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The world markets are on a tightrope, balancing between AI stocks and oil price shocks
Investors said that the turmoil on the world markets over the past week showed the economic outlook was 'now on a razor edge. There are equal odds for an AI boom to lift growth, or for oil shocks resulting from the U.S. - Iran war to send stocks and bonds into a tailspin. Global equities reached an all-time high on June 3 and then suffered their worst day in October the next day. This week, they have spent a lot of time reversing direction constantly to match U.S. president Donald Trump's volatile remarks about Iran as well as rapidly changing bets regarding when the Strait of Hormuz might reopen. Florian Ielpo, head of multi-asset and macro portfolio management at Lombard Odier Investment Managers, said that most investors had been assuming that the Strait of Hormuz would reopen in less than three months. He added: "If we were to expect oil prices at $95 for several months in the future, it would represent a radical change of outlook and a stagflation scenario." The market is treading a thin line. All Together In recent months, as interest rate and inflation markets have correlated with tech investment and oil outlook, assets that were not clearly linked have moved in tandem. AI-driven optimism is boosting Wall Street stocks, U.S. household assets, official growth forecasts for the next few years, driving breakneck expansion in Asia exporters, and lifting sentiment across asset classes, from global bank shares, to Greek debt. Taiwan is expecting the highest economic growth for 2026, thanks to "blockbuster semiconductor exports", while global tech spending sent imports and exported in China, which is the world's largest consumer of commodities, surging. It's because of this that the FTSE 100, which includes energy producers and miner stocks, has stopped moving inversely compared to so-called growth stock in the tech sector and is now rising with them. THE FLIPSIDE Investors warned that these tech-driven correlations would also make it harder to hide in the event of fears about inflation and rate increases affecting AI spending driving world markets. Investors warned that after markets began pricing in 70% odds of an U.S. interest rate hike, South Korea's won fell to its lowest level in 17 years and the country's technology-heavy Kospi index plummeted almost 9% within hours. Alessia Bernardi, global director of macro-economics at Amundi's research arm, Europe's biggest asset manager, still favors equities and believes that the markets are not pricing in a long-term Hormuz shut down. She warned that "a repricing (interest rate policy) along with higher oil costs and shortages would mean stagflationary risk, and some countries have already entered a recessionary perspective." The energy supply crisis is already affecting economies like Germany and India that aren't closely linked to technology. BUY THE DIPP? Asset managers are used to geopolitical shocks that cause rapid changes in sentiment. For example, Trump's "Liberation Day" tariff blitz of April 2025 shook U.S. stock prices before retail investors piled on a spectacular recovery trade. Ben Jones, Invesco’s global head for research, said: "If you believe that the Strait will remain closed for an extended period and that demand destruction and inflation are likely to occur then it's time to position your portfolio for stagflation." He said: "History has shown us that geopolitical risk?will pass, and when they do you tend to see markets rally very quickly." After Trump's announcements of tariffs, Wall Street's S&P 500 index fell sharply and then made a rapid and fierce rebound. The equity and bond markets also experienced the biggest swings since the COVID-19 epidemic. HEDGING Michael Nizard said that he was boosting his derivatives to profit from the stock market volatility. Many other asset managers have stated that they are now purchasing more insurance products rather than more equity. Kevin Thozet, a member of the Carmignac Investment Committee, said that he increased his holdings in inflation-linked U.S. debt due to market expectations for U.S. consumers prices being complacent. He said that data centre construction would be capital-intensive and increase energy prices. Ielpo, a Lombard Odier employee, said that he hedged his market bets while holding on to stocks and cutting back on government debt. Government debt can act as a safe-haven but it also moves according to inflation forecasts. German Bund yields have reached their highest levels in 15 years, as the price of debt fell during the Iran War. Meanwhile, Japanese 10-year yields have also risen to the highest level they've seen for three decades. Bond market volatility has risen by 5% since the beginning of the war. The stock market volatility is about the same as its long-term average but 35% more than it was year-to date.
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FOREX Dollar eases as US inflation data keeps rate hike at bay
The dollar eased Wednesday, after data showed that U.S. consumer inflation reached its highest level in 3 years in May. Although the reading was in line economists' expectations. This lowered the odds of the Federal Reserve raising rates this year. In May, the U.S. consumer price index increased at the fastest pace in three years as the Middle East conflict pushed up the cost of gasoline and energy products. Bureau of Labor Statistics of the Labor Department announced on Wednesday that the Consumer Price Index had increased by 4.2% over the 12-month period ending in May. This is the biggest gain since April 20,23. The economists surveyed by predicted the CPI to increase 4.2% on an annual basis. Karl Schamotta is the chief market strategist at Corpay, in Toronto. He said that the Federal Reserve has not yet been able to use the soaring prices of energy as a factor for the Federal Reserve's core measures. The dollar index (which measures the U.S. currencies against six other currencies) was 0.2% lower, at 99.75. However, it remained near the two-months high of 100.214?touched Monday. Schamotta stated that traders are preparing for a neutral statement by officials at the meeting next week, and have modestly reduced expectations of a rate increase before year's end. Short-term traders of?U.S. Interest rates have shifted away from betting that the Federal Reserve would deliver a rate increase as early as September. However, traders remain confident that a hike will arrive in October. The U.S. and Israeli conflict with Iran also put traders on edge. Donald Trump, the U.S. president, said that Iran took too long to reach a deal. They would now have to "pay the price." Meanwhile, Tehran announced it would review its diplomatic relationship with Washington following overnight strikes. Dominic Bunning is the head of G10 strategy for FX at Nomura. The Yen remains in focus A Bank of Japan rate increase at its policy meeting on June 16 is almost fully priced, so it's unlikely to cause a significant turnaround in the?yen's weakness even if it happens. Tony Sycamore is a market analyst for IG. He said that it would take a hawkish comment from Governor Ueda to signal the BOJ to move its next hike forward from December to September – with the possibility of a 3rd hike before the end of the year. Without that or something like it, the Ministry of Finance may need to take out their cheque book once again in order to defend the currency. The Japanese yen?remained steady against the dollar at 160.34, and continued to hover around 160. This level is widely considered as a line drawn in the sand that will trigger official intervention. According to a poll of economists, the BOJ is likely to raise its key rate of interest this month, and then again in the fourth-quarter, bringing borrowing costs up to 1.25% at the end of the year. This is because it's more concerned about inflation than the downside risks to the economy. DOLLAR SOFTNESS The Canadian dollar gained 0.2% versus its U.S. equivalent after the Bank of Canada kept?its benchmark rate unchanged on Wednesday. Governor?Tiff MacKlem, however, reiterated that central bank officials would not hesitate to increase rates if necessary to control inflation. The pound was 0.3% stronger against the dollar Wednesday as investors closely watched the latest escalation of tensions between Iran and the U.S. ahead of the UK GDP data on Friday. The leading cryptocurrency, bitcoin, was almost flat on the day. It now stands at $62,069. (Reporting and editing by Kevin Buckland, Jan Harvey and Jan Harvey; Additional reporting and editing by Sophie Kiderlin and Satoshi Sugyama in London; Reporting by Saqib Ahmed Iqbal; Additional reporting and editing by Sophie Kiderlin and Satoshi Sugyama in Tokyo)
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ROI-Global trade in rude health? McGeever: Yes, with a catch
Global trade is not cooling in the shadow of tariffs and trade wars. It's heating. How durable is it when the price and not the volume is what's stoking up the flames? Recent trade data from the U.S., China and other major economies show that cross border commerce is growing at a faster rate than economists expected. In many cases the "increased activity" and the "surprisingly strong headline export numbers" were primarily driven by "higher prices". These reflect the spike in inflation caused by the Iran War, particularly on the oil and energy markets. This was especially true in the U.S. where exports reached a record of $327 billion last month, largely due to shipments of a wide range goods. In fact, the goods surplus shrank to the lowest level since 2020. This is good news for the U.S. economic system, since the declining deficit could contribute to the growth of the economy in the second quarter. This may be primarily due to the high prices of fuel, oil and other energy products. It is important to ask how long the improvements will last. It's not only the price that matters. Canada's physical export volumes are now back where they were prior to the U.S. Presidential election which returned Donald Trump to office in November 2024. This has triggered trade tensions with the United States. According to CIBC, the exports of April were only second to those in February last year when companies were preparing for Trump's looming duties. Base effects are another factor which may have a positive impact on headline trade figures. The slowdown in trade during the first half of the year as Trump's tariff wars began is now used to compare year-over-year figures. It is too early to predict a trade revival. CHIPS, CHIPS HORAY The price is also playing a major role in Asia's trade explosion, but the booming AI-related demand also fuels the sizzling numbers. China, the largest exporter in the world, saw its total exports rise 19.4% in May. Pantheon Macroeconomics says that sales of high-tech goods accounted for 12 percent. While the value of integrated-circuit exports has more than doubled in the last year, the export volume rose by only 2%. This suggests that the headline figure is inflated because the price was high. The same thing is happening in other sectors. However, Beijing policymakers and critics will continue to focus on headline dollar figures, particularly the large one, China's total 12-month rolling trade surplus of more than $1 trillion. Taiwan's AI export surge was even more impressive. Exports rose in May more than expected to the second highest level by value ever, up almost 52% compared to a year ago. Price was again a major factor. TSMC, the largest manufacturer of 'advanced chip technology used in AI applications', is based in Taiwan. It also supplies Nvidia and Apple, among other tech giants. Chips, computer equipment and software, as well as other high-tech products, have seen a surge in price over the last year, largely due to an explosion in demand. Goldman Sachs Global Institute estimates that AI-related investments will reach $7.6 trillion by 2031. SURPRISING RESILIENCE Global trade has shown remarkable resilience, which few observers could have imagined possible in the face of volatile market conditions. Trump's "Liberation Day tariffs" triggered a global trade war, which may have ended decades of internationalization. Geopolitical rifts also threaten trade flows, notably in Middle East. AI frenzy?can be credited with keeping global trade moving. The demand for these applications has accelerated, and much of the trade of AI-related products takes place across borders. The question is, can this continue? Could the rise in AI compute costs curb demand eventually? Could major powers seek to reduce AI supply chains in order to minimize national security risks? The AI boom is unlikely to fade away anytime soon, which suggests that trade activity could'remain resilient', even in the face of deglobalization, tariffs and protectionism. Everything seems to be dependent on the outcome of this tech story, just as it is with other parts of the global economic system. You like this column? Open Interest (ROI) is your new essential source of global financial commentary. Follow ROI on LinkedIn and X. Listen to the Morning Bid podcast daily on Apple, Spotify or the app. Subscribe to the Morning Bid podcast and hear journalists discussing the latest news in finance and markets seven days a weeks.
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IIR reports that the gasoline unit of Nigeria's biggest refinery will resume full rates by mid-June.
IIR Energy, a monitor of the oil industry in Nigeria, said that Dangote's refinery had derated its gasoline-making unit (RFCC), by 34%. The?unit is expected to resuming full fares around mid-June. The refinery didn't immediately respond to our request for comment. "Initially, the lighter crude that was being processed resulted?insufficient feed availability for the RFCCU. By the end of the month, IIR Energy confirmed that there was a problem with the RFCCU's flue gas sliding gate valve. IIR confirmed that the repair work is nearly complete on "that issue" in an email. Fuel prices are at record highs due to the war in the Middle East. Africa's biggest refinery was fully operational in early 2018. Its goal was to?transform Nigeria into a major supplier of?refined? products after decades of inadequate refinery capacities. According to Kpler's data, gasoline exports have fallen from 81,000 barrels per day last June, down to 17,000 barrels a day in May.
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Expected increase in US consumer prices for May
The Federal Reserve has more reasons to maintain interest rates at the same level until 2027, as U.S. consumer inflation grew at its fastest pace in three years during May. According to the Labor Department Bureau of Labor Statistics, on Wednesday, the Consumer Price Index rose 4.2% over the 12-month period ending in May. This is the biggest gain since April 20,23. In April, the CPI increased 3.8% on a year-on-year basis. Prices rose 0.5% monthly after a 0.6% increase in April. Economists surveyed by predicted?the CPI to increase 4.2% on an annual basis and gain 0.5% monthly. Inflation has been outpacing wage growth for the second consecutive month, which could weigh on overall economic growth. For the second straight month, inflation outpaced wage increases. This could have an impact on economic growth. The rising cost of living has become a political liability for Donald Trump and his Republican Party as they seek to maintain control of Congress during the November midterm elections. Trump's promise to reduce inflation was a major reason he won the presidential election of 2024. However, his approval ratings have fallen as frustration grows over his economic management. Core CPI, excluding volatile components such as food and energy, increased 2.9% on an annual basis in May. This was after a 2.8% increase in April. The so-called core CPI rose 0.2% monthly after increasing 0.4% in April. For its 2% target, the U.S. Central Bank tracks Personal Consumption Spending Price Indexes. All inflation measures are well above the Fed target. Data from the U.S. Energy Information Administration revealed that in May, the national average gasoline cost increased by?8.8% to $4.60 per gallon. Gasoline prices were at one time up by over 50% since the U.S. Israel and the United States attacked Iran in late February. In recent weeks, prices have fallen amid a ceasefire. This has led some economists to cautiously hope that May will be the CPI peak. This report came after news that the economy had posted a?month with above-expectations growth of jobs in May for a third consecutive?month. For the third month in a row, the?unemployment level remained at 4,3%. Although financial markets are pricing in an increase, economists continue to believe that the central bank has a high bar to raise interest rates. (Reporting and editing by Andrea Ricci, Chizu Nomiyama, and Lucia Mutikani)
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Sempra says Texas grid projects require over $7 billion investment after ERCOT backing
Sempra, an energy infrastructure company, announced?on Wednesday it had received approvals for a number of new transmission projects in Texas. These, along with earlier go-aheads are expected to cost over $7 billion. Last week, the Electric Reliability Council of Texas, the operator of?the electricity grid in Texas, approved the new projects. According to the U.S. Energy Information Administration (EIA), U.S. electricity demand reached'record levels' in 2025, and it is expected to continue to rise 'this year as tech companies rapidly build data centers that use as much electricity as an entire town at one site. Sempra’s latest projects include new lines along the I-35 and southern Dallas-Fort Worth corridors, along with a?upgrade approved in April. These are expected to support 16 gigawatts in new power demand. As they rush to meet the soaring demand of tech giants, power companies in the U.S. are raising prices and increasing capital expenditures to expand infrastructure. Oncor Electric Delivery Company in which Sempra holds an 80.25% stake?expects the?majority? of the projects to be constructed. The projects should be completed between 2026-2034. Reporting by Katha Kalya in Bengaluru, Editing by Shailesh Kuber
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Hungary's Lake Velence is drying up and threatening tourism, wildlife and
Experts and locals say that the water level in Hungary's largest lake will?fall to new lows due to climate change and years of mismanagement of water. This could threaten its ecosystem and tourism sector. Experts say that Lake Velence is a popular destination for holidaymakers, but the water level may soon be too low to allow swimming and sailing. A recent warm day saw children playing on newly exposed sandbanks that extended far beyond the shoreline of the lake. Rental boats were resting at a jetty, now far away from the water, and on the sand. Data from the National Directorate General for Water Management revealed that the lake level in the town of Agard measured 56 cm, only 3 cm higher than the 'historic low' of 53 cm, which was recorded in 2022 - the year Hungary suffered an extreme drought. The water level was 80 cm in the early months of 2026. Experts warned that without substantial rain, the water level could drop by as much as half a centimetre per day, and reach as low as 30cm by summer's close. Tibor Horanyi, from the Association of Great Lakes, said that the water level would drop by at least 25-30cm in the next 30-40days and that the record low will be reached within days. Horanyi said that the problem was not just climate change, but also decades of poor water management. Businesses have already been affected by the disruption. Peter Szaniszlo, a sailing instructor, has started moving his operations to the?Lake Balaton. "Most people who wanted to learn how to sail chose me because Lake Veence is near Budapest. "Now they have to go to Balaton," said he. GOVERNMENT PLEDGES TO ACT Laszlo Gájdos, the Minister of Environment, met last week with local mayors, water management experts, and NGOs to discuss the future of the lake. Gajdos stated in a Facebook post that the government is working to improve the water quality and restore the shoreline. It will take some time to figure out how to replenish water in Lake Velence, according Arpad 'Pal Eotvos the mayor of Gardony a town located on the lake. Eotvos stated, "We'll have to adapt to this." As the climate changes, so will we. (Written by Anita Komuves, edited by Alexandra Hudson).
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In May, the share of Russian aluminium in LME stocks rose to 93%.
Data from the London Metal Exchange showed that, in May, the share of Russian-origin aluminum stocks in London Metal Exchange warehouses increased to 93%, up from 72%, in April. This was due to traders' decision to withdraw Indian metal. The total available or on-warrant aluminium inventories (0#MALSTXLOC>) on the LME dropped 23% to 254,625 tons in May, and now stand at 250 525 tons. This is the lowest level since May 2025. Production and logistics constraints in the Middle East are limiting global supply. Absolute terms, the amount of?Russian aluminum available in May fell by 3,950 tonnes to 237.175. The?share of?Russian aluminium rose however as Indian stocks fell by a greater 71,750 tonnes. After the withdrawal of 2,275 tonnes of Indonesian aluminum, the LME warehouses only had?17.450 tons of Indian aluminium left at the end May. In March, the share of Russian aluminium had reached 92% before Indian aluminum was placed back on warrant. Many traders do not want to deal with Russian metal, even though it can be traded if it was produced before April 13, 2020. To comply with Western sanctions, aluminum produced in Russia after that date is not allowed to be stored at the LME warehouse system. The share of Chinese copper in the LME's copper stock increased to 53% from 51% in April, despite the fact that the total amount dropped by 36,425 tonnes to 141.025 tons. The total?available copper stock decreased by 79.375 tons, to 266,875 tonnes. At the end of December, the?share of Chinese nickel remained at 71% of LME stock. Reporting by Tom Daly. Mark Potter (Editing)
As solar capability grows, some of America's most efficient farmland is at risk
Dave Duttlinger's very first thought when he saw a thick band of yellowishbrown dust smearing the sky above his Indiana farm was: I alerted them this would take place.
About 445 acres of his fields near Wheatfield, Indiana, are covered in solar panels and associated machinery-- land that in April 2019 Duttlinger rented to Dunns Bridge Solar LLC, for one of the biggest solar advancements in the Midwest.
On that blustery spring afternoon in 2022, Duttlinger stated, his phone sounded with questions from disappointed neighbors: Why is dust from your farm inside my truck? Inside my house? Who ought to I contact us to clean it up?
According to Duttlinger's solar lease, examined , Dunns Bridge said it would utilize commercially sensible efforts to minimize any damage to and disruption of growing crops and crop land triggered by its building activities outside the task website and not eliminate topsoil from the home itself. Still, sub-contractors graded Duttlinger's fields to help the structure of roadways and installation of posts and panels, he said, in spite of his cautions that it might make the land more vulnerable to disintegration.
Teams improved the landscape, spreading out fine sand throughout big stretches of abundant topsoil, Duttlinger stated. When visited his farm last year and this spring, much of the land below the panels was covered in yellow-brown sand, where no plants grew.
I'll never ever be able to grow anything on that field again, the farmer stated. About one-third of his approximately 1,200-acre farm-- where his family grows corn, soybeans and alfalfa for cattle-- has actually been leased.
The Dunns Bridge Solar task is a subsidiary of NextEra Energy Resources LLC, the world's largest generator of eco-friendly energy from wind and solar. Duttlinger stated when he approached NextEra about the damage to his land, the company stated it would evaluate any remedial work required at the end of its agreement in 2073, as per the regards to the arrangement.
NextEra declined to talk about the matter or on what future dedications it made to Duttlinger, and might not separately verify them. Job designer Orion Renewable Energy Group LLC directed questions to NextEra.
The solar market is pushing into the U.S. Midwest, drawn by cheaper land rents, access to electrical transmission, and a. wealth of federal and state incentives. The region also has what. solar needs: wide-open fields.
A renewable energy boom risks damaging some of America's. richest soils in crucial farming states like Indiana, according to a. analysis of federal, state and local information; numerous. pages of court records; and interviews with more than 100 energy. and soil researchers, agricultural economic experts, farmers and. farmland owners, and local, state and federal legislators.
A few of Duttlinger's farm, including parts now covered in. solar panels, is on land classified by the U.S. Department of. Farming (USDA) as the most productive for growing crops,. according to a analysis.
For landowners like Duttlinger, the pledge of earnings is. appealing. Solar leases in Indiana and surrounding states can. use $900 to $1,500 an acre per year in land rents, with annual. rate boosts, according to a evaluation of solar leases. and interviews with four solar project developers. In. contrast, farmland lease in leading corn and soybean manufacturers. Indiana, Illinois and Iowa balanced about $251 per acre in 2023,. USDA data shows.
Farmland Partners Inc, a publicly traded farmland genuine. estate financial investment trust (REIT) has leased about 9,000 acres. across the country to solar firms. Much of that ground is extremely. efficient, stated Executive Chairman Paul Pittman.
Do I believe it's the very best use of that land? Most likely not. However our investors would eliminate us if we didn't pursue this, he. stated.
Some renewable resource developers said not all leases end up being. solar jobs. Some are developing their sites to make it. possible to grow crops between panels, while others, like Doral. Renewables LLC, said they use livestock to graze around the. panels as part of their land management. Designers also argue. that in the Midwest, where more than one-third of the U.S. corn. crop is utilized for ethanol production, solar energy is crucial for. powering future electric automobiles.
Some farming economists and agronomists counter that. taking even percentages of the very best cropland out of production. for solar development and destructive important topsoil effects. future crop potential in the United States.
Typical solar farm building and construction practices, including clearing. and grading large areas of land, also can cause significant. disintegration and major runoff of sediment into waterways without. correct remediation, according to the U.S. Environmental. Defense Company and the Justice Department.
Solar development comes amidst increasing competition for. land: In 2023, there were 76.2 million - or nearly 8% - fewer. acres in farms than in 1997, USDA data programs, as farmland is. converted for domestic, industrial and industrial use.
In reaction to ' findings, USDA stated that urban. sprawl and advancement are currently larger contributors to. farmland loss than solar, pointing out reports from the Department of. Energy and agency-funded research.
BUILDING ON PRIME CROPLAND
No one understands how much cropland across the country is presently under. photovoltaic panels or leased for possible future development. Land. offers are generally private deals.
Scientists at the United States Geological Survey and the. U.S. Department of Energy's Lawrence Berkeley National. Lab have actually been compiling a database of existing solar. centers across the nation. Work on the U.S. Large-Scale. Solar Photovoltaic Database started in 2020 and includes data on. 3,699 facilities in 47 states and the District of Columbia.
While that task is incomplete and ongoing, discovered. that around 0.02% of all cropland in the continental U.S. converged in some method with massive, ground-based solar. panel websites they had identified as of 2021.
The total power capability of the solar operations tracked in. the data set represents over 60 gigawatts of electrical power. capability. In the following 2 years, solar capacity has nearly. tripled, according to a Dec. 2023 report from the Solar power. Industries Association (SEIA) and Wood Mackenzie.
To much better comprehend future land-use patterns, . evaluated federal government data to recognize cropland that USDA. classified as prime, distinct, or of local or statewide. importance. likewise reviewed more than 2,000 pages of. solar-related documents filed at regional county recorders' offices. in a little sample of four Midwestern counties-- Pulaski, Starke. and Jasper counties in Indiana, and Columbia County in. Wisconsin.
The counties, representing an area of land a little bigger. than the state of Delaware, are where a few of the country's. biggest projects are being established or built. The sample is not. necessarily representative of the wider United States however. provides an idea of the possible effect of solar projects in. farm-heavy counties.
discovered the portion of these counties' most. productive cropland protected by solar and energy business since. end of 2022 was as follows: 12% in Pulaski, 9% in Starke, 4% in. Jasper and 5% in Columbia.
Jerry Hatfield, former director of USDA Agricultural. Research study Service's National Lab for Agriculture and the. Environment, said ' findings in the four counties are. worrying.
It's not the variety of acres transforming to solar, he stated. It's the quality of the land coming out of production, and what. that indicates for local economies, state economies and the. country's future capabilities for crop production.
More than a dozen agronomists, in addition to renewable energy. researchers and other specialists spoken with , stated the. approach to measuring solar's impact was fair. The news agency. likewise shared its findings with 6 solar developers and energy. firms operating in these counties. 3 said ' sample size. was too little, and the range of findings too wide, to be a reasonable. representation of industry siting and building and construction practices.
By 2050, to fulfill the Biden Administration's decarbonization. targets, the U.S. will need as much as 1,570 gigawatts of electric. energy capability from solar.
While the land needed for ground-based solar advancement to. attain this goal won't be even by state, it is not expected to. exceed 5% of any state's acreage, except the tiniest state of. Rhode Island, where it might reach 6.5%, by 2050, according to. the Energy Department's Solar Futures Research study, published in 2021.
Scientists at American Farmland Trust, a non-profit. farmland protection company which champions what it calls. Smart Solar, forecast last year that 83% of new solar energy. development in the U.S. will be on farm and ranchland, unless. existing government policies changed. Almost half would be on the. country's finest land for producing food, fiber, and other crops,. they warned.
FUEL ARGUMENT
5 sustainable developers and solar power firms spoke with. counter that the industry's usage of farmland is too. little to impact domestic food production overall and need to be. balanced with the requirement to decarbonize the U.S. energy market in. the face of climate modification.
Doral Renewables, the developer behind the $1.5 billion. Mammoth Solar project in Pulaski and Starke counties, does not. consider corn or soybean yields in its siting decisions.
Instead, the business takes a look at the land's topography, zoning. and nearness to an electrical grid or substation-- and attempts to. avoid wooded areas, ditches and environmentally delicate areas,. said Nick Cohen, Doral's president and CEO.
Moving corn acres for solar? I do not see it as replacing. something that is crucial to our society, Cohen said. Solar can. make farmland more productive from a financial point of view, he. added.
Indiana farmer Standard Welker says he got a better offer leasing. 60% of his farmland to Massive than he would have growing corn,. with rates dipping to three-year lows this year.
We've got mounds of corn, we're below the expense of. production, and today, if you're renting land to grow corn--. you're losing money, Welker stated. By doing this, my financial. scenarios are great..
(source: Reuters)