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Automakers warn that China magnet pinch is a threat to car production
U.S. auto executives have warned of an imminent shortage of rare-earth magnetic materials from China, which are used in everything from anti-lock brake sensors to windshield-wipermotors. This could lead to the closing of automobile factories within weeks. In an unreported letter to Trump Administration officials dated May 9, the head of the group representing General Motors (GM), Toyota, Volkswagen, Hyundai, and other major automakers expressed urgent concerns. The Alliance for Automotive Innovation sent a letter to the Trump Administration stating that "Without reliable and consistent access to these magnets and elements, automotive suppliers won't be able to produce critical automotive parts, such as automatic transmissions and throttle bodies. They will also not be able to manufacture various motors and sensors, seatbelts, speakers and lights, motors and power steering. The letter was also signed by MEMA The Vehicle Suppliers Association. It added that without these essential automotive components it would be only a matter time before U.S. car factories were disrupted. The groups stated that in severe cases it may be necessary to reduce production volumes, or even shut down vehicle assembly lines. On Friday, both Alliance CEO John Bozzella as well as MEMA CEO Bill Long said that the situation was still not resolved and remained an issue. They thanked the Trump administration for its high-level involvement in preventing disruptions to U.S. automotive production and supply chain. Bozzella said that the automotive topic was discussed by Treasury Secretary Scott Bessent, U.S. trade representative Jamieson Greer and their Chinese counterparts at the Geneva talks earlier this month. Greer said on CNBC that China agreed to lift the restrictions on exports of rare earth magnets to U.S. firms, but was not moving quickly enough to allow access to key U.S. industry sectors. "We haven’t seen the flow" of critical minerals that they should be. China, which controls 90% of the global processing capacity for magnets used everywhere from cars and fighter jets to household appliances, imposed export restrictions in April that required exporters to get licenses from Beijing. Exports of rare-earth magnets from China have halved since April, as companies struggled to deal with an opaque process of obtaining permits that can require hundreds of pages. While some licenses were granted to Volkswagen suppliers and others, Indian automakers claim they have not received any. They will be forced to cease production at the beginning of June. The German auto parts maker Bosch stated this week that the more stringent procedures in China to obtain export licenses have slowed down its suppliers. A Bosch spokesperson called the process "complex and lengthy, in part due to the requirement to collect and supply a great deal of information." (Reporting and editing by David Shepardson, Kevin Krolicki, Sandra Maler;
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Stocks fall but are still set to gain in the month despite tariff concerns
The global stock market was down on Friday, but it is expected to post a weekly increase as well as its largest monthly gain since late 2023. This is despite the markets being roiled by the uncertainty surrounding the Trump administration's policies regarding tariffs. At the beginning of the week, sentiments were initially boosted by signs that trade tensions had eased between the U.S. Investors then focused on the earnings of artificial-intelligence chipmaker Nvidia. The company reported better than expected results in mid-week. The markets were temporarily shaken by an unexpected ruling of the U.S. Court of International Trade that struck down Trump's so called Liberation Day Tariffs. This triggered a court drama which saw an appeals court temporarily reinstate these tariffs. Trump claimed on Friday that China violated a bilateral agreement between the U.S. and China to roll back tariffs, trade restrictions and other measures for essential minerals. He also issued a new threat to be more aggressive with Beijing. Mark Malek said, "It has been a busy week." Mark Malek is the chief investment officer of SiebertNXT. "In just four days, we saw a compressed version what we had been experiencing for the whole month - the tug-of-war between the forces that drove the markets higher in the past year and prior year. That is AI and technology stocks. And then we faced the looming challenge of all the administration tariffs. All three major Wall Street indexes traded lower during the session due to weakness in consumer discretionary, technology and energy stocks. The S&P 500 was expected to finish the week and month on a positive note. The Dow Jones Industrial Average dropped 0.24% to 42111.71. The S&P 500 declined 0.61% at 5,875.91. And the Nasdaq Composite was down 1.16% at 18,952.93. European shares ended the week with a gain of 0.14%. This represents 4% growth for May. MSCI's broadest Asia-Pacific share index outside Japan closed up by 0.72% over night, ending the week with a lower value but adding nearly 5% to the month. MSCI's world index fell 0.37%, to 877. However, it was on course to gain over 1% in the coming week and over 5% for May. This would be the largest monthly gain since November 20,23. The closely-watched Personal Consumption Expenditures Price Index (PCEPI) rose by 0.1% in April. This was in line with the expectations. Trump and Fed chair Jerome Powell met for the first time on Thursday. A Fed statement stated that Powell did not discuss expectations for monetary policies, except to emphasize that the direction of policy would depend on the incoming economic data and its implications for the outlook. The yield on the benchmark 10-year U.S. notes dropped 0.8 basis points, to 4.416%. After reversing previous losses, the 30-year bond yield increased 1.2 basis point to 4.9346%. The dollar rose against other major currencies, including the euro. It is on course to gain against the Japanese currency for the month. The dollar fell 0.23% against the Japanese yen to 143.83, while the euro dropped 0.01% to $1.1364. The dollar index (which measures the greenback versus a basket including the yen, the euro and other currencies) rose by 0.05%, to 99.30. Tariff uncertainty was weighing down the market, and it was set to suffer its fifth consecutive month of losses. Investors are weighing up the possibility of a larger OPEC+ production increase in July. Oil prices have fallen and could be headed for a weekly loss for a second time. Brent crude futures dropped 0.439% to $63.90 per barrel. U.S. West Texas Intermediate Crude fell 0.53% at $60.63 per barrel. The dollar rose, and gold prices fell. Spot gold dropped 0.7% to $3.292.54 per ounce. U.S. Gold Futures dropped 0.81% to an ounce of $3,290.10.
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Mexican authorities seize 3 million litres of fuel stolen
Mexican authorities have announced that they seized over 3 million liters (792 516 gallons), of fuel illegally stored at a property located in Tabasco in the southeast of the country. This is the latest of a series of large fuel seizures in Mexico. Why it's important The seizure of fuel on Thursday was part of Mexico's ongoing fight against fuel smuggling. This includes both theft from the state-run oil company Pemex pipelines, and imports classified falsely to avoid taxes. KEY QUOTES In a statement released on Thursday, Mexico's cabinet of security said that 18 vehicles, 3 pieces of machinery and 3,904 metal containers containing hydrocarbons, identified as petroleum derivatives, had been secured. The Mexican President Claudia Sheinbaum stated on Friday that the seizures are related to a new system of "traceability", which tracks fuel imports all the way from their source until they reach the sale point. CONTEXT Since years, the state-owned Pemex is facing a rampant theft by illegal pipeline taps in Mexico. This has resulted in massive losses. By the numbers Over the last few weeks, the authorities discovered 1.5 million liters (fuel) in two raids conducted in the state Tabasco. They also found 10 million liters (fuel) in the State of Tamaulipas. These fuels were on a ship that arrived in Mexico from the United States a few weeks earlier.
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India reduces import taxes on crude edible oil to reduce food prices
India has lowered the basic import duty on crude edible oil to 10%, according to the government. The world's largest vegetable oil importer is trying to lower food prices and support the local refinery industry. Crude palm oil, soya oil and crude sunflower oils are subject to a customs duty. The total import duty for the three oils will be reduced from 27.5% to 16.5%, as they will also be subject to the Agriculture Infrastructure and Development Cess and Social Welfare surcharge of India. The Solvent Extractors' Association of India's (SEA) executive director, B.V. Mehta said, "This is a win for both the vegetable oil refiners and the consumers as the local prices will drop due to the reduction in duty." The government has not changed the import duty for refined palm oil or refined soya oil. These oils are currently subject to a 35,75% import tax. Mehta stated that the import duty difference between refined and crude oils has increased to 19,25%. This will encourage importers to bring crude edible oil instead of refined oil and boost local refining industries. India imports more than 70% its vegetable oil. It imports palm oil, mainly from Indonesia and Malaysia, and soyoil, sunflower oil, and other oils from Argentina, Brazil and Ukraine. Sandeep Bajoria is the CEO of Sunvin Group. A vegetable oil brokerage. He said that the reduction in basic duty will bring down the price of edible oil and help to revive the retail demand which has been subdued over the past few months. (Reporting and editing by David Evans, Susan Fenton and Rajendra Jadhav)
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Britain sells off last NatWest shares after crisis-era bailout
After a 60.59 billion pound ($45 billion) state-funded investment at the height the financial crisis in 2008, NatWest is now fully private. This ends a costly taxpayer-funded investment which reshaped both the lender and the industry. The British government has sold the remaining 1% of its bank shares, according to an announcement by the Treasury on Friday. It had previously sold small blocks over recent years. It held up to 38% as recently as December 20,23. In a press release, Finance Minister Rachel Reeves stated that "nearly 20 years ago, the government intervened to protect millions and businesses from the effects of the collapse RBS". "That decision was made to protect the economy, and the return of NatWest to private ownership marks a turning point in the history of this country." NatWest's reprivatisation is a turning point in the recovery of its business and mortgage lending in its home market. It transformed from an investment bank with a global reach to a more traditional, slimmed-down lender. NatWest shares have risen by more than 30% this year, to 523 pence. This is above the 502 pence bailout. Prior government selldowns took place at lower prices, resulting in a loss for the rescue. According to Britain's Finance Ministry, the government lost approximately 10.5 billion pounds in the 45 billion pound rescue when proceeds from share sales and dividend payments to finance ministry are added together with fees and other revenue. The SYMBOL of EXCESS NatWest's growth in the years leading up to the financial crisis became a symbol of excess in that time. It grew from being a small Scottish bank in the 1990s, to becoming one of the largest banks in the world, with a total balance sheet exceeding 2 trillion pounds in 2008, which was almost twice the annual British economic output. Before its 2020 rebranding, the bank known then as RBS had sold assets that ranged from a fleet aircraft in Beijing to the largest hospital of Sydney. It also included a golf-course in Florida, 110 km away from the nearest highway, and an American graveyard. Deep South. According to UK Finance, the bank, now under private ownership, is a significantly slimmed down lender, focused on its domestic businesses. It ranks third in Britain for mortgage providers behind Lloyds Banking Group, and Nationwide Building Society. After the financial crisis, Britain introduced so-called "ring-fencing" rules to protect ordinary savers from the riskier activities of banks. It also aimed to boost competition by encouraging smaller challenger banks. NatWest faces a challenge to increase fee-based revenue from businesses like wealth management. This is because incumbents have been largely unaffected by these efforts. Meanwhile, big rivals including HSBC are pursuing the same strategy in response to declining lending income due to Britain's central banks' policy rate cuts. Paul Thwaite, the current CEO of the bank, has made it a priority to further simplify and streamline its operations and to promote economic growth by providing mortgages and business loans. This is in line with the pressure the left-leaning Labour party has put on banks to kickstart the slow economic growth of the country. The ruling party may still tap the cash-rich banks via additional taxes to plug the gaps in the budget. Alex Potter, Investment Director, Developed Market Equities, Aberdeen, said that NatWest had rebuilt its reputation but was still a political ball. He said that the lender would continue to be under pressure to actively support the growth agenda of government. NatWest executives said that the state exit would not affect how they do business. However, bankers and advisors believe that it may try to accelerate its growth strategy through further acquisitions in 2024 after a number of such deals. ($1 = 0.7427 pounds)
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IIR: Nigeria's Dangote Refinery will run with reduced production until October.
IIR Energy, an industry watchdog, said that the Dangote oil refining plant in Nigeria, which is one of the largest refineries in the world, will operate its gasoline production unit with reduced output until October due to a series of problems in recent months. The 650,000-barrel-per-day (bpd) refinery, which opened last year, is currently running its 204,000 bpd gasoline-producing residual fluid catalytic cracking (RFCC) unit at about 70% of capacity, IIR said. IIR reported that the unit was closed from April 7 until May 11 due to damage to part of the unit, and again from May 15 through May 25 because of a mechanical problem. IIR stated that the full rate of production is not expected until October, when the refinery has completed a 40-day turnaround for reactor and catalyst repairs. Anthony Chiejina, a spokesperson for Dangote, said that the unit was not scheduled to be turned around in October. He did not specify when the refinery planned to finish maintenance or when the unit will be back in full operation. IIR announced that the refinery's Continuous Catalytic Reformer will also be closed for seven days beginning June 2 in order to fix leaks. In January 2024, the refinery built by Nigerian billionaire Aliko Dagote in Lagos began to process crude oil into products such as gasoil and naphtha, and started producing petrol in September. The closure of smaller fuel plants in Europe, and elsewhere, is expected to have a major impact on the global fuel market. Some downstream units, like the sulfuric acid-alkylation unit, have yet to begin commercial operations. Chiejina, a Dangote representative, said the unit was scheduled to begin operations on May 31. This is earlier than IIR had expected a mid-June start. As reported earlier, the Dangote Petrochemical Plant began producing 25 kilogram bags (55.12lb) of polypropylene for the local market back in March. The industry monitor reported that the crude processing unit of the refinery has been operating at 80% since mid-March. Chiejina stated that the unit was running at 85%. (Reporting from Shariq Khan, New York; Isaac Anyaogu, Lagos; Editing done by Sonali and Susan Fenton.
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Nigeria's Dangote Refinery continues WTI purchasing spree in July
Three trading sources have confirmed that Nigeria's Dangote refinery will import five million barrels (or more) of U.S. WTI Crude Oil in July. This is a continuation of its purchasing spree following a possible record tally for June. Sources said that the giant new 650,000 barrel-per-day (bpd), oil refinery will import 161,000 barrels of WTI per day in July, after recent tenders were awarded. This is on the back of the record 300,000 barrels per day booked in June's tenders. The final totals of the month may change if the refinery makes more purchases. Traders said that the buying spree highlights increased competition for oil exporters as OPEC+ producers increase output. U.S. crudes are struggling to compete with UAE Murban crude in Asia, which has a six-month low spot premium. Sources said that commodity trader Vitol provided two million barrels of oil for delivery in July, Azeri State-owned Socar supplied another two millions barrels and miner Glencore sold one million barrels. Glencore, Vitol, and the Dangote refinery did not respond immediately to our request for comment about the results of this tender. No one has confirmed the sellers of nine million barrels Dangote had allegedly bought in an earlier bid for arrival in June. The tender details are not public. Kpler, a global shipping analytics company, has revealed that Dangote had previously set a record of 173,000 barrels per day (bpd) for U.S. oil imports in April. Kpler reports that the Dangote refinery purchases WTI semi-regularly since March 2024, but mainly Nigerian crude grades. The data shows that in 2025, it also purchased spot cargoes of crude from Angola and Equatorial Guinea as well as Algeria and Brazil. According to IIR, the refinery will operate at a reduced rate until October as a result of recurring issues over the past few months. A spokesperson for the refinery said that it is ramping up to 85% of its operating capacity. IIR reported that the refinery had been operating at 80% capacity since mid-March.
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Stocks fall but are set to gain in the month despite tariff uncertainty
The global stock market was down on Friday, but it is expected to post a weekly increase as well as its largest monthly gain since late 2023. This is despite the markets being roiled by the uncertainty surrounding the Trump administration's policies regarding tariffs. At the beginning of the week, sentiments were initially boosted by signs that trade tensions had eased between the U.S. Investors then focused on the earnings of artificial-intelligence chipmaker Nvidia. The company reported better than expected results in mid-week. The markets were temporarily shaken by an unexpected ruling of the U.S. Court of International Trade that struck down Trump's so called Liberation Day Tariffs. This triggered a court drama which saw an appeals court temporarily reinstate these tariffs. Mark Malek said, "It has been a busy week." Mark Malek is the chief investment officer of SiebertNXT. "Within four day we had a compressed version what we've been having for the whole month. That is the tug-of-war between the forces that drove the markets higher last year, and the year before that - that is AI and technology stocks - then we have this looming problem with all of these administration tariffs." All three major Wall Street indexes traded lower during the session due to weakness in energy, technology and materials stocks. The S&P 500 is expected to finish the week and month on a positive note. The Dow Jones Industrial Average dropped 0.14% to 42155.39. The S&P 500 fell 0.33% at 5,892.70, and the Nasdaq composite lost 0.57% at 19,065.61. European shares ended the week mostly higher, and are expected to gain 4% in May. MSCI's broadest Asia-Pacific share index outside Japan closed up by 0.72% over night, ending the week with a lower closing but adding nearly 5% to the month. MSCI's world index fell 0.24%, to 878.15. However, it was on course to gain over 1% in the next week and more that 5% for May. This would be the largest monthly gain since November 20,23. The data released on Friday showed that U.S. consumer spending increased marginally in April. In addition, the closely watched Personal Consumption Expenditures Price Index (PCEPI) rose by 0.1% in March, as expected. Trump and Fed chair Jerome Powell met for the first time on Thursday. A Fed statement stated that Powell did not discuss expectations for monetary policies, except to emphasize that the direction of policy would depend on the incoming economic data and its implications for the outlook. The yield on the benchmark 10-year U.S. notes dropped 1.2 basis points, to 4.412%. The 30-year bond rate fell 0.3 basis point to 4.9203%. The dollar rose against other major currencies, including the euro. It is on course to gain against the Japanese currency for the month. The dollar fell 0.01% against the Japanese yen to 144.18, while the euro dropped 0.19% to $1.1349. The dollar index (which measures the greenback in relation to a basket including the yen, the euro and other currencies) rose by 0.18%, reaching 99.44. The tariff-induced uncertainty was weighing on the market, and it is now set to suffer its fifth consecutive month of losses. Investors are weighing up the possibility of a larger OPEC+ production increase in July. Oil prices have fallen and could be headed for a weekly loss for a second time. Brent crude futures dropped 0.44% to a price of $63.87 per barrel. U.S. West Texas Intermediate Crude fell 1.1% to 60.27 per barrel. The dollar rose as gold prices fell. Spot gold dropped 0.78%, to $3.289.91 per ounce. U.S. Gold Futures fell 0.93% to an ounce of $3,286.40.
Sources: Creditors of Brazil Braskem are skeptical about Tanure's bid
According to two sources familiar with the situation, the government of Brazil and the major banks that are Braskem's key creditors have so far been skeptical about the bid of businessman Nelson Tanure for a controlling interest in the petrochemical company.
Sources who requested anonymity in order to discuss private discussions said that for now, lenders prefer to have a plan to restructure a company, and eventually sell the shares used as collateral to repay outstanding loans.
Sources said that the banks were shocked by Tanure’s formal offer to buy a controlling interest in Braskem made on Friday and had yet to meet him to discuss this. Third source said that Tanure was visiting the heads of these banks but had not provided any details about his bid.
Financial details of the plan are still being kept under wraps. Tanure stated in a press release that he was committed to Braskem's long-term growth.
Sources said that before the proposal was made, banks including Brazil's state-owned development bank BNDES had held discussions with specialized firms such as Geriba Investimentos or IG4 Capital which specialize in alternative investments and special situations.
BNDES and IG4 Capital declined comment. Geriba has not responded to requests for comment.
The plan was for an investment firm, Braskem, to restructure the company, in order to increase its value, and to allow Novonor's creditors to gradually sell their shares over time.
Sources claim that the banks have not finalized any contracts with the investment firms with whom they have been in contact. Sources also said that Brazilian banks are still willing to explore other options and may engage with partners they have not yet approached.
After a major scandal involving corruption about a decade back, Novonor (formerly Odebrecht) has been unsuccessfully seeking a buyer for Braskem. It pledged Braskem shares as collateral for 15 billion reais (2.65 billion dollars) in bank loan.
Since then, the value of these shares have plummeted. They are now worth less than one-third of the outstanding debt.
Novonor confirmed on Friday that it had received a nonbinding proposal by an investment fund connected to Tanure, and signed an agreement. The proposal also stated that it was subject to conditions including completion of negotiations with creditors banks and Novonor fulfilling its obligations to Petrobras, Braskem’s second largest shareholder. Luciana Magnhaes, Luciana Magalhaes and David Gregorio (Editing)
(source: Reuters)