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The Trump tariff pause has led to a rebound in copper prices, but there is still concern about China.
After the U.S. suspended most tariffs for 90 days, copper and other base metals saw a sharp rebound on Thursday. Some investors were concerned about the rally because U.S. president Donald Trump escalated the trade war against top metals consumer China. The benchmark three-month copper price on the London Metal Exchange LME rose 3.6%, to $8.926 per metric tonne at 0945 GMT. On Monday, volatile LME copper fell to $8,105 per ton, down from its peak of $10164.50 on March 26. This was the lowest price in over nine months. Trump has paused most of the heavy duties he just imposed, which gave a boost to the financial markets. However, he increased tariffs on Chinese goods to 125%, up from 104%, the level at which they were introduced on Wednesday. Carsten Menke, an analyst at Julius Baer Zurich, said: "This is a typical knee-jerk financial market reaction." The relationship between China and the US is still a problem in industrial metals. We haven't seen much improvement there." He said that U.S. importers had pre-bought Chinese products in recent months, anticipating tariffs. There will therefore be a hangover. Your purchasing manager at Walmart would say that we are fully stocked. This is especially true if you don't have a clue about the direction of your own economy. So, I believe we will see a softening of demand for industrial metals in the coming months. The Shanghai Futures Exchange's (SHFE) most-traded contract for copper gained 3.9%, reaching 75,300 yuan per ton ($10,254.66), after hitting an eight-month-low on Wednesday. The data released on Thursday showed that the Chinese economy is still in a fragile state. Consumer prices dropped for the second consecutive month in March, while deflation at factories increased. ($1 = 7.3430 Chinese yuan renminbi) (Reporting by Eric Onstad;Editing by Elaine Hardcastle) ($1 = 7.3430 Chinese Yuan Renminbi)
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UK energy regulator to reject penalty exemptions for National Grid and SP Energy joint venture
Ofgem, the British energy regulator, said that it did not think an electricity transmission project by National Grid Electricity Transmission & SP Energy Networks qualified to be exempted from penalties related delays. A joint venture between National Grid units and Iberdrola, a Spanish company, had asked for a 480 day exemption from penalties in relation to delays in the completion of the Eastern Green Link 1 due to global supply-chain issues and capacity shortages. The project includes subsea cables and underground cables that link Scotland with north-east England. It is an important part of Britain’s goal to decarbonise the electricity sector by 2030. Ofgem, however, said that it would consider denying the request because supply issues were not present at the time the EGL1 bid was made and the companies had taken measures to reduce the impact of these constraints. Ofgem approved a funding package of 2 billion pounds ($2.57billion) for the project back in November. The regulator stated that construction of EGL1 started in March, and now expects it to be completed in April 2029. This is 16 months behind schedule, which will result in penalties of four months for Output Delivery Incentive. Financial incentives are used to promote timely and efficient delivery of projects. If projects are not delivered on time, a fine of up to 10 percent of the total project cost can be imposed. The joint venture will be exempted from penalties for delays if approved until April 25, 2020. Currently, it is exempted until December 31, 2020. EGL1 will be providing further evidence during Ofgem’s consultation period on supply chain issues, including the impact of delivery times. Raechel Thankam Job in Bengaluru and Shashwat awasthi, editing by Janane Venkatraman, Saad sayeed.
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Kazakhstan warns that investment could shrink due to a 'global storm'
Kassym Jomart Tokayev, the Kazakh president, said that he has instructed his government urgently to complete work on a new plan to protect Central Asia from global economic shocks. Kazahstan, the only Central Asian country targeted by President Donald Trump, was subjected to additional tariffs of 27 percent earlier this month. Despite Trump's Wednesday reversal of many of the heavy duties, the countries still face a tariff of 10%. Kazakhstan is also vulnerable to falling oil prices, as the U.S. continues to put pressure on China. Kazakhstan is among the top 10 oil producing countries in the world. According to the World Bank, its economy grew 4% in 2012. Tokayev was quoted as saying, "The current events in the world could be a sign of an economic storm around the globe," by the government's press service on Thursday. "This will affect all countries including Kazakhstan." We must be prepared for any situation, and act pragmatically and confidently. According to the U.S. Trade Representative, the total goods trade between Kazakhstan & the U.S. will reach $3.4 billion by 2024. Kazakhstan's Central Bank raised its key rate of interest to 16.5% during its March meeting, while annual inflation was 10% last month. Tokayev stated that the government is working to ensure that its development agenda will stay on track, but warned of possible difficult days ahead. "There will be a battle for investment in the current climate." He was quoted saying, "We need to be very well prepared here." (Reporting and writing by Mariya Goreyeva, editing by Kate Mayberry).
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Stocks rally in relief after Trump's tariff pause
On Thursday, global shares surged after U.S. president Donald Trump announced he would temporarily reduce the heavy duties he just imposed on several countries. In a shocking reversal, Trump announced on Wednesday that he would pause many of his new tariffs for 90 days following a market crash which erased trillions from global stocks. George Lagarias is the chief economist of Forvis Mazars. He said, "You have had a relief rally since realising that the market pressure resonates with President Obama." Lagarias said, "The main takeaway is that there will be limits and thresholds which he (Trump), will probably respect." Trump's reversal has pushed stocks higher around the world, beginning with a 9.5% rise in the S&P 500 index on Wednesday. The European stock market is following suit. The STOXX 600, the pan-continental index of global stocks, is up 5.3% and on course to its largest one-day increase since March 2020. The major indexes of London, Paris, and Frankfurt have risen between 4.1% to 5.6%. In Asia, Japan’s Nikkei gained more than 8% while a broad gauge of Asia-Pacific shares excluding Japan gained 4.4%. Wall Street futures have taken a break after the rally as investors try to understand the economic policies of the U.S. government. The world's political and financial leaders are looking with horror and not amusement at a government that prioritizes the signing of a executive order to increase the water power in shower heads on the day the bond market crashes and investors doubt the long-term credibility of the administration after it has flipped-flopped the biggest of its policies, tariffs," Martin Whetton said, Westpac's head of financial markets. Nasdaq Futures dropped 2%, while S&P500 futures declined 1.7%. In the Wednesday cash session, both indexes posted their largest daily percentage gains for more than a decade. The dollar fell around 0.9% against the Swiss franc and the yen, not sustaining its previous jump. Khoon Goh is the head of Asia Research at ANZ. He said: "I believe the initial move was simply massive short covering, and this gave the world a little breathing space. Except for China...because markets started to price the worst-case scenarios." Trump's decision to reverse the tariffs on specific countries is not final. The White House announced that a 10% blanket duty will continue to be applied to almost all U.S. imported goods. This announcement does not seem to affect existing duties on steel, aluminium and autos. He said he would also increase the tariffs on Chinese imports from 104% to 125%, which came into effect Wednesday. China raised the additional duties on American goods to 84% on Wednesday and imposed restrictions against 18 U.S. firms, mostly in defense-related industries. Investors, however, have a limited view of the latest escalation in Sino-U.S. Trade tensions. They are focusing on the 90-day window Trump granted to dozens countries. Hong Kong's Hang Seng Index rose 2%, while China's CSI300 blue chip index rose by 1.3%. Wong Kok Hoong is the head of Maybank's equity sales trading. The China + 1 route is still intact. "As the tariffs on the rest of world are 10% for 90 days and companies/businesses will have the time to adjust their supply chain routes." The onshore yuan is still at its lowest level since December 2007, 7.3518 dollars. The People's Bank of China set the midpoint, or the rate at which the yuan can trade within a 2% range, prior to the market opening. This is the lowest since September 11, 2023. BONDS SALE The steep drop in U.S. bond prices this week showed signs of slowing down on Thursday. The benchmark 10-year Treasury rate dropped by 10 basis points to 4.2985% after reaching a high of 5.150% the previous session. Fears of fragility on the world's largest bond market were reignited by a violent U.S. Treasury sale in previous sessions. The "sprint for cash" reminiscent of the COVID era had rekindled fears. Lagarias, a Forvis Mazars analyst, said: "It is sensible to discount risk assets in the United States by a certain amount." German Bunds, the only safe haven on the bond market, were sold off Thursday. The 10-year yield rose 8 basis points to 2.659%, while the 2-year rate rose 14 basis points to 1.855%. Investors worried about the continuing growth shock caused by the worsening Sino/U.S. Trade War, drove oil prices down elsewhere. Brent crude futures fell 2.3% to $63.97 a barrel while U.S. Crude dropped 2.2% to $60.95. Spot gold continued to climb, and it was up by 0.9% last at $3.109 an ounce.
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Some China producers begin maintenance due to the falling alumina prices
The falling prices are causing Chinese alumina manufacturers, who rushed to increase capacity last year after prices surged due to a shortage of bauxite as a raw material, to be squeezed. Some have shut down their capacity in April for maintenance. Alumina prices on the Shanghai Futures Exchange have fallen by almost half since their December 4 record. This is due to expanded capacity of the key ingredient in aluminium production and the eased supply of bauxite. Mysteel, a provider of information, predicts that China's alumina production capacity will increase by 20% this year, or 19,8 million metric tonnes. Mysteel's data shows that 60% of the existing capacity operates at a loss, averaging around 300 yuan per ton. Research firm Aladin reported that small-scale maintenance was carried out in April to reduce alumina output by around 5% in comparison to March. This will be mainly in Shanxi province and Shandong provinces where there is insufficient bauxite locally, forcing producers to import more expensive bauxite. According to Mysteel, China's alumina production rose by 1% from March 2024. Analysts and traders say that despite the fact that alumina refineries are reliant on long-term contracts with aluminium melters, it is unlikely they will make large-scale cuts this year. Our long-term customers would find another supplier if we started maintenance to reduce production. We'd also lose our credibility, said a trader at a medium-sized alumina refining plant, who declined to be identified as he was not authorized to speak to media. Alumina prices are also being pushed down by the increased supply of bauxite. Customs data revealed that bauxite imports into China increased by 26% in the first two month of this year. Zijin Tianfeng Futures stated that the 40 million ton expansion of bauxite production planned for this year by Guinea and Australia would be more than enough to offset the 14 millions tons lost last year due Guinea Alumina Corp suspending bauxite imports.
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New Zealand and Australia discuss free trade with EU and others
New Zealand and Australia announced on Thursday that they were each working with other countries on a potential joint response to bolster free trade in the face of a barrage U.S. Tariffs. Christopher Luxon, the New Zealand Prime Minister, said that he spoke with leaders from Singapore, Vietnam, and Malaysia as well as with the head of the executive of the European Union about international trade. Luxon, in a speech he gave on Thursday, floated the idea that members of the European Union and Comprehensive and Progressive Agreement for Trans-Pacific Partnership(CPTPP) could work together. The global trade system has been upended after U.S. president Donald Trump announced last week sweeping tariffs on dozens countries. Some of these countries responded with retaliatory duties, causing massive volatility on the markets. On Wednesday, Trump announced a dramatic reversal. He would suspend for 90 days the high tariffs that he had placed on many countries. Penny Wong, Australian Foreign Minister, said that government ministers have held discussions with Southeast Asian countries, Japan, Korea and India about a possible joint response to Trump’s tariffs. In an interview with ABC, she stated that "there is a group who sees the benefits of free, open and fair commerce." Luxon stated in posts to X that he had separate phone conversations with Singapore Prime minister Lawrence Wong and Vietnamese Prime Minister Pham Minh Chinh, as well as Malaysian Prime Minister Anwar Ibrahim, about bolstering free trade based on rules to stimulate economic growth. He also said that he spoke with Ursula von der Leyen, President of the European Commission about "what EU and New Zealand could do together to support trade rules which underpin Kiwi jobs and New Zealand growth". New Zealand, Singapore and Malaysia are all members of CPTPP. Other countries include Australia, Canada and Chile as well as Japan, Mexico, and Britain. Luxon had earlier said in an address to the Wellington Chamber of Commerce that "one possibility" is that the CPTPP members and the European Union could work together to promote rules-based trading and make specific promises on how this support will be implemented in practice. He said he will be heading to Britain in late April to meet with Prime Minister Keir starmer and discuss trade, geopolitical and security issues. He said, "We cannot make the case for New Zealand by staying at home." "We must position ourselves to be advocates for both our economic interests and institutions that support them." Trump has imposed 10% tariffs on Australia and New Zealand. This is the lowest of the levies he has for all imports to the U.S. Canberra, and Wellington both say they will not retaliate. Last year, about 12% of New Zealand and 5% Australia exports were sent to the U.S.
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Saudi Arabia outperforms Gulf counterparts in early trade, as Trump pauses the tariffs
Saudi Arabia's stock exchange led its Gulf counterparts higher on Thursday morning, following global shares. This was after U.S. president Donald Trump made the unexpected decision to suspend most of his recently implemented tariffs. Trump announced on Wednesday a 90-day suspension of many of his new tariffs. However, he increased the tariff rate on China from 104% to 125%, effective immediately. Saudi Arabia's benchmark stock index rose 4% on its way to the biggest intraday gain since March 2020. The increase was boosted by Al Rajhi Bank's 3.8% and Saudi National Bank's 3.9% increases. Saudi Arabia is currently subject to a minimum tariff of 10%. Saudi Aramco was among the other companies that gained 2.6%. According to SPA state news agency, the oil giant discovered 14 small oil and gas reservoirs and fields in the Eastern Region of the Kingdom and the Empty Quarter. Saudi index, which had its largest intraday drop in almost 5 years on Sunday, is set for its worst week since May despite its sharp gain. Dubai's main stock index rose 2.6% with Emaar Properties, the blue-chip developer, up 4.7%. The top lender Emirates NBD was up 3.7%. ADNOC Gas led the way with a 4.6% increase in Abu Dhabi. The oil prices, which were the driving force behind the Gulf financial markets, fell as Trump intensified his trade war with China. Qatar National Bank, the Gulf's largest lender, increased its share by 2.6%. The lender's net profit for the first three months was 4,26 billion riyals, which is more than analysts expected.
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Equinor creates new unit to capitalize on the soaring demand for power
Equinor, a Norwegian company, announced on Thursday that it is merging its renewables division with its gas to power plants and energy storage assets in order to increase its electricity business. Equinor said that the move was a response to a surge in demand for energy, fuelled by artificial intelligence, the growth of data centres and the green shift. The vast majority of Equinor's income still comes from oil and natural gas. In a press release, CEO Anders Opedal stated that by combining renewable energy with flexible power offerings we could strengthen our competitiveness in the market and create value. It added that the company is working on three "mega-offshore wind projects" in Britain, America and Poland and has an increasing number of assets for onshore renewables. Storage and other solutions will be crucial for deploying large amounts of green energy needed to decarbonise electricity. Equinor's statement said that while the demand for renewable energy will continue to increase, flexible power would ensure reliability and stability of the power offered to the market. In a worst-case scenario, global electricity consumption in data centres will reach 945 terawatts by 2030, according to a report released on Thursday by the International Energy Agency. Equinor weakened its energy transformation plan earlier this year due to industry challenges. Essi Jacobsen and Essi Lehto contributed to the reporting. Terje Solsvik, Mark Potter and Terje Solsvik edited the report.
Inuit pride fuels Greenland independence spirit after Trump interest
In a small workshop in Nuuk, the capital of Greenland, goldsmith Nadja Kreutzmann polishes stones and metals mined on this vast island rich in minerals. Her jewellery is decorated with Inuit symbols for life and survival. Indigenous identity in Greenland is resurging ahead of the March 11 general elections called by U.S. president Donald Trump after he said he wanted Greenland to be his.
Trump's interest in Greenland has shaken up the status quo. This, coupled with growing Inuit pride has led to some locals viewing the vote as an historic opportunity to free Greenland of Danish influence.
Greenland is an autonomous territory in the Kingdom of Denmark. It has only 57,000 inhabitants spread over an area three times larger than Texas. A referendum can be held to decide whether Greenland will become independent.
Greenland is dependent on Denmark for more than half of its budget. The main parties all support independence, but differ in how and when this could be achieved. Over the last month, new accusations of historical wrongdoings regarding the exploitation and exploitation of Greenland's mineral wealth have galvanized factions seeking a quicker track.
In the 1950s the Danish authorities began a program of forced relocation of Inuit into larger towns. This resulted in the marginalization of indigenous practices and languages, which accounted for almost 90% of population.
In recent years, the Inuit cultural revival in Greenland has exploded as awareness of colonial repression grows. A new embrace of traditional body and face tattoos is a visible demonstration.
"For many, many years it was an embarrassment for people to be Greenlandic. They would suppress their Greenlandic culture, and try to become more Danish, both in appearance and way of life," said Kreutzmann. Her European surname, Inuit lines tattooed on her arms, reflect her own mixed heritage.
"We were told we had to act more Danish and speak Danish if we wanted something," she said at Nuuk. There, wooden houses painted in primary colors contrast with the snow that covers the town, as well as the white-blue, icebergs floating in the bay.
Speaking Greenlandic and looking Greenlandic are now being celebrated, as is Greenland's rich cultural heritage. Kreutzmann has created earrings that look like the scales of capelin fish, which is a vital but small part of the Arctic eco-system and Inuit diet.
Greenland's own Prime minister and other institutions have been in place since 1979. However, strategic decisions like foreign affairs, monetary policies and defence are still under Danish control. The four-year term of the current parliament ends in April.
Political analysts say it's not clear if voters will support the left-wing coalition again. Election polls are few and far between. Greenland, on the other hand, is concerned about foreign interference. In response to Trump’s remarks, the government banned overseas donations in the campaign.
In order to write this article, I spoke with more than a dozen Greenlanders. All of them said that they were in favour of independence from Denmark and America.
Many wanted Greenland's foreign affairs to be decided by it, but warned against taking rash actions in light of Trump’s remarks. They feared that Greenland would become worse off if it sought independence too soon from Copenhagen. Independence for Greenland would allow for greater U.S. influence on the island, which is seen as crucial for U.S. national security. This comes at a time where the Arctic region, dominated by Russia and China, has become a geopolitical hotspot.
Trump cites China's and Russia's Arctic presence as reasons for his interest Greenland. The United States had previously offered to purchase Greenland from Denmark for $100 million in 1946 after World War Two. Recent polls showed that nearly half of Greenlanders viewed Trump's interest in Greenland as a threat.
Kim Kleist Eriksen is an artist that carves walrus bones and tusks into intricate sculptures based on traditional Greenlandic stories and symbols. He said Trump's proposal had attracted positive attention, but he was still offended by it.
"At first I thought it was just a joke. But he was serious. Eriksen's 40-year-old work is sold both locally and internationally. "I was disgusted."
Eriksen wants to preserve a Greenlandic tradition, when hunters would use walrus tusks or bones to create hunting tools, amulets or toys.
Eriksen said, "I can create art from the stories I heard as a kid and turn them into carvings." It helps me to understand myself and my culture better.
MISSIONARY KING
Qupanuk Olsen is one person who hopes to capitalize on Trump's interests. He's a mining engineer and social media influencer turned candidate for Naleraq. Naleraq is the main pro-independence party in Greenland, and the largest opposition force currently in the Inatsisartut Parliament.
Olsen said that after Trump's remarks, she found her calling in politics.
She said, "Every Greenlander needs to now have an opinion." "We have to decide if we want to remain under Denmark or become independent.
Olsen spoke with Greenlanders by Nuuk’s colonial harbour. The scene included a wooden church painted red and a statue of Hans Egede. Hans Egede was a missionary who had been sent by the Danish King in the 18th Century. He is a symbol of colonialism and the loss of Inuit values for many Greenlanders.
"I believe that the statue will disappear in the near future, and be replaced by either a Greenlander or Inuit myth representing our culture or identity," said Olsen. He gave up Christianity for Inuit religious practices.
Her party is of the opinion that U.S. interests strengthen Greenland's negotiating position with Denmark in regards to secession. The party wants to put a deal reached with Copenhagen up for a vote in the four-year period before the next elections. Three candidates said they wanted an agreement on defence with the United States.
Liv Aurora Jensen was a more cautious candidate. She is a member of the Inuit Ataqatigiit, a party that governs on the left.
"We must choose wisely because we want to remain a part Denmark and work towards our independence. Jensen added that we must also work with our neighbours Canada and the United States.
United Airlines will begin direct flights to Nuuk from New York in June.
Trump mentioned Greenland again on Tuesday. He promised mutual prosperity, and struck a more conciliatory note than his previous comments which refused to rule out a military action in order to acquire the island. "We support your right of choice and if that is what you want, we will welcome you to the United States of America," he told the U.S. Congress during a speech.
HISTORICAL MISCONDUCT The relationship between Greenland, Denmark and Greenland has been strained in the last decade due to revelations about historical misconduct committed by Danish authorities. This includes removal of Inuit girls and women from their families as well as forced contraception.
In a documentary that was released in February, it was alleged the Danish government and companies made money from a large mine of cryolite in Greenland in the period 1853 to 1987 without any benefit for locals. The mine produced the rare mineral cryolite, which is used to produce aluminium.
In response to an email question, the Danish Finance Ministry stated that Denmark would examine the profit claims made in the movie as part of a historical investigation into relations with Greenland. The ministry stated that it did not revise the numbers in the film.
Greenland's Prime Minister Mute Ede said at the premiere of the film that it challenged the idea that Denmark was a "good colonizer" or that Greenland deserved to be grateful for money received from Copenhagen.
He said, "The Danes must look themselves straight in the face."
Local media and social media have been dominated by discussions about Denmark since the screening.
It definitely helps us towards independence, because Greenlanders now are more frustrated. The film has made them realize we're worth more than they thought.
The goldsmith Kreutzmann has used cryolite pieces in her work. They were collected by a friend on the abandoned mining site by the Danes.
"For those of us who live up here, nature has always represented a common resource, a shared asset. Kreutzmann explained that they were able "to go out, take what we need but not too much".
RARE EARTH
Greenland is a country that has a lot of deposits of rare earths, uranium and lithium. This is why global powers are interested in the island. It is largely covered by a huge ice sheet and has very few roads. The ruling party Inuit Ataqatigiit was re-elected in 2021 after promising to stop a mine project linked to China, which is one of the largest rare-earth deposits on the planet. This was due to concerns over uranium contamination of marine life, which is key to fishing - the mainstay of the country's economy and culture.
Kvanefjeld is still opposed by the party that supports mining and tourism in order to reduce Denmark's dependence and fishing. The project could be revived if the government changes at the next election.
A White House official was asked for comment and said that Greenland has "ample" rare earth minerals which will power the U.S.'s next generation economy.
Thomas Emanuel Dans was a U.S. Arctic Commissioner during Trump's initial presidency. He said that Greenland is at the heart of a geopolitical Arctic Game between China, Russia, and the United States because its raw materials are there and it's located in the Arctic.
We're beyond the point of oblique discussions and conversations about what needs to be done. "This is the time to act," Dans said.
"If they wish to achieve independence, this must be achieved within the framework of reality," stated Dans. It's about finding a new agreement. (Reporting from Jacob GronholtPedersen, Nuuk; Additional Reporting by Trevor Hunnicutt in Washington; Editing and rewriting by Frank Jack Daniel).
(source: Reuters)