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Palm slips due to profit-taking, but production worries cap losses
Malaysian palm futures fell for the second session in a row on Monday. Profit-taking weighed them down, but concerns about a fall in production supported prices. At the close, the benchmark palm oil contract on Bursa Malaysia's Derivatives exchange for December delivery fell 6 ringgit or 0.14% to 4,436 Ringgit ($1,052.93) per metric ton. It closed Friday at 4,442 Ringgit, a 0.09% decrease. Anilkumar bagani, research head at Mumbai-based Sunvin Group, said that the fall in crude palm oil futures was due to profit-taking, amid market speculation about a possible increase in import duties for vegetable oils by India. Bagani also expressed concern about the lower than expected reduction in Malaysian production of palm oil. According to a survey, Malaysian palm oil production and stocks are expected to fall in September for first time in 7 months. On October 10, the Malaysian palm oil board will release its September supply and demand statistics. The oil price rose by more than 1%, as OPEC+’s planned production rise for November was less than expected. This eased some supply concerns, but a weak outlook for the near term is likely to limit gains. Palm oil is a better option as a biodiesel feedstock because crude oil futures are stronger. Chicago Board of Trade Soyoil Prices grew by 0.78%. Dalian Commodity Exchange will be closed on October 1-8 due to public holidays. As palm oil competes to gain a share in the global vegetable oils industry, it tracks the price fluctuations of competing edible oils. The dollar has weakened by 0.17%, which makes palm slightly cheaper to buyers who hold foreign currencies. $1 = 4.2130 Ringgit (Reporting and editing by Ashley Tang)
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State media reports that Turkey has detained 21 suspects as part of the investigation into the Istanbul Gold Refinery.
Anadolu, the state-owned news agency, reported on Monday that Turkish police had detained 21 individuals linked to the Istanbul Gold Refinery as well as related companies for allegedly obtaining support from the state through fraudulent means. Anadolu reported that police conducted simultaneous raids in a dozen different areas across the city, after Istanbul prosecutors had issued arrest warrants. Two more suspects are still on the run. According to data from Turkey's official Trade Registry, the Istanbul Gold Refinery is owned by Halac and is one of London Bullion Market Association's (LBMA) accredited refineries. Anadolu quoted a statement from the Istanbul chief prosecutor that IAR officials including main shareholder Ozcan Halac set up companies in order to receive a state subsidy of 3% on $543.6 millions worth of exports. This led to a loss to state of $12.5 million. Anadolu reported that an investigation revealed the refinery received a 3% state subsidy for selling foreign currencies to the central banks in exchange for Turkish lira under a scheme of incentives designed to support the Turkish lira. The suspects were said to have imported gold first, then processed it at home and exported it once more in order to generate forex. Halac and the IAR could not be immediately reached for comment. The suspects are accused of violating a central bank law, public finance laws and a law relating to the protection of lira value. Can Sezer, Daren Butler, and Ed Osmond edited the report.
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Thai PM orders immediate relief after floods in 16 provinces kill 12
Anutin Charnvirakul, the Thai prime minister, ordered Monday urgent relief efforts following flooding caused by heavy rains and storms that hit 16 provinces in the last week. Twelve people were killed and more than 100,000 homes were affected. The Interior Ministry reported that floods had inundated areas of northern, central, and northeastern Thailand. Uttaradit Province in the upper north region, which saw five deaths, was among the worst affected. The water was rising so quickly that we had to move to the roof, but when it collapsed, we were forced to leave, said a resident who only gave his first name Sakchai to state broadcaster ThaiPBS. He said, "We are staying in a temple right now." Anutin stated that officials were working on delivering aid and assessing the damage. As the monsoons begin, they are also preparing themselves for more rain. At a meeting of the task force, he stated that Thailand is experiencing floods, storms, and landslides in many provinces. This has caused extensive property damage and death. In Thailand, flash floods caused by monsoon rainfall killed 22 people last year. Reporting by Chayut setboonsarng, Panarat thepgumpanat and David Stanway.
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Predictive Discovery and Robex, two gold mining companies, will merge for $1.5 billion
Predictive Discovery, an Australian gold miner, and Robex Resources of Canada have announced that they will merge their companies in a A$2,35 billion (1.55 billion) all-share transaction. This merger will create a mid-tier producer of gold in West Africa. According to a joint announcement released late Sunday, Robex shareholders receive 8.667 shares of Predictive for every Robex share. This gives them approximately 49% ownership in the combined company. The new company is listed in Sydney, and will seek a dual listing at the TSX Venture Exchange of Canada. The combined project will produce more than 400,000 ounces of gold annually by 2029. This is supported by resources of 9.5 million and reserves of 4.5 million. Gold mining firms are consolidating as they leverage high margins through mergers and purchases. The two miners announced that Robex's Kiniero, set to start production in December this year, would help fund the development of Bankan. Bankan is aiming for a final decision on investment in mid-2026. Guinea, known more for its bauxite or iron ore than gold, has attracted renewed interest in the exploration of gold despite long-standing challenges from artisanal mines and recent regulatory crackdowns. Fortuna Mining of Canada, for instance, has signed a joint-venture with DeSoto Resources in Australia to explore the Siguiri Basin in northeastern Guinea. Matthew Wilcox, CEO of Robex, will be the new leader of the merged firm. Andrew Pardey, chief executive officer at PDI will also lead it. Cohen Group and Eglinton Mining hold 25% each of Robex. The deal is expected to be completed by the end of the year, subject to court and shareholder approvals. (1 Australian dollar = 1.5175 dollars) (Reporting and editing by Clara Denina, Joe Bavier and Maxwell Akalaare Adombila)
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Saudi Arabia's PIF Wealth Fund plans a dual-tranche Green Bond Sale
A source told us that Saudi Arabia's sovereign wealth fund had hired banks to handle the sale of its euro-denominated first green bond. Documents from one of the banks involved in the arrangement were also seen by the reporter. The planned bond sales are part of a larger effort to diversify financing sources and support the Kingdom's plans for economic transformation while also aiming at net-zero emissions by 2060. Documents show that the Public Investment Fund, which oversees assets worth nearly $1 trillion, has instructed Credit Agricole CIB and JP Morgan to organize investor calls beginning Monday. PIF did respond immediately to a comment request. Green bonds are securities which raise money specifically for projects that have environmental or sustainability benefits. PIF entered the green debt market in 2022. Since then, it has issued several U.S. Dollar-denominated Bonds under its Green Finance Framework. The framework allows for proceeds to be allocated to projects that promote renewable energy, clean transportation and sustainable infrastructure, including those undertaken in Saudi Arabia by PIF subsidiary companies aligned with Vision 2030. Crown Prince Mohammed Bin Salman announced the 2060 goal of net-zero in 2021 as Saudi Arabia intensified efforts to attract green investments and expand sustainable finance. Reporting by Md. Manzer Hussain, Editing by Kirby Donovan
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Sumitomo, a Japanese company, wins a Singapore grant for developing ammonia as marin fuel
Sumitomo Corp, a Japanese trading company, announced on Monday that it had been granted a grant by the Singapore government to develop ammonia to be used as a marine fuel alternative to decarbonise shipping. Sumitomo stated in a press release that this exclusive funding would support research and development efforts to enhance the safety and efficiency of ammonia supply, or ammonia bunkering, at Singapore's Port. The Maritime Innovation and Technology Fund of Singapore (MINT Fund) was used to award the grant. However, the MPA did not reveal the details of the grant. MPA didn't immediately respond to an 'ask for comment. Ammonia, a fuel alternative that is being explored by shippers and electric companies to reduce emissions, has a high cost. Sumitomo will demonstrate ammonia bunkering at a Singapore demonstration in 2027. It will also work with MPA on safety protocols, operational guides, and emergency response plans. Separately, a Keppel Ltd consortium, which includes Sumitomo, Advario Asia Pacific and Keppel Ltd has been selected by Singapore’s Energy Market Authority (EMA), and the MPA, to move to the next stage of a study to examine the end-toend low-carbon or zero-carbon solutions for ammonia bunkering and power generation on Jurong Island. Sumitomo stated that these efforts would contribute to the decarbonisation of the shipping industry while supporting the company's broader commitment to the energy transformation as a key area for growth. (Reporting by Yuka Obayashi; Editing by Harikrishnan Nair)
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Citigroup doubles down on EM optimism, despite a cold reception to UK equities
Citigroup downgraded UK equities from "overweight" to "underweight", and upgraded Emerging Markets to "overweight". This is part of a strategic pivot towards cyclical growth opportunities driven by AI. Citi analysts raised their target price for the MSCI EM Index to 1,465, implying a 7% increase from current levels. They also increased their target price for the FTSE 100 from 9,300 to 9,700, implying a modest rise from current levels for the same period. In a note published on Friday, the brokerage said that UK's exposure to defensive sectors like consumer staples and utilities made it less appealing in an environment where cyclical and growth plays are increasingly preferred. Citi notes that while economic activity in the UK has been stable, growth has been largely driven by government spending and front-loaded trade, with consumer demand still weak. The outlook for UK shares becomes less attractive when compared to Citi's expectations that earnings growth will be more evenly distributed across regions, industries, and styles by 2026. Citi analysts stated that "while the UK has performed very well as an overweight, the potential widening and demand for cycle is less favorable for the index." The macro-environment continues to be affected by lower energy prices. Citi predicts a 1% decline in FTSE 100 earnings by 2025, and there are no Bank of England interest rate cuts this year. Citi, on the other hand, sees EM as benefiting from a convergence of factors. These include a soft landing scenario in the U.S. and anticipated Federal Reserve rate reductions, along with exposure to the booming AI themes through markets such as Taiwan, Korea, and China. The report noted that equity flows into EM are still subdued but could increase.
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Gold rises above $3,900 for the first time due to safe-haven demand
Gold prices reached an all-time record high on Monday. They soared above the $3,900 per ounce level as investors sought out safe-haven gold amid the U.S. shutdown, economic uncertainty and expectations of future Federal Reserve rate reductions. As of 0730 GMT spot gold rose 1.2% to $3,932.40 an ounce after reaching $3,944 in the earlier session. U.S. Gold Futures for December Delivery climbed 1.2%, to $3.956.50. A senior White House official stated on Sunday that Washington would begin mass layoffs if U.S. president Donald Trump determines that negotiations with Congress Democrats to end the partial government shutdown "absolutely are going nowhere". The U.S. shutdown could be prolonged, which would have a negative effect on the U.S. economy. Independent analyst Ross Norman said that there is a general sense of caution among financial markets. The gold price has increased by nearly 50% this year. This is due to strong central bank purchases, an increase in demand for exchange-traded fund (ETF) backed with gold, a lower dollar, and the growing interest of retail investors looking to hedge against rising geopolitical and trade tensions. Norman added that the low participation in this rally and its primary drivers, central banks and investors with a longer-term perspective, rather than speculative purchasers, could indicate that any pullback may be milder than anticipated. Stephen Miran, the Fed Governor, called for a rate cut aggressively again on Friday. He cited the economic impact of Trump's policies. Various data, both from public and private sources, indicate that the U.S. labour market is weakening due to the shutdown of the federal government. Investors now expect a 25 basis-point reduction at the Fed's meeting in this month. An additional 25 bp is expected in December. UBS stated in a report that they expect gold to reach $4200/oz at the end of the year. Gold that does not yield is a good investment in low interest rate environments and economic uncertainty. In March, spot gold prices broke through the $3,000 per ounce barrier for the first. Many brokerages are now bullish about the rally. Silver spot rose 1.5% to reach its highest price in over 14 years. Palladium rose 1.2% to 1,276.10 and platinum gained 0.7% to $1616.
India is considering a nationwide climate-linked insurance scheme
India's government is in early stage talks with local insurance companies about designing a national climate-linked programme to simplify the payout process following extreme weather events like heatwaves and flooding.
The scheme would use a parametric model of insurance, in which policyholders get a payout when certain weather thresholds are exceeded, such as rain, temperature, or windspeed.
If the talks are successful, India – one of the countries most susceptible to extreme weather - could be the first major economy to implement such a program.
This would help to reduce costs for the government which currently uses disaster funds to assist states that are experiencing adverse climate events.
Ramaswamy Narayanan is the chairperson of the state-run reinsurer GIC re. He said: "We have seen an increase in the severity and frequency of adverse climate events, and this has led to the discussion with the Government."
In a parametric insurance model, payouts are made quickly. In traditional insurance, payments depend on the amount of loss and can take many years to assess. In areas with little or no traditional insurance, parametric insurance can be used.
According to an official in the federal government, officials support this idea even though there has not been a formal proposal made yet. Both the official and another insurance executive who declined to be named said that discussions were taking place.
Officials from the National Disaster Management Authority (NDMA), the Finance Ministry, GIC Re, and other major insurers are currently exploring funding and coverage options, according to the official.
Requests for comments were not immediately responded to by the ministry, disaster management agency or India's insurance regulator IRDAI.
Globally, interest in parametric insurance has increased. In 2023, Fiji, the first Pacific Island country, adopted a sovereign parametric policy to secure coverage against tropical storms.
As part of the United Nations Environment Programme’s finance initiative, it is expected that financial instruments will also be prominently featured at COP30 in Brazil this year.
SEEKING COVER
According to the Germanwatch Global Climate Risk Index, 2025, India is ranked sixth in the world for climate vulnerability. This index tracked events from 1993 to 2022.
India has experienced more than 400 extreme weather events during this time, which resulted in over 80,000 deaths, and an economic loss of $180 billion.
In recent years, flooding has caused crop losses and livelihoods in key agricultural states like Punjab and Assam. Flash floods and land slides have also destroyed roads, bridges, and homes in Uttarakhand, Jammu, and Kashmir.
According to a government official, the federal government is looking at multiple financing options. These include tapping into existing disaster relief funds, or adding small fees to utility bills in order to pay for premiums.
The official said that if it is in line with the rules of urban local authorities, small deductions on utility bills may be considered. A consortium of insurance companies could enter into contracts with municipal corporations.
Seven industry executives stated that, apart from the federal level, some states are piloting such schemes, and more are in discussions with insurers about securing parametric coverage.
Last year, a group consisting of 50,000 women who are self-employed in the states of Rajasthan, Gujarat, and Maharashtra received $5 when temperatures exceeded 40degC from May 18 to May 25.
After heavy rains earlier in the year, Nagaland in northeast India, which was India's first state to be covered by SBI General Insurance for disaster risks in 2024, got its first payout in May of $119,000 after excessive weather.
Kerala's cooperative milk marketing federation, located in southern Kerala, has also launched a scheme that protects cattle farmers from the losses they suffer during the summer months when temperatures rise and milk production drops.
"States look at a medium-term window for implementation." "These conversations are gaining momentum, and all insurance companies are attentive to the opportunities," said a senior executive of a leading private insurer.
(source: Reuters)