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Indonesia resumes international carbon trading after four years
According to a copy seen on Wednesday, Indonesian President Prabowo Subianto has issued a decree to resume international carbon trading after a hiatus of four years. In 2021, the Southeast Asian country published carbon market regulations that focused more on compliance than voluntary markets. The regulation effectively ended all trading of carbon credits across borders, even those generated by large projects such as the Katingan Mentaya Conservation Project. Indonesia claimed that the moratorium allows the country to prioritise meeting its own greenhouse-gas reduction targets instead of selling the reductions abroad. The suspension was also a result of concerns that carbon prices were too low and countries selling the product weren't benefiting from it. Until now, Indonesia had been one of the largest suppliers of carbon credits on the international market. This was mainly through the REDD+ reforestation program. The new decree signed by the president last week, and made public on Tuesday, allows for the international trade of carbon offset units in accordance to Indonesian standards or standards set forth by the United Nations Framework Convention on Climate Change, and other international certifiers. In order to avoid double counting, the decree calls for a decentralised registry of carbon units. This registry will be transparent and operate in real-time. Prabowo who is about to celebrate his first anniversary as president, on October 20, plans to generate capital from the sale of carbon offsets by foreign buyers for projects like rainforest preservation. This year, Indonesia signed agreements of mutual recognition with international organisations which certify projects to reduce greenhouse gas emissions. These include Verra Gold Standard, Global Carbon Council Plan Vivo, and Joint Credit Mechanism. Officials have stated that these deals are meant to facilitate international trade in carbon and foreign investment to support Indonesia's goals on climate change. Indonesia's local Carbon Exchange, which was launched in September 2023 and offers carbon credits to foreign buyers, began offering certificates of carbon credits to foreign buyers last year. However, trading has been very thin. Indonesia has committed to achieving net-zero emissions of greenhouse gases by 2060, or sooner. (Reporting and editing by David Stanway; Gayatri Suryo)
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Aurubis shares fall as Salzgitter's share shrinks in bond deal
The shares of German copper producer Aurubis dropped on Wednesday, after Salzgitter, the company's largest shareholder sold bonds worth 500 million euros ($582 millions) that could be exchanged for 7.6% Aurubis stock. Aurubis shares, which had been boosted by the booming copper market, dropped 6.7% at 0752 GMT to 108.2 Euros, erasing gains made earlier in the month. This move quenched simmering speculation about a takeover. Salzgitter held 29.99% in Aurubis, and a stake greater than 30% would have required a mandatory offer for remaining shareholders. The bonds are due in 2032 and offer a fixed interest rate of 3,375%. They can be exchanged for Aurubis shares, at a price of 145.80 euro, initially. BNP Paribas acted as global coordinators, Commerzbank acted in the capacity of bookrunners, and UniCredit was the joint global coordinator. The transaction aims to diversify Salzgitter’s maturity profile and financing structure. Salzgitter's shares rose 0.5% and the company plans to list its bonds on the Frankfurt Stock Exchange Open Market segment.
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Iron ore prices continue to fall as US-China trade tensions and rising steel stocks weigh
Iron ore futures declined on Wednesday for the second consecutive session. This was due to concerns about demand, resulting from an escalating Sino-U.S. Trade spat as well as rising steel inventories in China, which is the top consumer. Donald Trump, the U.S. president, said that Washington is considering ending some trade relations with China. The U.S., and China began Tuesday charging each other additional port fees for ocean shipping companies. This is another sign that tensions are rising between the two world's largest economies. These tensions have impacted the market sentiment and pushed down commodity prices. The daytime trading price of the most traded January iron ore contract at China's Dalian Commodity Exchange closed 1.46% lower, at 776.5 Yuan ($108.97), per metric tonne. On Tuesday, the contract reached a low of more than a month. As of 8:10 GMT, the benchmark November iron ore traded on Singapore Exchange fell 0.45% to $104.7 per ton. Accumulated steel stocks could also affect the price of this key ingredient, as they can reduce margins, and make mills less interested in acquiring more feedstock. Analyst Zhuo Guqiu at Jinrui Futures said that the latest data revealed steel inventories continue to accumulate, causing concern over ore supply outlook. The hot metal production may continue to fall due to the increasing losses in some mills. Analysts at Everbright Futures say that ore demand is expected to remain strong in the short term and support prices. The data released by the China Iron and Steel Association, a state-sponsored organization, showed that the daily crude steel production among members steelmakers increased by 7.5% compared to the same 10-day period in September. Coking coal, coke and other steelmaking materials have risen by 1.01% apiece and 0.34% respectively. The benchmarks for steel on the Shanghai Futures Exchange are mixed. Rebar dropped 0.85%, while stainless steel fell 0.24%. Hot-rolled coils lost 0.86%, and wire rod gained 0.45%.
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OPEC Secretary general says that oil and gas industry requires more investment
Haitham Al Ghais, Secretary General of OPEC, reiterated Wednesday that oil and gas will continue to make up about 30% in the global energy mix until 2050. He said that a growing economy, population increase and urbanisation are all signs "that the world will require much more energy than what it consumes today", in his remarks at the Russian Energy Week Conference in Moscow. He predicted a 23% increase in the primary energy demand between 2050 and 2050. "Yes, the world is turbulent and there's much going on. But that's constant." "For us at OPEC, the constant is our ability to separate all the noise from the detailed, technical analysis we perform," he said. OPEC's forecasts of demand are higher than industry estimates. It expects a more gradual energy transition, unlike other forecasters such as the International Energy Agency. The latter has predicted a peak in oil demand by 2029, and a glut of up to 4 million barrels of oil per day in 2026. OPEC+ - a grouping of OPEC and Russia, as well as other allies - is adding crude oil to the market, after some member countries decided that they would unwind production cuts faster than originally planned. This extra supply adds to fears about a glut, and is weighing down on oil prices in this year.
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Gold crosses $4200 for the first time due to Fed rate-cut betting and US-China trade worries
Gold reached the $4,200 per ounce mark for the first ever time on Wednesday. This was boosted by expectations of more U.S. interest rate cuts. Meanwhile, renewed U.S. China trade concerns also increased demand for safe haven assets. As of 0659 GMT, spot gold rose 1.4% to $4,200.11 an ounce. U.S. Gold Futures for December Delivery gained 1.3%, to $4218.0. The U.S. president Donald Trump announced on Tuesday that his administration would produce a list on Friday of "Democrat programs" which will be closed due to the federal government shut down. Matt Simpson, senior analyst at StoneX, said that the U.S. shutdown and Jerome Powell's dovish remarks have been two of the most recent reasons why gold prices are on an upward trend. Federal Reserve Chair Jerome Powell stated that the U.S. labor market was subdued. However, the economy may be "on a slightly firmer trajectory than anticipated." Powell said that interest rate decisions will be taken "meeting by meeting", balancing the labour market's weakness against persistent inflation above the target. Investors have priced in the near certainty of a Fed rate cut of 25 basis points in October and December. Bullion is more likely to perform well when interest rates are low and there are political and economic uncertainties. Gold has gained 59% in the past year, mainly due to geopolitical and financial uncertainties, central bank purchases, the de-dollarisation of currencies, and strong exchange-traded funds. Simpson added that "this rally has become a momentum trading, where traders pile into the market to chase away prices." Trump stated that Washington is considering cutting off some trade relations with China, such as in the cooking oil sector. On Tuesday, both countries started imposing port fees based on a tit-fortat system. The International Monetary Fund increased its global growth forecast for 2025, citing better than expected tariff and financial conditions. However, it warned that renewed U.S. China trade tensions may curb growth. Silver climbed 2% to $52.48 after hitting a record of $53.60 Tuesday. This was due to the gold rally and tightening supply on the spot market. Palladium increased 0.9% and platinum rose 1.3%. (Reporting and editing by Sherry Phillips, Subhranshu Sahu and Ishaan Aroo in Bengaluru).
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India's palm-oil imports have fallen to a four-month low, as refiners prefer cheaper soyoil
The Solvent Extractors' Association of India reported on Wednesday that India's palm oils imports fell to their lowest level since May, as refiners switched to soyoil which is cheaper. Soyoil shipments reached a three-year record. The benchmark Malaysian palm futures are expected to be impacted by lower palm oil imports from India, which is the largest buyer of vegetable oil in the world. Meanwhile, U.S. soybean futures will benefit. The industry trade group said that India's imports of palm oil in September fell 16.3% to 829.017 metric tonnes, their lowest level since May. Imports of sunflower oil rose 6%, to 272,386 tonnes, which is the highest since January. According to the trade association, India's total imports of edible oils in September fell by 1% on a month-on-month basis. This equated to 1,60 million tons. India's palm-oil imports in October are expected to drop to about 600,000 tonnes, while imports of soyoil will likely surpass 450,000 tons. This is according to a Mumbai-based trader with a global trading house. India imports mainly palm oil from Indonesia and Malaysia. It also imports sunflower oil and soyoil from Argentina, Brazil and Ukraine. Dealers said that India bought 300,000 tonnes of soyoil in Argentina between September 23 and 24, making it the largest purchase ever made within a two-day time period. They took advantage of Buenos Aires’ decision to abolish export taxes on soybeans, and other food items. The demand for edible oils in India, especially palm oil, usually increases during festival seasons due to increased consumption of sweets, fried foods, and other fried food. Reporting by Anmol Chaubey, Mumbai; editing by Himani Sarkar & Mrigank Dhaniwala
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Gold reaches record highs on Fed rate-cut betting, US-China Trade woes
Gold reached a new high on Wednesday just below the $4,200 per ounce mark, boosted by expectations for further U.S. interest rate cuts. Meanwhile, renewed U.S. China trade concerns also increased demand for safe havens. As of 0604 GMT spot gold was up by 1.1%, at $4,185.59 an ounce. It had earlier reached a session high of $4193.38. U.S. Gold Futures for December Delivery gained 1%, to $4204.30. The U.S. president Donald Trump announced on Tuesday that his administration would produce a list on Friday of "Democrat programs" which will be closed due to the federal government shut down. Matt Simpson, senior analyst at StoneX, said that the U.S. shutdown and Jerome Powell's dovish remarks have been two of the most recent reasons why gold prices are on an upward trend. Federal Reserve Chair Jerome Powell stated that the U.S. labor market was subdued. However, the economy may be "on a slightly firmer trajectory than anticipated." Powell said that interest rate decisions will be taken "meeting by meeting", balancing the labour market's weakness against persistent inflation above target. Investors have priced in the near certainty of a Fed rate cut of 25 basis points in October and December. Bullion is more likely to perform well when interest rates are low and there is political and economic uncertainty. Gold has gained 59% in the past year, mainly due to geopolitical and financial uncertainties, central bank purchases, a de-dollarisation trend, and strong exchange-traded funds. Simpson added that "this rally has become a momentum trading, where traders pile into the market to chase away prices." Trump stated that Washington is considering cutting off some trade relations with China, such as in the cooking oil sector. On Tuesday, both countries started imposing port fees tit for tat. The International Monetary Fund increased its global growth forecast for 2025, citing better than expected tariff and financial conditions. However, it warned that renewed U.S. China trade tensions may curb growth. Silver climbed 1.9% to $52.43, following the gold rally and tightening of supply on the spot market. Palladium and platinum both rose by 0.8%, to $1,537.19, respectively. (Reporting and editing by Sherry Phillips, Subhranshu Sahu, and Ishaan Aroor in Bengaluru).
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The Chinese Communist Party holds a plenary on its new five-year plan. What does it mean to you?
From Monday to Thursday, the elite Central Committee of China’s ruling Communist Party is holding a closed door meeting to discuss, amongst other things, its 15th five-year plan for development. This meeting is known as a Plenum and it's the fourth one since the Party Congress of 2022. What does it all mean? What is a plenum? Central Committee, the largest decision-making body of the party, holds seven plenums in between congresses. The fifth plenum is traditionally used to discuss five-year plans. The party will now be expected to review the 2026-2030 Plan during the Fourth Plenum, which takes place from October 20-23. This is due to a nine-month delay that was not explained in the third plenum. In order to prevent leaks, the plenum is traditionally restricted within the premises for the duration. The proceedings are kept secret until the meeting is over. Most Chinese journalists and foreign media are not allowed access. China will release a short report the day after the plenum concludes, outlining the main points of agreement - in this case, the scope of the five-year plan. No mention will be made of dissent to project unity within the party. Beijing may release more details a few days later, possibly in the week beginning October 27. However, it is unlikely that these will contain any specific costs or targets for new policies. The next five-year plans are likely to be approved by the parliament in March. What is a five-year plan? This is a blueprint for a strategic plan that defines the economic and social goals of a country over a period of five years, and guides national policy, investments and reform. This typically includes economic growth, industrial development, technological innovation and environmental protection as well as national security goals. China will have 15 five-year plans since adopting quinquennial policy cycles of Soviet style in 1950. Plans from the 1980s were seen as crucial in China's subsequent growth into the second largest economy of the world. These reforms opened the market, allowed for private ownership and helped integrate China into the global economy. In the 2000s and 2010, poverty reduction and a shift to an economy based more on domestic consumption rather than infrastructure investment and manufacturing were the main focus. China has declared victory in the fight against poverty. It is generally accepted, however, that China has failed to create a durable household demand. Will the plenum discuss other topics? Most likely. In the past, fourth plenums discussed party governance including personnel reshuffles and disciplinary measures. Diplomats, military personnel, and other observers are likely to pay attention to those who may rise or fall in rank, especially within the military, as a way of better understanding Beijing's thoughts. What's at Stake China's next five-year economic plan will be closely monitored to see how much it focuses on rebalancing the economy. Beijing is expected to use strong words in its efforts to increase consumption, according to most observers. Analysts say that in practice, the trade war between China and the U.S. will likely keep policymakers focused primarily on technological advancements and industrial upgrades, meaning resources will continue to flow mainly towards strategic investments and factories, rather than consumers. It could consolidate China's successes in developing world-leading sectors, like electric vehicles and green energy, while opening up new opportunities in other areas where it still trails rivals, like semiconductors or aviation. It also means that deflationary pressures will continue and debt will increase, as China's small contribution to global demand in comparison to its increasing stake in the manufacturing sector will keep tensions at a high. The plenum is held just days before the APEC Summit in South Korea where Donald Trump and Xi Jinping may meet. The plenum comes just days after Beijing tightened its export controls for rare earths. This prompted Trump to threaten triple-digit tariffs. Analysts say Beijing's five-year plans are not affected by short-term changes in diplomatic and trading relationships. Instead, Beijing bases its policies on protecting national interests during a time of increasing great power rivalry.
Trump prepares reciprocal tariffs amid trade war fears
Donald Trump's advisers on trade were finalising plans for the reciprocal duties that the U.S. President has promised to impose against every country which charges duties on U.S. imported goods, raising fears of an expanding global trade war.
Separately the trade ministers from the 27 countries of the European Union are due to meet by video conference to decide their response to the European Commission President Ursula von der Leyen's statement that tariffs against the EU "will not be ignored".
Trump shocked the markets on Monday with his decision to impose tariffs starting March 12 on all imports of steel and aluminum. Mexico, Canada, and the European Union condemned the plans, while Japan, Australia, and other countries said they wanted exemptions.
Industries that depend on imports of steel and aluminum scrambled to reduce the expected cost increase.
Trump announced last week that he would impose an additional 10% tariff for Chinese goods starting February 4. Chinese countermeasures will be implemented this week.
He delayed the 25% tariff on goods coming from Mexico and Canada by a month, until March 4, to allow for negotiations about steps to secure U.S. border security and stop the flow of fentanyl.
Many U.S. workers have welcomed the metal tariffs imposed on Monday, but manufacturing-heavy companies are deeply concerned about the next steps. They warn that the tariff increase will reverberate throughout supply chains and affect all businesses who rely upon the materials.
Ahold Delhaize, a supermarket chain, and Siemens Energy have warned that tariffs will lead to higher prices because they want to pass on additional costs from imports.
Steelmakers in Europe are also concerned that U.S. Tariffs could lead to an influx of cheap steel into Europe. French steelmaker Aperam
If that happens, Brussels will intervene and curb imports. Austria's specialty steelmaker voestalpine
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On the EU to immediately take countermeasures
Australia's Industry Minister meanwhile stated that the U.S. Tariffs will not derail Australia's plan to increase "green" aluminum exports.
Ed Husic: "The world is in high demand for aluminium. We need it to transition to net zero."
Reporters at the National Press Club, Canberra. "Our American friends, do you want to pay more money for this product you have a high demand for?"
MONUMENTAL UNDERTAKING
White House officials are being tight-lipped regarding the timing or structure of the next tariffs. One source has said that the announcement could come later this week.
Trump announced on Monday that he will announce reciprocal tariffs within the next two business days for all countries who impose duties on U.S. products. He also said he is looking into separate tariffs for cars, semiconductors, and pharmaceuticals.
Experts in trade say that structuring the reciprocal duties Trump wants presents big challenges to his team. This may explain why the latest tariffs were not announced Tuesday.
William Reinsch said Trump officials can choose between a simple 10% or 20% flat tariff rate or a messier option that requires separate tariff schedules that match U.S. rates to those of other countries.
A source who tracks the work on tariffs reported that details are still being worked out as late as Tuesday.
Damon Pike is a principal and trade specialist with BDO International's U.S. division. He said that the reciprocal tariffs Trump envisaged would be a massive undertaking given that the 186 member countries of the World Customs Organization have different duty rates.
"At an international level, you'll find 5,000 different product subheadings at the 6-digit level. That's 5,000 times 186 countries. "It's like an artificial intelligence project," said he.
Trump could also use the International Emergency Economic Powers Act to justify tariffs on China, and those pending against Canada and Mexico.
Pike added that, without IEEPA's help, it would take some sort of agency action before trade remedies could be imposed. "But everything seems to move quickly," he said.
Reinsch stated that imposing reciprocal tariffs also ceded the control of U.S. tariff rates to other countries.
"For instance, if Colombia had a high coffee tariff to protect their industry, we'd put a similar high tariff on Colombian Coffee, even though we do not grow coffee. "The only ones who would suffer are the U.S. consumer," he said.
(source: Reuters)