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BHP and CATL work together to reduce emissions by using more batteries
BHP, the world's largest listed miner, announced on Monday that it had signed preliminary agreements with China's battery giants CATL & BYD in order to explore battery options for mining equipment & transport across all its global operations. The companies will research and develop joint battery solutions for heavy equipment, such as locomotives and mining trucks. BHP's Western Australian operations transport millions of tons iron ore from mine sites all the way to the coast. Both companies will be involved in the study of battery recycling and fast charging infrastructure. The new products could also be a model for reducing emissions in the entire mining industry. This strategic relationship represents a further step forward in BHP’s efforts to reduce greenhouse gases (GHG) emissions from its operations, and will enable it to support further developments in the global resources industry," said Chief Procurement Office Rashpal Bhatti in a press release. Last year, Bhatti was promoted to the position of chief procurement officer at BHP's South Australian copper operations. He had previously worked to reduce emissions by the company's maritime division by using ships powered by liquefied gas to transport ore. BHP, in its quest to reduce diesel consumption, will explore with BYD FinDreams Battery options for developing electric vehicles to be used at mine sites. In recent years, the issue of high power costs has become a pressing concern for metals producers such as BHP. Trafigura, Glencore and others are evaluating the viability their Australian operations. BHP's mid-term goal is to reduce its operational emissions from 2020 by at least 30 percent by 2030. It also supports the development of technologies that can reduce emissions intensity by 30 percent by the end the decade. Its goals are still the least aggressive of all the major mining companies. Rio Tinto is committed to halving their operational emissions by 2030. Australian iron ore mining company Fortescue aims for net zero emissions without offsets by that date.
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Palm oil prices rise as Dalian crude and the weakening ringgit support.
Malaysian palm futures continued to rise on Monday. They tracked stronger edible oils in Dalian and crude oil, and were supported by the weaker ringgit. By midday, the benchmark palm oil contract on Bursa Derivatives Exchange for September delivery had gained 32 ringgit or 0.77% to 4,206 Ringgit ($989.41). Darren Lim said that the firm crude oil prices continue to support edible oil markets worldwide. The slight weakening of the ringgit has also maintained buying interest, making Malaysian Palm Oil more competitive abroad. Dalian's palm oil contract, which is the most active contract in Dalian, gained 0.62%. Chicago Board of Trade soyoil prices rose by 0.02%. As palm oil competes to gain a share in the global vegetable oil market, it tracks the price fluctuations of competing edible oils. Oil prices increased, adding to gains that exceeded 2% on Friday as investors viewed further U.S. Sanctions against Russia, which may have an impact on global supplies. However, a surge in Saudi production and tariff uncertainty tempered gains. Palm oil is a better option as a biodiesel feedstock because crude oil futures are stronger. The palm ringgit's trade currency, the dollar, has weakened by 0.02%, making the commodity more affordable for buyers who hold foreign currencies. Data from the industry regulator showed that Malaysian palm oil stocks increased by 2.41%, reaching a 18-month high at 2.03 million tonnes at the end June. According to data provided by cargo surveyor Intertek Testing Services, and inspection company AmSpec Agri Malaysia, exports of Malaysian products containing palm oil during the period July 1-10 rose between 5.3% to 12% compared to a month ago. Technical analyst Wang Tao stated that palm oil could test support at 4,134 Ringgit per metric tonne and a breakdown would trigger a fall towards the range of 4,034-40558 Ringgit. ($1 = 4.2510 ringgit)
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China's copper exports to the US jumped 9% from May to June, reversing a two-month decline.
China's imports of copper rebounded by 8.7% in June. This followed a two-month decline. However, imports this year have been below those from last year due to a global transfer copper inventories to United States. Customs data released Monday shows that imports of unwrought copper and copper products increased to 464,000 metric tons in June from 427,000 metric tonnes in May and 438,000 metric tonnes in April. Imports of copper products including anodes, refined, alloys and semi-finished products are down by 5% in the first half when compared with a year ago. The global copper stock has been reshuffled in this year, as traders have moved their inventories into the United States to prepare for copper tariffs that were first announced in February and whose start date was set last week. Copper concentrate, which is a key feedstock in China's massive smelter industry, dropped slightly from 2.4 to 2.35 millions tonnes, but remained roughly the same as the previous year, when it was 2.31 million tonnes. The new smelters expected to open this year will help keep the demand for concentrates high in a market that is suffering from a shortage of feedstock. In June, China exported 489,000 tons of aluminium, including alloys, primary and semi-finished products. This is down from the 547,000 tons in May. Reporting by Lewis Jackson, Beijing; Editing and proofreading by Clarence Fernandez
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Russia claims that Ukrainian drones have attacked a training centre at the Zaporizhzhia Nuclear Plant
The Russian-installed management of the Russia-held nuclear power plant in Ukraine confirmed on Monday that Ukrainian drones had attacked a training center at the Zaporizhzhia Nuclear Power Plant Sunday evening. The administration posted on Telegram that "the enemy used three unmanned aircraft vehicles." The administration added that there were "no serious" damages. Could not independently verify the Russian claim. The report was released a day after IAEA (the United Nations nuclear watchdog) reported that hundreds of rounds were fired at the plant late Saturday night. In the first few weeks of Russia's 2022 February, Russian forces captured the Zaporizhzhia Plant. Invasion of Ukraine . Both sides accuse the other side of triggering a nuclear disaster by firing weapons or other actions. Although the station is Europe's largest nuclear power plant and not in operation, it still needs power to keep nuclear fuel cool. In a statement, the plant's management based in Russia said that "all necessary safety measures are in place and the station continues to operate normally." Reporting by Lidia Kelley in Warsaw, editing by Kim Coghill
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MORNING BID EUROPE - The art of using tariffs to grab headlines
Wayne Cole gives us a look at what the future holds for European and global markets. The tariffs seem to be a convenient way for Trump to dominate the news cycle. He is not interested in months of complex, tortuous trade negotiations aimed at a mutually beneficial outcome. Why would you do that, when you could tweet a 30% threat of tariffs on a Saturday morning to dominate the news for a whole weekend? Assuming that this is a negotiation tactic primarily, the markets in Asia have only eased modestly. S&P futures are down about 0.4%, while most regional indexes are only marginally lower. The euro has lost a small amount, but European futures are down by 0.7%. It's difficult to imagine how Brussels will ever be able to satisfy Trump's requests, partly because it isn't clear what Trump wants. The EU tariffs against U.S. products are so small that there is not much to be cut. However, granting exemptions to domestic taxes and regulation is politically risky. The market's stoic response could also be a clever ruse. Investors believe Trump will be willing to ease up on tariffs if the need arises. Trump may think that the markets are on his side now, with U.S. stock prices at record highs, and bond yields down from their peak. It seems that, at any rate the U.S. effective tariff rate will be similar to the Smoot-Hawley levy that so greatly contributed to the Great Depression. We'll see if Trump was right and that the majority of professional economics were wrong. The U.S. deficit in trade is not yet solved. China reported today that its trade surplus with the U.S. increased by 48% to nearly $27 billion in June, and its exports exceeded forecasts. Trump found time to continue his feud against Fed Chair Jerome Powell. He said it would be a "great thing" for Powell to step down, eight years after Trump nominated Powell. Kevin Hassett, White House economist adviser, warned Trump over the weekend that renovation costs overruns at Washington's Fed headquarters could be grounds for firing Powell. Analysts believe that a Trump nominee for Fed chief will do what he wants by aggressively reducing interest rates, but whether the other FOMC members would agree with this assumption is still in question. Investors will likely demand compensation to compensate for the increased risk of inflation. This is what happened in Turkey. Market developments on Monday that may have a significant impact Piero Cipollone, ECB Board member, appears before the Committee on Economic and Monetary Affairs of European Parliament
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Oil edges up, investors eye Trump statement on Russia
Oil prices increased on Monday adding to the gains of over 2% made on Friday as investors hoped for further U.S. Sanctions on Russia, which could affect global supply. However, a surge in Saudi production and tariff uncertainty limited gains. Brent crude futures gained 15 cents, to $70.51 per barrel at 0400 GMT. This was a continuation of the 2.51% increase on Friday. U.S. West Texas Intermediate Crude Futures rose to $68.59 up 14 cents after closing 2.82% higher the previous session. Donald Trump, the U.S. president, said Sunday that he would send Patriot missiles for air defence to Ukraine. He will make a major statement on Russia on Monday. Trump expressed his frustration at Russian President Vladimir Putin over the lack of progress made in ending the conflict in Ukraine, and Russia's increasing bombardment of Ukrainian city. Last week, in an effort to pressurize Moscow into good faith peace negotiations with Ukraine a bipartisan U.S. Bill that would target Russia with sanctions gained momentum in Congress. However, it still needs Trump's support. Four EU sources reported that after a meeting on Sunday, the European Union's envoys were on the verge to agree on an 18th package against Russia. This would include a lower cap on Russian crude oil. Brent gained 3% last week while WTI saw a weekly gain around 2.2%. This was after the International Energy Agency stated that the global oil markets may be tighter then they appear, and demand is being supported by the peak summer refinery run to meet travel needs and power generation. Analysts at ANZ said that the price increases were limited due to data showing Saudi Arabia increased its oil production above the quota set by the Organization of Petroleum Exporting Countries (OPEC) and their allies supply agreement. Saudi Arabia surpassed its June oil production target by 430,000 barrels a day, reaching 9.8 million bpd. This compares to the implied OPEC+ goal of 9.37 millions bpd. Saudi Arabia's Energy Ministry said Friday that the country had met its voluntary OPEC+ production target. It added that Saudi Arabia-marketed crude supplies in June were 9.352 millions bpd in accordance with the agreed quota. According to data released by the customs on Monday, China's oil imports in June increased 7.4% from a year ago to 49.89 millions tons, which is equivalent to 12,14 million barrels a day. This was the highest rate per day since August 2023. J.P. Morgan Research team in a client letter said that China will likely continue to stockpile, but since storage is at 95% the peak inventory build in 2020, these stocks are likely to appear in "visible" Western markets, which are critical for price formation and exerting downward pressure. Investors also watch the outcome of U.S. trade talks with key trading partner that could affect global economic growth.
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Iron ore futures are up on the back of strong China trade data. Production curbs gains
Iron ore futures prices rose on Monday, boosted by a resilient Chinese demand for steel, but production restrictions in major steelmaking regions dampened investor sentiment. As of 0311 GMT, the most-traded contract for September iron ore on China's Dalian Commodity Exchange was trading 0.2% higher. It was 766 yuan (US$106.83) per metric ton. The benchmark iron ore for August on the Singapore Exchange rose 0.27% to $99.55 per ton. Everbright Futures, a broker, says that macro-news has boosted iron ore prices and fueled demand. Iron ore imports by China, the top consumer, rose 8% in July as some miner increased shipments in order to meet quarterly targets. This followed a slump in the first quarter caused by cyclones that hit Australia, the leading supplier. Stronger-than-expected steel demand boosted appetite for iron ore. Exports from China grew in June, while imports recovered. This was due to exporters speeding up shipments ahead of the August deadline. Anthony Albanese, Australia's prime minister, reaffirmed on Monday his commitment to work with China in order to address global excess capacity of steel and promote a market-driven and sustainable sector. Galaxy Futures said that the steel industry continues to grow, boosted by investor optimism amid supply-side reforms. Meanwhile, robust demand in manufacturing has supported prices. Everbright noted, however, that environmental protection-related restrictions on production in the major steel production hub Hebei Province caused a decrease in blast furnace molten-iron output by 10,400 tonnes month-on-month. Coke and coking coal, which are both used to make steel, also traded in a sideways manner. The Shanghai Futures Exchange steel benchmarks mostly fell. Rebar fell by 0.1%, while hot-rolled coils dropped 0.12%. Stainless steels fell 0.35% and wire rods rose 1.13%. ($1 = 7,1701 Chinese yuan). (Reporting and editing by Harikrishnan Nair; Reporting by Lucas Liew)
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China's rare Earth exports jump in June as a sign of relief from trade war
Customs data released on Monday showed that China's rare-earth exports increased 32% from the previous month. This could be a sign that the agreements made last month to open up the metals flow are paying off. In June, the U.S. reached agreements with China to reopen rare earths after Beijing imposed export controls in April at the height of the trade war between Washington and Beijing. This led to the closure of some auto factories in the world. China's Foreign Minister said recently that Europe's normal demand for rare earths could be met. Several carmakers reported late last month that the elements had started to flow freely again, but not yet. Data from the General Administration of Customs revealed that in June, the world's biggest producer of rare Earths, a group of minerals used to make products for automobiles, consumer electronics, and defence, had exported 7,742.2 tons, compared with 5,864.6 tons in May. Exports are 60% more than in June 2024. Customs data shows that China exported 32.569.2 tonnes of rare earths cumulatively in the first half of the year compared to 29,095.2 tons during the same period of last year. The data, while positive, is only indicative. The data released on Monday does not differentiate between rare earths, related products and other types of products that are not included in the control. On July 20, a more detailed breakdown will be published.
EU envoys close to agreement on lower Russian crude oil price cap
Four EU sources told reporters that after a meeting on Sunday, EU envoys were on the verge to agree on an 18th package against Russia in response to its full-scale invasion into Ukraine. The sanctions would include a lower cap on Russian crude oil prices.
Sources said that all elements of the package have been agreed upon, but one member state has still a technical reservation about the new cap.
Sources - who spoke on condition of anonymity in order to discuss confidential discussions - stated that they expected to reach a complete agreement on Monday ahead of the foreign ministers meeting the next day, which could officially approve the package.
Sources said that they also agreed on a dynamic pricing mechanism for the cap. The European Commission announced a price cap for Russian crude oil that is 15% lower than the average price on the market in the last three months.
According to one source, the initial price will be $47 per barrel based off the average price for Russian crude over the past 22 weeks minus 15 percent. The price will be adjusted based on average oil prices every six months, instead of three months as originally proposed.
Sources said that Slovakia, which had held up the package proposal, is still waiting for reassurances about its concerns regarding plans to phase-out Russian gas supplies. However it has accepted the new measures.
Sanctions must be approved by all EU member states.
The Group of Seven price cap was first agreed on in December 2022. Its aim is to limit Russia's financial ability to fund the war in Ukraine. Since the fall of oil futures, the European Union and Britain has been pressing the G7 to lower its cap.
The cap prohibits the trade of Russian crude oil transported on tankers at a price above $60 per barrel. It also prevents shipping, insurance, and reinsurance companies from handling cargoes containing Russian crude throughout the world, unless they are sold below the cap.
Early in June, the Commission presented a package aimed at further reducing Moscow's revenues from energy. This included a ban on all transactions with Russia's Nord Stream pipelines and its financial network, which helps Moscow circumvent sanctions.
One source said that the new package would list two Chinese banks and a flag registry, as well as a Russian owned refinery in India. Russia has used flags-of-convenience for its shadow fleets of oil tanks and ships. (Reporting and editing by Julia Payne, Andrew Gray)
(source: Reuters)