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Atlantic Lithium makes concessions in order to save Ghana project
Atlantic Lithium, a miner based in Australia, has asked Ghana's government to make fiscal concessions so that it can salvage the Ewoyaa lithium project. The global price collapse threatens the viability and profitability of the first lithium mine for the West African country. Ahmed-Salim Adam is the general manager of Atlantic Lithium. He said: "We've done the maths, and it makes no sense at all." "We wrote to the Minister of Lands and Natural Resources for urgent assistance on fiscals. "If not, this project will not proceed", he said. The price of battery metal has fallen more than 80% since its peak in November 2022. This is due to a global supply glut that coincided with slower adoption rates for electric vehicles. Ghana, Africa's leading gold producer, has granted an Australian miner 15 years to build the mine before the end of 2024. The miner hopes to take advantage of the electric vehicle boom. According to Atlantic Lithium's estimates, the Ewoyaa Project, with its estimated resource of between 35 and 40 million tonnes of ore containing lithium, will become one of top 10 producers of spodumene in the world. This is a major new source of supply outside of the dominant markets of Australia Chile and China. The U.S. is expected to import around 360,000 tonnes of lithium per year. The project's construction was halted due to a delay in parliamentary approval. In addition, the collapse of the lithium price has further complicated its viability, and the timeline for the company. Analysts remain cautious despite a recent recovery in prices, which is attributed to a normalization of global auto production. Tom Price, Panmure Liberum’s head of commodities said that while "EV-led growth is strong, it's still being overwhelmed by mine supply," noting the 25% tariff imposed by U.S. president Donald Trump. Price says that because West Africa is relatively new to the lithium market, investors prefer to remain in established markets during times of low prices. Atlantic Lithium, in its appeal to Ghanaian officials, said that the internal rate of returns for the project had fallen from 105% initially to only 13.6%. "Nobody will invest their money into that." Adam explained that it should have been 30 percent to make sense. Requests for comment from the Ghanaian mining regulator and other relevant ministries were not answered. CONCESSIONS SOUGHT The company wants to make several adjustments to its fiscal policy, such as reducing the royalty rate from 10% to 5% to match Ghana's gold-mining sector or using a sliding scale based on lithium prices. The company also proposed revising the corporate income tax rate of 32.5% and removing import duties on capital goods. Atlantic Lithium has said that it spent $70m since 2016, but is now facing "significant" challenges which could stall the project. The miner has been forced to drastically reduce operations. It dismissed 25 employees in October and plans to layoff approximately 50 additional workers in May. Adam stated, "We will only maintain a skeletal staff." He said that while parliamentary approval is still important, construction can't begin until the fiscal framework has been addressed. Even if we do get the ratification, we still can't get this off the ground. Adam concluded. (Reporting and editing by Veronica Brown, David Evans, and Maxwell Akalaare Adombila)
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Metlen sales in Greece up 31% year-on-year, boosted by the energy and infrastructure sectors
Metlen, a Greek energy and metals company, reported on Thursday a 31% increase in sales revenues for the first quarter of this year compared to last year. This was largely due to growth in energy and infrastructure. In the first quarter of this year, the group reported sales of 1,50 billion euros ($1,70 billion), compared to 1.14 billion euro in the same period the previous year. Metlen reported that its first-quarter energy sales rose to 1,18 billion euros from 904 millions euros a decade ago. Global energy production increased 35% over the past year, to 3.1 Terawatt-hours. On the retail market, the market share of the company has increased from 17.4% to 19,4%. The group stated that the infrastructure and concessions sector achieved a turnover growth of over 100% in the first three months compared to the same period in 2020, and all projects are progressing smoothly and according to schedule. Metals division has reported a 11% increase on the previous year in revenue for first quarter, reaching 228 million Euros. The total volume of aluminum production decreased by 2.1%. Alumina production also declined by 3.3%. Metlen was formerly known by the name Mytilineos. In January, an additional investment of 300 million euros was made to extract the critical mineral gallium out of raw materials used in aluminum production. China has placed restrictions on exports of gallium. This metal is used to make high-quality smartphones and semiconductors.
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Anglo American reports lower copper output in the first quarter
Anglo American, a global miner, reported on Thursday a 15% drop in its production of copper for the first three months of the year. However, the company left the yearly forecast unchanged. The London-listed company said that copper production dropped to 169,000 tons in the first quarter of this year. It attributed the drop in production in Chile. The copper production in 2025 is expected to range between 690,000 - 750,000 tonnes. As the world shifts to cleaner energy sources, it is expected that metals will be used more for electric vehicles and renewable facilities. Prices for industrial metals have been affected by concerns about trade tensions around the world. The first quarter saw an increase of 2% in iron ore production, to 15,4 million tonnes. Anglo, who in February recorded a $3.8 billion impairment mainly related to De Beers' diamond division, maintained its annual guidance of 20 million to 23 millions carats after a 11% drop in production during the first quarter. The global economic slowdown has reduced the demand for diamonds. Traditionally, these are luxury items. After BHP Group failed to take over the miner last year, it is restructuring its business and focusing mainly on energy transition metals copper as well as on iron ore. The company has agreed to sell its nickel and coal assets, and spin out the platinum division. In a Thursday statement, it stated that "We are continuing to pursue a two-track process to divest De Beers' interest. We are committed to finishing this at the right moment and when market conditions permit." The company had said previously that the process would be accelerated in the second half.
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S&P lowers Bahrain's outlook from 'positive' to 'negative,' due to weak financing conditions
S&P Global, the global ratings agency, downgraded Bahrain’s outlook from “stable” to “negative” on Wednesday. It cited ongoing market volatility as well as weaker financing conditions which could increase government interest burden. Fiscal deficits are expected to remain high due to lower oil prices, maintenance of the Abu Sa'fah field, volatility in the market affecting financing costs, and increased social spending. Bahrain's reserve currency position is still weak, and fiscal reform may not be enough to reduce Bahrain's debt-to GDP ratio. Bahrain's non oil revenue measures have been offset by increasing social spending and interest rates, as the economy is still heavily dependent on oil. In 2018, Bahrain received $10 billion in aid over five years in an agreement tied to fiscal reform. Bahrain's state finances are the weakest of the entire region. It lacks the oil and financial resources that its neighbours have. Its Gulf Arab allies, however, have been providing political and economic support over the years to maintain Bahrain's stability due to the importance of the country in combating Iranian influence. S&P predicts that the fiscal deficit in the country will reach 7% in 2025. This is up from 5.2% in the previous review and 4.9% for 2024. Bahrain's sovereign foreign currency credit ratings for long- and shorter-terms were confirmed at "B+/B." Reporting by Aatrayee chatterjee from Bengaluru, Editing by Alan Barona & Bernadette Baum
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Source in the government says that India expects the imports of steel from China, S.Korea, and Japan to slow down.
A government source who is directly familiar with the situation said on Thursday that India expects steel imports to slow down after temporary tariffs are imposed this week. India, the second largest producer of crude iron and steel in the world, announced a temporary duty or safeguard provision of 12% on certain steel imports. This duty will last for 200 days. India's imports for finished steel products increased for the second consecutive year in fiscal 2025, with shipments reaching an all-time high. This trend has continued as shipments from China and South Korea have also been increasing. The government source who refused to be named due to the sensitive nature of the discussions said that South Korea, China, and Japan were the main exporters and imports of steel from these countries should decrease. The government source stated that South Korean POSCO and Hyundai, two of the largest steel suppliers to India, are opposed to the safeguard duty on imports. POSCO and Hyundai didn't immediately respond to our request for a comment.
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Mining group Eramet keeps 2025 output targets despite Q1 setbacks
Eramet, a French mining company, maintained its full-year production targets on Thursday despite lower manganese and Nickel volumes which contributed to flat sales in the first quarter. The company reported quarterly sales adjusted to 742 million euros (842 million dollars) and said that sales volumes at its manganese mining in Gabon were down 15% on an annual basis due to a strike by workers and logistical issues at Owendo Port. Eramet, the Indonesian nickel ore miner, attributed this decline to destocking of local processing plants. The Chairwoman and CEO Christel Bories also attributed the "more difficult" than expected first quarter to a broader market uncertainty related to trade and geopolitical conflicts. The group maintained its production forecasts for 2025, which would see the marketed volumes in Gabon & Indonesia rebounding after a decline last year. The group reported that it sold its first lithium in Argentina during the first three months after beginning production of the battery metal in December. The company stated that it expected the full-year production to be lower than its target range of 13,000-13,000 metric tonnes due to a delay in equipment used for the concentration process. The geopolitical uncertainty caused by President Donald Trump’s tariff offensive has clouded metal markets, which have already been struggling with slow Chinese growth. Eramet, which reported its 2024 results back in February, had stated that it would reduce spending and increase productivity this year in response to the persistent weakness of its markets. Eramet said that it had limited exposure to U.S. Tariffs, but could be affected if China reshuffles its trade. BHP Group, one of the largest global mining companies, has warned that a trade war in escalation could be harmful to the world's economy. Reporting by Gus Trompiz, Editing by Himani Sakar.
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Eni confirms buyback and cuts capital expenditure, despite posting a smaller-than-expected profit drop
Eni, the Italian energy company, reported Thursday a net profit drop of 11% for the first three months adjusted. This was less than expected. The adjusted net profit was 1.41 billion euro ($1.60 billion), down from 1.58 million euros in the first three months of 2024. However, it was above the analyst consensus of 1,15 billion euro compiled by the firm. As a result of lower oil prices, state-controlled group announced it would reduce its planned net capital expenditures this year below 6 billion euro as part several mitigation measures worth 2 billion euros. Eni has confirmed its distribution strategy, which shareholders will be voting on in May. This includes a 1.5 billion euro share buyback. A weakening economy has led the group to lower its Brent oil price expectation from $75 per barrel to $65. The forecasts for natural gas prices and refining margins were also revised downward. This had a negative impact on the underlying cash flow of operations (CFFO) which was now estimated at 11 billion euro this year. ($1 = 0.8821 euro) (Reporting and editing by Francesca Landini)
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ITA reports that Myanmar's Wa State held a meeting to discuss the issuance of mining permits.
The International Tin Association (ITA), a group of tin mining companies, announced on Thursday that a meeting was held in Myanmar's Wa State on Wednesday. The ITA reported that mine investors, leaders of the mining bureau, and representatives from the Manxiang area attended the meeting. This clarified the application process for mining, concentrator, and prospecting permits. The ITA has warned that government fees are likely to increase, and this could put pressure on low-altitude mining and small- to medium-sized concentrators. Wa State is responsible for 70% of Myanmar's exports. Myanmar is the third largest producer in the world and China is its biggest supplier. The meeting was originally scheduled for the 1st of this month, but it had to be postponed due to a devastating earthquake. Traders were encouraged by the prospect of a meeting, as they believed that a mining ban in the area which had been in place for almost two years could be lifted soon. Wa State, unlike the majority of Myanmar which is controlled by the military junta maintains its own military, political system and economy. It's a state inside a country. The United Wa State Army (the militia affiliated with Myanmar's ethnic Wa minorities) controls large areas of Wa State. In August 2023, it suspended all mining in the areas that it controlled to protect its resources. (Reporting and editing by Christian Schmollinger, Muralikumar Aantharaman, and Lewis Jackson)
What Germany's planned expenditure spree might mean for the economy
On Tuesday, the lower house of Germany's parliament will vote on a massive increase in borrowing. This could help boost Europe's biggest economy and spur growth throughout the region.
German chancellor-in-waiting Friedrich Merz reached an agreement with the Greens on Friday on a massive increase in state borrowing, just days before a parliamentary vote on the issue.
The parties hoping to form the next government have agreed to create a special infrastructure fund of 500 billion euros ($545 billion), and to remove the debt restrictions on defence investments.
What the future plans for Europe's biggest economy could mean in terms of growth and debt:
Could the spending boost Germany's ailing economy?
According to economists yes, according to the economists
The German DIW Economic Institute said that the planned infrastructure fund could alone increase economic output by more than two percentage point per year in the next ten years.
DIW stated that a growth rate of 2,1% in 2026 is now expected instead of the previous 1.1%.
A second institute, IfW, also revised its growth estimate for Germany in 2026, predicting a 1.5% expansion on the backs of expected increases in public expenditure.
In its report for the month of January, the Economy Ministry said that fiscal policy plans can help to stabilise expectations and give planning security.
WHICH SECTORS ARE SET TO PROFIT MOST?
Construction can benefit from the fund set up to upgrade Germany's crumbling infrastructure.
Also, the defence industry stands to benefit. The "debt-brake" - a strict limit on German borrowing imposed by the current coalition – would be removed from the constitution. This would allow for higher defence budgets.
How much more debt will Germany take on?
Lots.
The debt ratio of Germany was 64% of its gross domestic product last year. This is lower than other industrialised countries like the United States or France.
Joerg Kraemer, chief economist at Commerzbank, expects this level to rise by 10 percentage points in the next few years due to the special fund created for infrastructure.
If defence spending was increased to 3.5% of GDP, the debt ratio would increase by 2.5 points per year.
Kraemer stated that the government debt ratio in 10 years could reach 90%. However, this is also dependent on inflation, and therefore, not easy to predict.
Friedrich Heinemann, a ZEW economist, said: "Germany would then quickly join the EU's most indebted countries." He predicted that Germany's debt could reach 100% in 2034.
WHAT WOULD THIS DO TO GERMANY'S TRIPLE A CREDIT RATING
Not necessarily. Eiko Sievert, a Scope analyst, said that the spending plans may increase Germany's level of debt to 72% of its gross domestic product in 2029. This is below the previous record of 80%, which was set after the global financial crises of 2010, when Germany maintained its AAA rating.
Sievert stated that the future of this possibility depends on the implementation and success of the necessary reforms in politics to boost competitiveness and economic development.
CAN GERMANY FIND SUFFICIENT LENDERS?
Germany is a popular borrower because of its top credit rating. German government bonds would need to be more attractive to investors if they are to continue to be so.
Kraemer, Commerzbank, says that investors are likely to demand a higher risk premium for German government bonds.
Could Germany's Spending Spree Influence ECB Policy?
It is possible that the injection of hundreds of billions in the German economy, as well as the wider euro zone economy, could lead to inflation.
The ECB must take into consideration that inflationary pressures will increase again due to the planned expansionary fiscal policies in Germany, said Cyrus de la Rubia. Chief economist at Hamburg Commercial Bank. Reporting by Rene Wagner and Maria Martinez, Writing by Rachel More, Editing by Gareth Jones Christina Fincher, Tomaszjanowski
(source: Reuters)