honestly. I saw a Gallente tower dropped recently and everyone was giving the guy crap. Most people seem to be under the impression that with the current prices of Oxygen, you are better off using other towers than Gallente for reactions, despite the natural affinity for reactions that Gallente towers have.

      November 16, 2011 at 1:25 pm Reply
  10. Temmu

    now your last… that is all

    November 16, 2011 at 1:52 pm Reply
    1. David Star

      At least he is still first at being last!

      November 16, 2011 at 3:44 pm Reply
  11. This is the campaign board for the Interdiction effort: https://killboard.goonfleet.com/shrugged.html As of this morning, the current tally is:

    1215 Mackinaws, 557 Hulks, 350 Retrievers, 167 Covetors and 14 Orcas. Even at relatively conservative estimates, that's 350bil isk in ship damage, and prices are flirting with 1500 isk p/unit this morning.

    November 16, 2011 at 3:00 pm Reply
    1. bagehi

      I see you are the top killer. Keep it up.

      November 16, 2011 at 4:51 pm Reply
  12. Paul

    The prices increased when the GSF mining campaign started. A few number of players bought a huge quantity of ice, and but buy orders up so it would stabilize at that an higher prize point. The result is the GSF (a few members) made or are still making tons of isk out of it. And because of the whole 0.01 isk game and lets be honest. The market doesnt move very fast. The prices are balanced again. Just at a different price point, but the 0,01 isk game continues. The whole market game would be different if you couldnt change your order with a 24h time limit.

    November 16, 2011 at 3:46 pm Reply
  13. 3M TA3

    Still making a profit & no goons in sight. Keep this up & I'll be in the trillions.

    November 16, 2011 at 4:28 pm Reply
  14. ViperRum

    There are more tower fuel requirements than just ice products that will go into tower pellets. You'll also need robotics, mechanical parts, coolant, oxygen, enriched uranium…and not sure if that is it or not. Check those too, if there are price spikes there then that might be what is going on.

    November 16, 2011 at 4:56 pm Reply
    1. bagehi

      The impact to the other fuels are covered in Ripard Teg's article here:
      http://www.evenews24.com/2011/11/16/jesters-trek-

      November 16, 2011 at 8:30 pm Reply
  15. Justasithought

    So in other words: the Goons epic finacial war is a dud.

    November 16, 2011 at 6:57 pm Reply
    1. bagehi

      Hardly. They have single handedly doubled the price of Oxygen Isotopes. Because of the strain on the supply from their campaign, all of these other things have had a much larger impact than they otherwise would have had.

      November 16, 2011 at 8:28 pm Reply
  16. […] is a followup on Part 2 and Part 1.  Yesterday, Mittens announced the insurance payout changes that came in Crucible would […]

    November 30, 2011 at 8:56 pm
  17. bagehi

    That came out on the 8th. The price was rising prior to that based on the information at the time.

    November 16, 2011 at 1:22 pm Reply

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