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ArcelorMittal abandons plans to produce green steel in Germany because of high energy costs
ArcelorMittal said that the energy costs in Germany were too high to allow it to convert its two German plants to carbon-neutral production. The German industrial sector is still suffering from the shock of losing the Russian gas which had been powering its factories for decades. This decision also calls into question the green hydrogen policy launched by the former government. The government hoped that the subsidies would encourage ArcelorMittal's existing plants in Bremen, in the north, and Eisenhuettenstadt, in the east, to convert to furnaces that are fired by hydrogen. Hydrogen can be produced from renewable electricity. The steelmaker stated that it decided to not proceed with its plans due to the high energy costs in Germany and the uncertainty surrounding the future energy mix. The first electric arc forges will be built in countries with competitive and predictable electricity supply, it stated. It highlighted a recent investment into a forge powered by electricity in France. It said that "electricity prices in Germany were high by international standards as well as compared to neighboring countries." The steel industry of Europe was also affected because so many consumers imported electricity instead of buying it from local producers. The German Economy Ministry regretted the decision of the company. The important thing to remember is that there has been no payment yet. In an email, a spokesperson for the ministry said that "no money needs to be reclaimed". Germany approved a total of 6.9 billion euro in subsidies for steelmaking projects to further its climate goals. This includes the amount for the now dropped Arcelor project. The ministry spokesperson confirmed that three other projects - owned by Salzgitter Flachstahl (TKSE), Thyssenkrupp Steel Europe and Stahl-Holding-Saar - are still in progress. Germany is building rapidly renewable electricity networks. However, the transition away from Russian gas, which has been a long and painful process, has proved to be lengthy and costly, despite the generous subsidies offered to industries who rely on gas to switch over to hydrogen. The conservative-led coalition government, which took office in this year, has criticised the left-leaning previous government's strategy on energy but so far hasn't outlined a radical new approach. Geert van poelvoorde, ArcelorMittal Europe's head of Europe, said: "The European steel sector is under unprecedented pressure in order to maintain its competitiveness." "And this is before decarbonisation costs." He called on the European Commission (EC) to limit imports of certain types of steel to Europe. The competition from abroad, he said, was the biggest problem facing the industry. Reporting by Thomas Escritt, Christian Kraemer and Tomaszjanowski; Editing Jamie Freed & Tomaszjanowski
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What is the risk of nuclear contamination from Israel's attack on Iran?
Experts say that Israel's attacks on Iran's nucleonic installations have so far only posed limited contamination risks. They warn, however, that an attack on Iran's Bushehr nuclear power plant could lead to a nuclear catastrophe. Israel claims it wants to prevent a nuclear catastrophe in the region, which is home to millions of people as well as producing much of the world’s oil. It is determined to destroy Iran’s nuclear capability in its military campaign. Israel's military announced that it had hit a Bushehr site on the Gulf Coast, home to Iran’s only nuclear power plant. But later they said the announcement was an error. What has Israel done so far? Israel has declared attacks on nuclear sites at Natanz, Isfahan and Arak, as well as Tehran. Israel claims it wants to prevent Iran from building an atom-bomb. Iran has denied ever having sought one. IAEA, the international nuclear watchdog, has reported damage at the Natanz uranium plant, the Isfahan nuclear complex, including the Uranium Conversion Facility and the centrifuge production plants in Karaj, Tehran and Karaj. Israel has also targeted Arak, which is also known as Khondab. IAEA reported that Israeli military strikes damaged nearby heavy water plant and the Khondab Heavy Water Research Reactor which was still under construction and not yet operational. IAEA stated that the reactor was not operational, and did not contain any nuclear material. Therefore, there were no radiological impacts. IAEA updated its assessment of the site on Friday and said that key buildings were damaged. The heavy-water reactors are capable of producing plutonium that, along with enriched uranium can be used in the production of an atom bomb. What are the risks of these strikes? Peter Bryant, professor of radiation protection science at the University of Liverpool, England, who specializes in nuclear energy policy and radiation protection, has said that he's not concerned with the fallout risk from the strikes. He pointed out that the Arak facility was not in operation while the Natanz site was underground. No radiation leakage was reported. He said that the issue was controlling what happened in that facility. Nuclear facilities were designed to do that. He said that uranium is only dangerous when it's inhaled, ingested, or gets into your body. Darya Dolzikova is a senior researcher at London's think tank RUSI. She said that attacks on the facilities at the front of the nuclear fuel chain - where uranium gets prepared to be used in a reactor -- pose chemical risks, and not radiological ones. UF6, or uranium hexafluoride is the main concern at enrichment plants. She said that when UF6 reacts with the water vapour in air, it creates harmful chemicals. She added that the weather will affect how much material disperses. In low wind, material is likely to settle near the facility. In high wind, material will travel further, but also disperse widely. Underground facilities have a lower risk of dispersal. Simon Bennett, the head of the civil safety unit at the University of Leicester, UK, stated that the risks to the environment are minimal if Israel strikes subterranean installations because "you're burying nuclear materials in thousands of tons of concrete, rock, and earth". What about nuclear reactants? A strike on Iran’s Bushehr nuclear reactor would be of major concern. Richard Wakeford is Honorary Professor of Epidemiology, University of Manchester. He said that while the contamination of the area surrounding enrichment plants would "mainly be a chemical issue", the extensive damage of large power reactors was "a different story". He added that radioactive elements could be released into the ocean or through a plume containing volatile materials. James Acton, director of the Nuclear Policy Program for the Carnegie Endowment for International Peace said that an attack on Bushehr could "cause an absolute radiological disaster", but that an attack on enrichment plants was "unlikely" to have significant off-site effects. He said that uranium is barely radioactive before it enters a nuclear reactor. "The chemical uranium is hexafluoride, which is toxic but doesn't travel far and has a low radioactivity," he said. "Israel's attacks so far have had virtually no radiological effects," he said, while expressing his opposition to Israel. Bennett of the University of Leicester stated that it would be "foolhardy" for Israel to attack Bushehr, because they could pierce and release radioactive material in the atmosphere. Why are Gulf States particularly concerned? The Gulf States' impact on any attack on Bushehr will be worsened if the Gulf waters are contaminated, putting at risk a vital source of desalinated water. According to the authorities, in the UAE, more than 80% drinking water is desalinated, and Bahrain has become fully dependent on desalinated waters since 2016. 100% of groundwater was reserved for contingency planning. Qatar is completely dependent on desalinated drinking water. According to the General Authority for Statistics, in Saudi Arabia, which is a larger country with more natural groundwater reserves, 50% of water supplies will be desalinated by 2023. Some Gulf States, such as Saudi Arabia, Oman, and the United Arab Emirates, have access to multiple seas to draw their water, but countries like Qatar and Bahrain are congested along the Gulf shoreline with no other coastline. If a natural catastrophe, an oil spill or even a targeted assault were to disrupt a water desalination facility, hundreds of thousands would lose their access to freshwater instantly, said Nidal Ilal, Professor and Director of the Water Research Center at New York University Abu Dhabi. He said that coastal desalination plants were particularly vulnerable to regional hazards such as oil spills and nuclear contamination.
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Scientists in Croatia are working to protect Posidonia seagrass
Scientists on the Croatian island of Dugi Otok in the Adriatic Sea have conducted a dive mission to assess damage caused by human activity. They are demanding that action be taken to protect the environmentally important seagrass meadows. Posidonia Oceanica, also known as Mediterranean Tapeweed, is named after Poseidon the Greek god of the ocean. It provides food and shelter to fish, protects the coasts from erosion and purifies the water. Scientists have found that a meadow of Posidonia could absorb up to 15x more carbon dioxide annually than a piece of Amazon rainforest of similar size. Scientists say that much more must be done to protect the area from tourists anchoring in the Adriatic Sea and from trawlers pulling fishing nets through the water of the Adriatic Sea near Dugi Otok, and the Kornati archipelago National Park. They have called for stricter regulations, and fines on those who break them. Dominik Mihaljevic is a biologist in the national park. He said that the park has begun installing anchorages which will not harm seagrass. He said that the ultimate goal was to prohibit anchoring in all 19 of the anchorage sites currently used. Matea Spika is a senior associate with Croatia's Sunce association for environmental protection. She told me that Mediterranean Posidonia endemic to Mediterranean Sea has declined by 30% over the past 30-40 years. She said that in addition to the anchors and nets issue, chemicals, excess nutrients coming from cities and farms, warming waters caused by climate change, invasive species, and excessive nutrients coming from farms had also caused damage. Posidonia is also unable to grow because of artificial beaches and new ports. (Reporting and Writing by Aleksandar Vaovics, Editing by Barbara Lewis. Reporting by Antonio Bronic)
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Libya objects to Greek tenders for hydrocarbon exploration offshore Crete
Libya's internationally recognized government of national unification has objected Greece's approval for an international tender to explore hydrocarbons off the island Crete. It said that some of the blocks violated its maritime zone. Both countries are trying to repair their strained relations after an agreement signed in 2019 by the Libyan government with Greece's regional competitor Turkey. The accord mapped out a large sea area that they share near the Greek island. Greece opposed the agreement. It said it had no legal foundation, as it was seeking to create an economic zone exclusive from Turkey's southern Mediterranean coast to Libya's north-east coast, while ignoring Crete's presence. Chevron, a U.S.-based major, expressed interest in the hydrocarbon exploration of two blocks south from Crete. Libya's Tripoli based Foreign Ministry said in a late Thursday statement that some of sea blocks tendered off Crete were within disputed areas and "clear violations of Libya's sovereignty rights". It said that the ministry was opposed to "any exploration or drilling activity in these areas, without a legal understanding prior to this respecting international law", and called on Greek authorities prioritise negotiation and dialogue. According to a senior source within the Greek energy ministry, Athens adhered to international maritime law and that its government is committed to discussions "within a framework of international legitimacy". A source in Greece's energy ministry declined to name the source due to the sensitive nature of the issue. An anonymous official from the Greek Foreign Ministry said that George Gerapetritis, the Greek foreign minister, is likely to visit Libya within the next few weeks. Reporting Ahmed Elumami from Tripoli, and Angeliki Kooutantou from Athens. Editing by Edward McAllister & Emelia Sithole Matarise.
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Next week, nuclear production will be affected by high temperatures in the French River
Nuclear operator EDF announced in a Friday notice that high water temperatures will affect electricity production along the Rhone River in eastern France starting June 25. This is especially true at the Bugey nuclear power plant with a 3.6 gigawatt capacity. The first warning of high temperatures on rivers in France for 2025 is here. Heatwaves can impact the environmental regulatory thresholds for cooling water going through the system, and then being discharged. Meteo France's data shows that a heatwave will sweep across France this weekend. Temperatures could reach as high as 38 deg Celsius (100.4degF), in the south. The bulletin did not mention the 3.6 GW Cruas Nuclear Plant and the 2.6 GW Saint-Alban Nuclear Plant, which are downstream of the Bugey nuclear plant. Currently, one of the 1.3 GW units at Saint-Alban as well as one of the Cruas reactors are offline for maintenance. EDF is able to lower production in individual reactors, rather than shutting down the entire nuclear plant. This means that if a reactor needs maintenance, the reactors currently operating will not be affected. The summer months are usually the maintenance period, as power demand is lower. Reporting by Forrest Krellin, Editing by Tomasz and David Evans
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Copper prices fall on geopolitical unrest
Investors were cautious as they watched the conflict between Israel and Iran. Israel attacked nuclear targets in Iran on Thursday. Iran then fired missiles and drones into Israel, after an Israeli hospital was hit overnight. U.S. president Donald Trump said he would make a decision on Israel's behalf within the next two week. As of 0103 GMT the most traded copper contract on Shanghai Futures Exchange was down 0.6% at 77,990 Yuan ($10,855.31) a metric ton. This is a 0.3% drop on the previous week. Three-month copper prices on London Metal Exchange were down 0.5%, to $9,571 per ton. Copper prices fell on both exchanges in the second consecutive week. Metals analysts at a Shanghai futures firm said that a number of issues are affecting the metals markets. These include the Middle East and possible U.S. rate cuts. China's reduced consumption is also a factor. Data on Wednesday showed that China's refined output of copper in May increased 13.6% over the previous year to 1,25 million metric tonnes, while its demand for metals like copper and aluminum has been muted due to the summer season's weakness. LME tin rose 0.3% to $32,100 while nickel dropped 0.6% at $14,960. Zinc was down by 0.6% at $2,625, and lead fell by 0.6% at $1,981. Aluminium also declined 0.2% to 2,517. SHFE tin dropped the most by 1.2% on the day to 260 560 yuan per ton. Aluminium fell 0.7% to 20 465 yuan. Lead was down 0.4% at 16,810 and zinc was down 0.3% at 21,845. Click or to see the latest news in metals, and other related stories. Data/Events (GMT). 1230 US Philly Fed Business Indx June 1400 EU Confid. Flash Jun ($1=7.1845 Chinese Yuan) (Reporting and editing by Harikrishnan Nair, Tasimzahid, and Hongmei Li)
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Oil prices on the rise as tensions in the Middle East flare
Brent crude oil has risen by around 20% in June and is set to make its biggest monthly increase since 2020, as tensions between Israel/Iran flare up. The rise in oil prices, although relatively modest, has been noticed just three years after the Russian invasion of Ukraine. This triggered an increase in energy costs that pushed up global inflation rates and led to aggressive interest rate increases. What does the rising price of oil mean for global markets? How high is it? Investors are comforted by the fact that oil production has not been disrupted, and so prices have increased slowly rather than spiking. Attention! Investors priced in a higher chance of Middle East supply disruptions, as the premium for Brent crude first-month futures contracts compared to those for delivery six months from now this week reached a six-month-high. . The level remained high on Friday. Oil is trading at $77 per barrel. It is still below the $139 peak of 2022, but it is approaching pain points. Christophe Boucher, CIO at ABN AMRO Solutions, said that if oil prices stay in the 80-100 dollar range for a long time it would be a serious threat to the global economy. "We're just below the threshold." SHOCK 2/ IN SUPPLY? Shipping is often viewed as an important energy indicator by traders. Around a fifth (25%) of all oil consumed in the world passes through the Hormuz Strait, which connects Oman with Iran. Analysts say that disruptions here could push the price of oil over $100. Blockade of shipping routes will compound any supply shock. Nadia Martin Wiggen, director of Svelland capital, stated that despite the 1.2 million extra barrels a week promised by OPEC+, none have yet been delivered or shipped. She said that if shipping routes are blocked, this supply will not reach the international market. She is closely monitoring freight rates. Wiggen said that the freight rates indicate that China has not yet panicked and bought oil due to supply concerns. Once China begins to buy, freight prices and energy prices around the world will increase. 3/ NO OIL NO GROWTH The rising oil price is a cause for concern because it can increase inflation in the near term and harm economic growth through squeezing consumer spending. According to economists, high oil prices are like a tax. This is especially true for countries that import energy in large quantities, such as Japan or Europe, as oil can be difficult to replace on a short-term basis. Samy Chaar, chief economist at Lombard Odier, said that oil prices over $100 per barrel would reduce global economic growth by 1% and increase inflation by 1%. Israel's strike against Iran last week triggered a wave of unease. The initial rise in safe-haven bond prices soon faded away as the focus shifted to the inflationary effects of higher oil. The five-year euro zone forecast, which is closely watched as a gauge of inflation expectations on the market, has risen to its highest level for almost a week. Frances Donald, chief economist at RBC, said that if the oil price rises to $75 per barrel, it will boost the CPI by about a half-percent by year's end. This would take the CPI from 3.5% to 3.5%. The rise in crude oil prices will be felt most by Turkey, India and Pakistan. Morocco, too, is heavily dependent on imported oil. Analysts say that those who supply oil, such as Gulf countries, Nigeria Angola Venezuela, and Brazil, Colombia, and Mexico, will benefit from the rise in crude prices. Oh king dollar The dollar is changing. The currency has gained in recent years when oil has rallied, but its latest increase has only been a limited one, with just a 0.4% weekly gain. Analysts anticipate that the downward trend of the dollar will resume given expectations about Middle East risks being limited for now, and underlying negative sentiment. The dollar has fallen around 9% against major currencies so far this season, hurt by the economic uncertainty and concerns about the U.S. president Donald Trump's administration being a reliable trading and diplomatic partner. A weaker dollar will certainly ease the pain of higher oil prices, since they are priced in dollars. UniCredit stated that the fall of the dollar offers relief to oil-importing nations, as it reduces the impact of rising oil prices, and also eases wider economic strains. 5/ COMPLACENT STOCK? World stocks are content to remain near their all-time highs in the absence of a sudden oil supply shock. Investors will look past it until there is a reason for them to believe that this conflict will grow to be much more serious, said Osman Aly, Goldman Sachs Asset Management’s global co-head Quantitative Investment Strategy. Gulf markets initially fell on initial news but then stabilized, aided by higher oil prices. U.S. energy stocks, especially oil and gas companies, and defence stocks have performed well. Israeli stocks have outperformed all other markets, with a 6% gain in one week. Airlines are the most affected, but oil-consuming stocks have also been hit hard.
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Dalian iron ore is near flat this week due to China's resilient demand and property woes
The prices of Dalian Iron Ore Futures rose on Friday but remained nearly flat for the entire week, as investors balanced the resilient demand for steelmaking ingredients in China's top consumer against the persistent slump in that country's real estate market. The most traded September iron ore contract at China's Dalian Commodity Exchange ended daytime trading 0.93% higher, at 703 Yuan ($97.85), a metric tonne. It also fell 0.07% in the past week. As of 0708 GMT, the benchmark July iron ore traded on Singapore Exchange was 0.94% higher. It stood at $93.55 per ton. This week, the contract was down 0.65%. According to Mysteel, the operating rate of China's blast furnaces increased by 0.4% in the last week to 83.82%. Mysteel data showed that hot metal production, which is a measure of iron ore consumption, increased 0.24% from week to week, reaching 2.422 millions tons as of 20th June. Galaxy Futures, a broker, said: "While the demand is resilient right now, market traders are primarily focused on whether or not off-season demand continues to be factored into trading." Construction in China peaks during the spring, before the rainy season begins. Analysts at ANZ say that meaningful growth in steel and ore demand will not be possible until the new construction activity increases. Official data released on Monday showed that China's new house prices dropped in May, continuing a stagnation of two years. Goldman Sachs reported late Monday that the demand for new homes in China will likely remain below its 2017 peak during the next few decades. Coking coal and coke, which are used to make steel, have both gained in the DCE. They rose by 1.08% apiece. The Shanghai Futures Exchange saw a significant increase in the majority of steel benchmarks. Rebar was up by 0.23%. Hot-rolled coils were up by 0.39%. Wire rod rose around 0.3%. Stainless steel fell 0.44%. $1 = 7.1845 Chinese Yuan (Reporting and editing by Harikrishnan Nair, Sherry Jacob Phillips).
Japan's Toyo to produce solar cells in Ethiopia for United States plant
Japan's TOYO Co. Ltd on Monday stated it will develop a 2 gigawatt solar cell factory in Ethiopia that will provide dutyfree elements to a panel factory it is preparing in the United States.
WHY IT is essential
TOYO's investment in Hawassa, Ethiopia, comes amid growing concerns over new U.S. tariffs on photovoltaic panels from 4 Southeast Asian countries. TOYO currently produces its solar items in Vietnam, one of the nations subject to the responsibilities.
KEY QUOTE
We are enjoyed embark on this enthusiastic project, which will enable us to rapidly scale up solar cell production to meet the needs of our planned module facility in the United States, Junsei Ryu, CEO of TOYO, stated in a declaration.
CONTEXT
U.S. trade officials this month set preliminary tariffs on solar batteries and panels from Malaysia, Vietnam, Thailand, and Cambodia. Producers in those nations, U.S. solar producers argue, get generous aids that threaten President Joe Biden's goal to improve domestic production of tidy energy innovations.
TOYO's brand-new center will be tactically positioned in Ethiopia, which is exempt from a U.S. tariff on popular double-sided panels. The business stated last month that it was in the lasts of negotiations to construct a 2 GW panel factory in the United States.
BY THE NUMBERS
The approximated financial investment for the task is $60 million, and the brand-new facility is anticipated to produce as much as 880 jobs. The factory is expected to begin production by the end of the first quarter of 2025.
(source: Reuters)