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Officials say that if the renewable energy sector is slow, Japan's LNG demand may increase. Canada will be there to supply it.
A senior official from the industry ministry said that Japan's demand may increase by more than 10 percent to 74 million tons of liquefied gas by 2040, under a scenario in which renewable energy is not implemented as quickly as expected. Japan's domestic LNG consumption continued to decline last year. It fell by 0.4%, to 66,000,000 tons, due to the weaker economy, an increasing share of renewable energies, and restarted nuclear power plants. Yuya Hasegawa, division director of the Ministry of Economy, Trade and Industry in Japan (METI), said at a conference held in Tokyo that the growing number of data centres is expected to increase the demand for power. He said that if we don't have a massive expansion of renewable energies, or if the cost of ammonia, hydrogen, and CCUS (carbon storage, utilization, and capture) cannot be reduced, our gas demand would increase. Hasegawa said that under a METI scenario for an alternative energy strategy, Japan's demand for LNG will increase to 74 millions tons by 2040 or almost 10% if the METI scenarios do not include a significant expansion of renewable energy. Australia, Malaysia, and the United States provide the most LNG to Japan. However, Canada, where Mitsubishi is an investor, is planning to begin exports later this year. Canada has turned its attention towards other markets. Japan is the second largest LNG buyer in the world after China. Trump has promised to increase the oil and gas production of the U.S. which is already the largest in the world, increasing the competition between sellers for the top buyers including Japan. Rebecca Schulz of the Alberta Government's Ministry of Environment and Protected Areas, who spoke at the same conference, said that Alberta wants to double its production to supply other countries, such as Asia and Japan. "Just because of the shipping time - half the time comes from the U.S. Gulf Coast - it makes us the perfect partner for Japan," she said. (Reporting and editing by PhilippaFletcher; KatyaGolubkova)
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TotalEnergies Namibia's project is smaller and later than expected
FID is expected to end in 2026, not by the end of 2025 Production capacity has dropped to 150,000 barrels a day from 160,000 The country has been discovered by fellow majors PARIS, February 5 - CEO Patrick Pouyanne stated on Wednesday that the French oil major TotalEnergies will make a final decision on investment in its Namibian oil discovery by 2026. The project would produce 150,000 barrels a day. This is down from the initial 160,000 barrels a day that was discussed during its Investor Day in October. Pouyanne's previous target for the decision date on FID was 2025. This was announced at a results conference last April. The French oil giant has stated that it struggles to break even at less than $20 per barrel - an internal requirement of FID. The high gas content in Namibia has complicated the development of promising offshore discoveries. Chevron and BP both declared their initial Namibian discoveries commercially unviable last month.
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UAE Non-oil Foreign Trade to Reach $817 Billion by 2024, PM Says
In a Wednesday post on X, Sheikh Mohammed bin Rashid Al Maktoum stated that the United Arab Emirates non-oil goods trade will reach a record of 3 trillion dirhams (816.86 million dollars) by 2024. Post on X reported that the non-oil exports of the Gulf State increased by 14.6% from the year before. The UAE is considered the tourism and business center of the Gulf Region. It has made significant investments in infrastructure and policy to support long-term growth. Since 2021 it has initiated a number of bilateral trade agreements, investments and cooperation deals, called Comprehensive Economic Partnership Agreements. It has so far signed deals with a range of countries, from India and Indonesia, to former political enemies Israel and Turkey. The Prime Minister, who is also ruler of Dubai, stated in his blog: "The UAE is not like the rest of the world's economic flock... or the usual global trade growth flock... Because the economy comes first ...,".
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Pandora's growth will be lower in 2025 following strong holiday sales in the U.S.
Danish jewellery company Pandora announced on Wednesday that it expected sluggish growth in Europe, and a slowdown in Germany following a period of strong growth. Pandora, a company known for its charms bracelets, has reported an operating profit that was in line with expectations. However, Black Friday sales accounted for a larger share of the total, which impacted profitability slightly. The largest jewellery company in the world by volume expects organic growth of 7-8% by 2025. The company had a better organic growth rate of 13% in 2024 than its guidance of 11-12%. Pandora's fourth quarter comparable sales in the U.S. grew by 9%, contributing to a 6% overall growth. Germany's comparable sales increased by 28% - slower than the growth of 42% in the third quarter. Revenues in France and Italy also fell. Lacik told an interviewer that the U.S.A. and Canada had experienced a strong fourth quarter. "The U.S. consumer is more optimistic and more in demand than Europe. This trend should continue this year." Pandora's performance in Italy and France has been affected by economic challenges, and an "intense promotion environment" (competitive pressure to lower prices and offer discount products). Pandora's analyst poll revealed that the average forecast for the fourth-quarter operating profits was 4.10 billion crowns, compared to 3.67 billion crowns a year earlier. Pandora's operating margin was 34.7%. This is slightly higher than the average analyst forecast. The company is expecting a margin of operating profit to be around 24.5% by 2025, down slightly from 25.2% in 2018. Pandora, whose share price recently reached a record, has also launched a new buyback program for up to four billion Danish crowns.
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India's Titan expects higher prices to be paid by bullion banks to purchase gold as the supply of gold is shrinking
The Indian jeweller Titan may have to pay a higher interest rate to lease gold from the bullion banks. These banks have increased their shipments to the U.S. to make more profits due to a tightening of supply in other areas, said the company on Wednesday. To avoid the risk of inventory due to fluctuations in the price of yellow metal, jewellers like Titan, who own the Tanishq brand and CaratLane, lease gold from the bullion banks that import the metal. This week, it was reported that global bullion banks were flying gold to the U.S. via trading hubs in Asia to take advantage of the high premium U.S. futures gold prices enjoy over spot price. Gold deliveries to Comex approved warehouses have reached their highest level since July 2022, amid concerns over the U.S. tariffs that President Donald Trump plans to impose. Gold moved from London to Comex due to anticipated tariffs. Ajoy Chwla, Titan's Jewellery Division CEO, said on an investor call that there has been a sudden gold shortage over the past week. Gold metal loan interest rates have also fluctuated. Titan has said that it is not certain how much the gold leasing rates will increase from the current 1,5%-2%. Vijay Govindarajan is the associate vice president of Finance at the company. Titan said that it was difficult to predict the fourth quarter growth because gold prices have reached an all-time high amid fears of another U.S. China trade war. It did not specify to which growth metric it was referring. After market hours, the company announced that its third-quarter profits were above expectations. It said that it had also absorbed all the inventory losses due to the Indian government reducing gold import taxes starting in July 2024. This weighed down its second-quarter profits despite increased sales. Titan had already built up inventory prior to the reduction in import taxes. This reduced the value of the stock. The old stock had to be sold at lower prices after the tax cut. "We hope we can sustain the growth rates we've seen in all of our quarters, or at least the second and third quarter," Chawla added, adding that consumers might buy gold if price doesn't drop. (Reporting and editing by Sethuraman N R; Varun H K).
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Report finds that Chinese companies control 75% of Indonesian Nickel capacity
C4ADS, a Washington-based nonprofit global security organization, said that Chinese firms controlled about 75% (or more) of Indonesia's capacity for nickel refining, causing concern regarding supply chain control as well as environmental risks. The report states that Indonesia's 8,000,000 metric tons of refining capacity is distributed among 33 companies. However, ownership trace showed overlap and Chinese companies ultimately controlled approximately three quarters of the smelting capability as of 2023. The report released on Tuesday stated that "as Indonesia seeks to use the nickel sector for economic growth," this significant foreign influence may limit its ability control and shape the market to its advantage. A report stated that the U.S., and European automakers are also at a disadvantage on the global EV markets due to the reliance on nickel produced by China. This is because of the increasingly restrictive trade policies with China. Nickel is an important battery component. The Indonesian mining ministry has not yet commented. Last year, an Indonesian official revealed that Chinese firms were reaching out to Indonesian and South Korean companies for possible partnerships in order to reduce their stakes and make their products more accessible to U.S. consumers. Last month, Mining Minister Bahlil Lahadalia stated that President Prabowo had formed a taskforce to develop the downstream mining industry using domestic financing. This was to "gradually decrease perceptions that foreigners benefited the most". C4ADS found that by 2023, two Chinese companies, Tsingshan Group and Jiangsu Delong Nickel Industry Co Ltd accounted for 70% of Indonesian refining capacity. They were two of the first investors to invest in Indonesia's push for the domestic processing and production of nickel ore, a move which has helped it become the world's leading producer. A court in Central Sulawesi last year sentenced two Indonesia Tsingshan Stainless Steel workers to seven months in jail for negligence which led to a fire in December 2023 and the deaths of several employees at a Tsingshan plant. Two workers were killed during clashes in early 2023 at the PT Gunbuster Nickel Industry smelter, owned by Jiangsu Delong Nickel Industry. Obsidian Stainless Steel, a joint venture between Jiangsu Delong and Tsingshan Eternal Tsingshan, did not respond immediately to comments. Jiangsu Delong was not immediately available for comment. Tsingshan is selling stakes in its smelters. One such deal was with Indonesian state-owned miner Aneka Tambang to buy 30% of PT Jiu Long Metal Industry.
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Draft document shows that Vietnam's new power plan targets offshore wind and gas as well as reducing gas consumption.
A draft document from the industry ministry showed that Vietnam's power production targets have been lowered for offshore wind and gas in this decade. Coal and other renewables will fill the gaps until nuclear reactors become part of the energy mix, which is expected to happen by 2035. The document was released late Tuesday night and is still subject to change. It aims to replace 2023's power generation plan. The Southeast Asian export hub is trying to meet the increasing electricity demand of domestic manufacturers as well as multinationals in the country. According to the revised plan Vietnam will not have an offshore wind project this decade. The initial goal was to install 6 gigawatts (GW) of power by 2030. This has been pushed forward to 2035 in order with the downbeat expectations within the industry. Due to the lower supply of gas domestically and LNG imported, it is expected that the installed capacity for converting gas into electricity also will be less than originally anticipated. The imports of LNG are expected to reduce the production capacity to 18 GW in 2030 from the initial 22.4 GW planned. According to the draft document, the production of electricity from LNG will begin in this year. The first power plants are expected to be online by the end of the year with a combined capacity 0.8 GW. The developer PetroVietnam Power announced last week that two of the world's first LNG power stations with a combined capacity of 1,5 GW would begin commercial operations in June. By 2030, domestic gas supplies will support an installed capacity of 10,8 GW. This is down from the 15 GW previously planned. The document, which confirmed earlier reports, said that the difficulties encountered at Exxon Mobil’s Blue Whale field off the central coast of Vietnam, the largest oilfield in the country, were among the reasons why the target was lowered. COAL, RENEWABLES and NUCLEAR The Communist-run nation expects to compensate for lost output due to gas and offshore winds by increasing capacity to produce energy from coal, hydropower, and other renewables like solar and onshore. The total capacity of the system is expected to increase to 175 GW from 150 GW initially planned by 2030. According to the document, Vietnam increased its coal imports last year to avoid power outages during a 2023 heat wave. It also plans to increase its installed capacity before 2030, before closing coal plants in mid-century. By the end of this decade, coal-fired power stations could produce 31 GW. This is up from an initial estimate of 30.1, GW. A further 7.2 GW of provisional capacity could boost the total potential by more than a quarter. This would make coal the primary energy source in the country. By 2030, solar power capacity will more than double compared to the current target of 30.4 GW. The draft shows that nuclear reactors recently reintroduced to the mix of power sources are expected to start operations in 2035 with the goal of generating 5 GW or more by the mid-century. The government announced on Tuesday that it plans to finish the construction of its first nuclear power station by the year 2030.
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Vestas' Q4 profits beat expectations
Vestas of Denmark, the largest wind turbine manufacturer in the world, announced on Wednesday that its adjusted operating profit was higher than expected for the fourth-quarter, but warned about the uncertainty to come for 2025. The company stated that despite the ongoing geopolitical uncertainty and the trade war, it expects to see increased revenue by 2025 as a result of the completion of its record-high backlog. Vestas' analyst poll revealed that the average forecast was 672 million. The operating profit before special items increased to 759 millions euros from 191 million dollars a year earlier. The company forecasted a 2025 full-year operating profit margin of 4-7% before special items and revenues between 18 billion to 20 billion euros. In 2024 they were 4.3% and 17.30bn euros respectively. Henrik Andersen, CEO of Vestas Service, said in a press release that the year had not progressed as expected. He also noted that Vestas has been fighting rising costs for most of 2024. He said: "But, with record-high order value, a high order backlog, and an incredible turnaround in Power Solutions... Vestas will leave 2024 stronger than when we started," he added. The company proposed to pay a dividend per share of 0.55 Danish crowns. $1 = 0.9629 euro (Reporting and editing by Anna Ringstrom, Shri Navaratnam).
Shipping snags and tariffs between China and the US limit iron ore's fall
Iron ore futures declined on Wednesday as investors worried about trade tensions between China and the U.S., the top consumer. However, shipping problems in Western Australia helped to cushion the decline.
The May contract for iron ore on China's Dalian Commodity Exchange ended the daytime trading 0.99% lower, at 801 Yuan ($110.00) per metric ton.
China's markets will be closed for Lunar New Year from January 28 to February 4th.
By 0709 GMT, the benchmark March iron ore traded on Singapore Exchange had fallen 1.09% to $100.39 per ton.
"Sentiment will likely suffer as Chinese markets reopen, and they react to the barrage on tariffs," ANZ analysts wrote in a recent note.
The additional 10% tariff imposed by President Donald Trump on all Chinese imports went into effect on Tuesday.
China responded quickly with tariffs on U.S. imported goods in response to new U.S. duty, reviving a war of trade between the two world's largest economies. These measures include a 15% tax on U.S. Coal, an important steelmaking ingredient.
A private sector survey revealed that China's service activity expanded at a lower pace in January, but the business climate improved.
A separate survey revealed that the growth of factory activity in the country slowed.
Rio Tinto said that on the supply side it has begun to clear iron ore vessels from two Western Australian port as two tropical storms off-shore complicated its efforts for repair of infrastructure damaged by last month's cyclone.
Rio warned in January that disruptions in rail operations due to record rainfall could affect its first-quarter shipment.
Coking coal and coke both fell by 3.17% and 3.58 percent, respectively.
The Shanghai Futures Exchange saw a decline in most steel benchmarks. Rebar fell 1.51%, hot-rolled coil dropped 1.64%, and wire rod lost 1.09%. Stainless steel, however, gained almost 1%. $1 = 7.2818 Chinese Yuan (Reporting and editing by Sumana Nady and Subhranshu Saghu).
(source: Reuters)