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China tightens restrictions on BHP cargoes, resulting in a rise in iron ore prices
Prices of iron ore rose on Friday as China, the world's largest consumer, tightened restrictions on purchasing some seaborne cargoes. This sparked concerns about supply that outweighed falling demand. The most traded?iron ore on China's Dalian Commodity Exchange (DCE) ended daytime trading 1.38% higher, at 772 Yuan ($111.90), a metric tonne. This contract has risen 2.54% in the past week. As of 0725 GMT, the benchmark April iron ore contract on Singapore Exchange rose 1.53% to $101,55 per ton. The contract is up 3.24% this week. Both contracts reached one-month highs during the session. People with knowledge of the situation said that China's iron ore 'buyer' told traders to purchase fewer seaborne shipments of BHP's flagship product, including Mac fines and Newman Fines, this week, as a contract dispute that has lasted for months continues. China has already banned domestic steelmakers and traders to buy BHP's Jimblebar fins since September, and in November extended the ban to include another BHP brand called Jinbao fins. BHP, the third largest iron ore producer in the world and a major supplier of the global market, has been cited by traders as the cause for concern over the availability of some seaborne cargoes. The gains were however limited due to a faltering market and lingering production limitations at North China's steel mills. Mysteel, a consultancy, reported that the average daily hot metal production, which is a measure of iron ore consumption, fell by 2.4%, to its lowest level since December, to 2,28 million tons on March 5. According to a report presented at the annual parliament meeting, China reiterated their commitment to combat overcapacity, which could reduce demand for feedstocks. Coking coal and coke, two other steelmaking ingredients, rose by 1.86% and 0.47% respectively. The majority of steel benchmarks traded on the Shanghai Futures Exchange advanced. Rebar gained 0.26%. Hot-rolled coils gained 0.31%. Wire rod increased 0.06%. Stainless steel fell 0.49%. $1 = 6.8992 Yuan (Reporting and editing by Rashmi Cheema and Sonia Cheema; Beijing Newsroom, Ruth Chai, and Lewis Jackson)
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India orders refiners in order to increase LPG production
A government order revealed that India has invoked emergency powers to increase production of LPG in order to prevent a shortage after supply disruptions caused by the Middle East Crisis. Last year, the world's second largest importer of LPG consumed 33.15 millions metric tons of LPG. This is a mixture between propane and butane. About two-thirds (or 85-90%) of LPG is imported, and most of it comes from the Middle East. The order, issued late Thursday night, asked all oil refiners to "maximise their propane and butane supplies and use them for the production of LPG". The government has asked that producers make LPG and propane available to the state refiners, Indian Oil Corp., Hindustan Petroleum Corp. and Bharat Petroleum Corp. for distribution to consumers. Government data showed that there are 332 million LPG users in the country. Reliance Industries Ltd. would be forced to reduce the production of?alkylates (a component of gasoline blend) by requiring propane and butane to be diverted for LPG. According to LSEG, Reliance exported about?four alkylates per month last year. The government also ordered refiners to stop diverting propane and butane from petrochemical production. A trade source stated that diverting propane and butane to LPG production would hurt margins for petrochemical firms who?make products like polpropyline?and alkylates?, since they sell better than LPG.
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India's Jindal Stainless warns of possible delays in Middle East shipment
India's Jindal Steel said on Friday that there could be some delays in steel shipments in the Middle East in the near term because of?the conflict? in the region. The Middle East is a small part of the country's export market, but the company remains committed to serving the region. Abhyuday Jindal is the managing director of Jindal Stainless. He said that given the escalating weather conditions, there could be a few?delays? in shipment arrivals. This may be due to the extended?transit times across certain international shipping and airspaces. He said that it would be premature to comment on any type of surcharges. Jindal stated that the company closely monitored the changing geopolitical environment and was prepared to minimize disruptions to its supply chain. "One area of focus is currently the availability 'of certain industrial gasses and raw materials such as dolomite and limestone, sourced (from the Middle East)",?Jindal said, adding that the company maintains a?adequate?stock?levels but was prepared to tap into other sourcing options in order to avoid any impact on production. Several steel companies have also prepared themselves to pay higher gas prices. Reports on Thursday indicated that India's Adani Total?Gas had raised its prices for industrial clients due to a lower supply of gas in the Middle East. Reporting by Neha?Arora; Editing by Mayank?Bhardwaj & Raju Gopalakrishnan
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Bloomberg News: Trump officials are excluding Treasury Oil Futures Trading for the time being
Bloomberg News reported on Friday that the 'Trump administration has ruled out using the Treasury Department to trade oil futures for the time being, citing an individual familiar with the issue. The report stated that officials discussed getting the Treasury Department to get involved but believed its ability meaningfully to affect the market was limited. The global oil prices have increased since the war began with Iran on Saturday, as the conflict has disrupted Middle East supply. Prices fell on Thursday, the first time since six days. This was due to reports that the U.S. The U.S. may intervene on the futures markets. Bloomberg News reported that officials were also hesitant to use the Strategic Petroleum Reserve immediately because it was only 60% full. White House and Treasury officials did not respond immediately to comments outside of regular business hours. ? Could not verify the report immediately. On Thursday, a senior White House official said that the Treasury would soon announce measures to combat 'rising energy costs in the aftermath of the Iran conflict. This could include potential action on the oil futures markets. Details of the plan are unclear, and the White House official declined to give a specifics on the condition 'of anonymity' to discuss 'internal issues. They said they didn’t want to get in front of the Treasury announcement. Reporting by Shubham Kalya in Bengaluru, Editing by Alexandra Hudson and Elaine Hardcastle
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Oil prices are expected to rise as the Middle East war continues. Stocks will be volatile this week.
The slight drop in oil prices Friday provided some respite to battered global shares, but the share markets in Asia were still on course for their biggest weekly decline in six years because the conflict in the Middle East shows no signs of abating. The oil prices are on track to make their biggest weekly gain since Russia's full-scale invasion of Ukraine began in February 2022. However, they have fallen after news broke that the U.S. Government is considering intervening in futures markets in order to curb rising prices. They remained close to 20% higher for the entire week. Brent crude futures were last trading at $84.73 a barrel. This is on track to be a 17% increase in ebb. U.S. crude oil retreated after reaching a 20-month peak and traded at $80 per barrel last, bringing its weekly gains to over 19%. Michael Brown, Pepperstone's senior research strategist, said: "We see markets (consolidating), for a while, cutting around current levels. A 'wait-and-see' approach is taking (precedence)." Investors rushed to cash this week as the U.S. and Israel war against Iran roiled the global markets. They realized that the conflict may last longer than originally anticipated. The traders also priced in more hawkish expectations of major central banks. They were frightened by the prospect that inflation would rise if energy prices continued to spike. The yields on U.S. Treasuries?have risen by 18 basis points, the most they have been in almost a year. Meanwhile, the dollar is set to make its biggest weekly gain in sixteen months. "The range (of plausible outcomes) of the war has expanded, including both?the possible of an extremely constructive resolution and a very destructive one," Daleep Singh said. He is chief global economist for PGIM Fixed Income. Markets are asked to price "a much fatter set" of tails, with little information about their likelihood or the paths in between. In Asia, EuroStoxx 50 futures rose 0.95% on Friday. FTSE and DAX futures also increased by 0.5% and 0.8%. Nasdaq Futures gained 0.27% while S&P500 futures increased 0.16%. High-Flying Stocks Tumble MSCI's broadest Asia-Pacific share index outside Japan traded 0.2% higher last week. However, it was expected to drop 6% this coming week. This would be its biggest weekly decline since March 2020. Japan's Nikkei gained 0.6%, but was on course for a weekly loss of 5.5%. South Korea's Kospi is headed for the biggest weekly drop in six years. Even high-flying indexes and technology stocks such as the Kospi fell this week as investors scrambled for profits to offset losses elsewhere. Ben Bennett, the head of Asia investment strategy at L&G Asset Management, said: "When dollar rallies and U.S. Yields rise, funding is tightening. This will often exacerbate wider moves, particularly if leverage is involved." DOLLAR IS THE KING Dollar is one of the few winners in this volatile week that has seen?stocks and bonds, as well as precious metals, fall. The dollar's rally paused on Friday but was still on course for a gain of around 1.5% per week, thanks to safe-haven demands and lower expectations about U.S. interest rate easing. The euro, still vulnerable to a rise in energy costs, is expected to drop 1.8% this week. Meanwhile, sterling will see a weekly decline of 1%. Investors now expect the Federal Reserve to ease by 40 basis points this year. This is down from 56 basis points a week earlier. The odds of a Bank of England rate cut this month are also lower, falling from a near-certainty last week. By the end of the year, it is expected that rates will be raised by?the European Central Bank? In Asia, on Friday, the yield of the 10-year U.S. Treasury benchmark was unchanged at 4.1421% after rising 18 basis points this week. The yield on the two-year bond has increased by 20 basis points for the past week. Spot gold, meanwhile, was unchanged at $5,118.79 per ounce. However, it was on track for a weekly decline of 3% as higher yields and the stronger dollar overshadowed its appeal as a safe haven. (Reporting and editing by Muralikumar Aantharaman, Jamie Freed and Rae Wee)
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After a wild earnings season, Australia's stocks have lost $91 billion in one week due to the Mideast War
This week, investors were on edge due to a growing Middle East conflict and record earnings season volatility. S&P/ASX 200 index is down 3.8% since last weekend, when Israel and the United States began bombing Iran. It has lost about half its gains in February. The benchmark index fell 1% on the Friday, with many blue-chip stocks falling. Nick Twidale is the chief market strategist for ATFX Global. He said, "Global downturns hit Australia harder than any other jurisdiction, and we may see a real decline if this war continues too long." "Australia will have more topside once the conflict is over." But unfortunately, the conflict seems to be advancing at this time. Investors are worried that rising oil prices will fuel inflation. This is causing a sharp drop in bonds as well. "A prolonged conflict would be a negative for global asset prices, and Australia will not be immune to that," said Phil Cornet. A portfolio manager with Atlas Funds Management. The sell-off this week comes on the heels of Australia's half year earnings season which was marked by wild swings. Profit beats were rewarded, while negative surprises punished. The ASX 200 has seen more than a third (33%) of its companies move by three standard deviations or more on the day they report, the highest proportion since JPMorgan started tracking this metric in 2015. In a recent report, the equity strategists at JPMorgan Australia, headed by Jason Steed wrote: "February's result season brought another record in terms of volatility for single stocks." According to LSEG, the top '20 companies' in Australia, who make up two-thirds or more of the ASX 200 indice, experienced the most volatile 'February in six years. CSL, the biotechnology giant, has fallen as much as 12 percent after reporting an 81% decline in first-half profits. Coles, the country's No. 2 grocery store, has fallen more than 7% since announcing a slow?start to second half. Companies that extract resources, drill oil or operate as licensed, regulated financial institutions are seen as more disruption-resistant, said Cameron ?Gleeson, a senior investment strategist at Betashares. BHP Group, the largest listed mining company in the world, soared 7% to a new record high. Commonwealth Bank of Australia, meanwhile, rallied by more than 8%, its best session since march 2020, following earnings reports that beat expectations.
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Andy Home: The fragility of the Western aluminum market is exposed by the war between Iran and ROI
The Iran War has exposed a growing vulnerability of the West's aluminium supply, a metal that is classified by the United States as a "critical manufacturing input" and by the European Union. The London Metal Exchange's (LME) aluminium prices hit a four-year peak of $3,418 per metric ton Wednesday, after a Gulf producer, Qatalum, a joint venture between Norsk Hydro, Qatar Aluminum Manufacturing and Qatar Aluminum Manufacturing started shutting down their smelter, and another, Aluminium Bahrain, declared force majeure. The closure of the Strait of Hormuz, which is still in place, risks further disruption of a regional hub of production that provides 23% of non-Chinese supplies. High inventories and excess capacity in China have historically protected the aluminium market from such unanticipated supply shocks. Producers would increase run-rates when they saw prices rising. China has no spare capacity and the inventory cover is much lower. This makes the market more vulnerable to disruptions like those currently occurring in the Middle East. DWINDLING STOCKS Daily stock reports from the LME show that aluminium is leaving LME warehouses at Port Klang in Malaysia, at a rate of 2,000 tonnes per day since January. No one has really paid attention. LME Aluminium stocks have lost much of their power as a signal over the past 10 years, as traders and banks competed for metal in order to lock in lucrative warehouse deals. The resultant churn of metal moving in and out the LME's system of warrants obscured any reading through to what was going on in the physical supply chains. The daily stock noise is a ruse to hide the steady depletion from a 3 million-ton mountain of aluminium at the beginning of the decade. The combined registered and off warrant stocks reached 583,000 tonnes in February, the lowest since the LME began publishing off-warrant stock figures in 2020. A significant portion of the remaining stocks is Russian aluminum, which made up 58% of the warranted stock at the end January. This is not very useful to most Western buyers. The U.S., Britain and EU banned the importation of Russian metals in 2024 in order to prevent Moscow from financing its war in Ukraine. The amount of metal that can be used in the LME is much smaller than the headline figure suggests. CHINA HITS BRAKES The change in stock dynamics reflects the profound structural changes that have occurred in the aluminium supply landscape. The Chinese government has mandated a maximum annual production capacity of 45 million tonnes. According to the International Aluminium Institute, Chinese production growth has slowed down from 4% to 2% in 2018. Smelters produced 44,5 million tons of aluminium annually in December. China's trade relationship with the rest is changing due to the production slowdown. Chinese manufacturers are importing more metals, especially from Russia. According to World Bureau of Metal Statistics which uses official customs data, the world's biggest producer imported a total of 2.5 million tons of primary metal last year, including just over one million tons of unwrought aluminum. China is exporting less semimanufactured goods such as sheet, tube and foil. In 2025, outbound shipments dropped by almost 10% on an annual basis, which is equivalent to a loss of nearly 600,000 tonnes in the Western market. Other words, China imports more aluminum metal and exports fewer finished goods, tightening Western supplies at both ends. FLAT-LINING Western smelters are even less flexible than their Chinese counterparts. According to IAI, production outside China was flat last year. The price of energy is the main problem, as it is a key cost component for the electrolytic melting process. The U.S., Europe, and Asia have a lot of idle smelter capacities, but they need to compete for limited long-term energy supplies with other sectors. High power prices are continuing to put a strain on existing plants. South32 has placed its Mozambique Smelter under care and maintenance after failing to negotiate a financially viable power contract. The Iran War is a major threat to the West's ability for longer-term supply. NEW VOLATILITY Aluminium is an essential part of our modern lives. It's used everywhere from cars to homes and food packaging. The energy transition is also a key issue. In 2020, the World Bank recognized aluminium as an "impactful" and "crosscutting" material in all existing and future green energy technologies. It is a metal that faces ever greater price volatility, as the global markets emerge from a period of "surplus" to one in which supply appears more problematic and stock levels are lower. The war in Iran is a warning for an important metal. Andy Home is a journalist. This column is a favorite of yours? 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Oil drops but is set to gain the most since 2022
The oil prices dropped on Friday, the first time since six days. This is because the U.S. government has been considering intervening in the futures markets to curb rising 'prices' and issued waivers to Russian oil buyers to ease the supply constraints caused by the Middle East War. Brent crude futures fell 95 cents or 1.1% to $84.46 a barrel, while West Texas Intermediate dropped $1.08 or 1.3% to $79.93 at 0440 GMT. Brent is still up 16.4% while WTI is up 19.2%, making this the biggest weekly gain since Russia's full-scale invasion in Ukraine began in February 2022. The gains were made after the beginning of the war on February 28, between the U.S.,?Israel and Iran, who have halted the movement of tankers through the Strait of Hormuz. This area is responsible for carrying about one-fifth of daily oil supplies in the world. Since then, the conflict has spread to the Middle East's key energy producing region. This has caused disruptions in oil production and shutdowns of refineries as well as liquefied gas plants. Priyanka Sahdeva, senior analyst at Phillip Nova, said that the halting of activities in Hormuz would have a two-fold impact on the oil market: it would make it impossible to store 20 million barrels a day and prevent the flow into the world. This could cause global energy prices to rise. A senior White House official stated on Thursday that the U.S. Treasury Department will announce measures to combat the rising energy prices caused by the conflict in Iran, including possible action involving oil futures markets. This would be an unusual move by Washington, to try and influence the energy price through the financial markets instead of physical oil supplies. Treasury Department also granted waivers to companies on Thursday to allow them to purchase Russian?oil that is stored in tankers. This will ease the supply shortages which are forcing refineries to reduce fuel processing. First waivers have been given to Indian refiners who responded by purchasing millions of barrels from Russian crude oil cargoes. This reverses months of pressure that they were under to stop the purchases. Kpler, a ship-tracking company, has gathered data that shows 30 million barrels (including floating storage) of Russian oil is available in the Indian Ocean and Arabian Sea regions, as well as in Singapore Strait. The recent price increase is still relatively modest compared to other price shocks, such as the one in '2022 after Russia invaded Ukraine and prices rose over $100 per barrel. Tony Sycomore, an IG analyst, said that it was important to keep this in perspective. Despite crude's nearly 20% increase this month the price is only $3.40 higher than its average for the past four years. Helen Clark reported from Perth, and Sudarshan Varadan in Singapore. Christian Schmollinger edited the story.
Police officer environment talks not fit for function and need reform, say climate leaders
A group of previous leaders and environment experts stated the annual U.N. police officer environment talks were no longer suitable for purpose and required to be reformed, publishing a. crucial open letter midway through what has actually up until now been a. fractious summit.
Almost 200 nations are gathered in Baku, Azerbaijan with a. main goal of agreeing a new target for how much money needs. to be provided to assist developing nations adjust to climate. modification and recuperate from harmful weather condition.
So far those talks have made little progress.
Delegates struggled for hours on the opening day to concur an. program and the mood has actually been soured by doubts about the United. States' future role under a Donald Trump presidency, diplomatic. spats involving the host nation and the withdrawal of. Argentinian delegation.
Friday's letter, signed by more than 20 specialists, former. leaders and researchers, consisting of previous UNFCCC boss Christiana. Figueres and previous U.N. Secretary-General Ban Ki-moon, stated the. Police procedure had accomplished much, today required an overhaul.
It is now clear that the COP is no longer suitable for purpose. Its existing structure just can not provide the change at. rapid speed and scale, which is essential to make sure a safe. environment landing for humanity, the letter stated.
This is what compels our require a basic overhaul of. the COP. We require a shift from negotiation to implementation,. enabling the police officer to provide on concurred commitments and make sure the. immediate energy shift and phase-out of fossil energy.
Others have actually likewise criticised the police officer procedure in Baku.
Previously this week Barbados Prime Minister Mia Mottley called. for urgent reform and Albanian Prime Minister Edi Rama spoke of. leaders sitting on sofas and taking photos while speeches. at the top played out on muted television screens.
Inquired about the letter and the general procedure, the COP29. Presidency's Lead Arbitrator Yalchin Rafiyev said: The procedure. has actually currently delivered ... so far by decreasing the forecasted. warming, delivering finance to those in requirement - and it's better. than any alternative.
However he said the multilateral process was under pressure. and that COP29 would be a base test for the worldwide climate. architecture.
(source: Reuters)