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Vattenfall CEO: Rising tariffs may curb European electricity demand
The CEO of Swedish utility Vattenfall said on Tuesday that the uncertainty caused by trade tariffs may slow down growth in Europe's energy demand as companies stop investing in new factories. Trade barriers are the most significant threat to large industrial clients who operate on global markets. Vattenfall CEO Anna Borg commented on the first-quarter results. The company reported a underlying profit of 8.5 billion Swedish Crowns ($886.4 Million) from January to March. This is down 21% compared to 10.7 billion crowns the year before. The company said that underlying earnings were boosted last year by sales of offshore wind assets and heating. Borg stated that "even though it is a quarter of great turbulence, there are many comparable items in our results which show a stable performance." She added that there may be room for negotiation when it comes to its own investment projects, as fewer projects have been built in comparison with projections from a few year ago. Vattenfall made its final investment decision in March for the German Nordlicht 1 & 2 wind farm project. This included buying back 49% of the German BASF stake and agreeing to a long-term contract with the chemicals company. Borg stated that the project was a good one for the market, where there will be a need for more fossil-free energy in all types of industries. She added that Vattenfall does not have any immediate plans to look for a new investor. $1 = 9.5896 Swedish Crowns (Reporting and editing by Terje Sollsvik, Susan Fenton).
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Gains for major Gulf markets on the back of positive earnings and easing tariff concerns
The major stock markets in the Gulf region rose in early trading on Tuesday. This was largely due to positive corporate earnings and the easing of trade tensions with the U.S. Officials said that the U.S. will take steps to reduce the impact on domestically produced cars of foreign parts, and prevent tariffs on imported cars from piling up. Businesses that were notified say China has exempted certain U.S. imports of its 125% tariffs, and asked firms to identify the critical goods for which they require levy-free treatment. This is the clearest indication yet that Beijing is worried about the fallout from the trade war. Saudi Arabia's benchmark Index edged up 0.1%, thanks to a 3.1% increase in Saudi Arabian Mining Company. Arabian Contracting Services Company, among others, jumped 7% after reporting a sharp rise in sales. The advertising firm did, however, see a drop in profits. Alinma Bank, on the other hand fell 1.2% after it reported a decline in its first-quarter profits. Dubai's main stock index rose 0.3% with the top lender Emirates NBD rising 1.2%. First Abu Dhabi Bank, the largest lender in the United Arab Emirates, beat expectations for the first quarter, boosting the Abu Dhabi index by 0.9%. According to data compiled and published by LSEG, the bank reported a profit net of 5,13 billion dirhams (1,40 billion dollars), exceeding analysts' expectations of 4,24 billion dirhams. Aldar Properties, which reported a positive quarterly profit, gained 2%. Abu Dhabi Commercial Bank, meanwhile, jumped 4.6% in anticipation of its earnings announcement. Qatar Islamic Bank rose 1.4%, while the Qatari index increased by 0.2%. Qatar Gas Transport fell 1.3% as it prepares to announce its first quarter earnings.
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How does Bangladesh prepare farmers for the increasing salinity of soil?
Salination of soils along the Bangladesh coast Saltier soils will prevent many crops from growing in the dry season Farmers are being educated on how to deal with the drought Rachel Parsons Bashar had no idea what she was going to see two years ago, when her land near Rampal (about 60 miles (97km) upstream the Rupsa river from the Bay of Bengal) grew nothing in the dry seasons. The soil was too salty. She says "I bought the cattle" with the extra money. She nods to a scrawny animal tied to a tree in front her house. During Bangladesh's long dry season, soil and water salinity destroys crops. This means that much of the coastal farmland is left fallow during the rainy seasons when most farmers plant rice. Saltwater intrusion has been exacerbated by storm surges, cyclones, poor water management practices and saltwater shrimp farming. Climate change makes things worse. By 2050, the United Nations Food and Agriculture Organization (UNFAO) predicts that half of all arable lands in the world will be affected with salinity. According to a report in Natural Resources Forum, a journal of sustainable development, published by the United Nations, the economic damage caused around the world costs over $27 billion per year. The Bangladesh Ministry of Agriculture, with the help of foreign aid, has partnered up with a number of NGOs in order to train tens of thousand farmers, like Bashar, on how and what to plant in soils that are salty. A RISING TIDE of CHALLENGES is facing BETTER farming Bashar has now access to salt-tolerant seed and has dug drainage channels and raised her planting beds. She was taught to use rice straw mulch to reduce evaporation, which increases salinity. Bashar now has an inexpensive, simple salinity meter from Cordaid, a partner NGO. She also has a rainwater irrigation system that is low-tech. The Bangladesh Rice Research Institute reported that the amount of land returned to production during the dry season, when soil salinity was highest, had increased by 270% in comparison to 2016. However the institute stated that this result has not been independently verified. Bashar, and the tens or thousands of women like her, consider Bangladesh's programme a success. But it is not without its flaws. Climate change and the lack of freshwater are threatening all that she has accomplished. Mazharul Anwar of the On-Farm Research Division of the Bangladesh Agriculture Research Institute (one of the program partners) said that the pattern of raining was uneven back in the past 20 or 15 years. "Now, the pattern of raining has changed." In April of last year, an extreme heatwave made the salinity in this area worse due to evaporation. Months later, heavier than normal rains led to devastating flooding. At the end of the season, when the salinity is at its highest, Bashar had some salt-tolerant plants growing. However, her mango trees were too salty to bear fruit. SHRIMP FARMING ADDS TO THE PROBLEM The problem is compounded by the shrimp farming that has been widespread in Bangladesh's coast region since the 1980s. Bashar and husband filled their shrimp pond with saltwater like many others. But the water seeped into their fields and freshwater fishpond. Zainal Abedin (former Cordaid programme coordinator) said that farmers are aware their land is never completely free of salt. He said, "They are aware of the negative effects of climate change." All coastal farmers suffer. Bangladesh has faced serious food issues before. Anwar pointed out how Bangladesh has fought to be self-sufficient in the production of rice, although some Bangladeshi media reports disagree that Bangladesh is fully self-sufficient. Between 1970 and 2023 the rice production has more than tripled, from 10,82 million to 41.3 million tons. He said: "Now we're trying to become (self-sufficient) in nutrition." This type of programme, which allows millions of smallholders to produce nutritious food to feed themselves and their families and earn a living on their own land is helping. Cordaid's country director for Bangladesh, Douwe Dijkstra says that 25 million people may migrate away from coastal areas over the next few decades.
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Swiss Re estimates that climate catastrophes will cost $145 billion by 2025.
Swiss Re, the reinsurance firm, said that in its report published on Tuesday, natural disasters such as hurricanes, storms and floods could cause insured losses of $145 billion by 2025. This would be a nearly 6% increase from 2024, and it would also make 2025 one of most expensive years ever. The projected amount of natural catastrophe losses covered by insurance for the year is $137 billion, which is significantly higher than long-term averages. Swiss Re's report cited the wildfires that ravaged Los Angeles in the first quarter of this year as the major contributors to the projected figures, which resulted in estimated insured losses of 40 billion dollars. The underlying risk increases continuously as a result of economic growth, population expansion and urban sprawl. This includes areas that are vulnerable to natural disasters. Swiss Re's report stated that climate change is also contributing to the compounding of losses in certain weather hazards and regions. The report stated that the total losses, including those not covered under insurance, will reach $318 billion by 2024. This is up from the $292 billion that was reported in 2023, and well above averages over a longer period of time. (Reporting and writing by Paul Arnold; editing by Matthias Williams).
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Demand eases, resulting in a narrowing of the spread between spot prices
The spread between French and German power prices has narrowed on Tuesday. German prices have fallen due to lower consumption estimates, while French contracts have benefited from a decrease in nuclear supply. Naser Hashemi, LSEG analyst, says that the lower wind power supply in Germany was more than offset by the weaker demand. The French baseload electricity for Wednesday at 0740 GMT was 36.5 Euros ($41.60 per megawatt-hour), 37.7% higher than its closing price on Monday. The German equivalent contract was down 18.3% at 73.5 Euros, but still more than twice as high as its French counterpart. LSEG data indicated that the German wind power production was expected to drop by 1.4 gigawatts on Wednesday to 3.9 GW. The French nuclear capacity has fallen three percentage points since Monday, to 60%. This is eight points below the level of last week. The Leibstadt nuclear power plant in Switzerland closed on Monday for a 4-week maintenance period. The demand trended down well ahead of Thursday's May Day holiday. This is followed by an inter-day that many businesses take off. The German power usage is expected to drop by 800 megawatts per day by Wednesday, to 53.4 GW. In France, the demand is predicted to fall by 2.2 GW at 41.4 GW. The German baseload power for the year ahead fell by 1.5%, to 79.1 Euros/MWh. In France, it was not traded after closing at 60.1 Euros. The benchmark contract on the European carbon markets was down by 1.6%, at 64.24 Euros per metric ton. The German regulator announced on Monday that an additional 6,493MW of electricity capacity would be required to maintain grid stability in Germany in winter 2025/2026. This is 7% lower than the requirement in the previous winter. The communication stated that the regulator is expecting to receive expressions of interest from foreign plant operators by mid-May.
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Neste, a biofuel manufacturer, expects a limited impact of tariffs. However, the supply glut is still weighing on them.
Neste, a Finnish biofuel producer and oil refiner, expects U.S. Tariffs to have only a small direct impact on their business. However, they warned about the oversupply of renewable fuels and market volatility. Heikki malinen, Neste's Chief Executive Officer said that "we expect European policymakers will safeguard an equal playing field and the competitiveness of European Industrial Companies." The Finnish group warned that it would continue to face challenges in the future due to the excess supply of renewable fuels, the weak global economy and the low demand for these fuels. Neste, a company that has a joint-venture with Marathon Petroleum California, said the U.S. was still incredibly important to the business. Malinen stated that the removal of Blender's tax credit (BTC) led the company, however, to optimize its Singapore shipments. BTC was an initiative to provide clean fuel tax credit that the Biden administration proposed, but then scrapped. The company's comparable earnings before interest taxes, depreciation, and amortization (EBITDA), which were 210 million euro ($239.15 millions) a year ago, fell by 62%. Malinen described the performance as "unsatisfactory". According to a consensus provided by the company, analysts had predicted a median of 211.7 million euro. Neste's margin on renewable products fell to $310 a tonne during the quarter, down from $526 a tonne at the beginning of 2024. This was better than the average expectation of $250 per tonne. While the company still expects to see its margins improve by 2025, the company warned about the impact of oil price fluctuations amid geopolitical unrest. Before April is a month of celebrations. The group has reduced 510 positions worldwide, resulting in an annual saving of 65 million euros. Neste shares rose more than 10% at Helsinki's 0725 GMT. ($1 = 0.8781 euro) (Reporting and editing by Andrew Heavens; Kirsten Donovan, Kate Mayberry and Boleslaw LaSocki)
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Dalian iron ore prices rise on strong Chinese demand
Dalian iron ore prices rose on Tuesday, supported in part by the near-term demand from China's top consumer, but gains were restricted by contradictory statements made by Washington and Beijing regarding trade negotiations. The daytime trading price of the most traded September iron ore contract at China's Dalian Commodity Exchange was 709 yuan (US$97.49). As of 0701 GMT, the benchmark May iron ore traded on Singapore Exchange fell 0.11% to $98,3 per ton. Mysteel, a consultancy, reported that the price of imported iron ore in China's port gained some ground on 28 April as downstream replenishing demands persist ahead of five-day Labour Day holidays. Everbright Futures, a broker, reported that hot metal production, which is typically used to gauge demand for iron ore, has increased from 2.4435 to 2.4435 millions tons in a month, an increase of 42,300 tonns. This represents 156,300 tonns year-onyear. ANZ reported that despite the uncertainty created by the U.S. trade war, the Chinese market is still under pressure to reduce its iron ore inventory. Donald Trump, the U.S. president, insisted that there had been progress made with China and that he had spoken to President Xi Jinping. Beijing denies that trade talks have taken place. A poll on Tuesday showed that China's factory activities likely decreased in April as Trump's "Liberation Day package" of tariffs put an abrupt halt to the two-month recovery. Fortescue, an Australian miner, reported higher third-quarter iron-ore shipments. Mysteel, in a separate statement, said that the total volume of iron-ore shipped from Australia and Brazil grew by 13.2% over the past week to 27.6 millions tons. Coking coal and coke, which are both steelmaking ingredients, were down by 2.36% and 1.02 %, respectively. The benchmark steel prices on the Shanghai Futures Exchange were flat. Hot-rolled coils and rebar fell by around 1.26% and 1.2% respectively, while wire rod and stainless steel gained 0.4% and 0.16% respectively.
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AstraZeneca may be subject to further import tax penalties from China
AstraZeneca said on Tuesday that it could face a fine up to $8,000,000 for suspected unpaid import tax in China. The drugmaker is working to boost its business in China, its second largest market, after scandals such as the arrest of the company's China president last summer. AstraZeneca, despite having a robust pipeline, is facing headwinds from its two largest markets: the United States and China. These include scandals in China and possible U.S. Tariffs on pharmaceuticals, as well as a trade conflict between Beijing and Washington. AstraZeneca reported that authorities in Shenzen had informed it that the unpaid amount suspected was $1.6 million. A fine between one and five times this amount could be imposed if found guilty. The company stated that "to the best AstraZeneca knows" the importation tax referred to in the opinion related to Enhertu, its breast cancer drug. AstraZeneca's core profit for the quarter ended March 31 was $2.49, beating analyst expectations. However, total revenue of $13.59bn missed analysts' estimates. In February, the company said that it could be fined up to $4.5million in China for suspected unpaid import duties, relating to cancer drugs Imfinzi, and Imjudo. It added that this probe could extend to Enhertu. AstraZeneca said on Tuesday that authorities had informed it that there was no "illegal profit" for AstraZeneca based on a separate allegation of personal information breach.
Finland supports EU goal of reducing emissions by 90% by 2040
Finland's State Secretary for Climate said that the EU should aim to reduce net greenhouse gas emissions by 90% in the EU by 2040. This comes as the governments prepare for the next EU climate goal.
The EU member states are waiting for a proposal by the European Commission on the bloc's climate goal 2040.
The Commission was planning to propose a 90 percent reduction in net emissions last month. However, it delayed its proposal due to pushback from countries and legislators who are worried about the impact of the goal on struggling European industries.
Mika Nykanen, in an interview about the 90% commitment that the EU's independent advisors had also recommended previously, said: "We think it is a good goal."
"We need a solid, attractive investment environment in Europe. If we change our big targets or policies, this will create uncertainty for investors and businesses."
The EU's environment ministers will meet in Warsaw, Poland on Tuesday. Although the 2040 goal is not part of the official agenda for their meeting, Ministers are expected discuss it informally.
Italy, Denmark, the Netherlands, and Slovenia are among the governments that oppose the 90% goal.
As a result of the opposition, the Commission has begun to look at ways that it can soften its 90% target, as previously reported.
This includes counting international carbon credits toward the target. This could weaken efforts to reduce CO2 from domestic industries. The new German government backed this idea in a statement made earlier this month. However, it said that credits should only cover three percentage points towards the 90% target.
A government source stated that France would be interested in the idea, provided there were safeguards to guarantee any international carbon credit delivered real emission reductions in other nations.
Nykanen stated that Finland had not suggested such flexibility, but he could understand the concerns of the poorer EU nations or those who are struggling to switch over to cleaner energy about their contribution at the national level to the EU's goal.
He said that there would be "difficult negotiations" on how to divide this share. Every country is concerned and has fears.
Wopke hoekstra, the EU's climate commissioner, has stated that he will now propose the climate target for 2040 before summer.
The EU has already made a legally-binding commitment to reduce its net greenhouse gas emission by 55% from 1990 levels by 2030 and eliminate them by the year 2050. (Reporting and editing by Lincoln Feast; Additional reporting by Anne Kauranen)
(source: Reuters)