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Iron ore gains, but reports a weekly loss due to tariff issues
Dalian iron ore contracts fell on Friday despite ending a nine session losing streak. The market was weighed down by news of China's steel production cutbacks and the intensifying trade conflict between Washington and Beijing. The May contract for iron ore on China's Dalian Commodity Exchange grew 0.19%, to 774 Yuan ($106.81), per metric ton. This week, the contract dropped 3.49%. As of 0712 GMT, the benchmark April iron ore traded on Singapore Exchange was up 0.04% at $100.4 per ton. It has lost 1.99% this week. Analysts at ANZ said that Beijing's efforts in support of economic growth boosted sentiment on commodity markets. China announced more fiscal stimuli on Wednesday and pledged to increase efforts to boost consumption and domestic demand. Chinese officials left the door wide open on Thursday to add more stimulus measures, on top of what was announced this week at the annual parliament meeting. Washington imposed an additional 10% duty on Chinese products on Tuesday, bringing the total tariff to 20%. Beijing retaliated. Hexun Futures said that the steel production cutbacks in China could increase iron ore supplies, increasing pressure on ore price. China's steel industry will be restructured through production cuts. However, it has not announced any targets in its latest intervention to reduce overcapacity. Despite this, China's imports of iron ore in the first half of 2025 dropped by 8.4% on an annual basis, due to weather-related disruptions in Australia, a major producer. Coking coal and coke, which are used to make steel, also rose on the DCE, by 1.79% each and 1.1% respectively. The Shanghai Futures Exchange saw a decline in most steel benchmarks. Hot-rolled coils fell 0.85%, rebars 0.67% and wire rod 0.14%. Stainless steel increased by 0.34%. $1 = 7.2467 Chinese Yuan (Reporting and Editing by Subhranshu Sahu, Sumana Naandy).
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Freeport Indonesia may get 1 million ton copper concentrate export quota
Energy and Mineral Resources minister Bahlil lahadalia told reporters Friday that Freeport Indonesia could receive an export quota around 1,000,000 metric tons copper concentrate. Bahlil stated that the government had issued a regulation that allows exports of minerals in force majeure situations. This quota is valid for six-months after the recommendation has been issued. Indonesia, a country rich in natural resources, has banned the export of unprocessed mineral products, including copper and nickel. This is to encourage domestic value-adding. Freeport is asking for permission to export copper concentrator after being forced to stop production of copper cathodes at its new smelter, in Gresik in East Java Province after an October fire broke out in its gas cleaning unit. Last month, the company's chief executive stated that the mining operation had been reduced by 40% due to an increasing stockpile. The domestic market is unable to absorb this copper concentrate. Tony Wenas, CEO of the company, said that its excess concentrate stockpile could reach 1.3 millions tons. Freeport requested an export permit following the new regulations, but Tri Winarno, a senior official, said that the mining ministry had not yet issued a recommendation. The Trade Ministry must receive a recommendation from the Mining Ministry before issuing an export permit. Freeport Indonesia didn't immediately respond to our request for comment. (Reporting and writing by Bernadette Cristina Munthe, Fransiska Nanangoy; editing by John Mair; Rashmi aich; Lincoln Feast.
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Three clean cookstoves approved by the Global Carbon Offset Standard
The global standard-setter for voluntary carbon projects approved three new methods to reduce emissions through the use of cleaner fuels in household cookstoves. This is to increase buyer confidence in credits generated. Carbon trading is a way that richer countries can meet their emission reduction targets while also helping the poorer countries transition to greener energy. Ecosystems Market data shows that the global voluntary carbon market is expected to be worth $723 million by 2023. Cookstove advocates say that in addition to reducing emissions caused by burning kerosene and coal for cooking food, these projects also benefit households' health because they reduce exposure to air pollutants. Critics have said that these programmes overestimate their benefits in terms of emission reduction and their use. Integrity Council for the Voluntary Carbon Market, an independent governance organization, is working to address concerns through the Core Carbon Principles (CCP) and assessing the validity for carbon offset projects. The clean cookstove method approved by the EPA requires a more rigorous approach for determining the baseline fuel to be replaced and monitoring usage. It said that this would reduce the risk of excessive credit. This will give communities the confidence they need to invest in these projects and deliver the social, environmental, and health benefits that they offer. Amy Merrill is the CEO of ICVCM. ICVCM stated that there are a number of projects in its pipeline, and it is expecting to update their methods so they can meet the new criteria. This could result in hundreds of thousands credits being issued this year. The ICVCM approved a household bio-digester, a sealed container that is designed to convert household waste like food scraps into usable cooking fuel. (Reporting and editing by Louise Heavens, Susanna Twiddale)
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Italian and Norwegian Associations Deepen Offshore Wind Ties
Norway’s offshore wind association Norwegian Offshore Wind has signed a memorandum of understanding (MoU) with ANEV, the Italian National Wind Association to increase offshore wind cooperation.The signing of the MoU sets a framework for extensive cooperation between the two organizations and is a natural next step for the offshore wind cooperation between these two markets.The MoU covers cooperation in areas such as offshore wind, and power-to-x and energy storage from offshore wind.Envisaged activities are conferences, workshops, market visits and networking activities for the companies in the two organizations.“The Italian offshore wind market is attractive for our member companies, with a strong pipeline of floating offshore wind projects, an offtake model ready to be implemented into auctions this year and strong regional supply chains,” said Saverio Ventrelli, leader of the Working Group for Italy in Norwegian Offshore Wind.“ANEV is fruitfully working with Italian companies and policy makers to make the most of the potential of offshore wind for the decarbonisation and energy independence of our country, and the signing of this MoU represents an important opportunity for Italian and Norwegian companies to work synergistically to achieve these goals,” added Davide Astiaso Garcia, Secretary General of ANEV.
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UK to Revise Windfall Oil and Gas Tax
Britain plans to overhaul its windfall tax regime on oil and gas producers once current levies run out in 2030, it said on Wednesday as it vowed to transform the North Sea into a renewables hub.The government is asking industry players and others to provide feedback until May 28 on policy options including taxing what it calls "excess revenue". It did not announce specific price thresholds in this consultation.Any new regime would likely apply to the price producers receive after the use of financial products commonly employed to shield them from price fluctuations, according to the consultation document.In October, Britain's Labour government upped its windfall tax on oil and gas producers to 38% from 35% and extended the levy by a year to March 2030, bringing the headline tax rate on the sector to 78%, among the highest in the world.A 25% windfall tax was first introduced by the previous Conservative government in May 2022 in the wake of soaring energy prices following Russia's invasion of Ukraine. The tax was subsequently increased to 35% in November 2022, and extended by one year in March 2024.Oil and gas producers have argued that the windfall levy has hit profits and brought uncertainty over investments, hastening an already advanced decline of oil and gas output in the British North Sea.Energy minister Ed Miliband said that oil and gas production would continue to play an important role in the energy mix, and the government was committed to maintaining existing fields for their lifetime.Wednesday's plans reiterate the government's intention not to allow any new oil and gas licenses.Alongside oil and gas production, the government also wants to ensure that clean energy sources such as hydrogen, carbon capture and wind start to thrive, creating new jobs.(Reuters - Reporting by Muvija M, Sam Tabahriti, Shadia Nasralla; Writing by Shadia Nasralla and Sarah Young; Editing by Sachin Ravikumar and Christina Fincher)
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The biggest weekly oil drop since October due to tariff uncertainty and supply gains
The oil price was little changed on Friday, but is set to have its biggest weekly drop since October due to the uncertainty surrounding U.S. Tariff policy creating concern about the growth of demand at the same time that major producers are planning to increase their output. Brent futures were up 17 cents or 0.24% to $69.63 per barrel at 0315 GMT. U.S. West Texas Intermediate Futures rose 12 Cents, or 0.1%, to $66.48 per barrel. Brent, however, is set to drop 4.9% this week, its largest weekly decline since October 14. WTI will also drop by 4.8% this week, which is its largest weekly decline since the week of October 14. The U.S. trade policy, which is the largest oil consumer in the world, has caused a whipsawing effect on the oil markets. Vandana Insights, a provider of oil market analyses, said: "It appears that the financial markets have entered a panic mode. They are no longer easily calmed by Trump's postponements for one month and exemptions from import tariffs." She added, "Crude is now stuck at four-month lows. It's vulnerable to further declines." The U.S. president Donald Trump has suspended 25% tariffs on the majority of goods imported from Canada and Mexico, until April 2. However, steel and aluminum tariffs will still be in effect as planned on March 12. The amended order doesn't cover all Canadian energy products. These are subject to a separate 10% tax. Tariffs are seen as a hindrance to economic growth, and by extension the growth of oil demand. The uncertainty surrounding the policy also impacts the economy. The BMI research unit of Fitch said that the risks for oil prices are still to the downside, as new supply from OPEC+ producers and non-OPEC ones is expected to push the markets well into oversupply. Brent prices fell on Wednesday to their lowest level since December 2021, after U.S. crude stocks rose, and following the Organization of the Petroleum Exporting Countries (OPEC+) decision to increase its output quotas. The group announced on Monday it would proceed with its planned increase in April production, which will add 138,000 barrels of oil per day to market. As the U.S. considers steps to halt Iran's exports, some of the downward pressure on prices has ebbed. In his first major address to Wall Street executives, U.S. Treasury secretary Scott Bessent stated that "we are going to shut Iran's oil industry and drone manufacturing capability." Sources told Reuters on Thursday that Trump was considering a plan for inspecting Iranian oil tanks at sea, using an agreement aimed at weapons or mass destruction. This is part of his "maximum" pressure to reduce Iranian oil exports to zero. (Reporting and editing by Christian Schmollinger, Sonali Paul and Mohi Nrayan)
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Couche-Tard considers selling US stores if a deal is struck with Seven & i
Alimentation Couche-Tard, a Canadian company, said that it was in exploratory discussions with third parties regarding a possible sale of U.S.-based stores. This would allow it to gain regulatory approval if it were to reach a deal for the takeover of Japan's Seven & i Holdings. Circle-K, the operator that has bid $47 billion to buy 7-Eleven, has said that it has identified an American portfolio and is currently in discussions to "identify potential acquirers". A spokesperson for Couche-Tard said, "We are committed to working with 7&i to obtain regulatory approvals. We have presented a strong proposal to 7&i to demonstrate our commitment." Seven & i opposes the bid, claiming that U.S. Antitrust Law would make a deal impossible. Both companies have about 20,000 convenience stores between them. Seven & i appointed its first non-American CEO on Thursday and gave him the job of reorganizing the company to fend the bid. Stephen Dacus, the new chief executive, said that he spoke with Couche-Tard on that particular day. He added that the talks would continue. However, there were significant regulatory obstacles, especially in the United States, that stood in the merger's way.
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Iron ore prices rise, but a weekly loss is expected due to tariff issues
Dalian iron ore prices rose on Friday, ending a nine session losing streak. However, they were still set to fall by a significant amount each week, due to reports of a reduction in steel production in China, and a escalating trade war between Washington DC and Beijing. By 0302 GMT, the most traded May iron ore contract at China's Dalian Commodity Exchange rose 0.65% to 777.50 yuan ($107.28). The contract is down 3.12% this week. The benchmark iron ore for April on the Singapore Exchange is 0.14% higher, at $100.5 per ton. This week it has lost 1.89%. Analysts at ANZ said that Beijing's efforts in supporting economic growth had boosted sentiment on commodity markets. China announced more fiscal stimuli on Wednesday and promised to increase efforts to boost consumption and domestic demand. Chinese officials left the door wide open on Thursday to add more stimulus measures to those announced this week at the annual parliament meeting, if economic growth falters. Washington increased tariffs on Chinese products by 20%, and Beijing retaliated with a 10% increase. Hexun Futures said that the steel production cutbacks in China could increase iron ore supplies, increasing pressure on ore price. China will restructure the giant steel industry by cutting output, despite not announcing any targets in its latest intervention to reduce overcapacity. Hexun, in a separate report, citing the China Iron and Steel Association, said that despite this, steel daily production increased by 13% month-on-month in February. Crude steel output also increased 5%. Coking coal and coke, two other steelmaking ingredients, rose on the DCE, by 1.88% and 1.00 %, respectively. The benchmarks for steel on the Shanghai Futures Exchange were flat. The Shanghai Futures Exchange traded sideways.
Iraq's SOMO seeks more high-sulphur diesel shipments for Dec, sources state
Iraq's stateowned refiner SOMO is seeking to purchase more highsulphur diesel shipments for December arrival, after earlier buying interest for one October cargo, 3 trade sources who saw the tender document said on Friday.
SOMO is looking for a total of 85,000 metric lots of 2500ppm sulphur diesel, to be divided into 2 42,500-ton cargoes, for delivery in between Dec. 1 and Dec. 31 to Khor Al Zubair, they stated.
The tender closes on Nov. 5, with credibility of approximately 20 days later on.
SOMO did not instantly react to a Reuters ask for comment.
This is the 2nd time the refiner has actually wanted to buy 2500ppm sulphur diesel cargoes, after a purchase tender at end-September for one October 42,500-ton cargo.
In May, the business looked for to offer 800-1000ppm gasoil term materials.
This increase in need could be due to lowered domestic production since of refinery maintenance, among the 3 sources stated.
SOMO did not import or export any gasoil for the very first half of 2024, while imports for 2023 totalled around 1.15 million tons, the company's website shows.
Iraq's newly minted Karbala refinery was shut for scheduled maintenance at end-September and has actually just rebooted.
A minimum of four more refinery sites in Iraq were scheduled for planned maintenance between September and November, a 4th source informed Reuters earlier.
(source: Reuters)