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Officials say that Ghana has drafted wage and tender floors for mining contractors.
A senior official revealed on Thursday that Ghana's mining regulator was developing minimum wage?and?tender benchmarks to be used by contract mining companies. The goal is to reduce aggressive underbidding, as the country encourages its miners to subcontract more work to local contractors. Ghana, Africa's largest gold producer, ordered in January 2025 that surface operations (blasting, loading and hauling) be transferred to Ghanaian owned contractors, and underground operations, to joint ventures with a minimum of 50% local ownership, by December 31, or face sanctions. This is part of a larger push by Africa's resource-rich countries to retain the value of their mineral wealth. Ghanaian miners have spoken out against this directive. They claim that contractors offer lower wages and less job security. Ben Birch Mensah, Director of Local Content at the Minerals Commission, the national regulator said in an interview on Thursday that officials wanted to make sure that wages and conditions for workers would not be affected. Birch-Mensah stated, "The regulator does not want contract mining to make people worse off." We are creating a base so that contract miner's cannot pay their employees below a specific threshold. OFFICIALS TRY CURB UNDERBIDDING Birch-Mensah added that the commission is also preparing benchmarks for minimum bids in order to prevent contractors from submitting bids below levels which are sustainable. He stated that aggressive underbidding in some cases had left contractors unable meet operating costs. A committee will be formed to determine the details of this policy. Ghana's mining rules of January 2025 required that miners switch to contract mining. Birch-Mensah stated that the December 2026 compliance requirement for local contractors was "non-negotiable." He added that firms such as?Newmont?, Zijin? and Ghana Manganese Company?were still to meet this deadline. The companies didn't immediately respond to our requests for comments. Ghana Chamber of Mines criticised the policy and said that contract mining should not be mandatory but optional. The chamber, on the other hand, supported?efforts aimed at addressing underbidding and warned that unhealthy competition between contractors could impact worker welfare and safety. Ken Ashigbey, CEO of the Chamber, said that if people continue to undercut themselves, then they might not have the resources necessary to complete the job, or they might not pay workers correctly, or they wouldn't train them. Ashigbey added that the chamber is also looking at contractor classifications and thresholds for minimum bids in order to reduce underbidding. He noted that contractors are responsible for a large share of mining accidents.
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Gold drops over 1% after US inflation data supports Fed hike bets
Gold prices dropped by over 1% after strong U.S. inflation figures and rising oil prices. This increased the odds of a Federal Reserve rate increase next week. By 01:42 pm EDT (1742 GMT), spot gold had fallen 1% per ounce to $4,355.85. Bullion had fallen by about 1.7% earlier to $4,323.78, the lowest point of the session. U.S. Gold Futures fell by 1.2% to $4,407.30. According to Kyle Rodda of Capital.com, the Producer?Price index (PPI) data shows that there is a slight increase in underlying inflation within the U.S. The Bureau of Labor Statistics of the Labor Department reported on Thursday that PPI for Final Demand rose 0.4% in August after a?0.1% increase upwardly revised in July. According to CME FedWatch Tool, traders now price in a 70% probability of an increase in U.S. rates next week. This is up from 62% prior to the data. The majority of economists surveyed by the Fed expect that the Fed will hold rates at the September 15-16 meeting, and throughout the remainder of the year. Gold prices were further impacted by the U.S. dollar's rise, as it made greenback-priced gold more expensive in other currency. Rodda said that bonds must reflect a higher level of inflation due to the steeper rise in oil prices. Gold is typically pressured by rising bond yields because they increase the cost of holding non-yielding assets. Brent crude, the benchmark oil price, hit $105 per barrel on Thursday after the largest spike in 'attacks against shipping since the beginning of the U.S. - Iran war prompted supply disruption fears. The European Central Bank raised interest rates for the second time this year on Thursday, in an effort to curb the rise in inflation caused by war-related energy costs. Silver spot fell 4.6% per ounce to $64.19, platinum was down 5.5% at $1,791.13, and palladium dropped 5.1% at $1,283.52.
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UK retailers stock charcoal that is linked to Paraguay's deforestation.
According to a report published on Thursday by the advocacy group Global Witness, major British retailers such as B&Q, Waitrose and others are selling charcoal made from trees that have been cleared in Paraguay’s Gran Chaco to make more farmland. The report links charcoal sold by UK supermarkets and hardware shops to the Paraguayan forest company Taruma. Global Witness claims that Taruma, the biggest international supplier for British barbecue brand Big K whose products are distributed across the country, is Taruma. Gran Chaco is the subtropical forest region of South America, second largest after Amazon. It stretches over Paraguay and Argentina. A Waitrose spokesperson responded that all charcoal sold by the company complies with the standards of the Forest Stewardship Council (an independent forest certification system). B&Q has not responded to any requests for comments. Paraguay is seeking to strengthen its?trade ties? with Europe via the EU-Mercosur Agreement, as the environmental impact of imported goods from South America, which includes Paraguay and?Argentina?, Brazil, and Uruguay, has become increasingly scrutinized. According to the report, satellite analysis found that Taruma sourced its wood from ranches which have since 2012 cleared more than 28 hectares (69 acres) of forest. The report stated that a second supplier, Paben SA, who worked with Big K up until 2023 has cleared approximately 2,700 hectares in the Paraguayan Chaco forest since 2021. Paben SA has not responded to requests for comments. Taruma, in a letter to?, denied any wrongdoing. Taruma doesn't clear forests and does not hold clearing permits. Our operations don't add to the deforestation of the region or its effect on climate. Rahmeen Farudi, Chief Executive of Taruma, said that the sustainability team closely follows research on Chaco Land-Use Change. Scientists, including NASA scientists have stated that Paraguay is one of the countries with the highest rates of deforestation relative to forest coverage, primarily due to farming and cattle ranching. Paraguay is a major grain and meat exporter. In July, it unveiled its first national forest policy. It acknowledged decades of deforestation by the state for agricultural purposes. The government has pledged to increase environmental monitoring in order to meet EU standards. The sale of charcoal to Britain may harm Paraguay’s plans to sell other goods to the EU as part of a future?trade agreement with Mercosur. The National Forestry Institute of Paraguay did not respond when contacted for comment. DEFORESTATION LEGISLATION, TRADE AND DEFORESTATION Global Witness stated that the UK's flawed environmental legislation and Paraguay’s permissive environment laws allow deforestation linked charcoal to reach the British Market. The '2021 Environment Act in Britain bans imports that are linked to illegal deforestation. The ban only applies to imports originating from land that has been illegally deforested and excludes charcoal products. Paraguayan products produced on legally cleared lands can still enter the UK. Beginning December 30, the EU's stricter rules will prohibit?all products that are linked to cleared land, regardless of whether or not?the clearing?was legal. The UK Department for Food, Environment and Rural Affairs (Defra) did not respond immediately to a comment request. Environmental groups, as well as several EU governments including France, Austria, and Poland have warned that the expansion of Mercosur agricultural exports into Europe could speed up deforestation.
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Alcoa: Cutting Canada tariffs will not be enough to reduce the US aluminum premium.
Alcoa's chief financial officer said that the steep price of aluminum in the U.S. would not?drop much even if Washington halved the tariffs on metals imported from Canada because other countries are still needed. The price that U.S. The price?U.S. Molly Beerman, Alcoa's Chief financial officer, said that the U.S. needs to import around 4 million tonnes of aluminum each year. Canada can only provide 3 million tonnes of this. Beerman stated that Midwest would not drop significantly, even if the U.S. were to receive a favorable rate from Canada. "It may come down a bit, but it won't return to the pre-tariff level." Beerman stated that if there are tariff waivers or relief for other trading partners, such as Japan, Europe, or South Korea, and the last million tons of grain is covered, then "you can expect the Midwest Premium to be reduced in response?to essentially eliminate the tariff benefit." Beerman stated that Pittsburgh-based Alcoa, which produces?around 900,00 tons of aluminum per year in Canada, is paying over $1 billion in tariffs in order to import the majority of this aluminum into the U.S. The Midwest compensates us for this, and also returns as margin due to the tightness of?tons. Customers in North America and Europe "actively seek our supply" because Middle East aluminum is "constrained," Beerman noted, adding that Alcoa’s order book "is almost completely sold out until 2026."
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Sources say that Dangote Oil refinery will buy 16 million barrels Nigerian crude in October.
According to four sources in the industry, Nigeria's Dangote Refinery has purchased at least 16,000,000 barrels of Nigerian crude oil for arrival in October. This is consistent with previous months, and significantly higher than average last year as Africa's biggest refinery ramps-up processing. Dangote has 16 million barrels of?oil, which is a combination of monthly allocations by Nigerian National Petroleum Company, and volumes purchased in a tender. This amounts to around 520,000 barrels / day. This is the majority of the refinery's?700,000.bpd monthly intake. Investors are focusing on the feedstock in preparation for an initial public offer. The purchases will reduce the amount of Nigerian crude that is 'available for export during a period of high demand as a result of the Iran War, which has drastically reduced Middle East supply. If Dangote purchases more crude, the final total could increase. Dangote has not responded to a comment request. According to Kpler, the Lagos-based refiner processed 565,000 bpd in Nigerian crude during August. This is nearly twice as much as last year's 280,000 bpd average. Sources familiar with the matter said that NNPC would supply Dangote eight of its 'October Nigerian cargoes' and one U.S. WTI Midland shipment. Kpler data shows that this would be the same as the previous monthly record of NNPC's supply to the refinery. It had provided a similar -volume in April May and August. Two traders said that the refinery purchased a second WTI shipment for October in a spot auction from a different provider, along with the additional Nigerian cargoes, to bring the total up to 16 million barrels. Dangote has purchased many grades of crude oil from countries other than Nigeria, such as Libya and Guyana.
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Solorz family reaches settlement ending fight over Polish media empire
According to a letter sent by TiVi Foundation, the controlling shareholder, Zygmunt 'Solorz, has settled all legal disputes regarding his 'business empire. The settlement, according to the family, outlines rules for how it will manage its assets in the future, including those of Polsat Plus Group headed by Cyfrowy Polsat and power producer ZE PAK. The family said the settlement was confidential and did not reveal any details. * 'Solorz will step down from an active role in the?companies owned by TiVi and Solkomtel and take on a advisory role. The settlement was reached after the Liechtenstein Constitutional Court upheld a lower court's?decision? that Solorz legitimately gave joint control of TiVi to his children. * The conflict was made public in late 2024, after Solorz’s children wrote to the management of his companies expressing their concern for?his health. * Solorz’s son Piotr zak is still the chief executive?of Cyfrowy Polsat, ZE PAK and?Tobias Solorz. Aleksandra and Tobias Zak are on the supervisory board.
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Gold drops over 1% after U.S. data on inflation boosts Fed rate hike bets
Gold prices dropped by over 1% on Thursday, after strong U.S. inflation data and higher oil prices increased the odds of a Federal Reserve rate increase next week. Spot gold fell 1%, to $4.358.09 an ounce, by 11:14 am EDT (1514 GMT), whereas U.S. Gold Futures dropped 1.4%, to $4.400.60. According to Kyle Rodda of Capital.com, a senior financial analyst, the Producer Price Index data "sort of shows that there's been a?bit? of a pick-up in underlying inflation" in the U.S. The Bureau of Labor Statistics of the Labor Department reported that PPI for final demands rose by 0.4% in August after a 0.1% increase, which was upwardly revised. CME FedWatch Tool shows that traders now price in a 70% chance of an interest rate increase next week. This is up from 62% prior to the release of the data. The majority of economists surveyed by the Fed expect that the Fed will hold rates at the September 15-16 meeting, and throughout the remainder of the year. Gold prices were further impacted by the U.S. dollar's rise, which made greenback-priced gold?expensive in other currencies. Rodda said that bonds must reflect a higher and more persistent?inflation due to the steeper oil price, which causes gold prices to drop. Typically, rising bond yields pressure gold by increasing the opportunity costs of holding non-yielding assets. Brent crude, the benchmark oil price, jumped by 4% to $105 per barrel on Thursday after the largest spike in 'attacks against shipping since the beginning of the U.S. - Iran war prompted supply disruption fears. The European Central Bank raised interest rates on Thursday for the second time this year to combat a rise in inflation caused by war-related energy costs. Silver spot fell 4.2% per ounce to $64.47, while platinum fell 4.6% to 1,808.42, and palladium dropped 3.9% to $1,000.75.
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The opposition warns that Finland's power supply could be affected by the Google AI deal.
Finland should implement a national permitting system for data centres to prevent power shortages and soaring energy costs, the opposition parties said Thursday after Google announced a major new investment. Nordic data centres have been popular for many years due to the region's cool climate, low-carbon electricity, and reliable power grids. However, AI developers are now under greater scrutiny from politicians and consumers. Alphabet’s Google announced on Wednesday that it would spend at least EUR13 Billion ($15.1 Billion) over the next two-years on?AI Infrastructure in Finland, its largest European investment. This includes a deal to supply nuclear power. Centre Party leader Antti Kaikoen said that while data centres were welcome in Finland, Finland must ensure there was enough electricity to power them. A national permitting system for data centres would be required. No one is looking at the big picture right now," said Kaikkonen. His party is Finland's largest opposition group. The Social Democratic Party (SDP), which leads in the polls in advance of the April election, has said that it welcomes data centre investments but is concerned about their implications for power demand. Niina Malm, a Social Democratic lawmaker said: "It's important to examine the availability of energy as an issue that affects internal security. This will ensure that people are able to afford it and have enough electricity." Google's deal included an agreement to purchase up to 50% energy from Finland's Loviisa Nuclear Plant over a period of 22 years. This will help extend the life expectancy of the plant from 2030, when it was originally scheduled for shutdown, until 2050. Together with utility Fortum, the companies said they would explore the development and production of nuclear energy and renewable energies in Finland. Finland's prime minister Petteri Orpo?has stated that the Google deal would boost the country's economic growth and that electricity rates will remain in control. The government didn't immediately respond to an inquiry for comment.
McGeever: Central banks will diverge from 2022 if the energy shock intensifies.
When the world was faced with a sudden surge in inflationary forces in 2021-22 due to a severe shock in supply and spikes in energy prices, all major central banks reacted?together. This is unlikely to happen again.
Five years ago, supply disruptions caused by pandemics led to a united - but belated cycle of interest rate hikes among the world's largest central banks. This cycle accelerated in response to the skyrocketing prices of energy triggered by Russia’s invasion of Ukraine.
By the time the European Central Bank raised rates in July 2022 (and the Bank of Japan did not), every G10 central banks except the Bank of Japan had joined the party. All of them raised policy rates by 400-525 bps.
The war in the Middle East is causing the largest monthly increase in Brent crude oil price in history. It also disrupts other supply chains, which could lead to a rise in global inflation. This is causing central bank forecasts to be re-evaluated.
Rates are shifting accordingly. Many policymakers fear that they will be too late in responding to the inflationary threat.
The two U.S. rates cuts that were expected for this year have disappeared from the curve of futures. In addition, the ECB may now hike three times. And the reversal of the expected 'path' for UK interest rates is even more astounding.
Can we expect the central banks to move in lockstep like they did 5 years ago?
Not if supply becomes more scarce.
SCENARIO PLANNING
All rate markets are based on the assumption that the Middle East Conflict will soon end and the Strait of Hormuz reopens, allowing the global supply of oil, natural gas liquefied, fertilizer and other energy products, to flow again.
This benign base-case scenario assumes that energy prices will continue to rise after the war, but will remain high on an average annual basis. Global growth will also hold steady, which will justify a relatively hawkish position from most central bankers.
What if energy prices continue to rise, the war doesn't end, or the war doesn't end? What would the central banks do?
UBS economists estimate the effects of three Middle East conflict scenarios. These include a rapid resolution, a two-month disruption of the Strait of Hormuz with oil peaks near $130 per barrel and an "extended disrupt scenario" involving additional damage to energy infrastructure as well as oil reaching $150.
They believe that in the event of a recession that is caused by the Federal Reserve, it could reduce U.S. interest rates to zero next year and that the Swiss National Bank will again use negative interest rates.
Bank of England could reverse only two or three of the rate increases currently expected for this year. The ECB may not reduce rates at all.
UBS economists noted that "considerable differences" exist between economies.
No one knows about POWELL
The U.S. labour market stagnates today, but the average monthly job increase in 2022 will be over 600,000. In comparison to five years ago, the current price pressures, tariffs and all, are relatively benign. Policy is also much tighter. Will the new Fed chair rush to raise rates in an economy that is weakening?
The euro zone labor market is tighter today than the U.S., while growth is near trend and monetary policies are more neutral. Moreover, since the ECB has only one mandate, which is to achieve a 2% inflation rate, it's more likely that they will tighten policy than ease.
You can imagine a scenario in which the central banks diverge. This could increase volatility, widen interest rates and bond yields, accelerate currency swings and cause macro volatility. There is already a lot of uncertainty in the markets.
Jerome Powell, Fed chair, said at his press conference after his March meeting that no one knows the economic effects of "the war" - not even him or his colleagues. It's therefore impossible to determine the best policy at this time.
We can expect that, the more the central banks are impacted by the disruptions, the more likely they will act independently.
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(source: Reuters)