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China's demand for iron ore is countering Australia's supply outlook.
The price of iron ore futures fluctuated within a narrow range on Tuesday as traders assessed the balance between the strong demand for near-term supply in China and the possibility of an improved supply coming from Australia, a major producer. As of 0310 GMT, the most traded September iron ore contract at China's Dalian Commodity Exchange remained unchanged at 706.5 Yuan ($98.45). The benchmark July Iron Ore at the Singapore Exchange fell 0.18% to $93.7 per ton. According to Chinese consultancy Mysteel, hot metal production, which is a measure of iron ore consumption, increased 0.24% week-on-week to 2.422 millions tons as of 20th June. Analysts at ANZ said that "volumes have remained around 2.4 millions tons since April. This suggests resilience on the largest steel market in the world." Hexun Futures stated in a report that the market still prices in seasonal demand weakness. Mysteel said in a separate report that "Chinese iron ore prices continued to fall during the period of June 16-20 as the seasonal decline in steel consumption during the summer undermined the demand for this steelmaking material." Rio Tinto, world's biggest iron ore producer and Hancock Prospecting enter a joint venture to develop the Hope Downs 2 Project in Western Australia. Rio announced in a press release that the two pits of iron ore will have an annual combined production capacity totaling 31 million metric tonnes. Coking coal and coke, the other steelmaking ingredients traded in a sideways manner. Jiang Mengtian is the chief analyst of Horizon Insights. He said that the Middle East conflict intensification has had little direct impact on ferrous prices, but the coking coal price did benefit from the energy concerns. The benchmarks for steel on the Shanghai Futures Exchange have lost ground. Rebar fell 0.13%, while hot-rolled coils dropped 0.16%. Wire rod slipped 0.75% and stainless steel was down around 1%.
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Gold nears 2-week low following Trump's announcement of Israel-Iran ceasefire
Gold prices dropped to their lowest level in nearly two weeks on Tuesday, as risk appetite increased after U.S. president Donald Trump announced that Iran and Israel agreed to a truce. This lowered demand for safe haven assets. As of 0257 GMT spot gold fell 0.5% to $3351.47 per ounce after reaching its lowest level since the 11th of June earlier in session. U.S. Gold Futures fell 0.9% to $3365.30. Ilya Spirak, the head of global macro for Tastylive, said: "It appears that there is a lot of geopolitical risks leaving the market in the near-term after we've seen signs of deescalation between Iran and the U.S." Trump announced that Israel and Iran would cease all hostilities. This could end the 12-day conflict which saw millions of Iranians flee Tehran, and raised fears about further escalation. Israel did not immediately comment. Israel has not yet responded. An Iranian official confirmed earlier that Tehran had agreed on a ceasefire. However, the country’s foreign minister stated there would be no cessation unless Israel stopped their attacks. Oil prices fell to their lowest level in a week after Trump announced a ceasefire between Israel and Iran. Michelle Bowman, Vice-Chairperson for Supervision at the U.S. Federal Reserve, said that it is time to lower interest rates due to possible risks on the job market. Investors are awaiting the testimony of Fed Chairman Jerome Powell to be given before the House Financial Services Committee on Tuesday. Powell has been careful to signal near-term ease. Spivak stated that "the bias is in favor of gold prices, but there could be a short-term correction and an increase in the dollar in the near term if Powell can convince markets they won't cut more than two times this year." In an environment with low interest rates, gold tends to flourish. Silver spot fell by 0.1% at $36.10 an ounce. Platinum dropped 0.2% to 1,292.39 and palladium was down 0.4% to $1,000.05. (Reporting and editing by Rashmia Aich, Mrigank Dhaniwala and Anmol Chaubey from Bengaluru)
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Metals are on the defensive after Iran-Israel truce announcement
On Tuesday, the London Metals Exchange (LME) and Shanghai Futures Exchange (SFE) were largely rangebound as caution reigned following the announcement by U.S. president Donald Trump of the Iran-Israel ceasefire. As of 0103GMT, LME's three-month copper rose 0.04% to $9671.5 per ton. SHFE's most-traded Copper gained 0.09%, to 78400 yuan. Trump stated in a post to his Truth Social website that a "complete" and "total" ceasefire would be implemented between Israel and Iran with the aim of ending the 12-day conflict. The commodity market has been unpredictable this year, and traders and investors are likely to wait and see how things turn out. As news of a ceasefire eased fears of supply disruptions, the U.S. Dollar fell and oil dropped to its lowest level in over a week. The greenback price of commodities is cheaper for buyers who hold other currencies. LME Aluminium fell by 0.77%, to $2.568.5 per ton. On Monday, it had reached a three-month peak on fears that the conflict could push up energy costs and disrupt supply. SHFE aluminium fell 0.37% to 20 345 yuan. LME zinc fell 0.37%, to $2677 per ton. Tin dropped 0.13%, to $32,650, and lead declined 0.05%, to $2,000. Nickel rose 0.21% to $14.835. SHFE nickel fell 0.58% to reach 117,280 Yuan. Zinc rose 0.68% to 22080 yuan, while lead increased 0.3% to 16920 yuan. Click or to see the latest news in metals, and other related stories. Data/Events (GMT) 0500 Japan Chain Store sales YY May 200800 Germany Ifo Business climate, current conditions, expectations New Jun 1400 US consumer confidence Jun ($1 = 7,1790 Chinese Yuan) (Reporting and editing by Hongmei LI; Sumana Niandy).
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Australia starts formal sale process of Gupta’s Whyalla Steelworks
The Australian government officially opened on Tuesday the sale process of commodity tycoon Sanjeev Gupta’s Whyalla Steelworks. It said that global steelmakers interested in expanding into low-emission manufacture have shown strong interest. In February, the steel plant in South Australia, whose operating company owed creditors tens and tens millions of dollars, was placed into administration. This forced the federal and state governments to provide a bailout package of A$1.9 billion ($1.23billion). Federal Industry Minister Tim Ayres announced that "selected prospective buyers" now have access to a secured data room. This allows for initial due diligence, and parties can prepare non-binding indication offers. A number of potential buyers have expressed an interest in purchasing and transforming integrated operations. Ayres stated that the independent sale process would be led by administrator KordaMentha, and sales advisors 333 Capital. Gupta’s family conglomerate GFG Alliance did not respond immediately to a comment request. GFG reported in March that it was the largest creditor of Whyalla Steelworks with A$536m ($347m). Since March 2021, when its main backer, the supply chain finance company Greensill, declared insolvency, the privately-held conglomerate has refinanced its global business in steel, aluminum and energy. Liberty Steel East Europe was placed into administration at the end of last year. ($1 = 1.5444 Australian dollars)
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AVZ Minerals will resume legal proceedings against DRC in dispute over disputed Lithium deposit
AVZ Minerals, an Australian company, announced on Tuesday that it would resume legal proceedings against the Democratic Republic of Congo over mining rights for the Manono Lithium deposit. The parties had been unable to settle a dispute regarding the deposit. Unresolved issues could pose a problem for the plans of California-based metals company KoBold Metals to purchase AVZ Minerals stake in one world's biggest hard rock lithium deposits. AVZ originally held the permit for the Manono Project, but the DRC mines ministry revoked it in 2023 on the grounds that the project hadn't advanced fast enough. The rights were granted later to a unit of Zijin Mining, which prompted AVZ, to seek relief from both the International Court of Arbitration of International Chamber of Commerce and the International Centre for Settlement of Investment Disputes. In late May, the AVZ temporarily suspended the ICSID proceedings after the U.S. Government encouraged the parties to resolve the dispute. AVZ's shares were suspended by DRC in May 2022, and then delisted from the stock exchange two years later, due to a dispute. DRC said that it did not interact with AVZ at all during the suspension, and therefore the suspension is now void. The company announced that the ICSID proceedings will resume. KoBold Metals didn't immediately respond to our request for comment. (Reporting and editing by Sherry Phillips and Alan Barona in Bengaluru, and John Biju in Bengaluru)
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Trump's announcement of a ceasefire between Israel and Iran has caused oil prices to fall over a week.
The oil prices fell on Tuesday, to their lowest levels in over a week. U.S. president Donald Trump announced that a ceasefire had been reached between Iran and Israel. This eased concerns about a supply disruption. Brent crude futures dropped $2.69, or 3.76%, to $68.79 per barrel at 0006 GMT. This follows a session in which Brent crude futures had fallen more than 4% and reached its lowest level since the 11th of June. U.S. West Texas Intermediate Crude fell $2.7 or 3.94% to $65.46 a barrel after hitting its lowest level since June 9 during the session. It also dropped around 6%. Trump announced Monday that Israel has agreed to a full ceasefire with Iran. He added that Iran would begin the ceasefire immediately and Israel 12 hours later. The war will end officially after 24 hours if both sides keep peace. He stated that a "completely and totally" ceasefire would be implemented to end the conflict between both nations. Tony Sycamore is an analyst at IG. He said, "With the ceasefire announcement we now see a continuation of risk premium built in to crude oil prices last week almost disappear." Iran is OPEC’s third largest crude producer. The easing of tensions will allow Iran to export more oil, which would prevent any supply disruptions. This has been a major reason for the recent spike in oil prices. The oil contract prices fell by over 7% in the previous session, after reaching five-month highs following the U.S. attack on Iran's nuclear facility over the weekend. This stoked fears of an expansion in the Israel-Iran war. "Technically speaking, the overnight sale reinforces a resistance layer between approximately $78.40 ($October 2024 to June 2025 highs), and $80.77 ($the year-to date high). It's clear that something unexpected and detrimental to crude oil supply will be required to break through this resistance layer," Sycamore said.
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Investors' reactions after Trump announces ceasefire between Iran & Israel
Donald Trump, the U.S. president, said Monday that an "absolute and complete" ceasefire will be implemented between Israel and Iran in order to end the conflict between these two nations. Trump wrote about his Truth Social website that "On the assumption everything works as it is supposed to, which it will, i would like to congratulate Israel and Iran for having the stamina, courage, and intelligence to end, what we should call, 'THE 12-DAY WAR.'" After Trump's announcement that came after Wall Street closed trading, U.S. crude oil futures fell. S&P 500 futures increased when trading resumed. Comments ROBERT PAVLIK, SENIOR PORTFOLIO MANAGEMENT, DAKOTAWEALTH "I think that it will be huge." We could have a very limited Iran. We don't need to worry about a regime change if we have a country with the same government but no nuclear capabilities. A possible attack on Israel is off the table and there's no threat to US troops. The market will like this. "I expect a more positive reaction from the market tomorrow, as we move forward." ART HOGAN, CHIEF MARKET STRATEGIST, B. RILEY WEALTH "If this is true, then I'd say it's a positive for the market, and futures are moving in that direction." Talk is cheap when it comes to these things. I do think that the market, and the rest the world, would prefer to see this issue resolved peacefully and not escalate any further than we have already seen. "I think the market's action this afternoon was leaning towards that, and I hope this is the next move in that direction. We don't need to worry about the next escalation which will never be pretty." JACK ABLIN, CHIEF INVESTMENT OFFICER, CRESSET WEALTH ADVISORS, PALM BEACH, FLORIDA This removes some of geopolitical uncertainties surrounding the markets. However, most equity investors have shrugged off the uncertainty. "I think it is certainly an incrementally positive, but I do not think that it will be a catalyst for a new bull market." It certainly sounds like an important milestone and I hope that it is true." JAKE DOLLARHIDE is the CEO of LONGBOW ASSET MANAGER, TULSA. The higher oil prices, as well as the geopolitical risks have been a major factor in the decline of equities. A ceasefire or an end to the conflict could help solve both issues. This may be the match to spark a continuation of today's rally." (Compiled by Global Finance & Markets Breaking News)
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Investors' reactions after Trump announces ceasefire between Iran & Israel
Donald Trump, the U.S. president, said Monday that an "absolute and complete" ceasefire will be implemented between Israel and Iran in order to end the conflict between these two nations. Trump wrote about his Truth Social website that "On the assumption everything works as it is supposed to, which it will, i would like to congratulate Israel and Iran for having the stamina, courage, and intelligence to end, what we should call, 'THE 12-DAY WAR.'" After Trump's announcement that came after Wall Street closed trading, U.S. crude oil futures fell. S&P 500 futures e-minis increased slightly after trading resumed. Comments ART HOGAN, CHIEF MARKET STRATEGIST, B. RILEY WEALTH "If this is true, then I'd say it's a positive for the market, and futures are moving in that direction." Talk is cheap when it comes to these things. I do think that the market, and the rest the world, would prefer to see this issue resolved peacefully and not escalate any further than we have already seen. "I think the market's action this afternoon was in this direction. Hopefully, this is the next move in this direction so that we won't need to worry about the next escalation which will never be pretty." JACK ABLIN, CHIEF INVESTMENT OFFICER, CRESSET WEALTH ADVISORS, PALM BEACH, FLORIDA This removes some of geopolitical uncertainties surrounding the markets. However, most equity investors have shrugged off the uncertainty. "I think it is certainly a positive step, but I do not think that it will be a catalyst for launching the next bull market." It certainly sounds like an important milestone and I hope that it is true." JAKE DOLLARHIDE is the CEO of LONGBOW ASSET MANAGER, TULSA. The higher oil prices, as well as the geopolitical risks have been a major factor in the decline of the stock market. A ceasefire or an end to the conflict could help solve both issues. This may be the match to spark a continuation of today's rally." (Compiled by Global Finance & Markets Breaking News)
CERAWEEK-Exxon CEO states not trying to buy Hess however considers its Guyana stake
Exxon Mobil CEO Darren Woods on Monday stated his business is attempting to establish it has rights over Hess Corp's Guyana properties in its dispute with Chevron, not buy the company itself.
In his very first public remarks on the company's pursuit of an arbitration case that might obstruct Chevron's $53 billion offer for Hess, Woods stated Exxon would not have actually waited for Chevron to reveal its Hess offer if it had actually wished to purchase Hess.
We're basically defending what our company believe is a. fundamental right, Woods informed at the CERAWeek energy. conference in Houston. Exxon is trying to verify and secure. the rights because contract gives the existing partners.
Chevron and Hess have stated they disagree with Exxon's. interpretation of the joint operating arrangement that governs the. consortium accountable for all of Guyana's oil production and. which Exxon claims consists of a right of first refusal.
The file has actually not been revealed. Hess has said the. offer may not be able to close by its prior estimate of mid-2024.
PRIZED PROPERTY
Exxon does not rule out obtaining Hess' whole 30% share. in the giant Stabroek block offshore of Guyana, which would take. its stake to 75%. Exxon currently holds a 45% stake with Hess. and China's CNOOC Ltd as minority partners.
Stabroek is the reward in Chevron's bid for Hess. It is the. site of the largest oil discoveries in practically 20 years and is. expected to produce more than 1.2 million barrels of oil and. gas each day by 2027.
A prospective acquisition of Hess' properties in Guyana would be. the last choice in a three-stage procedure, Woods said.
Exxon first wishes to develop that it holds. preferential rights over Hess Guyana's property, Woods stated. Then. it intends to identify the Hess asset's worth with partners before. If it makes sense for Exxon to take on the, considering. financial investment required for holding a bigger share of the block, the. CEO said.
We've got to surpass the very first obstacle, which is an. alignment, an agreement that a preemption right exists in the. agreement, Woods said. He left open the possibility of an offer. for some or all of the stake.
I don't feel locked into a 75% number, the amount of Exxon. and Hess's current stakes, Woods stated. That is among the. choices. And one of the considerations with that choice would be. the capital requirements that we comfortable with.
A Chevron spokesperson did not respond to request for comment on. Woods' remarks.
TIMING
Exxon comprehends Hess' desire to deal with the matter and. will be very cooperative and try to help with a quickly. resolution of the preemption of rights disagreement, Woods stated.
He stated he does not have a great view on timing for. last resolution on the destiny of Hess' properties. The arbitration. case could last 5 to six months, another executive had stated.
Figuring out how Chevron's proposed acquisition of Hess. will translate into a worth for Hess property in Guyana will be the. 2nd stage of dispute and one that will not be a. uncomplicated black and white procedure, Woods said.
There will be, you know, a great deal of conversation that. occurs in between the celebrations, the CEO stated.
Woods declined to talk about whether he would satisfy this. week with Chevron CEO Michael Wirth or Hess CEO John Hess.
Chevron and Hess were first to reveal in filings that. Exxon planned to bring the dispute to arbitration.
Among the obstacles of this particular offer is it. went public, Woods said. A lot of those discussions (about. agreement terms) needed to occur and had not been happening.
Exxon does business with Chevron all around the world. and will continue to have long partnerships with Chevron, Woods. stated.
This is a service issue, Woods said. We are going to. be a positive force as we work to get to the ideal answer..
(source: Reuters)