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China's MMG suspended its production at a new Congo cobalt mine late last year
The company's annual report stated that Chinese state-controlled mining firm MMG Ltd put its Kinsevere Cobalt Project in the Democratic Republic of Congo under care and maintenance due to the unfavourable market conditions for cobalt in December. MMG approved a 2022 extension of the mine's life and added cobalt production to its current copper production. MMG reported that the extension project was finished in September of last year but that the cobalt facility was shut down in December. It said that "a flexible cobalt strategy will be implemented moving forward, adapting cobalt prices to market conditions and cobalt content varying across different mineral sectors," By late 2024 the price of cobalt had fallen by over two-thirds compared to its peak in 2022. This was due to a combination a massive surge in supply and a slowing down of demand. Last month, the Democratic Republic of Congo (DRC), the world's largest producer of cobalt temporarily halted exports of the metal to alleviate a global oversupply. In 2022, the miner stated that the now mothballed project would have increased annual cobalt output at Kinsevere from 4,000 to 6,000 tonnes. MMG, which is owned by China Minmetals and has a major stake in the company, sold 1,617 metric tonnes of cobalt during last year. The most actively traded March electrolytic contract at China's Wuxi Stainless Steel Exchange rose by 7.45% to its highest since May 2024. Reporting by Amy Lv in Beijing and Lewis Jackson; Editing and proofreading by Pratima Dewasi and Jan Harvey
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Trump's Canada Oil Tariff speaks of US vulnerability
Canadian oil imports are subject to a 10% tariff - less than other imports Canada provides 50% of US crude oil imports Canadian crude discount widens Ron Bousso LONDON, 6 March - The U.S. president Donald Trump gave Canadian energy an modest break when he announced tariffs against Canadian and Mexican imports. This shows that "Tariff Man", will engage in realistic politics with regards to oil and natural gas. The Republican President said Monday that all Canadian and Mexican imports would be subjected to a 25% duty, with the exception of Canadian energy which will only receive a 10% tariff. The energy interdependence between Canada and the United States is reflected in the lower tariffs on Canadian gas and oil. Canada, which is the fourth-largest crude oil producer in the world, depends on the United States for 90% of its imports. Canada also supplies half of U.S. imports of crude oil, and will supply 4 million barrels of crude per day by 2024. This is around one fifth of the consumption in America, the largest oil consumer in world. The majority of Canadian crude oil is transported via pipelines to refineries in the U.S. Midwest, which are landlocked. The U.S. refineries rely on Canadian crude for 70% of their supply and are designed to process the grade of feedstock they require, so it is not easy to replace Canadian crude. RAPID ADJUSTMENT Canadian oil producers, on the other hand, have adapted quickly to Trump's changes by lowering their crude prices sold to the United States in an effort to retain their customers. Western Canada Select (WCS), a heavy crude oil from Western Canada, has been discounted to West Texas Intermediate (WTI), the benchmark North American futures contract. The discount has increased over the past week by approximately $2.50 a barrel to $14.25. The price of Mars sour, an alternative Gulf of Mexico crude to Canadian and Mexico grades has also more than doubled to $2.35 per barrel since February 25, up from $1.85. If tariffs continue, refiners say that gasoline prices will rise in certain U.S. areas, especially in the Midwest. Canada can bypass the United States by using the Trans Mountain pipeline, which runs from Alberta up to the coast of British Columbia and was recently expanded. The oil can then be loaded on tankers and shipped overseas. The capacity of seaborne exports, however, is limited. To date the United States was the primary destination for exports to the port of Vancouver. Data from analytics firm Kpler shows that exports from the port to its southern neighbour are expected to double from February to 309,000 BPD in March. This is a sign traders have booked extra volumes to prepare for the tariffs Trump had warned about weeks ago. How long the tariffs are in place will have a major impact on the market. Canadian producers may be forced to reduce output if the negotiations drag on. In the short term, however, 10% tariffs will not cause significant disruptions, since producers, refiners, and consumers are likely to absorb any additional costs. The question is whether Trump will be able to stomach the political fallout that could result if tariffs are maintained and energy prices rise. The author is a columnist at. Want my weekly column, plus additional energy insights and trending articles delivered to your inbox? Subscribe to my Power Up Newsletter here.
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ADNOC's agreements with European companies
ADNOC (Abu Dhabi National Oil Co.), a state-owned company, has pursued a number of mergers and acquisitions with European companies with the aim of diversifying and developing its renewable energy and chemicals operations. ADNOC has been involved in the following deals and discussions: COVESTRO ADNOC announced on October 1 that it had agreed to purchase German chemicals manufacturer Covestro for $14.7 billion. This is one of the largest foreign takeovers in the Gulf, and is intended to reduce the country's heavy reliance on oil during the energy transition. ADNOC will merge with OMV its polyolefin business to create a chemical powerhouse, they announced on 4 March after almost two years of negotiation. Borouge Group International will also purchase Nova Chemicals Corp. from the sovereign wealth fund Mubadala in Abu Dhabi for $13.4 billion including debt. FERTIGLOBE ADNOC has agreed to buy the entire stake of European chemical company OCI in Fertiglobe, which produces ammonia and is urea. The deal will be completed in December 2023. ADNOC will become its largest shareholder. (1 euro = 0.9259 dollars) (Reporting and editing by Milli Nissi, Tristan Veyet in Gdansk)
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Brazil warns Trump Effect risks a 'triple-negative' climate
Brazil warned on Thursday that the return of Donald Trump to the White House could have a "triple-negative" impact on the fight against global warming. The country is preparing to host the U.N. Climate Talks later this year. Trump has pulled out of the Paris Agreement on Climate Change. He also launched a trade battle with Canada, China, and Mexico and changed U.S. policies on the war in Ukraine. Marina Silva, Brazil's Environment and Climate Change minister, told reporters through a translation that the "increasingly complicated geopolitical environment", characterised as a turbulent and tariff-laden trade, could disrupt progress in curbing climate changes. They can drain resources and also hamper an environment of trust and confidence among parties. Silva stated that we have a "triple negative" effect, because the less we see of action, the less we see in terms of money, which results in less cooperation between countries. Brazil, the host of COP30, the annual United Nations global summit on climate change in November, said it would use its presidency to push for multilateralism, respect for science and to oppose Trump. Silva says that other countries might feel the need to redistribute funds to areas like defence, due to Trump's disruption in prioritising the United States as a solution to global problems and a source of international finance. She questioned the agreement made at the COP summit last year to triple funding to poor countries to $300 billion per annum by 2035. "It cannot be taken as a given," she said. Silva said that disputes over tariffs are "bad for everyone", and have only short-term benefits. She said: "Inflation can lead to inflation in the long run, and people will be less supportive of them if their homes are destroyed by fire, or if it affects their food security." Reporting by Shivam Patel, New Delhi. Editing by Barbara Lewis
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Copper rallys nears three-week high after Trump's rollback on automobiles
The copper price rose to its highest level in almost three weeks on Thursday after U.S. president Donald Trump granted temporary tariff exemptions to automakers. The price of three-month copper at the London Metal Exchange rose 0.5% to $9,635 per metric tonne by 1100 GMT. This was its highest price since February 14 after a 2.6% jump a day before. Trump granted a one-month exemption to the 25% tariffs on Canada and Mexico for the auto industry, which is heavily reliant on metals. Nitesh Sha, commodity strategist at WisdomTree, said: "It's helped most metals by giving them a bit more time before they can be used in vehicles without having to face immediate tariffs. It also shows some flexibility." The Shanghai Futures Exchange's most active copper contract gained 1.6%, to 78.310 yuan (10,813.31) per ton. This is the highest level in over two weeks. Investors adjusted their expectations about tariffs Trump could impose on the metal. Trump announced that 25% of aluminium and steel imported from March 12 will be subject to tariffs. He also ordered an investigation into the possibility of new tariffs for copper. Comex copper premium over LME copper has decreased to $872 per tonne from $984 per tonne on Wednesday. Investors have capped gains in industrial metals after digesting news from China's National People's Congress. The NPC led to pledges of more fiscal stimulus, and an emphasis on boosting consumers spending. However, the immediate steps announced to boost household demand were not well received by economists. Shah asked, "Now that we are aware of the tariffs in place against China, is it necessary to do more to balance that?" The dollar index fell to its lowest level in four months, making commodities priced in greenbacks cheaper for buyers with other currencies. LME aluminium rose 1.1%, to $2687 per ton. Zinc advanced 1.4%, to $2918.50. Lead was up 0.2%, at $2038.50. Nickel climbed by 1.1%, to $16,075; and tin increased 1.1%, to $32,065. (1 yuan = 7.2420)
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Russia-backed Indian refiner Nayara lines up $217.5 mln share buyback
Nayara Energy is a private Indian refiner that is majority owned by Russian companies, including Rosneft. It will offer a $217.5-million share buyback to assist its minority shareholders in leaving the delisted company. Rosneft, along with its partners, closed the acquisition of Nayara Energy (formerly known as Essar oil) for nearly $13 billion in 2017. Before the closing of the deal, Essar Oil shares were delisted. Nayara announced that it has decided to make an offer of 731 rupees each ($8.39), totaling 18.94 billion rupees, to over 200,000 minority investors who have not participated in previous delisting or exit offers. Nayara said that it hasn't finalised its buyback schedule. Rosneft owns 49.13% of Nayara Energy, and a similar share is held by Kesani Enterprises Co Ltd., a consortium led by Italy's Mareterra Group, and Russian investment group United Capital Partners. Nayara runs a Vadinar refinery that produces 400,000 barrels of fuel per day in Gujarat, a western state. It also operates 6,500 retail petrol stations across the country.
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Harbour Energy announces annual loss and urges UK windfall tax reform before 2030
Linda Cook, Harbour Energy's CEO, warned that if the UK's windfall taxes were not repealed by 2030 it would cause irreversible harm to the oil and gas industry in Britain. This was after the company's 2024 earnings saw a spike due to a tax increase. Harbour, Britain's largest North Sea oil and natural gas producer, has reported a $93 million loss for 2024 compared to a $45 million profit in 2023. Its tax bill is more than doubled, from $571 millions a year earlier, to $1.31 million. LSEG data shows that the pre-tax profit for 2017 was $1.22billion, which is below analysts' estimates of $2.03billion. Harbour's shares fell 14% to 184p by 1021 GMT. North Sea producers claim that the UK Energy Profit Levy, first introduced in 2022 after a spike in energy prices due to Russia's invasion in Ukraine, has hurt profits and created uncertainty for investments. Since the EPL was introduced, we have had an effective tax rate higher than 100% every year. Cook told a press conference that the EPL does not only tax windfall profits but all our profit. Britain announced on Wednesday that it plans to revamp the windfall tax system on oil and gas companies once the current levies expire in 2030. It also pledged to turn the North Sea into an energy hub. In October, the government increased the tax from 35% to 38%, bringing the headline rate for the sector up to 78%, making it one of the highest rates in the world. The government is asking for feedback from industry and other stakeholders until 28 May on possible policy options, including taxing "excess revenues". The consultation did not include any specific price thresholds. Cook stated, "We are eager to engage. Our message will be to work with Treasury to create a fair and stabile fiscal regime. We hope to have this in place by 2030." Harbour has said that despite the difficult environment, it does not plan to move its listing from Britain over to the United States. The group's revenues in 2024 will be around $6.22 Billion, up from $3.75 Billion the previous year. This is primarily due to higher production and post-hedging realized European natural gas prices. (Reporting and editing by Arunima in Bengaluru. Sumana and Emelia Sithole Matarise).
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Germany investigates Argus Media and S&P Global regarding fuel pricing concerns
After an initial investigation that raised concerns about pricing and competition, Germany's antitrust regulator said it was investigating whether the price information services provided on the wholesale fuel market by Argus and S&P Global had any impact. Prices are often linked to wholesale contracts, and this can have an indirect impact on retail prices. These are provided by agencies that report prices, such as S&P Global Commodity Insights and Argus media. They are based on transactions reported. Neither Argus Media nor S&P Global Commodity Insights, (Platts), were immediately available to comment. The cartel office urged for stronger regulations last month after a review of oil market prices revealed that they were based on limited information and susceptible to manipulation. In a Thursday statement, Andreas Mundt said, "We are seeing indications that there is a structural disruption in the wholesale fuel trade." The office will use the new powers it obtained in 2023 in order to investigate if there is a significant and continuing disruption of competition in individual markets or across all markets. If confirmed, it will address its causes. (Reporting from Riham Alkousaa, Ahmad Ghaddar and Miranda Murray in London)
Infestations in two states of Malaysia have affected palm oil production
A minister revealed that palm oil plantations have been infested in two states of Malaysia, the second largest producer in the world. The country is recovering from flooding which has disrupted its production.
Plantation and Commodities minister Johari Abdul-Ghani stated in a Wednesday parliamentary response, which was then published on Thursday, that leaf-eating pests have been reported to be attacking in Peninsular Malaysia.
Johor, Perak and Perak account for 1.01 million of the 5.61 million acres of oil palm plantations.
In recent months, floods have affected the country's output. The result is that it has hit a six-month low.
Perak is experiencing an increase in oil palm crop threats. He said that to address the situation, a budget of 5 million Ringgit ($1.13million) was requested in order to intensify control efforts against this increasingly widespread outbreak.
He added that the Malaysian Palm Oil Board is taking steps to control the infestation, including spraying biopesticides and planting beneficial plants. Reporting by Ashley Tang, Editing by Sonia Cheema. $1 = 4.4220 ringgit
(source: Reuters)