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Acerinox: 'Deglobalisation is an opportunity'
Acerinox, a Spanish steelmaker, said it expected to benefit from the "deglobalisation", and increased trade barriers. However tariff-related uncertainty hurt its first-quarter results. Acerinox is unique in the industry. Chief Corporate Officer Miguel Ferrandis stated on a conference phone that it has an advantage in taking advantage of "regionalisation" issues. In the first quarter, the company's net income fell by 81% from the same period of 2024 to just 10 million euros ($11.28m) due to a downturn in the steel market exacerbated the trade war. At 1028 GMT the shares were down by 1.3%, partially recovering from an earlier 5% drop. Steel has been the focus of international trade wars since U.S. president Donald Trump introduced steel tariffs in his first term. In 2021, Trump's successor Joe Biden lifted the tariffs on metals from the European Union, but in 2016, the second Trump administration reinstituted 25% tariffs on both steel and aluminum, giving U.S. mills a competitive advantage over European steel mills. Acerinox's Chief Executive Bernardo Velazquez said that the U.S. steel tariffs are a positive thing for Acerinox. The company produces more steel in the U.S. now than it does in Europe. He also sees greater stability and guarantees for the steel industry in the U.S. in the future. Velazquez stated, "The U.S. provides us with stability and allows us to look more into the future. That is why we grow there." He estimated that the energy costs of Spanish mills were about half as much. Velazquez demanded that European steel producers take additional measures to prevent production from North America flooding the European Union, causing harm to their business. Reporting by Javi Larranaga and editing by Inti landauro, Philipp Fletcher, and Inti Landauro.
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EU makes it easier to hunt wolves in Europe
The European Parliament approved on Thursday plans to make it easier for wolves to be hunted in the EU. They cited their increasing numbers and the danger they pose to livestock, as reasons to downgrade the animals' status of protection. The Bern Convention on the Conservation of European Wildlife and Natural Habitats has changed the status of wolves in EU law from "strictly" protected to "protected". It means that EU countries will be able to allow wolf hunts, but must take measures to prevent the animals from becoming endangered. For example, they can limit hunting seasons. Since 1979, Bern Convention has prohibited wolves being intentionally hunted or trapped unless they pose a serious risk to livestock or human health. Herbert Dorfmann, a member of the European People's Party (EPP), a centre-right party, said: "Farmers are now able to breathe sighs of relief." It's time for us to adapt to the realities of today. He said that this means finding a balance between our conservation efforts and protecting farmers. Some EU legislators and campaigners have accused European Commission Chief Ursula von der Leyen of targeting wolves for personal reasons. Her pony had been killed by a wild wolf in the year 2022. JuttaPaulus, a Green EU legislator, said: "This is not helpful to livestock farmers and damages forestry and the nature." By controlling game populations, wolves can help forest ecosystems. The Commission made the proposal for a change in the status of the wolf under EU law. It said that it was based upon an in-depth study and reasoning, including the fact wolf populations were increasing in the EU with approximately 20,300 animals in 2023. This has caused increased damage to livestock. The EU was opposed to a proposal made by a non-member Switzerland, in 2022, that would have lowered the protection status of wolves under the Bern Convention. The European Parliament approved this proposal with 371 votes for, 162 votes against and 37 abstentions on Thursday. The final vote is expected to be passed by the EU countries. (Reporting and editing by Gareth Jones.)
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Britain to be first to reach a deal on Trump tariffs
Thursday, the United States and Britain are expected to announce an agreement that will lower tariffs for some goods. This is the first such deal since U.S. president Donald Trump started a global war of trade with his universal levies. Trump announced on Truth Social that he will hold a news conference in the Oval Office at 10:00 am EDT (1400 GMT), on Thursday, to discuss a "full-and-comprehensive" trade deal with Britain. Keir starmer, the British Prime Minister, will give an update on Thursday. He has described the United States as an essential ally. The agreement is expected to be limited, as Britain will likely only get lower tariffs for cars and steel. These are the two sectors that have been hardest hit. Trump said that it was an honor, because of the long history and loyalty we share together, to announce our FIRST deal with the United Kingdom. Many other deals are being negotiated and will follow! Investors have been pressing the United States to reach a deal to de-escalate their tariff war. Trump's chaotic policies, which disrupted global trade and impacted both friends and enemies, threatened to ignite inflation and trigger a recession. Since the president imposed on April 2, a 10% tariff for most countries and higher tariffs for many trading partners, which were then suspended for 90-days, top U.S. officials are in a frenzy of meetings with trading partner. The U.S. also imposed tariffs of 25% on automobiles, steel, and aluminum, as well as 25% on Canada, Mexico, and 145% on China. On Saturday, U.S. officials and Chinese officials will hold discussions in Switzerland. Starmer has forged a warm bond with Trump, despite his struggles in government after being elected with his Labour Party last July. His government will be celebrating becoming the first to reach a deal. The British car industry exports high-end brands to the U.S., and the 25% tariffs have hit them hard. Jaguar Land Rover suspended shipments to the U.S. of its vehicles for a whole month as it looked at ways to minimize the impact. Aston Martin shares rose 8% Thursday after the company announced it would share the tariff costs with its customers, and limit shipments into the U.S. NARROW SCOPE An official from the British government had stated that any agreement would likely be limited, and Britain was expected to achieve lower tariffs for a certain amount of autos and steel exports. In exchange, Britain will likely agree to lower their own tariffs on U.S. vehicles and reduce a digital tax that is imposed on U.S. technology giants. The UK refused to lower their food standards which are aligned closely with those of the European Union. However, Britain's agricultural trade union said that certain U.S. farmers meet British standards because they do not use growth hormones or antibiotic washes and may be granted greater access to the market. Starmer's Government has been on a tightrope when it comes to trade. As an independent country following Brexit, they are trying to establish new ties with China, the U.S. and the EU, without going too far in one direction. On the domestic front, there are also threats. The government is still unpopular, despite its efforts to reduce pensioners' energy bills and increase taxes for households and businesses. Any move that would lower taxes on multinational tech companies is a risk. POLITICAL RISK In response to a public outcry over tax avoidance, the UK introduced a digital service tax in 2020, which is based on 2% of UK revenues for online marketplaces and search engines, as well as social media platforms. A 2023 report from lawmakers predicted that it would raise 800 million pounds ($1.1billion) this year. More than 90% of the money will come from five large tech companies. It was not clear what would happen to the 10% "baseline tariff" imposed by Trump against most countries, including Britain, and any tariffs threatened on the pharmaceutical industry. The British Parliament reported that Britain exported 9.6 billion dollars worth of pharmaceutical and medicinal products to the U.S. during the year ending September 2024. This is the second-largest sector after cars. One FTSE 100 CEO and economists said that the immediate impact of a trade deal would be limited, but trade agreements generally - the UK signed a free-trade agreement with India this week – will help produce growth on the long-term. The CEO, who spoke on condition of anonymity, said that the deals with the US, India and other countries would be important for the UK's long-term economy. However, don't expect euphoria to happen overnight. Allan Monks, JPMorgan's economist, said that the benefits would be limited should the 10% tariff remain in place. He said that the UK has a broadly balanced trade relationship with the U.S. and a good political relationship. There is no real threat from Westminster of retaliation, and there have been extensive bilateral discussions. It's not clear what the UK will do next. (Additional reporting by James Davey, Paul Sandle and Kate Holton. Writing by Kate Holton. Editing by Toby Chopra.)
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Dollar firms focus on US-China discussions as copper slips
Copper prices fell on Thursday, as the dollar remained steady and market attention shifted to U.S. China talks this weekend. As of 0950 GMT, the benchmark copper price on London Metal Exchange (LME), fell by 0.8% to $9 345 per metric ton. The U.S. Dollar index increased by 0.2%. The dollar's strength makes commodities priced in greenbacks more expensive for currency holders. The copper price is slightly under pressure, as traders secure "short-term profit and a marginal turnaround of the U.S. Dollar". John Meyer, analyst at SP Angel, said that he believes the market will not take large positions in such an environment. This weekend, U.S. Treasury secretary Scott Bessent will meet with China's economic tsar He Lifeng. The news that the U.S.A. and Britain will announce a deal on reducing tariffs for certain goods added to the positive sentiment. "The dichotomy in copper remains between the strong demand for Chinese copper in the present versus the macro-bearish outlook of the street," said Alastair Murro, senior metals strategist with broker Marex. Yangshan Copper Premium The key indicator of Chinese import demand is $100 per ton. This is the highest level since December 20,23. The Shanghai Futures Exchange monitors warehouses for copper stocks Inventory levels in COMEX warehouses have dropped dramatically recently The highest levels since late 2018 "Amid U.S. Tariff Expectations, all metal is being pulled to CME creating an tight supply situation elsewhere in the world." Munro said that the Chinese situation was exacerbated by the shortage of scrap. Goldman Sachs raised its quarterly copper forecast, citing a de-escalation of trade tensions as well as resilient Chinese demand for copper. LME Aluminium increased 0.1%, to $2.385.5 per ton. Two sources with knowledge in the matter said on Wednesday that Guinea had initiated a procedure to revoke Emirates Global Aluminium’s mining license. LME zinc fell 0.2% to $2,611, while lead dropped 0.8% to 1,941.5. Tin rose 0.3% to $30,755 a tonne, and nickel remained flat at $15 545.
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ADNOC Drilling first-quarter profits jump on the strength of oilfield services
ADNOC Drilling is the subsidiary of Abu Dhabi’s state oil company. It reported on Thursday a 24 percent increase in profit for its first quarter, driven by a strong growth in oilfield services. ADNOC Drilling increased its net profit to $341 millions in the March quarter, up from $275 in the same period of last year. The revenue rose by almost a third, to $1.17 Billion. Oilfield Services' revenue increased by 134%, to $342 Million. This was mainly due to an increase in activity for unconventional and integrated drilling. The board of directors also approved quarterly dividends instead of semiannually. The first payment, $217 million for 2025's first quarter, is expected to be made on May 28. This amount will serve as a minimum for all subsequent quarterly payments made in 2025. ADNOC Drilling stated that despite recent volatility on the global markets, its previously announced guidance for 2025 and the medium-term remains unchanged. Recent contract awards also support this. The company expects a net profit of between $1.35 billion and $1.45 trillion in 2025, and revenues of $4.6 to $4.8 billion. ADNOC Offshore has recently won a contract worth $1.63 billion for five years of integrated drilling services and a contract worth $806 million for three island rigs. ADNOC Drilling’s joint ventures Enersol & Turnwell are driving its growth. Turnwell was founded to access unconventional energy resources, such as oil and gas, which require advanced extraction techniques. Enersol is a joint venture between Alpha Dhabi and Abu Dhabi that invests in drilling powered by artificial intelligence. Youssef Salm, the Chief Financial Officer, said that it is expected to spend $700 million this year on at least two acquisitions and mergers, with a focus on the United States. Alpha Dhabi will contribute about half of the $700 million, as it is part of an Abu Dhabi business empire headed by Sheikh Tahnoon Bin Zayed Al-Nahyan. Salem stated that ADNOC Drilling expects to spend around $500 million on capital expenditures this year, and another $500 million for mergers and purchases, $350 of which would be for Enersol. Out of a total of 144 wells, the company has already drilled over 40 unconventional ones. The CFO stated that it expects to drill more than 80 wells by the end the year. The company also drills about 800 conventional wells per year. (Reporting and editing by Emelia Sithole Matarise; Yousef SABA)
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Draft shows EU countries want to reduce red tape in energy laws
According to draft conclusions of a summit on EU energy ministers to be held next month, the EU wants to include energy policies as part of its efforts to reduce red tape and help struggling industries. The European Commission is launching a campaign to eliminate layers of bureaucracy, which European businesses claim puts them at a competitive disadvantage with China and the United States where the Trump Administration is aggressively rollingback regulation. The Commission has now assessed which other EU laws can be simplified to reduce red tape. According to the draft conclusions of the Ministers' Meeting on June 16, EU countries will show their support to add energy policies to this initiative. The draft conclusions supported the plans to simplify EU laws and stated that this "is expected have a profound effect on lowering regulatory burdens for companies in energy sector and energy-intensive industries while maintaining alignment to the original policy goals." Diplomats in the EU are still working on the final conclusions. They could be changed before they are approved by ministers. So far, the EU's efforts to simplify have been met with mixed reactions. The EU's simplification efforts have met with mixed reactions so far. EU diplomats have told countries that they want to simplify the EU's methane emission rules and energy savings obligations. Diplomats say that the final conclusions will likely not reveal much about Brussels' plans to propose legislation in June to ban all Russian imports of gas by 2027. This is because EU member states must unanimously approve conclusions, which means that one government could block them. Hungary and Slovakia both rejected the plan to stop using Russian energy. (Reporting and editing by Kate Abnett, Andrew Cawthorne).
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Gold drops as Trump signals possible trade deal with Britain
Gold prices dropped on Thursday as U.S. president Donald Trump hinted that he might sign a trade agreement with Britain. This lowered trade tensions, and reduced the appeal of gold as a safe haven investment. As of 0858 GMT, spot gold dropped 0.7% to $3339.32 per ounce. Bullion had risen by more than 1% in the early part of the session. U.S. Gold Futures fell 1.4% to $3345. Nitesh Sha, commodities strategist at WisdomTree, said: "As confirmation comes that there's some sort of deal on the horizon that could help firm up the dollar and take a little steam off gold." On Thursday, the U.S. will announce an agreement to lower tariffs for some goods. Trump announced on Truth Social that, later in the afternoon, he would hold a presser regarding a major trade deal. Meanwhile the British Prime Minister Keir starmer will also provide an update about the U.S. and UK trade talks. Investors are also on edge as the U.S.-China trade talks in Switzerland this week keep them on their toes. Trump stated that China was the initiator of these talks, and reiterated his refusal to lower import tariffs for Chinese goods as part of a negotiation strategy. As its policymakers deal with the impact Trump's tariffs, the Federal Reserve kept interest rates unchanged on Wednesday. However, it warned of an increased risk of inflation and unemployment. In a low interest rate environment, gold, a non yielding asset, which serves as a hedge to political and financial uncertainty, thrives. Two people with first-hand knowledge of the situation said that China's central banks has allowed commercial banks to purchase foreign currency in order to pay for imports of gold under newly increased quotas. The Pakistani military confirmed that 12 Indian drones violated Pakistani airspace and were shot down by Pakistan. This comes a day following Indian attacks on several targets across the country. Ole Hansen is the head of commodity strategy for Saxo Bank. He said that rising tensions between India, Pakistan and other countries will continue to draw attention. This could lead to an unquantifiable amount of demand for safe havens. Silver spot fell by 0.4%, to $32.34 per ounce. Platinum rose 0.1% to $975.08 while palladium dropped by 1.5% to $957.50. (Reporting and editing by Ed Osmond in Bengaluru. Anmol Choubey is based in Bengaluru.
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COP30 Brazilian presidency calls for new global climate governance
According to a letter released by the Brazilian presidency on Thursday, COP30, which is this year's global climate summit, has called for new global governance mechanisms in order to help countries implement their commitments and curb global warming. The summit in the Amazonian town of Belem, in November, will mark the 10th anniversary since the Paris Accord when signatories agreed that warming should be kept well below 2 degrees Celsius compared to pre-industrial levels. Many nations are still struggling to bring their plans to life and reduce carbon emissions to the level necessary to prevent the planet from reaching catastrophic levels of warming. In a letter from the COP30 Presidency, it is stated that "the international community must investigate ways in which climate cooperation can be improved to accelerate" the implementation. Luiz inacio Lula da So, the Brazilian president, first made this proposal during the G20 summit held in Rio de Janeiro last November. Lula suggested at the time creating a “United Nations Climate Change Council” to help countries implement the commitments they made in 2015 to combat climate change. Lula stated that "negotiating new commitments is pointless if we do not have an effective way to accelerate the implementation" of the Paris Agreement. "We need stronger climate governance." Andre Correa do Lago will be the Brazilian ambassador at COP30. Correa do lago said that the UNFCCC Climate Convention has been the subject of decades-long debates. However, it lacks the implementation capability. Lago, a journalist on Wednesday, said: "The UNFCCC or the Paris Agreement do not have the power or the mandate to move this forward. We propose to reconsider how institutionally we can strengthen implementation." The COP Presidency Letter suggests that this discussion should take place at the United Nations General Assembly and not COP30. The letter says that "debates at U.N. General Assembly can explore innovative governance approaches for endowing international cooperation with the capabilities of rapid sharing data, knowledge, and intelligence as well as leveraging networks, aggregate efforts, and articulating processes, mechanisms, and actors both within and outside the U.N." According to sources in the Brazilian Government, the creation of an U.N. Lula has discussed the creation of a Climate Council in his diplomatic talks with world leaders. However, there are no immediate results expected in the near future. One source stated that "it's still a first convincing effort." (Reporting by Lisandra paraguassu; editing by Manuela andreoni, Lincoln Feast)
CSN believes that Brazil can negotiate steel quotas in the US with CSN
A Brazilian executive told reporters on Thursday that the Brazilian steelmaker CSN believes there is room to negotiate with the United States a quota system in the months ahead, following the tariffs imposed by U.S. president Donald Trump on imports of steel and aluminum.
Brazil, the world's largest steel importer, has announced that it will no longer be importing U.S.
seek dialogue
Trump's administration, and not immediately retaliate to what it termed "unjustifiable tariffs".
Trump imposes 25% tariffs on steel and aluminum imports
took effect
On Wednesday, the U.S. stepped up its campaign to reorder trade globally in favor of America. Canada and Europe retaliated swiftly.
"From what I've heard, I think that it is possible in the next two month for a similar negotiation to the one we had last year to be opened. CSN's Luis Fernando Martinez, the commercial head of CSN, told analysts during an earnings call that a possible quota system could be implemented.
Trump, who was sworn in as president in January 2018 for a second term, initially targeted steel and aluminium for tariffs, but then granted exemptions to several countries and struck duty-free deals with Brazil based upon pre-tariff volume.
South America had suggested previously
Quotes
As a "smart device." Martinez pointed out that the U.S. is still a net exporter of steel products such as plates and sheets.
Earnings Blocked
CSN, Brazil's largest miner and steelmaker, reported a net loss for the fourth quarter of 85 million reais (14.66 millions) due to "still high financial costs," but core earnings exceeded market expectations.
According to an LSEG survey, the company reported adjusted earnings before taxes, interest, depreciation, and amortization of 3.33 billion reais. This is down 8% from last year, but still beats analysts' expectations, which were 2.87 billion reais.
Analysts had predicted 11.8 billion reais.
Shares of the company traded in Sao Paulo rose more than 7.5%. The mining division CSN Mineracao also jumped around 10%. Both companies were among the top gainers in Brazil's Bovespa index, which grew 1.3%.
JPMorgan analysts said that CSN Mineracao and CSN exceeded their expectations for the quarter due to better than expected costs. They expressed a positive outlook. They said that "an upward revision of the consensus estimates is anticipated."
(source: Reuters)