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Brazil's Competition Authority allows the soy moratorium indefinitely pending a year-end ruling
The Brazilian competition watchdog approved on Tuesday that the country's soy ban will continue through at least the end of this year. CADE's 5-1 vote marked a dramatic change after its reporting councilor in the case voted against the appeal of soybean traders and processors. The private pact, which has been in place for two decades, aims to protect the Amazonian rainforest by prohibiting soybean traders from purchasing from farmers who have cleared land after July 2008. However, it could be a violation of Brazilian competition laws. Back and Forth CADE's Superintendent ordered the agreement to be suspended in August. He argued that it was a cartel and gave signatory companies unfair advantages over farmers. On appeal by trading companies, the federal judge halted this order pending an in-depth review by CADE. The superintendent made the decision on Tuesday, but councilor Carlos Jacques Gomes backed it up. He cited competition concerns and raised concerns over the pact’s potential to increase trading companies' bargaining power when buying soybeans from farmers. TIME FOR DIALOGUE Gomes was followed immediately by councilor Jose Levi Mello do Amaral Junior who granted the trading company's appeal in part, ordering that the suspension of the agreement be delayed until December 31. Amaral junior, joined by his colleagues, said that freezing the suspension would give traders and processors the time they need to speak with soybean producers who claim the moratorium is a cartel. The Council President Gustavo Augusto Freitas de Lima granted Amaral Jr. more time to make a decision, but disagreed with him on other issues. REACTIONS OF THE INDUSTRY Abiove, an industry group that represents soybean traders and processors, and was involved in this lawsuit, stated that the new deadline would allow more time to find a solution. In a press release, it stated that "Abiove continues to monitor the developments at CADE" and is available to work with relevant authorities in order to promote legal predictability and regulatory certainty in the sector. (Reporting and editing by Gabriel Araujo, Leslie Adler and Roberto Samora)
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Caution is urged as the US government shutdown approaches
On Tuesday, caution ruled the world markets. The dollar and stocks fell and gold briefly hit record highs as investors worried that a possible U.S. shutdown would delay important jobs data. Donald Trump stated that the United States was likely headed for its 15th shutdown since 1981 and that his administration would be able to make irreversible decisions in this scenario. Investors prepared for a government shutdown that would begin after a midnight deadline passed to come up with a new funding agreement. The dollar fell and U.S. stock prices also dropped. The prospect of a U.S. shutdown puts the spotlight on jobs. A government shut down would delay Friday's important employment figures, and instead focus attention on the Labor Department's JOLTS Report from Tuesday. This report showed that U.S. hiring decreased in August but job openings rose marginally. The Federal Reserve could cut rates again next year despite the resilient consumer spending, if labor market conditions remain weak. Monica Guerra of Morgan Stanley Wealth Management, who is the head of U.S. Policy, said that a full-government shutdown on October 1, appears to be more likely. The Dow Jones Industrial Average dropped 0.3% and the Nasdaq Composite fell 0.3%. Wall Street's lackluster performance weighed on the MSCI All-World Index, which was flat. The Nikkei, Japan's stock market, closed at a loss of 0.25%. The STOXX 600 rose 1% for the month. This is its best performance since May. China's blue chip CSI300 Index rose nearly 0.5%. This is the longest streak of gains since October 2017 and it marks its fifth consecutive month. Overall, the outlook for equities remains positive, as U.S. shares are expected to end September with a gain of more than 3%, and European stocks have had their best month since last May. Shaniel Ramjee is the co-head of Pictet Asset Management's multi-asset division. "The earnings picture is improving quite significantly at the same moment that central banks around the world are cutting interest rates, and global growth continues to be good." The Australian dollar gained after the central banks held policy rates at their current levels, as was widely expected. Oil prices dropped over 1% due to the prospect of increased production by OPEC+. Meanwhile, China's manufacturing activity declined for a sixth consecutive month in September. A GOLDEN MONTH The risk of a shutdown has added to the stunning rally. Gold briefly reached a record high of $3.871.45 an ounce, before trading lower for the day. It is on track to achieve its largest monthly percentage gain in July 2020. The dollar fell 0.6% to 147.70yen while the euro rose 0.3% to $1.1757. Both the Swiss Franc and the pound also gained a little against the dollar. The dollar index is expected to finish September with little change, despite the recent 0.3% decline. The uncertainty over the U.S. government shutdown increased demand for U.S. Treasury 10-year bonds and pushed the yield to 4.1329%. ING currency analysts wrote in a report that the yen would likely outperform as a hedge against a U.S. shutdown. The Fed will be calculating the timing of rate reductions based on the September employment report, which is due this Friday. The Fed's meeting on October 29 could be thrown into confusion by a prolonged government shutdown. China's purchasing manager's index increased to 49.8 from 49.4 at the end of August. This is below 50, which separates growth from contraction. The report suggested that producers were waiting for more stimulus to boost the domestic demand as well as clarification on a U.S. Trade Deal. The Reserve Bank of Australia kept its cash rate at 3.60%. Recent data indicated that inflation could be higher than expected in the third quarter, and the economic outlook was uncertain. The data that showed an increase in inflation in four important German states did not have a significant impact on the market. The oil price remained weaker because of an expected production increase by OPEC+, and the resumption in Iraq's Kurdistan. Brent crude oil fell by 1.3%, to $67.10 a barrel. U.S. crude dropped 1.3%, to $62.60.
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Trump warns Democrats about 'irreversible actions' in the government shutdown
U.S. president Donald Trump warned Congress Democrats on Tuesday, that allowing the government to shut down by midnight would allow him to take "irreversible actions" including closing programs important to them. Trump told reporters in the White House Oval Office that he could do things during the shut down that were irreversible. They would be bad for them as well as irreversible themselves, such as removing a large number of people, cutting the things they want, and cutting the programs they enjoy. Trump continued, "You know Russell Vought." He was referring to the Director of the Office of Management and Budget. "He has become popular in recent years because he is able to trim the budget at a level you could not do otherwise." Trump has not specified the specific actions he may take. However, he recently raised the possibility of further reducing the federal workforce. The United States will be entering its 15th shutdown since 1981 at midnight unless Republicans in Congress and Democrats agree on a temporary funding deal with the start of Wednesday's new fiscal year. However, there were no signs that such a result was likely. The Republican-controlled Senate is expected to vote on a temporary spending bill that has failed once already, with no sign that a second vote will bring success before the midnight deadline (0400 GMT Wednesday). Democrats are modifying the bill in order to extend the health benefits of millions of Americans, which expires at the end the year. Republicans insist that they must address this issue separately. Washington has become used to budget-related arguments, which are usually resolved in the last moment. In 2018 and 2019 the government shut down 35 days due to an immigration dispute. The TRILLION-DOLLAR FIGHT The $1.7 trillion allocated to agency operations represents roughly a quarter of the $7 trillion total budget. The remainder is used to fund health and retirement plans and interest on the $37.5 trillion growing debt. Federal agencies began to release detailed plans which would shut down offices that conducted scientific research, customer services, and other non-essential activities and send thousands home if Congress did not agree on a solution before funding expired. Budget experts warned some Americans could already be feeling the impact. Jonathan Burks of the Bipartisan policy Center, a health expert, explained that Medicare reimbursements at home for "acute hospital" care could be disrupted. Patients would then need to seek out inpatient facilities. He told reporters on Tuesday morning that "that's a serious disruption right now." He also said that Medicare reimbursements of telehealth medical appointments would expire midnight. Airlines have warned that a shutdown may slow down flights. The Labor Department has also announced it will not release its monthly unemployment report - a barometer closely watched for economic health. Small Business Administration announced it would cease issuing loans. The Environmental Protection Agency also said that it would suspend certain pollution-cleanup activities. The more time a shutdown is in place, the greater the impact. Bipartisan Policy Centre experts say that public housing subsidies for families with low incomes could shrink and that some Head Start early childhood education programs could experience delays in receiving grant money. DEEPFAKE VIDEO The White House meeting between Trump and leaders of Congress on Monday ended in a deadlock. Trump posted a deepfake clip showing manipulated images that showed Democratic Senate Leader Chuck Schumer criticizing Democrats, while Hakeem Jeffreys stood beside him with a crudely-drawn sombrero over his face. Jeffries told reporters outside the U.S. Capitol that he would not accept Trump's response by using a fake AI video or racist language. Say it to me when I return to the Oval Office. Any last-minute agreement would also have to be approved by the Republican-controlled House, which is not due to convene until Wednesday, after funding expires. ADMINISTRATION TREATES MORE LAYOFFS Trump's willingness this time to ignore the spending laws passed by Congress is causing more uncertainty. He has also threatened to continue his purge of federal employees if Congress permits the government to close. He ordered agencies in the spring to consider letting go of "non-essential" employees, who would normally be told not to work if there was a government shutdown. Trump also refuses to spend billions approved by Congress. This has led some Democrats to wonder why they should vote in favor of any legislation that involves spending. Even though Republicans control both chambers, they still need seven Democratic votes in the Senate to pass any legislation. Democrats also wanted to make sure that Trump would not be able undo the changes made by Trump if they were signed into law. Democrats, who are locked out of Washington power, face pressure from their supporters to achieve a rare win ahead of 2026's midterm elections. These will determine the control of Congress during the last two years of Trump’s term. They have a chance to come together behind a cause that is popular with voters. Some in the party still question whether it's worth risking a shut down. It's not about who gets blamed or politics. "It's about millions of Americans being harmed," Democratic Senator John Fetterman from Pennsylvania told reporters.
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In India, Chennai, nine people have been killed in an accident at a power station
Officials in Chennai, southern India said that nine workers died in an accident on Tuesday at a thermal plant under construction. J. Radhakrishnan is the secretary of the Tamil Nadu Electricity Board and the chairman of the plant owner, Tamil Nadu Generation and Distribution Corporation. Radhakrishnan stated that one person was also injured, on top of the nine fatalities. Radhakrishnan, a reporter, told reporters that officials from BHEL (the contractor for the project) were present at the site of the accident. ANI has a minor stake in BHEL. Tamil Nadu Chief Minister M.K. Stalin confirmed that the nine workers died in an X-post and stated they were from Assam, a state located to the east. In a recent post, Prime Minister Narendra Modi expressed his sadness over the incident caused by the collapse of a structure in Chennai, Tamil Nadu. (Reporting from Shubham and Yazhini M.V. in Bengaluru and Chris Thomas in Mexico City. Additional reporting by Surbhi misra in Bengaluru. Editing and production by David Goodman, Gareth Jones and David Goodman)
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France's Orano claims 1,500 tons of uranium is stored at the seized Niger site
Orano, a French nuclear company, has announced that 1,500 metric tonnes of uranium is stored at the SOMAIR mine it expropriated in northern Niger. It will pursue compensation and criminal charges if this material is taken or sold without authorization. Sources at the mine confirmed that Niger has not sold any uranium yet, despite "potential customers including Iranians Russians and Turkey". Orano initiated arbitration at the World Bank’s International Center for the Settlement of International Disputes (ICSID) in January, after Niger’s military government had blocked operations at SOMAIR and then nationalised it. INTERNATIONAL COURT BANS NIGER URANIUM TRANSFERS Niger was the seventh largest producer of nuclear fuels and cancer treatment materials in the world when Orano mines were fully operational. It accounted for 15 percent of Orano uranium supply. Niger's expropriation Orano's stake of 63.4% reflects a regional shift in which military-led governments are asserting greater control over resources. On September 23, a World Bank tribunal ordered Niger not to sell or transfer uranium Orano claimed had been mined prior to the suspension of operations by the military government. Orano, in response to questions by e-mail, said that the company had no information on future production at the mine. It added: "To our best knowledge, the uranium remains at the SOMAIR facility." Orano’s stockpile in the Somair Mine is valued at about $270 Million at $82 per lb. The prices have risen by around 30% since the middle of March, but remain below the peak price of $106 in February 2024. Orano refused to comment about prospective buyers approaching Niger citing the focus of its attention on arbitration. The Niger government did not respond immediately to a comment request. NIGER TAKES CONTROL OF URANIUM PRODUCTION Sources at SOMAIR said that the mine has 1,570 tonnes of uranium. The SOPAMIN (Societe du patrimoine des mines du Niger) is in charge of the production, they said. The source, who asked not to be identified due to the sensitive nature of the matter, said: "To my knowledge there haven't been any official sales." There is a high demand for purchasing. Since the 1970s, the Somair Mine has produced more than 70,000 tons uranium in the vicinity of Arlit. The Niger military government has tightened its control over gold, coal and oil. Ali Lamine Zeine, the Prime Minister of Niger, accused foreign companies of exploitation for decades, claiming that uranium brought Nigeriens "misery and pollution, rebellion and corruption, as well as desolation," while enriching France.
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Vale Base Metals increases Onca Puma's capacity with new nickel-based furnace
Vale Base Metals began operating a new Nickel furnace at its Onca Puma Complex in northern Brazil. The company claimed that this would increase the nominal production capacity of the asset by 60%, and allow them to produce more for lower costs. Shaun Usmar, Vale Base Metals' CEO, said on Tuesday that the new furnace would help the company deal with the current low nickel prices. The firm attributes the low nickel price to an oversupply of nickel from Indonesia. It will also put Vale Base Metals in a very strong position for when the market recovers. Usmar stated that the company would generate "reasonable" cash flow with this expansion. He estimated it would increase Onca Puma’s production capacity to 40 metric tons per year. Vale Base Metals anticipates producing between 165,000 and 175,000 tonnes of nickel globally this year. The new furnace and output from Voisey's Bay in Canada should boost output to 210,000-250,000 tons by 2030. Onca Puma says that the second Onca Puma furnace took around three years to build and cost $480 million less than the $555 million originally planned. Vale Base Metals, a Brazilian company majority-owned by Vale is a joint venture of Saudi Arabia's Public Investment Fund and Saudi miner Ma'aden. Manara Minerals, a joint-venture between Saudi miner Ma'aden & Saudi Arabia's miner Vale - owns 10%. Usmar stated that Vale Base Metals would continue to invest in order to expand their presence in Brazil, and to strengthen their critical minerals portfolio. ($1 = 5,3231 reais). (Reporting and writing by Marta Nogueira, Editing by Gabriel Araujo, Chris Reese).
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Sources: Sinochem could sell its Pirelli stake in a governance dispute.
Sinochem, a Chinese company, is willing to sell its Pirelli shares - but only if they are offered at a premium. This comes after the Italian government announced this week that Sinochem had not violated the rules protecting the autonomy of the tyre manufacturer. Rome is trying to resolve a dispute over governance that has affected Pirelli for years. Sinochem, Pirelli’s largest shareholder, is at odds with Camfin, another investor. Pirelli and Camfin complained that the fact that a Chinese company was its largest shareholder was preventing the tyre manufacturer from expanding in the U.S., because Washington is tightening restrictions on Chinese automotive technology. Marco Tronchetti Provera is the Italian businessman behind Camfin. He has been Pirelli's executive vice-chairman since 1992. It owns a stake of 27.4%. Sinochem was offered an olive branch by the Italian government on Monday. The group had not violated the special "golden powers" measures that were imposed in the year 2023, to protect the independence and strategic importance of the company. In a press release, the government stated that it was in "constant dialogue" with the company to ensure "its full competitiveness across all areas of operation and to adapt its instruments to new regulatory requirements in its reference markets." Sinochem and Camfin have been unable to reach an agreement for more than a year. The Chinese group is now willing to concentrate its efforts in talks with the Government and explore arrangements that are in Pirelli's best interest, including the sale of its 37% share, according to one source. Source: Sinochem will assess market premiums offered by bidders, even though it sees itself as a potential long-term investor. The source said that other options could be explored, including those not involving the sale of a majority stake. One source and a third party said that Pirelli has been working informally with banking advisors on a possible deal where Sinochem would reduce its stake. It could be some time before any real progress is made. Pirelli and Sinochem have declined to comment. Banking sources say that selling its entire shareholding in Pirelli wouldn't be easy for Sinochem. Industrial investors may not want to invest money in a company led by a local shareholder. In order to protect strategic assets, the government of Prime Minster Giorgia Melons intervened in Pirelli two years ago. The so-called golden powers rules were designed to protect management autonomy and limit Chinese influence. In accordance with that ruling, Pirelli’s Italian shareholder is entitled to nominate the top management of the group and steer its strategic decisions.
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Saudi Arabia's finance ministry expects a fiscal deficit of 3,3% of GDP by 2026.
Saudi Arabia projected a fiscal surplus of 3.3% for 2026. This is higher than the previous estimate in the budget for 2025, which predicted a deficit of 2.9% for next year. The 2026 deficit equals 165 billion Riyals ($44.00 billion). The Ministry Estimated Value The 2025 deficit is projected to be 245 billion riyals (65.33 billion dollars), or 5.3%, which is higher than the 101 billion riyals that were originally forecast in the budget released last November. The latest pre-budget announcement on Tuesday by the Finance Ministry puts the total expenditures for 2026 at 1,31 trillion riyals (349 billion dollars) and the revenue at 1,14 trillion riyals (304 billion dollars). Saudi Arabia has embarked on a massive overhaul of its economy known as Vision 2030. It aims to reduce reliance upon oil and develop more sustainable revenue streams. This requires hundreds of billions in investment. The Ministry of Finance forecasts a real GDP growth rate of 4.4% by 2025, fueled by non-oil activity growth, and 4.6% by 2026. According to a July poll, 20 economists surveyed between July 15 and 28 predicted that Saudi Arabia's economy would grow by 3.8% in this year. This is nearly three times faster than the 1.3% recorded growth in 2024. The International Monetary Fund increased its GDP growth forecast of Saudi Arabia for 2025 to 3.5%, from 3%. This was partly due to the demand for government-led initiatives and the OPEC+ plan to gradually end oil production cuts. $1 = 3.7501 Riyals (Reporting and writing by Elwelly Elwelly; editing by Alex Richardson).
US corn stocks drop before record-large harvest
U.S. grain handlers and farmers had 13% less corn stored ahead of the fall harvest than they did a year ago, according to data released by the U.S. Department of Agriculture on Tuesday. However, a record crop is expected to replenish stocks.
Low prices have boosted exports this year in the top corn-supplying country in the world, reducing stocks in storage but also making it hard for farmers to make a profit, at a time where costs for fertilizer and seed, among other things, are increasing. In a quarterly report, the USDA stated that as of September 1 there were 1,532 billion bushels in storage. This is down from 1.763 million bushels one year ago. Analysts expected an average of 1.337 billion bushels.
After the USDA released its data, corn futures fell as Midwest farmers began to ramp up harvesting. The market dropped below $4 last month and was close to a 4-year low, set in August 2024 due to forecasts of a record crop.
The United States livestock industry likely used less corn than expected despite low prices because Washington has blocked the import of Mexican cattle to keep them out.
New World Screwworm is a parasite that can be harmful.
Analysts said that the disease has spread to Mexico.
Don Roose is the president of U.S. Commodities, a brokerage.
China, the world's largest importer of soybeans, has also seen its prices fall.
No supplies purchased
A rare delay occurred in the fall harvest of the United States during Washington's trade war. Chinese importers turned instead to South America for their soy.
Analysts said that despite the decline in U.S. stocks, they were still able to reduce them due to strong domestic demand. As of September 1, there were 316,000,000 bushels of soybeans stored, compared to 342,000,000 a year earlier. Analysts expected 323 million bushels.
According to USDA, wheat stocks were at a five-year record high of 2,120 billion bushels as of September 1. This is up from 1.992 million bushels one year ago. Analysts expected 2.043 billion bushels.
Wheat futures fell after the USDA increased its estimate of U.S. production from 1.927 to 1.985 million bushels.
Terry Reilly is the senior agricultural strategist at Marex.
(source: Reuters)