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Iron ore prices continue to fall due to a growing supply, but China's resilient demand is limiting the loss.
Iron ore prices continued to fall on Tuesday. They were dragged down by the expectation of an increase in supply. However, a resilient demand from China, their top consumer, and hopes for easing Sino-US tensions helped limit losses. As of 0215 GMT, the most traded September iron ore contract at China's Dalian Commodity Exchange dropped 0.28% to a metric tonne price of 702.5 yuan (US$97.79). The benchmark July Iron Ore at the Singapore Exchange fell 0.21%, to $94.5 per ton. Data from Mysteel revealed that shipments of the main steelmaking ingredient, mainly from Australia and Brazil, rose nearly 2% compared to the previous week. This was the highest weekly level since December. Analysts at Shanghai Metals Market wrote in a report that iron ore imports are expected to increase in June as mills will use imported cargoes more due to the lower price and miners will increase shipments to meet quarterly targets by June's end. Analysts at Hongyuan Futures wrote in a report that "given the healthy steel margins, hot metal production is likely to be at a high-level." Mysteel data shows that the hot metal production is a good indicator of iron ore consumption. The daily average was 2.42 million tonnes on June 5, which was 2.6% more than a year earlier. Investors are also hoping that top U.S. officials and Chinese officials will improve their relations during a second round of trade discussions in London, on Tuesday. Coking coal and coke, which are used in the steelmaking process, both saw gains of 0.32% and 0.4%, respectively. The benchmarks for steel on the Shanghai Futures Exchange were traded within a narrow range. Rebar gained 0.1%, hot-rolled coil advanced 0.16% and wire rod increased by 0.12%, while stainless steel declined by 0.79%. Reporting by Amy Lv & Lewis Jackson. $1 = 7.1839 Chinese Yuan
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London copper prices slightly ease as US-China discussions are in focus
London copper prices dipped marginally on Tuesday as the market watched closely the progress of the ongoing trade negotiations between the two world's largest economies, which are taking place in London. The London Metal Exchange's three-month contract for copper fell 0.3%, to $9,761.5 a metric ton, by 0101 GMT. Meanwhile, the Shanghai Futures Exchange's most traded copper contract gained 0.6%, to 79.160 yuan ($11,024.76) a tonne. Tuesday's U.S. China trade talks will continue into the second day. Washington and Beijing are attempting to resolve a bitter dispute, which has expanded from tariffs to restrictions on rare earths. This is threatening to cause a global economic slowdown and supply chain disruption. The Trump administration is ready to lift a recent flurry of measures that targeted ship design software and jet engine parts. It also targets chemicals and nuclear material. Markets were encouraged by the apparent cooling in trade tensions. This offset fears that the trade conflict is having a negative impact on economic activity," ANZ stated. Copper Stocks In LME-registered storage warehouses, the amount of copper dropped by 10,000 tons to 122 400 tons on Monday, indicating that the shipment has continued despite the threat of U.S. import tariffs. Other LME metals include aluminium, which fell by 0.2% to $2473.5 per metric ton. Zinc also declined, falling 0.1% to 2,647. Tin dropped 0.3% to 32,605, while nickel declined 0.4% to $16,355. Zinc, among the other SHFE metals, continued to weaken. It lost 1.2%, or 21,870 Yuan. Nickel fell by 0.9%, or 121,640 Yuan per ton. Lead gained 0.8%, to 16,860 Yuan. Tin gained 0.3%, to 263,550 Yuan. Click or to see the latest news in metals, and other related stories. DATA/EVENTS (GMT) UK HMRC May Payroll Changes ($1 = 7.1802 Chinese Yuan) (Reporting and Editing by Sumana Niandy; Reporting by Hongmei LI)
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Dollar tepid ahead of US-China talks
The dollar was on alert on Tuesday, as the United States and China continued their trade negotiations for a second consecutive day. There were some tentative signs that tensions could be easing between the two world's largest economies. The U.S. president Donald Trump gave a positive spin to the discussions at Lancaster House, London. They ended for the evening on Monday but were scheduled to resume at 9am GMT on Tuesday. The fact that the market is still near record highs suggests that the market has accepted what Trump said. When you consider the comments of Lutnick and Bessent it appears to me that they're relatively satisfied with the progress," said Tony Sycamore. The market likes to hear concrete news. Investors have been focusing on the progress of talks as Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick, along with U.S. trade representative Jamieson Greer, were about to meet their Chinese counterparts for the second time. Markets will likely be relieved if the talks progress, given that Trump's tariffs have been chaotic and the swings in Sino/U.S. relations have hampered global growth. In Asia, stocks advanced further than they had at the beginning of the week. Nasdaq's futures rose 0.62%, while MSCI's broadest Asia-Pacific index outside Japan gained 0.5%. S&P futures rose 0.43%. Both the FTSE and EUROSTOXX futures added about 0.1% each. After hearing that Japan was considering purchasing some of the super-long government securities issued at low rates in the past, the Japanese bond market also received attention. Early trade saw the yield of the 10-year JGB drop one basis point, to 1.46%. The 30-year yield fell 5 bps, to 2.86%. Last month, yields on super-long JGBs reached record levels due to the waning demand from traditional investors such as life insurance companies and concerns over rising global debt levels. Justin Heng is a rates strategist for HSBC Global Investor Research in APAC. He said that the volatility of the super-long segment stems from a supply/demand imbalance which has been brewing ever since the BOJ began to normalise its balance sheet. Katsunobu Kato, the Japanese Finance Minister, said that on Tuesday he would implement appropriate debt management strategies while working closely with market participants. After falling on Monday, the dollar tried to gain ground in currencies. The dollar rose 0.45% against the yen to 145.25. The euro dropped 0.28%, to $1.1387. Sterling fell 0.2%, to $1.3523. Investors' confidence in U.S. assets has been eroded by Trump's unpredictable trade policies, and concerns over Washington's increasing debt. The dollar is down more than 8% this year. The greenback's next test will come on Wednesday when the U.S. Inflation data is released. The expectation is that core consumer prices will have increased slightly in May. This could put a halt to bets on imminent Federal Reserve rate reductions. The report on the producer price index will be published a day after. Kevin Ford, Convera’s FX and macrostrategist, said that the May CPI and PPI figures in the United States will be closely examined for any signs of inflationary pressures. If core CPI continues to be elevated, rate cuts may not occur at the FOMC meeting on June 18. The Fed is expected to hold rates at its next policy meeting, but traders have priced in roughly 44 basis points of rate easing for December. Brent crude futures gained 0.24%, to $67.20 per barrel. U.S. West Texas Intermediate Crude was last up 0.25 percent at $65.45 a barrel, after reaching a session high of more than two months earlier. Spot gold dropped 0.5% to $3.310.40 per ounce.
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Gold drops as traders monitor US-China trade talks at London
Market participants were waiting for further developments in ongoing U.S. China trade talks, which are now entering their second day. As of 0125 GMT, spot gold dropped 0.5% to $3311.16 per ounce. U.S. Gold Futures fell by 0.7%, to $3330.90. The high-level talks between U.S. officials and Chinese officials have extended into a second session, with topics ranging from rare earth restrictions to tariffs. Tim Waterer is the chief market analyst for KCM Trade. He said that "with these important U.S. China trade talks still underway, gold is currently trading cautiously" until we can see if there is any progress between the two superpowers. U.S. president Donald Trump noted that his administration is "doing very well" in negotiations. Both sides agreed last month to temporarily pause tariffs. This provided some relief for the financial markets. If traders believe that U.S. and China are on track for a wider trade agreement, the demand for safe-haven assets like gold may ease. China's data showed that export growth in May slowed down to a 3-month low as U.S. Tariffs affected shipments. Factory-gate deflation also reached its highest level in the past two years. Investors are waiting for Wednesday's U.S. Inflation data to get more clues about the Federal Reserve's policy. Waterer stated that "if CPI ticks higher, that is expected, but if CPI jumps, that may raise alarm bells among investors and any flight to safety that results could boost the gold price." When interest rates are low, gold tends to perform well. Other than that, silver spot was down 0.6% at $36.51 an ounce. Platinum fell 0.8% to 1,210.46 and palladium dropped 0.2% to 1 071.75. (Reporting and editing by Rashmi aich in Bengaluru, Anmol Choubey)
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US-China Trade Talks to Resume for a Second Day
Tuesday in London, top U.S. officials and Chinese officials are expected to resume their trade negotiations for a second time. They hope to achieve a breakthrough on export controls of goods like rare earths which have caused a global supply-chain shock and slowed economic growth. Investors hope that the two superpowers will improve their ties. The relief brought by the preliminary trade agreement reached in Geneva last week has given way to new doubts. Washington accuses Beijing of blocking critical exports to industries such as autos, semiconductors, and defence. The talks take place at a critical time for both economies. Customs data shows that China's exports into the U.S. dropped by 34.5% in may, the biggest drop since February 2020 when the COVID-19 virus pandemic disrupted global trade. The dollar is still under pressure by U.S. policies, even though the impact has been minimal on U.S. jobs and inflation. Both sides will be expected to provide updates on both Tuesday and Wednesday. On Monday, the two sides met in the elegant Lancaster House of the British capital to discuss their disagreements regarding the Geneva agreement. The U.S. delegation is led by U.S. Treasury Sec. Scott Bessent and Commerce Sec. Howard Lutnick, while Vice Premier He Lifeng leads the Chinese delegation. Lutnick's inclusion, whose agency is responsible for export controls in the U.S.A., shows how important rare earths are. China has a near monopoly on rare-earth magnets. These are crucial components in electric vehicle motors. Lutnick didn't attend the Geneva negotiations where the countries reached a 90-day agreement to reduce some of the triple-digit trade tariffs that they had imposed on each other. Trump's often erratic tariff policy has caused global market turmoil, caused congestion and confusion at major ports and cost companies billions in lost sales. The second round of talks between the two parties comes four days after Trump spoke with Xi by phone. It was their first direct contact since Trump's inauguration on January 20, 2017. After the call, Trump reported that Xi agreed to resume shipments of rare earths minerals to the U.S. and reported China had granted temporary export licences to rare-earth supplier of the three largest U.S. automobile manufacturers. The tensions over export controls remain high, as factories across the globe worry that they will not have enough materials to continue operating. (Reporting and editing by Alistair Bell; Kate Holton)
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Oil prices rise as US-China trade talks are awaited
The oil prices rose on Tuesday, as traders awaited the outcome of U.S. China talks which could ease trade tensions and increase fuel demand. Brent crude futures rose 12 cents a barrel to $67.16 at 0041 GMT. U.S. West Texas Intermediate Crude was trading at $65.42, up 13 cents after reaching its highest level since April 4, earlier in the session. Brent oil prices rose to $67.19 on Monday, their highest level since April 28. This was boosted by the prospect of a U.S. China trade agreement. The U.S. and China trade talks will continue in London for a second consecutive day as officials try to reduce tensions which have risen from tariffs on rare earths to global supply chain disruptions. Donald Trump, the U.S. president, said that the talks in London were "going well" and he had received only positive reports from his team. The U.S.-China trade agreement could boost the global economy and increase demand for commodities, including oil. Iran has said that it will soon present a counter proposal for a nuclear agreement to the U.S. as a response to an offer from the U.S. that Tehran finds "unacceptable", whereas Trump stated that both sides remain at odds on whether Iran would be permitted to enrich uranium in its soil. Iran is the third largest producer of oil among the members of the Organization of Petroleum Exporting Countries. Any easing of U.S. sanction on Iran will allow it to export even more oil and this would have a negative impact on the global crude price. A survey also found that OPEC's oil production rose in May. However, the rise was not as large as expected, since Iraq pumped less than the target amount to make up for the earlier overproduction, and Saudi Arabia, the United Arab Emirates and Kuwait increased their output by a smaller amount. OPEC+ - which includes OPEC and its allies, such as Russia - is accelerating the plan to undo its latest layer of production cuts. Daniel Hynes is a senior commodity strategist with ANZ. He said that the prospect of further increases in OPEC's supply still hangs over the market. "A permanent switch to a market-driven strategy (in OPEC), would push the oil markets into a large surplus in H2 of 2025, and almost certainly lead to lower prices for oil." (Reporting by Anjana Anil in Bengaluru; Editing by Himani Sarkar)
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Sizewell C Nuclear Project: Britain invests 14.2 billion pounds
The government announced on Tuesday that it will spend 19.25 billion pounds (14.2 billion pounds) to build Sizewell C in southeast England as part of a wider review of spending which will determine its priorities for the next four-year period. Britain wants to build new nuclear power plants to replace the aging fleet in order to boost energy security, as well as reach its climate goals. Sizewell C is expected to produce enough electricity for around 6,000,000 homes once it's built. Ed Miliband, Britain's Energy Minister, said that new nuclear is needed to bring about a golden age for clean energy. This will protect the family finances, give us back control over our energy and help combat the climate crisis. The press release did not specify whether or not the funding included the 6.4 billion pound pledged for the project, nor when the final investment decision was expected. The report did not give any figures on the total expected cost of the project, nor a time frame for its completion. The plant would be the second nuclear power station built in Britain since more than 20 years, following French state-owned EDF’s Hinkley Point C, which has been delayed and overspent. It is now expected to begin operations in 2029 at a cost estimated between 31 and 35 billion pounds, based on 2015 prices. Sizewell C, originally an EDF project, is now owned by the British Government with EDF as a minority shareholder. EDF financial results from February showed that the UK government held 83.8% of the shares and EDF had 16.2%. EDF's share is expected to decline following Tuesday's announcement. The announcement made on Tuesday did not mention other parties. The developer of the project told us in December that there were five investors who participated in a bid process. ($1 = 0.7378 pound) (Reporting by Susanna Twidale, editing by David Evans).
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Stocks rise, dollar falls as US-China talks are in the spotlight
The dollar fell on Monday as the United States and China began talks in London to settle a trade conflict between their two largest economies. The dispute has gone beyond titt-for-tat trade tariffs and now includes restrictions on rare earths. This could cripple global supply chains, slowing growth. U.S. president Donald Trump said that his administration is doing well, and he's getting good feedback as U.S. officials are holding the talks with China. The market considers dialogues with Beijing to be progress, regardless of whether they produce tangible results. "The market will take the administration at its word until it is proven otherwise," said Jake Dollarhide of Longbow Asset Management, Tulsa. The Dow ended flat, as Morgan Stanley downgraded McDonald's to "equal weight" and Travelers. The Dow Jones Industrial Average rose 0.09 points to 42,761.76, while the S&P 500 gained 5.52 points or 0.09% to 6,005.88. Finally, the Nasdaq Composite climbed 61.28 or 0.31% to 19,591.24. The S&P 600 index rose 0.9%, indicating that small-cap stocks have outperformed. MSCI's global stock index gained 1.94 points or 0.22% to 893.90, and is on course for its second consecutive session of gains. In five of the six recent sessions, it has increased. In Europe, STOXX 600 closed down by 0.07%, ending a winning streak of four sessions, its longest consecutive run in three weeks. The U.S. Dollar fell against most major currencies as caution in anticipation of trade talks offset optimism about a better than expected U.S. Employment Report on Friday. In a post on social media, Trump stated that U.S. Treasury Sec. Scott Bessent and Commerce Sec. Howard Lutnick, as well as Trade Rep Jamieson Greer, would be representing Washington at the London talks. The Chinese Foreign Ministry said that Vice Premier He Lifeng attended the first China-U.S. Economic and Trade Consultative Mechanism meeting in Britain. U.S. data on the economy showed that wholesale inventories in April increased due to stockpiling prescription medications in anticipation of tariffs by the Trump administration. Investors will also be awaiting U.S. data on inflation that could affect expectations about the timing of rate cuts from the Federal Reserve. Morgan Stanley analysts said that they expect May to be the beginning of a series of core inflation readings which will become increasingly stronger. The impact from tariffs is expected to peak in the third quarter, and then begin fading in the fourth. According to LSEG, the market is not expecting a Fed cut before September's meeting. It currently prices in a 62% probability of a reduction of at least 25 base points. Fed officials are in an "invisible period" ahead of the policy decision on June 18. The dollar index (which measures the greenback in relation to a basket of currencies) fell 0.14%, while the euro rose 0.25%, reaching $1.1423. Treasury yields on longer-term U.S. Treasury notes were lower to start the week. This reversed after the Friday jobs report drove yields higher. The yield on the benchmark U.S. 10 year notes fell 2.8 basis points, to 4.482%. Investors will be watching the auctions for U.S. bonds and notes of 3, 10 and 30 year maturities this week to see if there is any investor demand. U.S. crude oil settled up 1.1% at $65.29 per barrel while Brent settled at $70.04 per barrel up 0.86% for the day. This was due to hopes that a trade agreement could boost the global economy along with a weaker dollar.
Brazilian meatpacker JBS states net-zero emissions promise was 'never a guarantee'
The world's largest meatpacker, JBS, became in 2021 the very first of its peers to devote to cutting or balancing out all its emissions by 2040, and to ending prohibited deforestation throughout its long supply chain that starts in the heart of the Brazilian Amazon.
It used terms such as dedication and pledge, and a. slogan that anything less is not an alternative, to explain its. plan on calls with financiers about a sustainable bond issue and. in marketing materials, consisting of for its beef.
Nearly four years later on, Jason Weller, worldwide chief. sustainability officer at the business in which the Batista. family is the biggest investor, informed Reuters in an unusual interview. that its emissions goal was simply an aspiration.
It was never ever a promise that JBS was going to make this. occur, Weller said about the net-zero emissions pledge.
He also stated JBS can not manage how farms. operate, although they are motivating voluntary change. The. business had pledged in 2021 to end unlawful Amazon logging. by its livestock suppliers by 2025.
In a written statement to Reuters after the interview, JBS. said: Our climate aspirations have actually not altered. Any assertion. otherwise is completely false.
Reuters found that investors have achieved little in holding. JBS to its promises in the last five years, with no investor. proposals being put forward about the environment, couple of ballot. versus the Batistas on any problem and barely any concerns about. sustainability on earnings calls. Earnings are skyrocketing on strong meat need, assisting drive JBS'. Sao Paulo-listed stock last month to a record high. Logging by livestock farmers is pushing the Amazon closer to. a tipping point at which the world's biggest rainforest will. gradually stop locking away climate-warming co2.
Brazilian cattle ranchers are responsible for 80% of present. Amazon logging, according to scientists.
The trouble of decreasing the ecological damage related. to JBS and other farming business could weaken President. Luiz Inacio Lula da Silva as he prepares to host global climate. talks in November. Oil majors Shell and BP are also among international business to have. softened their environment promises.
There are far too couple of investors utilizing their shareholder. impact to engage with this concern, stated Vemund Olsen, a. senior analyst for sustainable financial investments at Norway-based. Storebrand Possession Management, which sold its JBS stock in 2017.
It's a problem to which the whole market needs to discover. typical solutions, and which also requires improved regulation. and enforcement of legislation in nations like Brazil.. In October, Brazil's environmental protection agency fined. cattle ranches and meatpackers, including JBS, for raising or purchasing. livestock on unlawfully deforested Amazon land.
SUPPLY CHAIN DIFFICULTY
Ecological activists have actually calculated that 97% of JBS'. emissions originate from greenhouse gases launched through. logging, biodiversity loss and pollution.
In emissions accounting, these are called emissions from. modifications in land usage. JBS has actually called these computations flawed.
While JBS reports indirect emissions throughout its supply. chain, it leaves out emissions connected to modifications in land usage.
There is not an approved format today on how to determine. land-use-change emissions for which we have self-confidence, Weller. stated. JBS rather focuses on emissions from its own operations,. consisting of slaughterhouses.
Other global business, including packaged food business Mars. and grain traders Archer Daniels Midland and Bunge, have actually started. divulging change-of-land-use emissions.
We do not have the capability to mandate or require a modification on. farms, nor do we have the capability to mandate and alter how our. clients use our products, Weller said.
Because of these limits, he said JBS had absolutely no operational,. contractual or legal control of its supply chain.
The executive, however, added that regardless of not having any. mandate, we're acting upon our supply chain, investing, and. driving genuine modification.
LITTLE PRESSURE
Morningstar Sustainalytics, an independent sustainability. ratings firm, places JBS in the 95th percentile among the. companies it evaluates, with a severe-risk score connected to. its environmental efficiency.
Reuters found in interviews with investors and reviews of. company filings that the fast-growing company faced little bit. pressure even as evidence installed that it was on track to miss. sustainability targets. The business's 20 biggest financiers decreased demands to discuss. the business even as demands from European companies to stop. logging mounted.
Morningstar information revealed that 17 funds identified as. sustainable hold JBS stock. All decreased to discuss their. engagement with the company or their investment reasoning, or. did not react to requests for remark.
Weller said JBS is committed to improving transparency and. engagement with investors on sustainability.
The ability of personal financiers to affect the business is. already restricted as the Batistas hold practically half of the. company's stock. Another 21% is owned by Brazilian advancement. bank BNDES, which has sided with management in votes.
Non-public advice to investors in 2015 from proxy consultant. Glass Lewis showed JBS scored low on climate threat mitigation and. board accountability, while proxy consultant ISS likewise raised. concerns over management and egregious governance practices in. the context of corruption.. During the broad anti-corruption investigation referred to as. Operation Automobile Wash, which began in 2014 and included companies. throughout Latin America, a court banned siblings Wesley and Joesley. Batista from holding management positions.
It came after they confessed bribing approximately 2,000. Brazilian regulators, government authorities and politicians,. including a previous president, over a span of ten years.
Last April, the Batista brothers rejoined JBS's board. following an investor vote.
(source: Reuters)