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Australian rare earth stock soars on MP Materials' multibillion US dollar deal
The shares of Australian rare-earths miners including Lynas, Iluka Resources and MP Materials, which is based in the United States, surged on Friday following a multi-billion dollar deal between MP Materials and the U.S. Government to increase production of rare-earth magnets. Lynas Rare Earths - the largest rare earths producer in the world outside China - surged up to 20%, reaching its highest level since mid August 2022. It was on track for its best day ever since April 2020. Iluka's intraday gains were the highest ever, with a 27% increase. As of 0558 GMT, the stocks were the biggest gainers in the benchmark ASX 200, which was also on the rise. The U.S. Department of Defense's (DoD) deal with MP Materials has lifted the mood for Australian rare-earth firms. The deal comes after China placed restrictions on rare Earths last month, which led to a 75% decline in rare earth magnets exported from the country and forced some auto manufacturers to suspend production. Rare earths are 17 metals that can be used to produce magnets, which are essential in the production of cars, electric vehicles, auto parts, electronics, and weapons. The DoD, as part of this deal, will become the largest shareholder of MP Materials, and guarantee that the two most common rare earths are priced at $110 per kilo, almost double the current market price in China. This signals a strong U.S. effort to achieve rare earth magnet autonomy, which increases the upside risk for rare earth prices. Jefferies noted that Lynas appeared to be the next logical recipient of government market assistance. We see the resetting the pricing metrics of rare earths as providing material upside potential for Lynas earnings in the short term, and an increased possibility for de-risking its growth projects through government entity funding. The brokerage raised its price target from A$6.40 to A$10 per share, and upgraded Lynas from "underperform". Lynas's last price was A$9.67. Sayona Mining, a smaller lithium player, and Liontown Resources both saw their shares rise by 2.8% and 1.6% respectively. (Reporting and editing by Sonia Cheema in Bengaluru, with John Biju reporting from Bengaluru)
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ASIA GOLD-Demand is sluggish as volatility in prices affect sentiment
The demand for physical gold was sluggish across the major Asian markets this week as volatility in prices weighed on sentiment. Premiums in China remained firm, while discounts in India were narrowing. Dealers in the top consumer China have charged premiums between $10 and $25 per ounce above the global benchmark spot rate, compared to premiums between $4.2-$33 from last week. On Wednesday, spot gold dropped to its lowest levels in more than a week, dropping below the $3300 mark. It then recovered to trade at $3335 by 0520 GMT Friday. In recent days, U.S. president Donald Trump has expanded his trade war, announcing levies against several countries that will take effect August 1. Hugo Pascal said that this uncertainty failed to spark a renewed interest for gold purchases in China during the week. China's central banks issued new anti-money-laundering and counter-terrorism funding regulations that target precious metals and gem dealers, according to the state news agency Xinhua. A precious metals trader based in mainland China said that "this regulation" will kill some potential onshore demand. He added that gold demand could only increase when prices reach $3,000 to $3,100. Meanwhile, Indian dealers' discounts The price of gold has dropped to as low as $8 per ounce, including 6% import duties and 3% sales taxes, down from $14 last week. A Mumbai-based bullion seller with a private banking firm said that discounts are slowly narrowing because of limited supplies. Imports were low between May and June, and scrap is also scarce. The price of domestic gold per 10 grams was around 97.300 rupees (1,133.57 dollars) on Friday, after reaching an all-time high of 101.078 rupees in the previous month. During the monsoon period, which spans from June to September, gold demand in India is usually subdued. In Hong Kong, gold In Singapore, the price was $1.50 higher than in Singapore. Gold traded at par prices with a $2.20 price premium. In Japan, bullion The premium was $0.50. (85.8350 Indian Rupees = $1)
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Russia claims that Ukraine drone strikes target Moscow and kill a Russian in the southwest
Russian authorities confirmed that overnight Ukraine drone attacks killed one person, damaged an agricultural enterprise and targeted Moscow, as well as scores of other Russian regions. The Russian defence ministry announced on Telegram that Russian air defences shot down 155 Ukrainian drones from 11 pm on Thursday (2000 GMT) to 7 am on Friday. Of these, 11 were headed for Moscow. Russia's aviation agency Rosaviatsia announced late Thursday that three of the four airports servicing the Russian capital, Domodedovo Vnukovo Zhukovsky temporarily suspended their operations, but they later resumed. Igor Artamonov, the regional governor, said that a drone crashed into the Lipetsk agricultural enterprise, causing a fire to flare up and killing one and injuring two others. The Russian Defence Ministry reported that their air defence systems had destroyed four drones in the Lipetsk Region, which is located in Russia's south-west. The Russian defence ministry reports only the number of drones its units destroy and not how many Ukraine launched. The ministry said that the majority of drones destroyed overnight were over Russian bordering regions: Kursk Belgorod Bryansk. The reports could not be independently verified. Ukraine has not yet responded. Kyiv claims its attacks on Russia's territory are meant to destroy infrastructure that is key to Moscow’s war effort and are a response to Russia’s continuous strikes on Ukraine during the war. (Reporting and Writing by Ron Popeski, Lidia Kelly, Editing by Andrew Heavens Cynthia Osterman, Saad Sayeed).
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MORNING BID EUROPE - New tariff drama shakes complacent markets
Stella Qiu gives us a look at what the future holds for European and global markets. On Friday, the markets were jolted from what appeared to be a dull day in summer when U.S. president Donald Trump went on TV to inject new drama into his simmering wars of trade and to disrupt Wall Street's recent upward trend to record highs. Trump stated that tariff letters would be sent to Canada and Europe "today or tomorrow". He also floated the idea of increasing the tariff rate for other countries who do not receive a tariff letter from 10% to 15% or 20%. He posted his letter to Canada in social media shortly after, stating that from August 1, a 35% duty rate would be applied to all Canadian products. The market nerves were calmed slightly when an official from the administration clarified that goods covered by United States-Mexico Canada Agreement would be excluded. Wall Street futures fell 0.8%, and EUROSTOXX futures fell 0.7%. Last, they were down around 0.3%. The currency markets were also roiled, but once the dust settled the dollar had gained 0.3% against the loonie, and the euro was down 0.2%. As the chances of a U.S. - Japan trade agreement dim, so has the yen. The dollar rose 0.6% to 147.12yen on Friday, and is heading for the largest weekly gain this year of 1.7%. The yen has fallen for the seventh consecutive week against the euro, and is at a five-month high against the Australian dollar. Investors suspect that trade talks aren't going well between the EU and Trump, now that Trump has said the EU too will receive a letter. EU officials said they hoped to reach a deal by August 1. Investors will be focusing on the second-quarter U.S. earnings report next week in order to assess the impact of Trump’s tariffs. Fast Retailing, the owner of Uniqlo, has warned that tariffs could have a major impact on its U.S. operations later this year. It plans to increase prices to cushion the blow. Tokyo's stock market saw a drop of almost 7%. The following are key developments that may influence the markets on Friday. UK May monthly GDP Canadian Employment Statistics for June Eurozone Final CPI for June Possible Trump letter to the EU on tariffs
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Lloyd's Register Study Identifies Hidden Fatigue Risks in Offshore Wind Tech
Some offshore wind turbine (OWT) support structures may fall short of required fatigue life expectations, according to a new Lloyd’s Register (LR) report, which also pinpointed reliability-based inspection as one of the measures to manage fatigue-driven risks in such structures.The case study evaluated a North Atlantic offshore wind farm of 60–70 turbines, with the combined 500 - 600 MW capacity.Offshore wind turbines are typically designed for 25 years of service, using a fatigue design factor of three, implying a minimum required fatigue life of 75 years.However, the study found that a critical joint in the jacket foundation would reach the end of its fatigue life after just 52 years, falling short of this design requirement.Instead of redesigning the joint, the study took a reliability-based inspection (RBI) approach to identify and mitigate potential failure through targeted, risk-based maintenance.The study combined a S-N (Stress vs. Number of cycles) model, to estimate when structural safety drops below acceptable thresholds, with Fracture Mechanics (FM) crack growth analysis, to predict the probability of failure over time and inform inspection intervals.This approach incorporates inspection results via Probability of Detection (PoD) curves to allow inspection schedules to be dynamically updated, responding to real-world conditions and inspection findings.The results suggest that the first inspection should be carried out around year nine. After that, depending on the inspection method, further inspections might be needed every year to maintain acceptable safety margins.Advanced Inspection Techniques Offer Greater ReliabilityHowever, the case study highlights the limitations of current inspection methods. Visual and ultrasonic inspections were found to be less effective for fatigue-critical components.More advanced techniques, such as Eddy Current or ACFM, offer greater reliability and allow for longer inspection intervals, but only when operators were willing to adopt slightly lower safety thresholds.While RBI planning is effective in reducing in-service life costs and ensuring the longevity and safety for OWT structures, it requires expert input, reliable models, and software tools that can handle complex calculations.Ongoing research aims to refine the models and address the challenges during their application. Reliability updating, especially when integrating PoD curves, requires complex modelling and precise calibration of parameters such as initial crack size and stress intensity factors, areas often underdeveloped in practice.The study calls for wider industry collaboration to refine inspection standards, share real-time monitoring data to refine fatigue predictions, and adopt more flexible definitions of acceptable reliability where appropriate.“Many offshore wind assets are designed to a standard fatigue factor, but real-world conditions often expose critical vulnerabilities. Our findings show that using reliability-based methods allows operators to focus inspections where the risks are greatest.“By integrating sophisticated models and real-world inspection data, we can extend asset life, reduce costs and, most importantly, maintain safety,” said Kourosh Parsa, Global Head of Technology - Offshore and Subsea, LR. “By focusing on the areas with the greatest risk, we can not only help to manage fatigue-related issues more effectively, we’re also enabling developers and operators to make better-informed decisions that optimize asset life and performance.“This proactive, risk-based approach is exactly how we support our clients in navigating complexity, controlling costs, and ensuring the long-term viability of their offshore wind investments,” added Manuel Ruiz, Head of Offshore Renewable Solutions, LR.
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Officials claim that armed men have kidnapped and killed nine bus passengers in Pakistan.
Officials said that nine passengers were killed by armed men after they kidnapped them in Pakistan's southwest Balochistan Province. Shahid Rind, spokesman for the provincial government, confirmed that passengers were kidnapped on multiple buses Thursday evening. Naveed alam, a government official, said that bodies with bullet injuries were found overnight in the mountains. No one has taken responsibility. In the past, separatist Baloch militants were involved in similar incidents. They killed passengers who they identified as being from eastern Punjab. The Baloch Liberation Army (BLA) is one of the most powerful insurgents operating in a mineral rich region bordering Afghanistan and Iran. The Baloch militants accuse the authorities of Pakistan of stealing resources from their region to finance spending in Punjab Province.
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The iron ore market is set to gain for a third consecutive week on the hope of China reforming its supply
Iron ore futures continued to rise on Friday and are headed for their third consecutive weekly gain. This is due to renewed hope that China's crackdown against a price war, will pave way for new reforms aimed at curbing steel overcapacity. As of 0303 GMT, the most traded September iron ore contract at China's Dalian Commodity Exchange was trading 2.07% higher. It was 766 yuan (US$106.82) per metric ton. As of 0253 GMT, the benchmark August iron ore traded on Singapore Exchange was $0.85 higher per ton. Both benchmarks are up 4% this week. Jiang Mengtian is a principal analyst with Horizon Insights. He said that the strength of the ferrous market stemmed primarily from the sentiment fuelled by the environmental protection-related restrictions on production in Tangshan, the main steel production hub, and the hopes for supply-side reform. Jiang said that the steel market was the most affected, as shown by the rise in futures prices. He also noted the stockpiling of iron ore by downstream consumers. Despite signs of a softening demand, ore prices continued to rise. According to Mysteel, the average daily hot metal production, which is a measure of the iron ore demand, fell 0.6% from the previous week, reaching 2.39 million tonnes in the week ending July 10. This was the lowest level recorded since April 3. Coking coal and coke, which are both steelmaking ingredients, also saw gains. Jiang said that the price of coal had seen the biggest increase due to its low valuation. The majority of steel benchmarks traded on the Shanghai Futures Exchange rose. The price of rebar increased by 1.32%. Hot-rolled coils rose by 1.39%, and wire rod was up 1.77%. Stainless steel fell by 0.47%. ($1 = 7.1707 Chinese Yuan Renminbi)
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Gold prices rise on Trump's tariffs but dollar firmness caps gains
Gold prices rose Friday, after U.S. president Donald Trump announced new tariffs against Canadian imports as well as broader threats of tariffs to other trading partners. However, gains were limited by the stronger dollar in light of mounting signs that global trade is experiencing turmoil. As of 0245 GMT, spot gold increased 0.3% to $3333.67 an ounce. U.S. Gold Futures rose 0.6% to $3345.10. Trump announced on Thursday that the U.S. will impose a tariff of 35% on imports coming from Canada, and plans to impose blanket duty rates of 15% or 20 % on all other trading partners. The announcement follows a 50% tariff announced on Wednesday on U.S. imports of copper and a similar tax on Brazilian goods, as well as tariff notifications sent to other trading partners including Japan and South Korea. All new tariffs announced will go into effect on August 1, 2018. Tim Waterer, KCM Trade's Chief Market Analyst, said that despite Trump's tariffs wars picking back up again, gold prices haven't seen the same boost as they did previously because investors are more familiar with both Trump's policies and the tariff story. Gold is becoming more expensive to international buyers due to the U.S. Dollar Index. Waterer stated that the move of the dollar north in tandem with gold likely limited the gains made in precious metals. The weekly jobless claims for the U.S. dropped unexpectedly to the lowest level in seven weeks, signaling stable employment levels even though the labour market is cooling. It also signals that the Federal Reserve does not feel the need to cut interest rates again. In a low-rate environment, gold, which is often viewed as a safe asset in times of economic uncertainty, tends do well. On Thursday, the White House renewed its attack on Fed Chairman Jerome Powell. A senior official said Powell had "grossly managed" the central banking, citing budget deficits and overruns. Silver spot rose 0.4% to $37.17 an ounce. Platinum fell 0.2% at $1,358.61, and palladium increased 0.2% at $1,143.55. (Reporting and editing by Sumana Aich and Rashmi Nandy, Bengaluru)
What is in the EU draft Clean Industrial Deal?
A draft package was revealed on Tuesday by the European Commission. The package will be proposed next week to help EU industry stay competitive and reduce their carbon footprint.
The European manufacturing industry is facing a number of challenges, including a weak demand for its products, the cheaper Chinese competitors and upcoming tariffs by U.S. president Donald Trump on imports of steel and aluminum.
Here are the key elements of a leaked EU 'Clean Industrial Deal,' which is intended to revitalize Europe's struggling domestic industries.
Energy Prices
Energy prices in Europe are up to three-times higher than those of their American competitors, and Brussels has been under pressure to reduce this price differential to help local businesses to compete.
The draft EU document detailed plans for an European Investment Bank scheme that will launch by the end March. This scheme would offer guarantees to smaller companies for signing power purchase agreements, helping them lock in renewable electricity generators with predictable prices.
The EIB will also provide support to manufacturers who produce components for power grids to upgrade Europe's aging energy networks.
A proposed EU legislation in the fourth quarter would provide fast-tracked permits for energy-intensive industries in order to boost investment in clean industrial project.
The draft states that Brussels will recommend to all 27 EU member countries to lower electricity taxes to the legal minimum to reduce consumer bills on a short-term basis.
The Commission plans to also soften existing EU gas storage filling target, which the EU planned to extend past 2025. This is in response Germany and other countries who are concerned that fixed deadlines for filling storage could raise gas prices.
PUBLIC PURCHASING, STATE AID
The EU plans to make it easier for businesses to get state aids and other financial incentives when they undertake projects that reduce their carbon emission.
EU governments will be allowed to offer tax breaks on clean industrial investments through measures like accelerated depreciation. This allows businesses to depreciate a larger part of an asset sooner.
The draft stated that these changes will be made by simpler EU state aid regulations, which are due to be published in July. The EU will help countries to use national state aids to combat energy price spikes. This could include using subsidies to protect consumers from high gas costs.
Gas is the main source of electricity for most EU consumers, despite the rapid expansion of renewable energies in the EU.
In 2026, the EU's public procurement rules are set to be reformed. Buy-Europe criteria will be added in order to increase demand for local products.
Trade and CO2 Costs
According to the draft Clean Industry Deal, the EU will continue using anti-dumping and anti-subsidy duty as long as industries continue to be concerned about cheap imports, particularly of electric cars, and other clean technologies from China.
Before 2026, the bloc will start collecting taxes on steel, cement and various other imports.
The EU wants to simplify rules in order to reduce the administrative burden on industry. It could potentially scale back the carbon border tax to only 20% of companies that are covered by the scheme because they produce nearly all the emissions.
The draft stated that the Commission would propose a scheme to fund industrial CO2-cutting project using revenue from the EU Carbon Market, but did not specify how much money would be set aside.
(source: Reuters)