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Shanghai metals prices rise as China's demand improves
On Tuesday, the most traded metals contracts at the Shanghai Futures Exchange increased. This was supported by better signs of demand from China. The Chinese authorities are vowing to stabilize industrial growth as well as a major hydropower plant in Tibet. SHFE nickel rose 1.41% at 0100 GMT to 123400 yuan (17,205.3) a ton. It hit 124180 yuan earlier in the session, its highest level since May 22. Zinc grew by 0.26%, to 22,845 Yuan. Lead climbed by 0.15%, to 16,960 Yuan. SHFE aluminium rose 0.48% to 20 845 yuan, after reaching a new high since March 14, at 20,880 earlier in the day. The Chinese government's plans to stabilize industrial growth, and the opening of the massive Tibet hydropower station are all positive signs for the metals markets. In addition, the prospects of metals demand in the country will boost the sentiment. Analysts added that it is unclear just how much demand there will be. An analyst in Shanghai echoed this view and said, "Despite all the uncertainty, such news seems definite and positive. This may support the commodities market for a little while." On July 19, China began construction of the largest hydropower project in the world on the eastern edge of the Tibetan Plateau. The estimated cost is at least $170 billion. The three-month contract for copper on the London Metals Exchange increased by 0.07%, to $9,866.5 per ton. Nickel fell 0.28% at $15,480, while tin dropped 0.08% at $33,785. Zinc and aliuminium were flat at $2.644.5 and 2.836.5 respectively. Investors outside China remained cautious and focused primarily on new developments in the trade talks between the U.S. After a short fall in the previous session, the U.S. Dollar traded in a narrow range. Click or to see the latest news in metals, and other related stories.
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New EU Russia curbs could increase Indian oil refiners’ reliance on traders
After the latest round European Union sanctions, Indian private refiners who have used cheap Russian crude in order to boost their margins will need to find ways to work around it and depend more on traders for finding new markets for products. In recent years, refiners like Reliance Industries or Nayara Energy have benefitted from the pressure that sanctions imposed on Russia's crude oil prices due to its invasion in Ukraine. Many of these refiners have exported their refined products to European buyers. In its 18th package against Russia, which was approved on Friday by the European Union, it banned imports from third-country refiners of petroleum products that are made from Russian crude, except for a few Western nations. The sanctions also target Nayara Energy, an oil refinery owned by Rosneft. The package will be implemented over a six-month period. In the first seven month of this year, LSEG data on ship tracking showed that Reliance was India's biggest buyer of Russian oil products and refined products. It shipped 2.83 million barrels per month of diesel fuel and 1.5 million barrels per month of jet fuel to Europe. This accounted for roughly 30% and 60% respectively of its exports of both products. Nayara Energy exports 4 million barrels of refined products per month including jet fuel, diesel, gasoline, and naphtha, but only jet fuel is typically shipped to European markets. Sources said that under the sanctions, traders will likely play a larger role in the placement of refined products made with Russian crude. They will likely get creative in their routes due to the long transition period. Singapore traders have said that traders will likely swap Indian diesel with Middle East cargoes to export to Europe. The traders said that they may also send Indian cargos to floating storage in the Middle East and West Africa for re-export. They said that Indian refiners could either divert jet fuel cargoes into local markets or ship supplies in Asia. Reliance and Nayara didn't immediately respond to comments. A trader in Asia said that the changes would benefit traders, as they will generate more trade, but be costly to producers and consumers. He added that Europe may be forced to pay more for refined fuel as winter approaches. Nayara condemned in a Monday statement the EU’s “unjust and unilateral” decision to impose sanction on the company. India, on the other hand, said that it did not support "unilateral" sanctions by the EU. Refining sources say that Indian refiners who also purchase Russian crude are less likely to be affected by sanctions, as they sell the majority of their fuel locally, and export it through tenders to buyers mainly in Asia, such as Singapore. Mangalore Refinery and Petrochemicals Ltd, an Indian state refinery, said that the latest sanctions would not affect the diesel exports of the company. LSEG reports that traders have sold MRPL diesel parcels to UK buyers in recent months. "We do not directly sell diesel to our end customers." The trader picks it up after a tendering procedure," said M Shyamprasad Kamath, managing director of M Shyamprasad Kamath. He added that he doesn't see any problems with selling refined fuels because of the sanctions. A tender document obtained by revealed that Nayara Energy, in response to the EU sanctions, amended the terms of the naphtha bid issued on Monday, requiring payment in advance.
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Asian stocks rise as investors focus on tariff negotiations and earnings
Investors took note of the tariff negotiations between America and its trading partners, while Asian stock markets remained near their four-year high on Tuesday. They were buoyed up by Wall Street's record closing high in advance of a series of corporate earnings. After a weekend election in which the ruling coalition lost in the upper house elections but Prime Minister Shigeru ishiba pledged to stay in his position, the Japanese markets have returned to activity. Japanese shares briefly rose at the opening before trading modestly higher. Bonds had a muted response as the results of the elections were already priced in, and not as bad for investors as they had anticipated. The yen rose 1% on Sunday, recouping losses from previous weeks. It was little changed on Tuesday at 147.46 to the dollar. Kristina Clifon, economist at Commonwealth Bank of Australia said that the weakening of Ishiba’s leadership would open the door for more fiscal expansion, which will be negative for Japanese assets including the yen. The bottom line is that the yields on longer-term Japanese government bonds and JPY could fall if worries about Japan's fiscal expenditures intensify. MSCI's broadest Asia-Pacific share index outside Japan reached its highest level in October 2021 during early Asian hours, but last changed little. The index has risen by nearly 16% in the last year. Alphabet, and other megacaps, have lifted the S&P 500 to record highs overnight, ahead of a flurry of earnings reports due this week. Investors have focused on tariff negotiations in advance of the deadline of August 1, with the European Union exploring an broader range of possible countermeasures to the United States, as the prospects of an acceptable agreement with Washington diminish. CBA's Clifton says that the EU and Japan are the two most important countries for global growth. Clifton noted that the USD's reaction to trade deals announced with these countries will depend on their details. The dollar could also fall against the British pound and the euro. The euro was unchanged at $1.1689 after gaining 0.5% the previous session, but it is still far from the four-year high that it reached at the beginning of the month. Investors are looking for alternatives to U.S. stocks that have been hurt by tariff uncertainty. The euro is up 13% in 2018. The dollar index measured against six key currencies was 97.905. Investors have been on tenterhooks for the past few weeks due to the rumblings about whether President Donald Trump would fire Fed chair Jerome Powell. Trump was on the verge of firing Powell last week but backtracked, citing the likely market disruption. U.S. Treasury secretary Scott Bessent said on Monday that the Federal Reserve as a whole needed to be examined and whether or not it was successful. This further exacerbated concerns about the independence of U.S. Central Bank. It is expected that the Fed will hold rates at their July meeting, but may lower them later in the year. The market will focus on Powell's address on Tuesday to get clues as to when the Fed may ease policy. Goldman Sachs' strategists predict that the Fed will deliver three consecutive 25 basis-point reductions starting in September "provided inflation expectation remains in check amid concerns about Fed independence." Oil prices in commodities fell on fears that a trade war between the U.S., the European Union and other major oil consumers would curb fuel demand. Brent crude futures dropped 0.35% to $68.97 per barrel while U.S. West Texas intermediate crude fell 0.31% to $66.49 per barrel.
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Oil prices fall as concerns about trade wars increase fuel demand
Investor sentiment was weighed down by concerns that a brewing trade conflict between the U.S., the European Union and other major oil consumers would reduce fuel demand growth through a reduction in economic activity. Brent crude futures dropped 24 cents or 0.35% to $68.97 per barrel at 0055 GMT, after closing 0.1% lower Monday. U.S. West Texas Intermediate Crude was trading at $69.99 a barrel. This is down 21 cents or 0.31% from the previous session, which saw a loss of 0.2%. The WTI August contract expires Tuesday, and the September contract, which is more active, was down 23 cents or 0.35% to $65.72 per barrel. The oil market is still struggling to find direction after the ceasefire between Israel and Iran on June 24, which ended the conflict, has removed any concerns about major supply interruptions in this key Middle East region. Brent and WTI have traded between $5.19 and $5.65 since then. This is because supply concerns were eased as major producers increased output, and investors became more concerned about the global economic situation due to changes in U.S. Trade Policy. A weaker dollar has helped to support crude oil prices as buyers paying in other currencies pay less. In a recent note, IG analyst Tony Sycamore noted that prices have fallen "as trade-war concerns offset the support provided by a softer dollar". Sycamore has also suggested that the tariff dispute between the U.S.A. and EU could escalate. According to EU diplomats, the EU is looking at a wider range of counter-measures that could be taken against Washington as the prospects of an acceptable trade deal with Washington are fading. US has threatened to impose 30% tariffs on EU imports if no deal is reached by August 1. As the Organization of the Petroleum Exporting Countries (OPEC) and its allies begin to unwind their output cuts, there are signs that the market is also seeing an increase in supply. Data from the Joint Organizations Data Initiative showed that Saudi Arabian crude oil exports rose in May to their highest level in three months. (Reporting by Anjana Anil in Bengaluru; Editing by Christian Schmollinger)
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Report: China must reduce its steel production by 2025 to achieve the decarbonisation goal
Researchers said that in order to meet the green steel goal for this year, China must reduce its steel production from coal-powered blast furnaces by over 90 million metric tonnes from 2024. Why it's important Around 8% of carbon dioxide emissions are attributed to the global steel industry, and China produces more than half of all global steel. Analysts at the Centre for Research on Energy and Clean Air in Helsinki said that if China met its goal of producing 15% of its steel using electric arc furnaces this year, CO2 emissions could be reduced by 160 million tons. This is almost equivalent to the carbon footprint of the European Union's steel sector. By the Numbers China is far behind other countries in the world when it comes to electric arc furnace steel. According to the centre, the average global share is 30%, with 71.8% of that in the United States and 58.8% India, and 26.2% Japan. The report said that from 2021 to 2025's first half, China's capacity utilization of blast furnaces increased from 85.6% up to 88.6%. However, the utilisation of electric-arc furnaces fell from 58.9% down to 48.6%. KEY QUOTE Belinda Schaepe is an analyst with the Helsinki-based Centre. She said that a credible strategy would address the structural problems of the sector and ease global tensions. CONTEXT China will produce 1.005 billion tonnes of crude steel by 2024. Around 90% of this will be produced in blast furnaces. Overcapacity in China's steel industry has led to a decline in prices, and has prompted a growing backlash against the country from its global trading partners. High power costs, an unstable scrap supply, and increasing losses have been a major obstacle for cleaner electric arc plants. Reporting by Amy Lv, Lewis Jackson and Cynthia Ostert. Editing by Cynthia Ostert.
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Taiwan's CPC rejects'specifics' US shale-gas acquisition talks
CPC Corp, Taiwan's state owned energy company, said that it was not in negotiations for "specific" shale fields in the United States. However, it did not exclude any potential partners and would make the best decision based on their own evaluations. Three sources with knowledge of the matter said earlier this month that CPC was in early discussions to purchase shale gas producing assets in the United States. The move is part of a plan to secure the supply for natural gas to fuel Taiwan's economic growth. CPC stated in a late Monday statement that the U.S. Shale Gas has been a target for many years because of its quality, mature extraction technologies and favorable investment environment. The CPC said that it would not exclude any potential partners, but instead make the best decision possible based on evaluation results. The company said that the reports stating that CPC was in the process to discuss the acquisition of certain shale fields in the United States were not true. Taiwan has committed to increasing its energy purchases from the United States in order to reduce its trade surplus. This will also help avoid tariffs. CPC and Alaska Gasline Development Corp signed an agreement in March to purchase LNG and invest into the Alaska LNG Project. The project will use pipelines to transport gas from Alaska's remote northern region to Taiwan, Japan, and South Korea. (Reporting and editing by Jacqueline Wong; Ben Blanchard is the reporter)
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Steel Dynamics reports disappointing quarterly results for raw material costs
Steel Dynamics reported second-quarter earnings below Wall Street expectations on Monday, due to rising raw material costs and the uncertainty surrounding U.S. Trade Policy. After hours, shares of the Fort Wayne-based company dropped more than 4%. Tariffs imposed by President Donald Trump on steel imports will benefit U.S. Steelmakers, as they will increase prices. However, the tariffs could also raise raw materials costs. In a statement, CEO Mark Millett stated that "the uncertainty surrounding trade policy continues causing hesitancy among customer order patterns in our businesses despite the healthy demand factors underlying." We are confident that, as trade policies and individual country agreements are settled in the next few months, a strong demand for our products is likely to result. Steel Dynamics has also confirmed that it has an overhang of coated flat-rolled products because of imports. LSEG data shows that the company's adjusted second-quarter profit per share of $2.01 was below the analysts' expectation of $2.10 The quarter ending June 30 saw revenue of $4.56 billion. This was below the $4.76 billion Wall Street expected.
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Merz: Berlin is still interested in TenneT German business
The German Chancellor Friedrich Merz stated on Monday that the government has not yet decided if it will take a stake of the German division owned by the Dutch state-owned power grid operator TenneT. He also said the Netherlands and Germany were still in discussions. The Netherlands announced last month that it would decide in September if it wanted to sell a minority stake in TenneT Germany, or pursue a partially IPO. This could be Europe's largest deal in 2025. After a failed partial sale of TenneT Germany to the German state lender KfW in June last year, the Dutch government began a dual-track process. Merz stated in a joint press conference with Norwegian Prime Minster Jonas Gahr Store that "the discussion within the federal governments is currently underway and has not been concluded." The Norwegian sovereign wealth fund, according to Handelsblatt, which cited sources familiar with the issue, is looking at a multi-billion-dollar investment in TenneT Germany. Store, when asked if he would support it, said that the fund has already made "significant investments" in German companies. Store stated that there are numerous opportunities to invest in Germany. (Reporting and editing by Marguerita Chôy)
Trump's staff cuts are forcing firefighters to clean toilets as US wildfires rage.
Former and current employees of the U.S. Forest Service have complained that the Trump administration has reduced the federal workforce, leaving fire teams understaffed. This is as the U.S. struggles with a record number of wildfires this year.
These claims were rejected by the agency that oversees America's largest wildland-firefighting force. It said it had sufficient resources.
More than a dozen U.S. Forest Service active and retired employees said the agency was struggling to fill key roles after about 5,000 employees, or roughly 15% of their workforce, quit in the last five months.
According to firefighters in Oregon, New Mexico and a Pacific Northwest fire chief who recruits support staff, the vacancies are causing personnel to be held back in frontline firefighting due administrative duties.
The crew leader of an Oregon fire said that her team was left without food for days, medical supplies and chainsaw fuel, after the support staff had quit during two rounds "forks in the road" buyouts.
The crew leader of the Alder Springs Fire said, "I had guys going to bed after working 16 hour shifts," and asked to remain anonymous for fear of losing their job.
National and local USFS officials, however, say that the force is prepared for what will be a fire year worse than average in California, the Pacific Northwest and the northern Rockies. This is according to National Interagency Fire Center predictions.
Isabella Isaksen is the USFS Public Affairs Officer who represents USFS Operations in Central Oregon. She said, "Our staff are very confident about our staffing levels as we enter this fire season."
Isaksen explained that the food issues on the Alder Springs Fire was due to a newly hired caterer, and they were quickly fixed. She said that medical supplies, chainsaws, and other equipment were readily available at the 3,400-acre fire, which prompted evacuations in both counties.
They are ready
The Trump administration has pledged to not cut firefighting jobs and other public-safety positions in firings and voluntary resignations. They also promised to take early retirements to increase efficiency at the USFS. This agency manages roughly 193 million acres (78 million ha), which is the same size as Texas.
USFS employees interviewed for this article said that the loss of thousands foresters, biologists and trail builders was having an impact on firefighters.
These people claim that not only do firefighters have to fill vacant positions at ranger station, but also they are losing hundreds of their peers who switch from regular jobs each year to firefighting support roles in the fire season which runs from spring until fall.
USFS Chief Tom Schultz told agency managers on Wednesday to make available all the "red-carded", fire-qualified staff for an "extremely difficult" fire year. This memo was seen by. Wildland firefighters were called out to 41,000 fires in the first half of this year, which is by far the most since federal data dating back at least to 2015. Year to date, wildfires have consumed 2.9 million acres, which is below the 10-year-average of 3.3 millions acres.
Last month, Schultz said to a U.S. Senate Committee that he wanted to temporarily hire 1,400 support staff with "red cards" who had taken buyouts.
Schultz replied, "I believe they are prepared," when asked if the fire-year 2025 was ready.
FIREFIGHTERS mow the lawns
In June, Agriculture Secretary Brooke Rollins who oversees USFS said at a gathering of Western state Governors in New Mexico, that the agency is on track to hire 11,300 firemen by mid-July. This will be a record number compared to the hiring in the previous three years.
According to the latest USDA data, as of June 29, 11236 people, or 99%, had been hired. This is slightly lower than last year.
The USDA denied claims that staff shortages endanger communities, forests and firefighters.
A USDA spokesperson stated that any suggestion of firefighting duties being deferred or given less priority is incorrect. This is not a second mission. It is at the heart of our work in public safety, and each decision reflects this urgency.
New Mexico U.S. Senator Martin Heinrich criticized Trump's administration for firing and rehiring 3,400 USFS probationary employees, of which three quarters were red-carded. He also criticized its agency-wide buyouts, and what he described as its indiscriminate staff hiring practices.
Heinrich stated in an email statement sent on July 11 that "Wildfire Season is well underway and the U.S. Forest Service has been gutted thanks to DOGE, Donald Trump and their policies."
The Forest Service claims it doesn't have enough wildland firefighters to deal with the "wildfire crisis" in the United States and relies on "red-carded employees" to "boost firefighting capability."
Forest Service employees are not the only ones who see problems.
Steve Ellis, Chairman of the National Association of Forest Service Retirees said that his checks with Oregon fire staff revealed no reports of firefighters being hungry or having other support issues.
Riva Duncan, an officer assigned to a New Mexico fire, told reporters that even firefighters are being used to fill in the gaps created by job losses. This is exacerbating the long-standing shortage of personnel who can operate fire engines.
They're answering the phones at the front office, cleaning toilets in campgrounds, or mowing lawns at administrative sites," Duncan, a retired USFS Fire Chief who reenlists every fire season, said. Duncan also helps run Grassroots Wildland Firefighters - a federal firefighter advocate group.
Fire staff officers in the Pacific Northwest reported that managers had told support staff they must first meet Trump's targets for increased oil and gas production and timber sales, which are higher than ever.
The fire chief who requested anonymity for fear of reprisals said, "They claim we get all we need but in reality it's not even close." (Reporting by Andrew Hay; Editing by Donna Bryson and Diane Craft)
(source: Reuters)