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First visit by Serbian President Aleksandar Vucic to Ukraine
Aleksandar Vucic, Serbia's populist president and a friend of Moscow, visited Odesa in Ukraine on Wednesday for a regional conference. It was the first visit to the country by the leader during his 12-year tenure. Vucic’s office released a statement saying that he will travel to Ukraine to attend the Ukraine-Southeastern Europe Summit at the Black Sea Port of Odesa. This week, Odesa was the target of a Russian drone attack and missiles. The summit was expected to bring together senior politicians from 12 nations in Southeastern Europe. Gazprom, Gazprom NEFt and Gazprom are the majority owners of the only oil refinery in Serbia. Belgrade, despite refusing to join Western sanctions against Russia for its invasion of Ukraine has condemned Moscow’s policies at the United Nations. It has also expressed support for Ukraine’s territorial integrity. Vucic also met Ukrainian President Volodymyr Zelenskiy at least 3 times. Belgrade recognizes Ukraine as a whole, including the territories that Russia has seized since 2014. Kyiv, on the other hand, refused to acknowledge Kosovo's 2008 independence, Serbia's former predominantly Albanian southern province. SVR, Russia's foreign intelligence service, claimed that Belgrade had "stabbed in the back" by selling weapons and ammunition to Ukraine through intermediaries. Boris Tadic was the only Serbian President to visit Ukraine after 2006, when the Balkan nation became independent. Petro Poroshenko visited Serbia as Ukraine's former president in 2018. (Reporting and editing by Alex Richardson; Aleksandar Vasovic)
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Gold prices rise as US-China trade tensions persist and inflation data is in focus
Investors remained cautious on Wednesday, as they awaited key inflation data which could give clues to the Federal Reserve on its next policy move. As of 0808 GMT, spot gold rose 0.7% to $3344.93 per ounce. U.S. Gold Futures increased 0.7% to $3366.40. U.S. officials and Chinese officials announced on Tuesday that they had reached an agreement on a framework for re-establishing their trade truce and removing China's export limitations on rare earths. The talks did not show any signs of a lasting resolution to the long-standing trade disputes. In April, both the U.S.A. and China implemented tit-fort-tat tariffs. This triggered a trade conflict. Both countries agreed, following negotiations in Geneva last week, to lower their tariffs. Han Tan, Exinity Group's chief market analyst, said: "Markets know that the road to a trade agreement between major economies will not be a simple one." "Gold should be supported so long as the global trade tensions are at risk of escalating or staying elevated longer." Investors could get more information on the U.S. Federal Reserve policy by watching the U.S. Consumer Price Index report at 1230 GMT. Tan said that the markets are expecting a rise in CPI, which will keep the odds of Fed rate reductions in check. Most economists polled believe that the Federal Reserve will hold interest rates for at least a couple more months. This is because there are still risks of inflation resurging due to President Donald Trump’s tariff policies. Silver spot was also down 0.1% at $36.54 an ounce. This is near the highest price in more than a decade. "We expect that silver will reach $38/oz within the next few months." UBS stated that market deficits and a weaker USD are the keys to higher prices. A test of $40/oz could be possible. Platinum increased 2.9% to $1.257.06, reaching its highest level since may 2021. Palladium rose 2.1% to $1.081.90. (Reporting by Anushree Mukherjee in Bengaluru; Editing by Joe Bavier)
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Solar demand and lower prices are driving down spot prices
The European electricity market saw its prices rise on Wednesday as a result of a combination of a slightly lower demand and a higher solar energy generation. LSEG's analysis revealed that the growth of solar power in Germany, its main producer country, outweighed a decline in wind power. The increase in coal-to power production in Germany also exceeded a decrease in gas power in the region. At 0750 GMT, the French baseload day-ahead was trading at 25.5 Euros ($29.12 per megawatt hour), 8.9% lower than its previous close. The German baseload on Thursday was not traded, and the indicated price on Friday was 10% lower than the previous close. LSEG data indicated that the German wind power production was expected to drop by 2.4 gigawatts per day to 12.5 GW for Thursday. The German solar power generation was projected to rise by 3 GW, to 20.8 GW. The French nuclear capacity remained unchanged at 71%. The demand for electricity in Germany will be down by 300 MW per day to 53.5 GW. In France, it is expected to rise by 100MW per day to 43.7GW. This leaves the total usage of the region at a lower level. The temperature was expected to increase between 1 and 2,7 degrees Celsius until Thursday. Warm temperatures usually boost the European carbon market as they require additional energy to cool devices, which is often generated using carbon-intensive fossil energies. The German baseload power for the year ahead was up by 2.4% to 89.0 Euro/MWh. The French equivalent, at 66.4 Euros, was 5.7% more expensive. The benchmark European carbon contract, for delivery in December 2020, rose by 1.8% to a little under 74 euro per metric ton. Scientists at the EU Climate Information Programme C3S said that May was the second warmest month since records began in this year. A record-breaking Heatwave in Greenland was a result of climate change.
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Sri Lanka increases household electricity tariffs by 15% - power regulator
Sri Lanka's power regulator announced on Wednesday that the country will raise its household electricity tariffs by 15 percent. This is a major step for the island nation in its efforts to secure its next payment of $2.9 billion from the International Monetary Fund. K.P.L. reports that the power price for industries will increase by 20,5%, while the electricity prices of businesses in the tourism industry, which is a major foreign exchange earner, will rise by 20,2%. Chandralal is the chairman of Sri Lanka's Public Utilities Commission. The new tariffs will be in effect at midnight. The new government of Sri Lanka, headed by President Anura Dissanayake, reduced electricity prices by 20 percent in January. This raised concerns about cost recovery for the state-owned Ceylon Electricity Board's monopoly on power. Sri Lanka had to increase its power tariffs to get board approval for the fifth tranche of $344m from the IMF. Sri Lanka's economy collapsed in 2022 due to a severe currency crisis, but it has recovered faster than expected. It grew by 5% in the last year after a bailout in March 2023 from a global lender. (Reporting and editing by Sudipto Ganuly; Uditha Jayasinghe)
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Iron ore prices rise as traders celebrate Sino-US trade progress
Prices of iron ore futures rose on Wednesday as progress was made in trade negotiations between the two world's largest economies. However, uncertainty about a final deal and a softening of steel demand limited further gains. After two days of intense negotiations in London, officials from the United States, the largest iron ore buyer in the world, and China, which is the second-largest consumer, have agreed on a framework that will put their trade truce on track. This has helped to support the prices. China buys over two thirds of the global seaborne supply. The day-time closing price of the most traded September iron ore contract at China's Dalian Commodity Exchange was 707 yuan (98.39 dollars) per metric ton. The contract lost nearly 1% Tuesday. As of 0720 GMT, the benchmark July iron ore traded on Singapore Exchange was up 0.87% at $95.2 per ton. Coking coal and coke, which are used to make steel, have gained 1.1% and 1.31% respectively. Steel benchmarks at the Shanghai Futures Exchange rose on higher raw material costs, but soft downstream demand capped gains. Rebar grew by 0.67%. Hot-rolled coils climbed 0.78%. Wire rod grew 0.43%. Stainless steel grew 0.48%. Galaxy Futures analysts said that "Steel consumption is rapidly declining as we enter the off-peak season." The state-backed China Iron and Steel Association, amid growing concerns about market stability and the spillover effect of fierce price wars among domestic automakers on steel markets, called for a boycott on Tuesday. ($1 = 7.1860 Chinese Yuan) (Reporting and editing by Sherry Jackson, Amy Lv)
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Israeli strikes kill 35 people in Gaza; many are near a medical aid site, say medics
Local health officials reported that Israeli military strikes in Gaza killed at least 35 Palestinians on Wednesday. The majority of the victims were at a Gaza Humanitarian Foundation aid site in central Gaza. At least 25 people died and dozens of others were injured as they approached a site for aid near the former settlement Netzarim. Medical officials from Shifa Hospital and Al-Quds Hospital confirmed this. They added that ten other people died in Israeli airstrikes in Khan Younis, in the southern part of the enclave. The Israeli military has not yet commented. The army claimed that it had fired warning shots on Tuesday when Gaza officials reported 17 deaths near another GHF aid station in Rafah, in the southern Gaza Strip, to keep "suspects", who were approaching troops, at a distance. Benjamin Netanyahu, the Israeli prime minister, said that there had been "significant" progress in the efforts to free the remaining hostages from Gaza. However, it was still "too early" to hope that a deal will be reached. Despite the efforts of the United States and Egypt to restore a Gaza ceasefire, neither Israel or Hamas have shown a willingness to compromise on their core demands. Each side blames the other for not reaching a deal. Hamas has denied any knowledge of new ceasefire proposals. In an attack on October 7, 2023 that was Israel's deadliest day, Hamas militants killed 1,200 people - most of whom were civilians - and took 251 hostages. According to Gaza's health authorities, Israel's campaign has killed more than 55,000 Palestinians since its beginning, the majority of whom were civilians. It also flattened a large part of this coastal enclave. (Reporting and editing by Michael Perry; Nidal al Mughrabi)
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South African macadamia growers look to new markets following US tariff shock
Gene Likhanya, who built his macadamia-nut farm in South Africa's Madimbo Valley over the past two decades with his personal savings, is now facing a new challenge due to U.S. tariffs on imports. This has forced him to find other markets. South Africa is the top producer of macadamia nut, which is known for its distinctive buttery flavor and is coveted by many for their perceived health benefits. The U.S. ranks second behind China as the largest market for the nuts. Likhanya is ambitious for his business, which he has grown to 78 employees and has produced just 25 tonnes of nuts in the past year. He wants to triple production over the next 4 years. However, President Donald Trump’s desire to increase tariffs may disrupt this. Likhanya and other macadamia nuts farmers are already searching for alternative markets. I feel there is so much more that we can do to explore international markets. We are talking to certain markets. "We're talking with India," Likhanya told an interviewer at his farm. India has a population of 1.5 billion who are also interested in macadamia. There's always a plan B. Other South African farmer associations have warned about the potential destruction caused by U.S. Tariffs. Citrus growers whose $100 million annual exports into the U.S. could be affected by tariffs. Likhanya is a member of the board at Macadamias South Africa. The main industry body representing growers. She described the tariff standoff as "loss-lose" and expressed hope that it could be resolved. "America imports kernels which are further processed by them. These (processing jobs) are under threat. It's either a win-win situation or a lose-lose one, and I don't want to be in that kind of situation," he said.
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Low grade Australian iron ore changes global benchmark
Platts, a pricing service, said that the long-standing global benchmark price for iron ore cargoes traded globally will be adjusted by 2026 in order to reflect the declining quality of ore supplied by Australia as its top supplier. The global price reporting agency, PRA, announced on Tuesday that Platts (part of S&P Global Commodity Insights) proposed a revision to its benchmark index specification to reduce the iron content to 61% from 62%, due to the decreasing quality of Australian ore fines. In an announcement on its website, it stated that the updated baseline specifications would more closely reflect those of major medium grade fines traded on the market. Since decades, the benchmark 62% Iron Ore Index has been used as a contracting tool between international buyers and miners. Rio Tinto's flagship product, Pilbara Blend fines, now contains less iron than 61% of the original, according to multiple sources. Rio Tinto didn't immediately respond to a request for a comment sent via email. The Platts Benchmark Prices Futures, Options and Swaps on the Singapore Exchange is one of the largest iron ore futures market in the world. Pei Hao is a senior analyst at Freight Investor Services, an international brokerage based in Shanghai. Platts also proposes to reduce the iron content of its benchmark 62.5% Fe China Iron Ore Spot Lump Premium to 62%. According to the notices, both changes will come into effect on January 2, 2026. Platts published a daily basis spread of 62%/61% on Tuesday to reflect the calculated value difference between current and proposed specs. Recently, other price reporting agencies, including Mysteel and Argus, launched new iron ore indices of 61%.
South Africa's Telkom resumes dividends, shares jump 7%
Telkom, the South African telecoms firm, reported a 62.3% increase in its full-year earnings on Tuesday. The company also increased its free cash flow. This allowed it to resume dividends after a suspension of four years and even sweeten them with a special payout.
The operator of South Africa’s largest fixed-line network, announced in 2020 that it would suspend dividends beginning 2021 for the next three years to save cash for spectrum auctions.
After reaching its initial goal, the operator under pressure delayed dividend payments due to challenging market conditions.
"This year, our strong performance and successful strategic execution have allowed us to distribute both a regular and special dividend. Telkom announced that the group would return 1.3 billion Rand ($73.28million) to shareholders.
Telkom announced a final dividend per share of 163 cents and a special distribution of 98 cents, thanks to the proceeds of Swiftnet's mast and tower division.
The operator has also raised its mid-single-digit revenue growth guidance from low-single-digit to mid single-digit. This is a result of its industry-leading revenue growth for mobile services and high fibre connectivity ratio.
Telkom shares soared by 7% at 0849 GMT to 42.81 Rands after rising 10% on the opening day.
Telkom, which is majority owned by the government and continues to operate, reported a headline profit per share of 467.5 cents for the year ending March 31.
The revenue increased by 3.3%, to 43.8 billion Rands, exceeding expectations. This was due to the strong growth of mobile service revenues, which grew 10.2%, as well as fibre-related data revenues, which grew 10%. LSEG surveyed analysts who had predicted revenue of 43.5 billion Rand.
Telkom's data and strategy are helping them gain substantial market share, according to SBG analyst Nadim Mohammed.
The company's free cash flow increased to 2.8 billion Rand from 424 millions rand due to cost-optimization, revenue improvement and a disposal program.
"Cash generation has been the best Telkom has ever seen for a long time." "They also had large assets disposals during the period, and these have also helped to reduce debt on their balance sheet," Peter Takaendesa said. Chief Investment Officer of Mergence Investment Managers.
(source: Reuters)