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EU warns Trump tariffs may trigger firm countermeasures
Ursula von der Leyen, President of the European Commission, pledged "firm and proportionate" countermeasures in response to U.S. president Donald Trump's decision on Tuesday to impose tariffs for all steel and aluminum imports. This heightened fears of a possible trade war. Trump signed a proclamation late Monday night to increase tariffs on steel and aluminum imports by 25%, without any exceptions or exclusions. An official at the White House said that these measures would go into effect on March 4th. Von der Leyen stated in a press release that she regretted the U.S.'s decision. She added that tariffs are taxes that are bad for businesses and even worse for consumers. In the last decade, EU steel exports have averaged around 3 billion euros (3.10 billion dollars) per year to the U.S. "Unjustified tariffs against the EU won't go unanswered. They will trigger firm, proportionate countermeasures." "The EU will protect its interests," said she. Von der Leyen didn't provide any details about the response. One option is to reactivate tariffs that the EU imposed on the United States in 2018, but were suspended as part of a truce between von der Leyen, and Joe Biden, the former U.S. president. Tariffs on U.S. goods such as motorcycles, orange juice and bourbon are suspended by the EU until March 31. Maros Sfcovic, EU Trade chief, described the U.S. ruling in an address to the European Parliament. "lose-lose scenario". He said that the Commission is now evaluating the scope of U.S. actions and the appropriate EU reaction. Trump's latest trading salvo drove gold prices to record highs on Tuesday, on the back of safe-haven demand. The precious metal hit $2,942.70 early in trading. A videoconference of European Union Trade Ministers scheduled for Wednesday will allow the Commission to hear from its 27 EU member states on their response. Joe Biden, Trump's successor, suspended the steel and aluminum tariffs that Trump imposed in 2018. They were replaced by quotas. Exports of EU steel to the United States have dropped by around 1 million tonnes to 2.2 millions in 2019-2024. Tariffs could lead to a re-direction of 15 million tons that the United States imported from non-EU countries last year. ($1 = $0.9692 euros) Reporting by Philip Blenkinsop Editing Peter Graff and Sharon Singleton
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BestChange, a crypto exchange platform, is in the dark about Russia's block.
BestChange, a cryptocurrency exchange platform, has stated that it does not know why Roskomnadzor's website was blocked. However it says it is working with the central banks to try and lift the ban. In Russia, it is illegal to circulate and advertise digital currencies, but cryptocurrency mining is legal. Roskomnadzor has restricted bestchange.ru in Russia, the platform responded late Monday to a comment request. "Unfortunately, this is not the reason for which it happened. We are in communication with the central banks to identify the cause and we're interacting with regulators to clarify the issue and lift the ban. Roskomnadzor lists bestchange.ru on its website as being blocked. Roskomnadzor told RIA that the block was due to "legal violations in the financial sphere". Roskomnadzor didn't immediately respond to an inquiry for comment. BestChange says that new crypto regulations or a problem with a service user could be the cause of the ban. Russia legalised cryptocurrency miner and introduced taxes which could generate up to 200 billion Rubels ($2 billion per year) from miners. Since then, Moscow has restricted crypto mining to some Siberian areas in order to avoid power shortages. In order to avoid payment delays caused by Western sanctions, Russia allows businesses to use cryptocurrency in international trade. However, a trial period has yet to begin.
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Stocks of Chinese steelmakers fall as Trump's new tariffs increase uncertainty over exports
The shares of major listed steelmakers, the top steel producer in China, fell on Tuesday after President Donald Trump's new tariffs stoked fears about possible impacts on steel exports for this year. Trump raised the tariffs on imports of steel and aluminum to a flat rate of 25% on Monday, "without any exceptions or exclusions", in an effort to help struggling domestic industries. However, this move increases the risk for a multi-fronted trade war. Shares of Baoshan Iron and Steel, HBIS Co., Angang Steel, Hunan Valin Steel Co., Shandong Iron and Steel Co., Jiangsu Shagang Co., and Shandong Iron and Steel Co., fell between 0.14% and 2.63%. The Shanghai Futures Exchange closed the daytime trading with a loss, while the CSI Steel Index fell 0.52%. The fear is that the new tariffs could add to the uncertainty surrounding China's exports of steel this year. Trade tensions are already a threat, but the impact on Chinese direct steel exports to the U.S. will be limited due to the small proportion of trade flows. Customs data revealed that China's direct exports of steel to the U.S. in 2017 were 890,000 tons. This represents just 0.8% its total exports, which reached a nine-year record at 110.72 millions tons. China's strong steel exports helped offset the dwindling demand at home, which was hampered by the prolonged property crisis and lower than expected consumption in the infrastructure sector. In a recent note, analysts from consultancy Fubao stated that "both direct exports as well as transit trade would feel some impact" if the tariffs are implemented more strictly. Transshipment or transit trade is the practice of buying cheap steel from China and then reselling it to another country, such as the U.S., to avoid tariffs. Pei Hao is a senior analyst with international brokerage Freight Investor Services. Some countries transshipping steel will need to reduce their purchases from major producers. The manager of an East China steelmaker who requested anonymity because he was not authorized to speak with the media warned about "a butterfly-effect on the market which takes time for it to manifest." The manager refused to divulge any further details, saying that "the bad news hasn't started yet".
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UniCredit pledges to maintain 2025 profits and increase payouts
UniCredit posted earnings on Tuesday that were better than expected for 2024 and stated it would keep profits stable in spite of declining rates this year, while promising to increase shareholder reward levels between 2025-2027. After years of record profits, investor payouts, and the ECB rate hike cycle, European lenders have been looking for new profit-generating strategies. Some have turned to mergers & acquisitions. UniCredit, under the leadership of CEO Andrea Orcel, has launched an aggressive expansion plan. It acquired a 28% stake at Germany's Commerzbank, and made an all-share offer for Banco BPM, a smaller competitor in Mexico. In early February, the bank revealed that it had acquired a 4,1% stake in Generali. The bank's investment in Italy's largest insurer gives it a lot of influence over other takeovers and boardroom fights in Italian finance. UniCredit is returning 9 billion euros to its shareholders as dividends and share buybacks. The company's 2024 profits still benefitted from an increasing net interest margin - a measure that measures the profit generated by the difference between deposit and lending rates. Analysts at JPMorgan said that the capital distribution exceeded expectations as well as the guidance to make an even greater distribution in 2025. UniCredit’s profit target for 2027 of 10 billion euro was also higher than market expectations. In a note, KBW analysts stated that the management outlook was positive. "UniCredit shares have outperformed SX7E (European Banking Index) by 6% in the last month. But with these results, we believe the market won't be disappointed." UniCredit's shares dropped 2.7% at the opening of trading on Monday, falling behind other European banks. The drop was a result of a report in the Corriere della Sera on Tuesday, which cited banking sources and stated that Delfin (the holding of the Del Vecchio Family) is looking into the possibility of selling their 2.7% stake in UniCredit. Delfin did not respond to a request for comment. UniCredit's share price has nearly six-folded since Orcel arrived in 2021. This gives UniCredit a powerful hand when it comes to merger deals that are paid in shares. Orcel also has billions of Euros in cash that is above the targeted capital reserve. Orcel plans to return a portion of the cash to shareholders in 2027. UniCredit stated that it would only pursue growth opportunities outside the company "if they met strict strategic and financial criteria". UniCredit predicted that its net interest income would decline "moderately" by 2025 due to the lower interest rates in the euro zone but also to efforts to shrink their Russian business. UniCredit is under pressure from the European Central Bank to accelerate its exit. It said that a "mid-single-digit" fee increase projected for 2025 wouldn't be enough to offset lower rates. Net revenues would exceed 23 billion euros ($24billion) as opposed to 24.2 billion dollars last year. The profit for the period October-December totaled 1.97 billion euros, above a consensus estimate of 1.63 billion euros gathered by companies. This was despite provisions for loan loss that were higher than expected. This compares to 2.8 billion euros last year, when tax credits related to losses in the past were more than double as large. (1 dollar = 0.9706 euro) (Reporting and editing by Alvise Armllini and Kate Mayberry).
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China's CATL restarts a lithium refinery and mine in Jiangxi Province
A spokesperson for the refinery joint venture partner Lopal Tech, which is part of Chinese battery giant CATL's refinery joint-venture, said Tuesday that its lithium lepidolite refinery and mine in Jiangxi Province has been reopened. A spokesperson stated that the resumption is due in large part to CATL's ability to reduce production costs at both sites. The operation produces over 2,000 tonnes of lithium carbonate. "As we progress, our plan is to increase production to over 3,000 tons per month," said the company. UBS reported that the mine was restarted on Friday, citing a news report. CATL has not responded to any questions sent via email. The mine of CATL in Jiangxi, a province in southern China, has played a significant role in the rapid growth of lithium supplies in China. This is the top producer of battery materials in the world. The news of its closing in September sparked a sharp rise in lithium stocks. On Tuesday, shares of lithium miner companies in Australia fell on the news that the mine was restarted. Tuesday's closing price for the most traded November Lithium Carbonate Futures Contract on the Guangzhou Futures Exchange was 77,300 Yuan ($10578) per metric ton, down 1.6% compared with Monday. CATL's shares closed at 251.8 Yuan on the Shenzhen Stock Exchange on Tuesday, down by 2.6% on Monday.
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Finnish utility Fortum says lower power prices and mild winter dampen Q4 earnings
The Finnish utility Fortum reported on Tuesday that its fourth-quarter operating profit was below analysts' expectations. It cited lower volumes of hydro and nuclear power and weaker prices. Fortum says that the fall in Nordic spot prices was partially offset by the ongoing recovery of Nordic power demand. According to a poll conducted by the company, analysts had expected 280 million euro in operating profit. Fortum CEO Markus Rauramo stated in a press release that the comparable operating profit of the Generation segment decreased due to lower volumes for hydro and nuclear and lower spot and hedge price. Operating profit rose from 376 to 390 millions euros, a rise of 182 million euros. This includes a capital gain from the sale of Fortum's waste and recycling business. Rauramo stated that "we are beginning a feasibility study in order to explore the possibilities of flexible hydro-power pumped storage in Sweden, to provide flexible and balancing power which is much needed." Rauramo stated that Fortum achieved 60 million euro in cost reductions by 2024. This was more than its previous target of 50 millions. It is on track to achieve its goal of reducing its recurring fixed expenses by 100 million by the end 2025. Fortum's Board of Directors proposed a dividend per share of 1,40 euros for 2024. After the Helsinki market opened, shares of the company dropped by 1.1%.
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Where do the US steel and aluminum come from?
U.S. president Donald Trump raised tariffs on imports of steel and aluminum on Monday by a substantial 25%, "without exceptions or exclusions", in an effort to help struggling industries in the United States. However, this move could also spark a Multi-front Trade War Here is a list of major trading partners that will be affected. A quarter of the steel used in America is imported. The bulk of this comes from Mexico and Canada, or other close allies such as Japan, South Korea, and Germany. China is the largest producer and exporter of steel in the world, but very little is shipped to the United States. In 2018, tariffs of 25% were imposed on Chinese steel, which effectively shut the market. Last year, China exported 508,000 tons of steel net to the U.S. This is 1.8% of all American steel imports. Aluminium The U.S. relies more on imports in the case of aluminium. Approximately half of the aluminum used in America is imported. The majority comes from Canada. Canadian imports topped the list of countries with 3.2 million tonnes in 2012. United Arab Emirates (UAE) and China are the next two largest importers, with 347,034 metric tons and 222,872 respectively. According to global standards, the U.S. aluminium smelting sector is small. According to the U.S. Geological Survey, the total smelter capability in the United States was only 1.73% of global capacity.
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Climate-focused venture capital firm Junction Growth Investors raises 115 mln euros
Junction Growth Investors is an investment firm that funds companies working to combat climate change. On Tuesday, it announced raising 115 million Euros ($119.8 millions), which demonstrates the resilient appetite of investors in this sector. Even though President Donald Trump has ordered the United States not to participate in the Paris Climate Agreement, many funds continue to invest in green energy. Last month, Norway's $1.8 billion wealth fund expressed its commitment to renewable energies. Junction Growth Investors in Belgium said that Keeling Capital and BNP Paribas Private Equity were among the firms who participated in the fund-raising. The European Investment Fund of the EU, as well as the Belgian Growth Fund, also took part. Junction Growth Investors has backed companies such as Belgian grid company Ampacimon, and Portuguese Eneida. Both firms develop grids that aim to create low-emission neighborhoods. Climate change is a constant threat, with tangible effects on society and individual wealth. The energy transition isn't just about fighting climate change, said Dirk Dewals. He added that the opportunity presented by this technology is for Europe to become less dependent on carbon fuels, which are geopolitically sensitive. It also allows it to create a few European technology leaders who have global reach. Ampacimon has 50% of its order books in the United States.
HPCL, India plans to increase the capacity of its Vizag oil refining plant by up to 20%
Rajneesh Narang, chairman of Hindustan Petroleum (HPCL), said that the state-run company plans to increase its Vizag oil refining capacity by up to 20% in order to meet local fuel demand.
India, the third largest oil consumer and importer in the world, is increasing its crude processing capability. It wants to become a major global refinery hub. At the same time its fuel demand will continue to grow for the next decade.
HPCL has recently increased the capacity of its Vizag refinery from 200,000 barrels to 300,000. It is now looking for an additional increase.
"We are looking at increasing the (annually) capacity by 2-3 millions (metric) tonnes (40,000-60,000 Bpd). Narang said at the India Energy Week Conference that the board must approve this. He did not provide a cost estimate or time frame.
HPCL is soon to start operating at Vizag's secondary units. This includes a 3.5-million-ton per year (tpy), residue-upgradation unit, which will boost distillate yields by 10%. It will also improve the gross refining margin by $3 a barrel. The company will also bring a diesel hydro desulphuriser of 2.6 million tons per year online.
India's fuel consumption is set to increase with the growth of its economy. However, drivers are increasingly turning to electric cars and industries are shifting to renewable energy from diesel-generated power to reduce their carbon footprints.
HPCL, to future-proof their plants, is building a petrochemical facility at its Barmer refinery that produces 180,000 bpd in the desert of Rajasthan.
India's refinery has the highest petrochemical intensities - that is, the amount of crude oil converted into chemicals.
Narang stated that the Barmer refinery's crude processing will begin between June and July, while the petrochemical plant will be operational by December.
He said that the company would operate the Rajasthan refinery by making spot purchases of crude oil and sign annual crude purchasing deals for the plant after the units stabilize.
HPCL operates a Mumbai refinery that produces 190,000 barrels per day in western India.
Narang stated that the company imports approximately 21 million tonnes of crude oil annually, and about 8 to 9 million tonnes are procured on the spot market.
The refiner, to reduce its crude import costs, set up a crude-trading desk last year, which negotiates better terms with oil sellers instead of floating tenders on spot purchases.
(source: Reuters)