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Iron ore prices are on the rise as traders consider Beijing's stimulus and tariff issues
Dalian iron-ore futures prices fluctuated in a narrow range Thursday as investors weighed trade concerns, reports of steel production reductions and expectations of additional stimuli to boost China's consumption against the expectation of more stimulus measures. As of 0302 GMT, the most traded May iron ore contract at China's Dalian Commodity Exchange was unchanged at 776 Yuan ($107.14). The benchmark iron ore for April on the Singapore Exchange rose 0.6% to $100.35 per ton. Chinese stocks rose on Wednesday, after Beijing promised more stimulus measures to boost consumption and soften the impact of a escalating US-China trade war. Washington has added 20% to existing tariffs on Chinese goods. The latest 10% increase was implemented on Tuesday and prompted Beijing's response. The U.S. needs tougher legislation to enforce trade laws against Chinese government-subsidised companies that circumvent U.S. tariffs by shipping goods through third countries, U.S. companies said on Wednesday. Previous reports have indicated that the new U.S. steel duties will disrupt Chinese steel trans-shipment to the United States. Hexun Futures, a broker, said that the daily average molten output in China is expected to rise to 2.329 millions tons in March. The demand for steelmaking materials has also recovered, he added. Hexun stated that the news of production reductions intensified downward pressure on prices. China will restructure the giant steel industry by cutting output, despite not announcing any targets in its latest intervention to reduce overcapacity. Coking coal and coke, which are used to make steel, also lost ground. They fell by 0.7% and 0.4%, respectively. The majority of steel benchmarks traded on the Shanghai Futures Exchange rose. Rebar rose by nearly 0.3%. Hot-rolled coils increased by 0.44%. Stainless steel increased by 1.06%. Wire rod fell 0.32%.
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Japan's Seven & i is expected to announce a new CEO and restructuring plan
Seven & i Holdings is the Japanese operator of 7-Eleven, a global convenience store chain. It will announce a new leadership on Thursday, and plans to restructure the business in response to a $47 billion takeover bid from a foreign company. Sources have confirmed that Stephen Dacus, the lead outside director, will succeed Ryuichi isaka as the chief executive of Seven & i. This is the first time a foreigner has been in charge at the Japanese retail conglomerate. Sources said that Seven & i will announce its leadership change and plans, including the sale to Bain Capital of non-core assets, at a board meeting. Investors have been criticizing the company's capital allocation over many years. In August, it received a purchase offer from Circle-K operator Alimentation Couche-Tard, which was eventually raised to $47 Billion, or a premium of 35% to its current market value. This sparked a tug-of-war amongst Canada's Couche-Tard and the founding Ito family of Seven & i, as well as company management, who thought they could chart their own path to recovery. Dacus has led a committee that has been evaluating the takeover offers. Dacus previously held executive positions with Walmart and Fast Retailing. Ito family group was unable to secure funding of $58 billion for their bid, which led to the cancellation of the deal. The Nikkei published a report on Monday that Paul Yonamine will replace Dacus as the head of the Special Committee. The shares of Seven & i fell on Tuesday after a report that the Japanese company was considering the Couche-Tard bid, but the Japanese firm said they were still evaluating it. Bloomberg News, citing sources familiar with the situation on Wednesday, reported that Seven & i will likely sell its non-core businesses to Bain Capital at a price of more than 700 billion yen (about $4.75 billion). Isaka joined 7-Eleven in 1980 and became its president in 2016. His reign was criticised by foreign investors. ValueAct Capital tried to remove him from office in 2023 because it believed his strategy was flawed. Artisan Partners, based in the United States, has urged Artisan to adopt a competitive bid process for takeover offers. Isaka announced an independent turnaround plan for October. It aims to double its sales to 30 trillion Japanese yen in 2030, by expanding overseas and focusing more on fresh food offerings. It would be the largest foreign takeover ever of a Japanese firm if Couche-Tard were to succeed in acquiring control of Seven & i. Seven & i, a Japanese media company, was classified in September as "core" for Japan's national defense. However, the Finance Ministry said that it would not create obstacles to a takeover. ($1 = 149.9500 yen). (Reporting and editing by Ritsuko Shimizu and Rocky Swift)
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LME copper reaches near 3-week highs on dollar dropback and China stimulus hopes
London copper reached a near-three-week high Thursday, spurred on by a sharp drop in the U.S. Dollar and expectations for more stimulus coming from China's top consumer. As of 0154 GMT on the London Metal Exchange, three-month copper rose by 0.4% to $9 624 per metric ton. This is its highest level since 14 February. The Shanghai Futures Exchange's most active copper contract rose 1.7% to 78,430 Yuan ($10,834.67) per tonne, a two-week high. Dollar index fell 1.5%, hovering near a 4-month low. This made commodities priced in greenbacks cheaper for buyers with other currencies. As investors anticipated more headlines on stimulus amid concerns about a trade war, the Chinese National People's Congress entered its second day. Base metals rose in Asian trade due to the prospect of more China stimulus measures. Premier Li Qiang said the goal of economic growth for 2025 is 'about five %',", according to Daniel Hynes. The White House announced on Wednesday that President Donald Trump would exempt automakers for one month from the 25% tariffs he has imposed on Canada and Mexico, as long as they follow existing free-trade rules. Trump's tariffs are straining relations with Canada and Mexico. Trump imposed a 10% additional duty on Chinese products, and Beijing responded by imposing its own tariffs. The looming threat to import tariffs has pushed up the price of aluminium in the U.S. to record levels. SHFE aluminium increased 1.6%, to 20,925 Yuan per ton. Zinc gained 1.6%, to 24,030 Yuan. Nickel gained 0.4%, to 128,680 Yuan. Lead rose 0.4%, to 17,390 Yan, and tin firmed up 0.6%, to 258,350 Yan. LME aluminium rose 1.1% to $2688.5 per ton. Zinc climbed 0.8% to 2,900.5; lead remained at $2,033.5; nickel surged 0.6% to 16,000 and tin jumped 0.9% to $30,975. ($1 = 7.2388 Yuan) (Reporting and editing by Rashmi aich in Bengaluru)
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US Board reinstates thousands USDA employees terminated by Trump administration
The U.S. Board that reviews the firings of Federal employees ordered on Wednesday the U.S. Department of Agriculture (USDA) to temporarily reinstate thousands of people who lost their jobs in President Donald Trump's federal layoffs. Cathy Harris is a member of Merit System Protection Board. She ordered that the USDA reinstate probationary employees fired for 45 days, while a legal challenge against the terminations takes place. The decision came a day after a judge in federal court blocked Trump's attempt to fire Harris, a Democrat and remove her from her board position without cause, before her three-year term expired. The administration has appealed that decision. J. said, "This is a great news. It needs to be implemented as quickly as possible with all agencies that have employees in similar situations." Ward Morrow is the assistant general attorney at the American Federation of Government Employees (AFGE), which represents some of these reinstated workers. Tanya Torst was fired on February 15 from the U.S. Forest Service (a USDA agency), but she said she'd be delighted to return to fundraising for six national forests. She did worry, however, about talks of closing federal offices across the country and further staff cuts later in this month. We're excited to return, but we hope they'll have a room for us." The USDA and White House didn't immediately respond to our request for comment. Trump and Elon, the architect of what is called the Department of Government Efficiency (DGE), are leading an unprecedented effort to shrink federal bureaucracy through job cuts. Out of the 2.3million federal civil servants, it is estimated that over 20,000 employees, mostly probationary workers have lost their job and another 75,000 took a buyout. Most probationary workers have served in their current role for less than one year, but some federal employees are long-time workers. The unions' attempts to challenge the mass firings at federal court were met with procedural obstacles. Judges questioned whether the unions had the right to bring these cases, or found that they should have brought them to administrative boards such as the MSPB. The merit board could be a roadblock to the Trump administration in its efforts to clean up the federal workforce. The board is responsible for hearing appeals from federal employees who have been fired or disciplined. The administration has already stopped the firing of six employees from various agencies, at the request of an agency that was headed by Hampton Dellinger, former director of the U.S. Office of Special Counsel. Trump had fired Dellinger. Dellinger, a Trump appointee appointed by Biden's Democratic predecessor, revealed on Tuesday that he asked the board to stop the firing of thousands USDA employees. Dellinger claimed that the Trump Administration fired the probationary workers without respecting the rights of the employees and in violation of federal regulations on mass reductions. Harris also agreed, stating that she had reasonable grounds to believe the agency terminated them in violation of federal laws. The board has ordered that all probationary USDA workers terminated after February 13 be temporarily reinstated. Dellinger welcomed the decision in a press release. Dellinger said that his agency will continue to investigate the firings of other probationary federal employees. He also called on agencies who have recently terminated such workers, to reinstate them immediately. He said that "rescinding these hasty, and seemingly unlawful personnel actions" was the right thing to be done and would prevent taxpayers from wasting money. Dellinger was fired by Trump on February 7. He had been reinstated on the bench, but on Wednesday a federal appeals court in Washington allowed Trump to dismiss him. Dellinger said on Wednesday that he had been removed from his position shortly after the decision, which was temporary until appeals court judges reviewed the merits in the case. Reporting by Daniel Wiessner, Albany, New York, and Nate Raymond, Boston; Additional reporting from Leah Douglas, Washington; Editing and proofreading by Chizu, Alexi, Garamfalvi, and Sandra Maler.
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India's small importers are seeking to reduce import duties in response to US tariffs on steel and aluminium
The head of a trade body in India said that India's small engineers goods exporters had urged the government on Monday to reduce import tariffs for some U.S. products to achieve better trading terms, as President Donald Trump is preparing to implement new duties on steel and aluminum. Exporters in India are concerned about the 25% U.S. steel and aluminum tariffs that will be implemented on March 12th. Pankaj Chadha is the chairman of Engineering Export Promotion Council which represents over 10,000 small exporters. Chadha said that the EEPC, along with other industry groups, has urged the federal government to lower tariffs on certain U.S. products with low inbound shipments. They believe that by lowering these tariffs, the Trump administration will be more inclined to negotiate a bilateral trade agreement. Trump has labeled India as a high-tariff nation and warned about "reciprocal duties" starting in early April. India's Trade Minister Piyush Goyal, is currently in the U.S. to hold trade talks. He hopes to negotiate possible tariff reductions as part of a proposed trade agreement and assess the impact Trump's reciprocal tariffs. Chadha stated that India could reduce import duties on U.S. scrap steel from 7.5% down to almost zero and lower tariffs on nuts and castings, while also offering concessions for certain agricultural and manufacturing products. Exporters are also concerned that India's proposed safeguard duty on steel imports of up to 14 percent, which is intended to protect local steel producers from cheaper Chinese imports will increase domestic prices and squeeze margins. EEPC data shows that India's engineering exports to the U.S. grew 18% on an annual basis in January, surpassing the overall sector growth of 7.44%, ahead of tariffs. Engineering exports to the U.S. increased by 9% annually from April 2024 until January 2025. This was driven by an increase of shipments of automobiles, aircraft parts, and industrial machinery. The latest U.S. Tariffs have added pressure to the engineering industry. "Continued government support for export credit and technology are crucial for competitiveness", Chadha said. India's engineering exports to the world, which make up a quarter (or $8.77 billion) of all merchandise exports in India, increased to $9.42 Billion in January, from $8.77 Billion a year ago, but were still lower than the $10.84 Billion exports made by India in December. EEPC data show that cumulative exports from April to January rose by 9.82% on a year-over-year basis, reaching $96.75 billion. Manoj Kumar reported; Kirby Donovan edited.
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Trump's trade tariffs and threats
Since returning to office in January, Donald Trump has issued numerous tariff threats. These range from a duty on all imports to a targeted tariff on certain sectors or countries. Trump's threats changed over time. This left other nations and business unclear as to what was next. It also created uncertainty for consumers and triggered a recent stock-market sell-off. Here's a summary of Trump’s threats and actions in relation to trade. BROAD TARIFFS Trump's vision is based on a gradual roll-out of tariffs that will apply to all U.S. imported goods. Last month, Trump asked his team of economists to devise plans for reciprocal duties on all countries that tax U.S. imports. They also had to come up with ways to combat non-tariff barriers, such as vehicle safety regulations that exclude U.S. automobiles and value added taxes that raise their costs. In the past, tariffs accounted for the majority of U.S. taxes. However, they now only make up a small fraction. Economists claim that Trump's policies are inflationary, as businesses who import goods and pay tariffs will pass on the costs to consumers. Potential counter-tariffs against U.S. agricultural and energy exports, as well as machinery and equipment, could escalate into a global trade war. This would create uncertainty for investors and businesses. Specific COUNTRIES Trump's tariff proposal targets several key trading partners. MEXICO AND CANADA : Mexico and Canada were the two largest trading partners of the U.S. from 2024 to November. Trump's new tariffs of 25% on imports from Mexico, Canada and the European Union took effect on 4 March as a response to migration and fentanyl. Tariffs were imposed on the majority of goods imported from Mexico and Canada. A 10% tax was also imposed on Canadian energy imports. Canada exports mainly crude oil, other energy products and cars and auto components within the North American automotive manufacturing chain. Mexico exports a variety of goods to the U.S., including industrial and automotive products. Canada retaliated with a 25% tariff on C$30 billion worth of imports from the United States, including oranges juice, peanuts butter, beer and coffee. It also imposed tariffs on appliances, motorcycles, beer, and other products. The Canadian government said that it would add additional tariffs to C$125 billion worth of U.S. products if Trump's Tariffs were still in effect in 21 days. This could include vehicles, steel and aircraft, as well as beef and pork. In his address to Congress on March 4, Trump said that further tariffs will be implemented by April 2, including "reciprocal duties" and non-tariff measures to address trade imbalances. U.S. Commerce secretary Howard Lutnick stated that U.S. officials could still work out a partial solution with the two neighboring countries, and added that they need to do more in the fentanyl arena. CHINA: Trump imposed 10% tariffs on all Chinese imports to the U.S. effective February 4, after repeatedly warning Beijing that it was not taking enough measures to stop the flow of illegal drugs into the United States. Trump then added another 10% tariff on Chinese products, which took effect on March 4. This is on top of the 25% tariffs that were imposed during Trump's initial term on Chinese imports. China announced additional tariffs between 10% and 15% on some U.S. Imports starting March 10, as well as a number of new export restrictions for certain U.S. Entities. It then complained to the World Trade Organization about the U.S. Tariffs. Trump has said that the EU, and other countries, have alarming trade surpluses against the United States. He said that the products of the other countries will be subject to tariffs, or he would demand that they purchase more oil and natural gas from the U.S. despite the fact the U.S.'s gas export capacity has reached its limit. In a statement released on 14 February, the European Commission stated that the "reciprocal trade policy" was a step backwards. Trump has threatened to impose a "reciprocal rate" of 25% on European goods. Pharmaceuticals are among the industries that could be affected, since U.S. companies such as Johnson & Johnson, Pfizer, and others have large facilities in Ireland. Ireland is also a leading exporter of medical equipment. PRODUCTS AUTOMOBILES - On March 5, Trump announced that he would exempt certain automakers, such as the Detroit Three – Ford, General Motors, and Jeep owner Stellantis – from his 25% tariffs against Canada and Mexico if they comply with a free trade agreement. According to these rules, vehicles must contain 75% North American components to be eligible for duty-free entry into the U.S. Some foreign automakers, such as Honda and Toyota with large U.S. manufacturing footprints would also benefit from the exemption, while competitors who don't comply will have to pay 25% of tariffs. Trump also floated the idea that tariffs of up to 100% would be imposed on other vehicles including EVs. In 2024, the automobile industry will account for more than $200 billion in imports from Canada and Mexico. METALS: Trump announced on February 9 that he would impose tariffs on all imports of steel and aluminum used by automakers and aerospace companies as well as in construction and infrastructure. More than half of the U.S.'s aluminum and steel imports come from Canada, Mexico, and Brazil. Trump ordered on February 25, a new investigation into the possibility of new tariffs on imports of copper to rebuild U.S. manufacturing of this metal, which is critical for electric vehicles, military equipment, semiconductors, and a variety of consumer goods. Just over half of the refined copper that America consumes every year is produced domestically. SEMICONDUCTORS : Trump stated that tariffs would start at "25%" or more, and increase substantially over a period of one year. He did not specify when they will be implemented. Taiwan Semiconductor Manufacturing Co., the largest contract chipmaker in the world, produces semiconductors for Nvidia and Apple, among other U.S. customers. In 2024, it will generate 70% of its revenues from North American clients. LUMBER: On March 1, Trump ordered a new investigation into trade that could add more tariffs to imported lumber. This would be in addition to the existing duties on Canadian Softwood Lumber and 25% tariffs for all Canadian and Mexican products.
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Canada's Parkland begins strategic review of the company to examine sale
Canadian fuel refiner Parkland Corp announced on Wednesday that it has launched a strategic evaluation which could lead to the sale of its company. Calgary-based Parkland stated that the review is necessary to "maximize shareholder value" and will explore the possibilities of asset divestments and acquisitions, as well as business combinations. Parkland has had its share price under pressure for over two years. The company has a value of approximately C$6 billion (4.19 billion). Engine LP, a U.S. activist investor, has urged Burnaby Refinery to sell its refinery or spin it off. The company has also been involved in internal conflict, namely a dispute over its 20% stakeholder Simpson Oil. Simpson Oil, Parkland's largest shareholder with a 20% stake in the company, has asked Parkland for a strategic review. However the Simpson nominees to the board of directors have resigned since December 2023. The resignations were not explained at the time. However, Simpson continued to express his concern over the direction the company was taking, most recently in an open message to Parkland’s board on February 25, 2019. Simpson called for a review of Parkland's strategic direction and a possible sale in the letter. Parkland announced on Wednesday that Simpson would be invited to join the board of the company and take part in its strategic review. (1 Canadian dollar = 1.4335 dollars) (Reporting and editing by Jamie Freed in Calgary)
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Los Angeles County and Pasadena sue Southern California Edison for wildfires
On Wednesday, the County of Los Angeles, City of Pasadena and other public entities filed lawsuits against Edison International, its subsidiary Southern California Edison and others, alleging that they were responsible for igniting California's most devastating wildfire. The Eaton Fire, which began early in January in the foothills to the east of Los Angeles and scorched over 14,000 acres - nearly as large as Manhattan - caused dozens of fatalities. The authorities have not yet released an official cause of the major fires including the Eaton fire. The County of Los Angeles and the Los Angeles County Flood Control District filed lawsuits to seek compensation for damage caused by fire to public infrastructure and resources. The lawsuits are intended to hold Southern California Edison accountable for the devastating fire, and to recover the infrastructure and taxpayer funds that were destroyed by the fire, said Ed Diab in a press release. Like other lawsuits filed by SCE, the lawsuits cite eyewitness reports and images showing a fire at a transmission tower owned SCE before the wind gusts spread the flames rapidly. Edison International announced that it was reviewing recent lawsuits filed against the company, and would respond in the appropriate legal channels. SCE's spokesperson said that because the investigation is still in its early stages the company cannot estimate the potential costs. According to the lawsuits, the amount of damages and losses resulting from the Eaton Fire are still being assessed but are expected at least to be hundreds of millions of dollar. Edison International stated that it has not determined whether the Eaton Fire was caused by its equipment in its earnings announcement for the fourth quarter. Reporting by Seher dareen and Pooja menon in Bengaluru, editing by Mohammed Safi Shamsi
Shanghai's base metals prices fall on US-China tensions
The prices of most base metals dropped in Shanghai on Wednesday, as investors worried about the possible impact of a potential trade war between China and the United States, the largest metals consumers, after both economies had imposed tit for tat tariffs.
By 0405 GMT, the most active copper contract at the Shanghai Futures Exchange had fallen 0.1% to 77,060 Yuan ($10,614.03) per metric ton.
Copper prices have been trending downwards amid fears of a potential global economic slowdown due to U.S. tariffs on trade and the retaliatory actions of U.S. trading partners. Kelvin Wong is OANDA’s senior analyst for Asia Pacific.
The new tariffs of 25% on imports to the United States from Mexico and Canada, as well as a doubled duty on Chinese goods up to 20%, went into effect on Tuesday.
China swiftly retaliated on Tuesday against the tariffs. The world's two largest economies are now one step closer to a full-blown trade war.
The National People's Congress will begin on March 5th and close in the late afternoon of March 11th. Given the ongoing tariff war, and the concerns over a slowing economy, the market is eager to learn if there are any additional stimulus measures.
China released more fiscal stimulus Wednesday, signaling greater efforts to boost consumer spending as a way to restrict the economy's progress towards this year’s roughly 5% target growth rate amid an escalating US trade war.
SHFE aluminium dropped 0.4%, to 20,600 Yuan per ton. Zinc fell 0.4%, to 23,655 Yuan. Nickel was unchanged at 128,150 Yuan. Lead rose 0.7%, to 17,360 Yoan. Tin lost 0.4%, to 255.730.
The London Metal Exchange's (LME) three-month copper rose by 0.4% to $9.381.5 per metric ton. LME aluminium rose 0.2% per ton to $2621, zinc 0.5% to 2,824, lead firmed up 0.2% at $2 014, nickel dropped 0.3% to $15,930, and tin fell 0.2% at $31,520.
(source: Reuters)