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The price of gas in Europe continues to drop due to global trade concerns and warmer temperatures
Dutch and British gas rates continued to drop on Monday morning, as fears of a trade war and warmer temperatures resulting in a weaker demand for energy weighed heavily on the market. LSEG data shows that the benchmark Dutch front-month contract fell 1.75 euros, or $11.19/mmBtu to 34.70 Euros per megawatt hour. The contract reached 33.65 Euros/MWh earlier in the year, its lowest level ever since September 2024. The Dutch June contract is down by 1.92 Euros at 34.83 euro/MWh. The British day-ahead contracts was down 4.25 pence to 85.25p/therm. The global financial markets were shook by Donald Trump's tariff plans on Monday, after he warned that foreign governments would need to pay "a great deal of money" in order to remove the taxes he referred to as "medicine". These tariffs include an additional 20% on products from the European Union. This has caused concern about a slowdown in Europe's economy and a reduction in industrial activity. In a daily report, LSEG analyst Oleh Skrynyk stated that this has contributed to a bearish feeling on the gas market. The benchmark contract dropped around 9% Friday after China announced reciprocal duties on U.S. products, intensifying a trade conflict that has caused investors to price in an increased probability of recession. The gas market was also affected by the expectation of warmer temperatures. In a daily report, Engie EnergyScan analysts said that "Gas Demand in Local Distribution Zones" (LDZ) has continued to fall amid temperatures above normal in many European countries. The European gas storage sites finished the winter heating season almost two thirds empty on March 31, and current low prices are expected encourage more injections. In a daily note, the consultancy Auxilione stated that "fears about being able fill gas storages in this summer has changed and an advantage is being taken to start this process." The benchmark contract on the European carbon markets was down by 3.51 euros, at 60.31 euro per metric ton. (Reporting by Susanna Twidale, Editing by Varun K.)
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Dalian iron ore falls to a two-week low due to trade war fears
Iron ore prices fell on Monday as a result of tit-fortat tariffs between China and the U.S., which have escalated a global trade conflict. The May contract for iron ore on China's Dalian Commodity Exchange ended the daytime trading 3.36% lower, at 762.5 Yuan ($104.31). In the early part of the session, the prices dropped to 754 Yuan, their lowest level since March 21. As of 0752 GMT the benchmark May iron ore traded on the Singapore Exchange had fallen 2.8% to $97.8 per ton, after hitting a session low nearing three months earlier at $96.4. In a recent note, Galaxy Futures stated that new U.S. Tariffs will cause external shocks on global markets. This will put pressure on iron ore prices. Chinese stocks plunged on Monday as a result of escalating tensions between the two largest economies in the world, which could disrupt trade and cause a global slowdown. China responded on Friday by imposing additional tariffs of 34% on all U.S. goods after U.S. president Donald Trump imposed tariffs of 34% on most Chinese products. Steelmakers have ramped up production in the spring construction season, March and April. According to Everbright Futures, the broker that tracks hot metal production (which is typically used to gauge demand for iron ore) has reported a rise of 14,500 tonnes per month to 2,3873 million tones. Coking coal and coke, which are used to make steel, have both fallen in price. They fell by 2.06% and 2.21 %, respectively. The benchmarks for steel on the Shanghai Futures Exchange have stagnated. Rebar fell 2.59%, while hot-rolled coils weakened by about 3%. Wire rod slid 3.5%, and stainless steel dropped 3.87%. ($1 = 7.3101. Chinese yuan). (Reporting and editing by Mrigank Dahniwala.
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Santander and BNDES support Mombak reforestation by drawing on Brazil Climate Fund
Mombak, a Brazilian startup that specializes in reforestation, announced on Monday it had secured 100 million reais (17.8 million dollars) from Santander Brasil, and the Brazilian Development Bank BNDES. The company is aiming to grow rapidly in the market for carbon removal. Mombak, a company that buys land from farmers or ranchers to restore it to its original state in the Amazon Rainforest, and partners with them, will be first to receive funding for reforestation projects with the support of Brazil's New Climate Fund. The Brazilian government announced the initiative to finance climate related projects in 2023. Santander will act as the financial intermediary in this deal, highlighting the growing interest of private lenders to the sector. BNDES offered a credit of up to 160 millions reais in August to Mombak, but it required a financial agent to provide the necessary guarantees. "It's a big challenge to get this approval before you can use the capital." In an interview, Mombak cofounder Gabriel Silva stated that they had reached a "very important milestone". Mombak has managed 45,000 acres, which is an area that's three times as large as Manhattan. By June, they expect to have planted eight million trees, making it the largest rainforest in the world. The company generates "carbon credits" by converting degraded land to forests that can be purchased to offset greenhouse gas emissions. Mombak has signed contracts for $150 million in carbon offtake, a number that CEO Peter Fernandez expects to triple this year. Many investors are still wary of the risk associated with Brazil's new carbon market. Some companies have reported difficulty in obtaining loans to finance their operations and reduce capital costs. BNDES Director Tereza Campello stated that the Mombak agreement should help ease some of these concerns. Brazil, which is home to 60% of Amazon rainforest, is seen by the bank as a well-positioned country to lead in the carbon offset market. "This is what a development banking does." Campello stated in an interview that we are taking the initiative. This deal proves that the market is viable, and not only BNDES but also other financial institutions believe in it. Leonardo Fleck, Santander Sustainability head, said that the new funding was a reflection of a growing market in Brazil. "Capital is flowing. Companies are planting and getting contracts with global giants. "I see it as a bit like a big puzzle. You start to put the pieces together."
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Russian rouble falls on cheaper oil and recession fears
The Russian rouble fell against the U.S. Dollar on Monday as the escalating tensions in trade between the United States, China and other countries stoked concerns of a possible recession which would lower demand for crude. The rouble had fallen 2.1% to 86.30 USD on the OTC market by 0740 GMT. The Russian currency has risen by about 24% this year against the dollar, mainly due to expectations that geopolitical tensions will ease. Analysts at BCS Brokerage said that a collapse in oil price could lead to the weakening the rouble. However, this would not happen immediately and only if low prices per barrel continue for a prolonged period of time. The price of oil, Russia's primary export commodity, has fallen to its lowest level since April 2020. Last week, the Russian central bank warned that President Donald Trump’s tariff increases could slow world economic growth. They may also fuel inflation. Oil prices might be lower for years to come due to reduced global demand. Analysts say that the increased sales of foreign currencies by the central banks, which began on Monday, has supported the Russian currency. The U.S. tariffs have not had a direct impact on the Russian economy. However, the Kremlin has said that it must take additional measures to minimize the market turmoil. The rouble, which is the most commonly traded currency in Russia, was also down by 0.5% on the Moscow Stock Exchange, at 11,77. (Reporting and Editing by Gareth Jones.)
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Ferrexpo's Pellet Production Drops 26% after Ukraine stops VAT Refund
Ferrexpo, a Ukrainian miner with a focus on iron ore production, reported a 26 percent drop in its first quarter iron ore pellet output Monday. The suspension of VAT refunds forced the company to reduce operations and cut back liquidity. The shares of the London-listed firm fell by 8.3% in early trading to 43.9 pence, amid a global stock market crash following the U.S.'s drastic tariffs. Interim Executive Chairman Lucio Genovese stated that the environment in which they operate has become more challenging. He cited lower funds as well as "significant" measures to cut costs across the company. The miner reported that Ukrainian tax authorities had suspended the VAT refund of 512.9 million Hryvnias (12.5 million dollars) because sanctions were imposed on its largest shareholder, who was accused by authorities of embezzlement. Ferrexpo said that the sanctions had not been imposed on them or their units. Genovese said, "We will continue to lobby the Ukrainian government and all other interested parties to reinstate the VAT refund." Ferrexpo reported that it was only able to operate one pellet line in the quarter. This led to a fall in production from 1.81 to 1.35 millions metric tons. The total commercial production, including iron ore as well, increased by 20% on a quarterly basis to 2,13 million tonnes. This is the highest quarterly output ever since the start of the Ukraine war. The company stated that this was not reflected in improved earnings because of high input costs (particularly imported electricity) and the deterioration of iron ore prices.
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Andy Home: Trump, tariffs, and tin.
The LME Base Metals Complex got a sneak preview of what to expect. The threat of similar tariffs on copper caused a transatlantic price gap that was unprecedented. The micro tariff turmoil is now accompanied by macro tariff turmoil, as the markets are frightened at the prospect of a full blown trade war. This week, the London Metal Exchange index of base metals fell 6% as reciprocal tariffs became a reality. Only one metal was spared the tariff tsunami. Tin continues to perform better than the rest of LME's pack, boosted by its own supply-chain chaos. Shocks Rock Tin - Supply LME's three-month tin increased by 25% in the first quarter 2025, surpassing gold's incredible run. The tin market has been on a roller coaster ride due to a series of supply shocks. After 18 months, the market fell on the news that the giant Man Maw mine in Myanmar was to restart. Then the market rebounded when Alphamin Resources announced they were closing their Bisie mine in Congo due the the escalating violence in the eastern part of the country. Tin has risen even more after the devastating earthquake in Myanmar that casts new doubts on Man Maw’s return. Investors are rushing to get in on the action. The long positions of funds have reached record highs. The LME stock market is slipping and the time-spreads are tightening. This adds to the volatile mix. The bulls should also note that China has a plentiful supply of tin. Shanghai Futures Exchange has seen a 47% rise in stocks this year, and the 9,872 metric ton stock is at its highest level since September. COPPER GAP - HOW TO IDENTIFY IT Since February, when Trump launched a national-security investigation into copper imports, the U.S. has imposed tariffs on the copper trading market. Arbitrage has been played out between the CME U.S. Customs-cleared Price and the LME Global Price. The market has tried to guess when and how much copper tariffs would be implemented. The CME's record premium over LME Copper has led to a massive movement of metal into the United States. It remains to be determined how much metal makes it through U.S. Customs before tariffs become effective. CME prices that were at record highs and the physical market disruption initially revived bullish sentiments. However, LME copper is now below $9,000 per ton as concerns grow over the adverse effects of U.S. tariffs on global manufacturing. ALUMINIUM PREMIUM ACTION Tariff trades have been reflected in premiums for regional markets. Last month, the U.S. Midwest Premium widened to over $900 per ton above the LME Basis Price as the market priced the increase in U.S. Import Tariffs from 10% up to 25%. The European premiums have dropped sharply in contrast to the U.S., suggesting that physical metal has already been diverted. Analysts were expecting high aluminium prices at the beginning of the year, but the market is now generating mixed signals. Like copper, it has also been affected by reciprocal tariffs. NICKEL ATTENDS INDONESIA Nickel spent the first quarter of 2025 stuck in a wide range between $15,000 and $17,000 per ton. As overproduction in Indonesia floods the refined nickel chain, the price of nickel has fallen. From 11% in 2024, the amount of Chinese Nickel stored at the LME has increased to over 50%. This metal is a product of Indonesian raw material that was processed in China. Indonesia is now producing its own refined metal which can also be found in LME sheds. Even Indonesian operators feel the pinch of the nickel price, which is so low. However, until Indonesia limits its production growth nickel will remain in oversupply. The question is whether or not the Indonesian flood will continue to wash down into the Class II lower-grade segment of the Nickel market. All depends on Indonesian margins. Heavy Stocks Weigh on Heavy Metal Talking about high stock prices. Last month, someone cancelled 120,000 tons LME lead stock. However, there was no response from the market in terms of price or time spreads. Nobody thinks that the physical metal market is short of this much metal. Lead is experiencing the type of LME warehouse arbitrage which comes with an oversupply and elevated stock levels. These stocks have grown from 21,500 to 331,000 tonnes at the beginning of 2023. Lead's price has held well despite the overhang of inventory, but this could be because lead is still in better condition than zinc. ZINC MINE REBOUND Zinc has consistently outperformed the LME group since the beginning of the year, despite the fact that exchange stocks have been falling steadily. The market seems to be more interested in the zinc raw material narrative than its nuanced refine metal dynamics. In 2024, the mined zinc production will fall by 2.8% on an annual basis. The raw materials supply chain will tighten to the point where smelter charges are negative in the second part of the year. In 2025, restarts and new mining are expected to produce a significant recovery. This new wave of mining supply appears to be gaining momentum. The smelter treatment charge, which had fallen to zero in 2024 due to a lack of mined concentrates, has now risen to $35 per ton. The demand for zinc was flat last year. With little hope of a recovery within the global construction sector, which is a major use of zinc, a higher output from mining will likely lead to an oversupply on the refined metals market. These are the opinions of a columnist who writes for.
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China's central banks purchases gold for the fifth consecutive month in March
Official data released by the People's Bank of China on Monday showed that China's central banks added gold to their reserves for the fifth consecutive month. China's gold reserves increased to 73.7 million fine troy-ounces by the end March from 73.61 millions ounces in February. Gold reserves in the United States were valued at $229.6 Billion at the end last month. This is up from $208,64 Billion at the end February. Yeap Jun-Rong, IG's market strategist, said that "strong central bank demand for Gold has been an important reason behind the gold price's rally." With rising global trade tensions and central banks' efforts to diversify reserves by increasing their gold holdings, this trend could continue in the future. The gold price has reached record levels this year, largely due to the uncertainty around tariffs, interest rate reductions, geopolitical conflict, and central bank purchases. China, the largest metals consumer in the world, responded to the U.S. tariffs that Trump imposed with a series of countermeasures on Friday. This intensified the trade war between two of the biggest economies. Central banks will likely continue to support gold's spectacular rally this year, with purchases aimed at diversifying their reserves away from dollars due to the risks posed by Donald Trump's policies. The PBOC halted their 18-month gold buying spree in May 2024. This had a significant impact on the Chinese investor's demand. The central bank began buying gold again in November 2024. Reporting by Anushree Mukerjee, in Bengaluru; Qiaoyi Li and Yukun Zhu in Beijing, with editing by Kim Coghill, Janane Venkatraman and Janane Venkatraman.
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Australian heavy rare Earths miners protest China export controls
Australian listed miners of heavy-rare earths rallied Monday, despite major selloffs on other markets. They were betting that Western governments would redouble their efforts to create a separate supply after China, the top producer, imposed export controls. Shares in Lynas, the top rare earths producer in the world outside China, rose 5%, as did Meteoric Resources which has a Brazil project. Meanwhile, shares in Australia's heavy rare earths developer Northern Minerals soared by 9.5%. China placed export restrictions for rare earth elements as part of a sweeping response to U.S. president Donald Trump's new tariffs. This has resulted in a reduction of the supply of minerals to Western countries, which are used to manufacture weapons, electronic devices, and consumer goods. The group of rare earths consists of 17 elements. Heavy rare earths have higher atomic masses, such as dysprosium, yttrium and others. These are less abundant but more valuable. The news from China highlighted Lynas’s strategic capabilities, which are underpriced on the market at present," said Barrenjoey Analyst Dan Morgan. China produces 90% of rare earths in the world, and export restrictions affect all countries, including the U.S. Analysts said that the export restrictions affect not only minerals, but also magnets and finished products. Lynas stated that it closely monitored global developments while it moved forward with its production plan. A spokesperson stated, "We are pleased to announce that our new heavy-rare earth separation circuit will be commissioned in this quarter." Lynas will be able to meet the demand for both heavy and light rare earths materials once production begins. Meteoric Resources announced in a Monday filing that it plans to produce six elements under export controls on its Caldeira Project, which is expected to be operational during the second half 2027. Separately Australia's Premier Anthony Albanese who faces a May 3, 2019 election raised the possibility of creating national stockpiles for critical minerals. This would likely include rare earths. Albanese stated last week that a Labor Government would establish a Critical Minerals Strategic Reserve. I will be able to elaborate on this. Analysts said that they were waiting to hear more details, as it is usually consumers who stockpile inventory in the event of a supply chain disruption, not producers. (Reporting and editing by Jamie Freed, Kate Mayberry, and Kirsty Wantham in Sydney)
US energies boosting capex strategies to meet demand from power-guzzling sectors
Major U.S. energies are anticipated to spend greatly on updating their electrical lines and grids over the next 5 years to deal with powerhungry sectors, although professionals fret that their plans to raise rates greatly to balance out greater expenses might face regulatory hurdles.
In the previous couple of weeks, about nine energies had actually raised their capital investment anticipated by 22% typically for the three years starting in 2025, as they anticipate insatiable demand from AI-focused information centers and battery-powered electric cars.
A Reuters analysis revealed that four of these energies had raised their capital spending by record levels.
Evergy
, an energy that serves Kansas and Missouri states, increased its rolling five-year financial investment plan by $3.7 billion, in its biggest modification since 2018 with a 29.6% hike.
American Electric Power, which serves 11 states and nearly five million individuals, revised its strategy by up to $54. billion - a 25.6% walking and the highest considering that 2016.
The substantial hikes in capital spending, driven by the bullish. power need forecast, is rather new for the sector, industry. specialists stated.
They likewise kept in mind that utilities, whose capital program is not. greatly based on rate cases, will likely have an edge.
Investors will look more positively at energies that do not. have any rate cases scheduled for next year, as that reduces. unpredictability associated to their capital program, said Nicholas. Campanella, head of U.S. power and energies research study at. Barclays.
You have so much riding on these rate case results. If you. get a bad choice, you're going to have to cut CapEx - you're. going to need to reprioritize where you're investing the dollars. and clearly the stocks are going to decrease, Campanella. included.
Energies typically supplement their capital plans by. charging customers more for power supply.
From the beginning of 2023 through August 2024, regulators. approved 58% of ask for rate increases by energies, the. U.S. Energy Info Administration stated.
The rate case overhang notwithstanding, some specialists still. expect the aggressive growth in capital spending to continue.
I think it's still got to double. So if you consider. the next five to 10 years, you're most likely going to see this. type of rate of development or something comparable to it, said Chris. Ellinghaus, expert at Siebert Williams Shank.
The capital spending growth will not be limited to the. energies sector alone. Goldman Sachs experts see financial investment in. information centers and hardware devices resulting in a rebound in. overall capital expenditure growth in the U.S. next year.
(source: Reuters)