Commodity: Urea, Coal, En 590, Pellets

2023-02-22 10:41:32 Chinese Lithium Prices Drop by 30% as EV Demand Weakens

The cost of lithium, commonly referred to as “white gold” for its critical role in the clean energy industry, has fallen by almost a third in China over the past three months due to weakening demand in the world’s largest electric vehicle market. Prices have dropped 29% from November highs to RMB425,000 ($61,795) per tonne, according to pricing agency Fastmarkets, driven by concerns over the strength of EV demand in Asia's largest economy.

Experts attribute the fall in prices to the persistent weakness in China’s EV market, which is currently waiting to see the impact of reduced subsidies for new energy vehicles and is concerned about low household confidence due to the country’s property crisis. Adding to the bearish sentiment, Chinese battery producer, CATL, was recently reported to have signed battery contracts with Chinese EV manufacturers at discounted prices, further dampening the outlook for lithium prices.

Despite the recent dip in prices, Chinese lithium prices are still eight times higher than they were a year ago, and prices in the US and Europe have fallen far less, only dropping 10% over the same period. The recent sell-off in lithium equities has been largely unjustified, with Scotiabank arguing that there will not be enough new supply to satisfy demand beyond 2024, even as lithium demand eases from “super-growth” to “high-growth”. Albemarle, the world's largest lithium producer, has also stuck by its bullish view on EV sales and lithium prices, predicting a 40% increase in China's EV demand this year. Ochish/sharhlash

2023-02-14 21:13:34 The cost of shipping containers from China to Russia:

Shipping a 20" container from China to Vladivostok costs $3500, and 40" costs about $6000. Shipping from Vladivostok to Moscow costs $7000.

Railway delivery from China to Moscow costs $10,000 - $12,000, including all charges.

Meanwhile, the cost of shipping a standard 40-foot steel container from China to the U.S. West Coast is $1444, according to Xeneta, up from a peak price of $9500 last March. The widespread delays and queues that arose at ports during the pandemic have also disappeared, and prices are actually back to pre-pandemic levels.

Shipping group Maersk predicts that demand for containers, a symbol of trade, will fall 2.5% this year.

In an attempt to lower freight rates, logistics companies are also cutting services. According to eeSea, carriers canceled or missed 1,639 flights between East Asia and Europe or North America in 2022, a 40% increase over the previous year.

However, European carriers do not work with Russia, so the cost of freight for us is almost nonexistent.

Before the pandemic, the cost of transportation from China to St. Petersburg was $2000-$2500, and the freight itself cost $1700-$1900 per container Ochish/sharhlash

2023-02-09 19:57:34 Trafigura scammed of $577 million

Trafigura said it was the victim of "systematic fraud" and is facing more than half a billion dollars in write-offs after it discovered that nickel shipments it bought did not contain the metal.

In a statement Thursday, the commodities trader said it recently discovered the alleged fraud and began legal action against a group of companies "associated with and apparently controlled" by Dubai-based metals trader Pratik Gupta, including TMT Metals and companies owned by UD Trading Group.

She added that a small portion of the containers purchased from those companies had been inspected since December and no nickel was found in them. She added that most of the cargo is in transit and "awaiting further inspection."

The first half of 2023 will reflect impairment charges of up to $577 million related to alleged fraud, which Trafigura said included "misrepresentation and submission of a variety of fraudulent documentation" by the companies.

TMT Metals describes itself on its website as a trading company that trades in base metals, minor metals and ferroalloys.

Nickel is the most expensive base metal, at more than $28,000 a ton, compared to about $9,000 for copper.

The impairment of assets is a potentially significant blow to Trafigura's earnings, representing more than 7 percent of the company's record net income of $7 billion in fiscal 2022. Ochish/sharhlash

2023-02-08 10:56:21 Indonesia’s Adaro struggles to secure funding for $2bn aluminium project

Indonesian coal company Adaro Energy is facing difficulties in securing funding from international banks for its $2 billion aluminum project in North Kalimantan province. The company and its partner, South Korea's Hyundai, are being accused by environmental groups of "greenwashing" the project, as it includes building a 2.2 GW coal power plant. Despite claiming to be a flagship green and renewable project, Adaro Minerals, a subsidiary of Adaro Energy, relies primarily on coal for its revenue and has only recently ventured into aluminum and battery production. The company is seeking $1.1 billion in bank loans for the project, in partnership with Chinese investment group Legend Holdings, but has faced rejections from global banks including DBS and Standard Chartered, who have committed to not funding coal-related businesses. The project has faced criticism for contradicting Indonesia's transition away from coal, and for being too slow in meeting global climate goals and commitments. Ochish/sharhlash

2023-02-07 12:23:01 Amid intensifying Western restrictions on Russia, Iran's "ghost flotilla" of tankers has shifted to carrying Russian oil. According to a Financial Times report, at least 16 ships from the flotilla network that had previously violated U.S. sanctions have now been shipping Russian crude oil in the past two months. Prior to this surge, only nine ships had switched to the Russian route in the nine months since the start of the war in February 2022.

Ship brokers and industry experts suggest that Russia has been tempting tanker owners and operators with premium rates to safeguard its primary source of export revenue from Western sanctions such as the G7/EU oil price cap. As a result, income from Russian oil exports has significantly dropped from pre-war levels.

The markup on Russian trade is reportedly 50% higher than normal market rates and in some cases, it can even exceed 100%, making it a more attractive option than Iranian oil shipments. Despite this, Iran has still managed to maintain or increase its crude oil exports. The country, which collaborates with Russia on oil policy through OPEC+, has become a strong supporter of Russian President Vladimir Putin's invasion of Ukraine.

Competition for vessels could potentially create friction in the relationship between Iran and Russia, however, an analyst at Kpler, a data and analytics firm, suggests that the rise in the number of ships in ghost fleets owned through secret offshore structures has helped to mitigate supply issues. Ochish/sharhlash

2023-02-06 23:19:34 Newmont's $17 Billion Mega-Deal Continues Gold Frenzy

The world's largest gold mining company, Newmont, has offered to acquire Australian competitor Newcrest for $17 billion, sparking potential trade wars as other groups seek consolidation. This reunification of the companies, as Newcrest was originally established as an Australian subsidiary of Newmont in the 1960s before being spun off after a merger with BHP's gold assets in 1990, could also result in one company controlling four out of Australia's five largest gold mines, pending approval from the Australian government.

The surge in demand for gold, reaching a record 4741 tons last year, the highest in a decade, was driven by "colossal" purchases from central banks led by China and Russia. Its status as a safe haven asset during geopolitical turbulence has been heightened by "doubt, skepticism, and uncertainty" following the US and its allies' decision to freeze Russian dollar reserves.

The last time gold mining saw such a wave of consolidation was in the late 1990s, and experts believe the current trend will continue, fueled by the growing demand for gold and the limited number of major gold assets. Stay tuned as the gold rush continues to unfold. Ochish/sharhlash

2023-02-05 15:33:01 Why Myanmar’s opposition is calling for a ban on jet fuel

According to UN figures, the Let Yet Kone raid was one among at least 670 air attacks carried out by the Myanmar military last year – a number that marks a 12-fold increase from the 54 aerial assaults recorded the year before.


A Myanmar fighter jet on a bombing mission on the Thai border in June last year, meanwhile, prompted panic in Thailand when it crossed the frontier, with officials ordering the evacuation of villages and schools in the area.

At least 460 people died in last year’s raids, according to Irrawaddy, while the two-year conflict has killed an estimated 31,022 people in total – civilians and combatants alike – according to the Armed Conflict Location and Event Data Project (ACLED).

The UN estimates that a further 1.1 million people have had to flee their homes, mainly because of the bombing raids.

As the toll rises, the NUG and human rights campaigners have called for a total ban on sales of jet fuel to Myanmar, even if that means the grounding of civilian flights, too. The NUG, in a statement following the bombing of the Chin rebel camp in January, called the ban “an urgent and necessary step that potentially will save thousands of lives”.

www.aljazeera.com Ochish/sharhlash

2023-02-04 21:27:48 South Korea’s GS Caltex offers March jet fuel – sources

South Korea’s GS Caltex has issued a tender to sell March-loading jet fuel cargoes, three sources close to the matter said on Friday.

This comes after earlier market expectations that the company is maximising jet fuel production, instead of gasoil, to capitalise on better margins for the heating and aviation fuel.

Regrade, the discount between jet fuel and 10 ppm sulphur gasoil, has been steadily narrowing since mid- January, data from Refinitiv Eikon showed.

The refiner is looking to sell three cargoes via the tender that closes on Feb. 3, the sources said, adding bids will remain valid until the end of the day.

These cargoes will load on March 7-9, 10-12 and 20-22.

The company had previously sold four February-loading jet fuel cargoes at premiums of $1 to $3 per barrel to Singapore quotes to buyers in the United States and Japan.

GS Caltex was not immediately available for comment.

Source: Reuters Ochish/sharhlash

2023-02-04 00:33:20 The European Union (EU) has agreed on the price caps for shipments of refined oil products from Russia, which will come into effect on February 5th. The caps are a part of the G7 effort to reduce Russia's export revenues. The EU ambassadors agreed to limit the price of premium products such as diesel to $100 per barrel and low-end products, including fuel oil, to $45 per barrel. This will allow shipping companies carrying Russian oil products to access western insurance and financing only if they pay less than the prescribed level.

The agreement to impose price caps was supported by more hawkish EU states, including Poland and the Baltics, who demanded a review of the cap level every two months. However, other G7 states, including the US, are less inclined to such a mechanism due to the potential instability it could cause on energy markets. The first review of the price cap is scheduled for mid-March, taking into consideration its impact on the Russian budget, EU member states, and the market.

The price cap on Russian crude imposed by the EU in December also comes with a review every two months. The tightness in diesel markets has raised questions about whether EU buyers will be able to replace the barrels they once got from Russia once sanctions create an embargo.

An EU diplomat commented that the caps are a "well-balanced restrictive measure" that will reduce Russia's income while guaranteeing access for third countries. The debate between EU capitals over the level of the cap was exacerbated by demands from some countries to also tighten trade sanctions against Belarus, Moscow's key ally and military supporter in the war. However, the debate over Belarus sanctions has been shifted to a discussion later this month on a new package of sanctions against Russia. Ochish/sharhlash

2023-02-03 10:09:07 Imagine - there are two companies that sell the same goods for export.
Ask yourself a question. What will their sales volumes be?

Most likely one will sell well, and the other poorly.
And most sales will be distributed according to the classic principle of 80 / 20. Do you agree?

And then companies come to us that need to sell their products, most often the proverbial 20%.

And they begin to torture us, how will you increase sales? What to put prices? How should we be different? All have the same pain, to sell more expensive and the entire volume. And our clients and partners think about their product for 10 hours and know how to sell it know the ins and outs.

But we don't know your product as well as you do, we are not as good at pricing, markets are very fluid, prices are dynamic. We don't answer your questions, we just know the challenges of finding customers. We think about it all the time.

If you want answers to your questions, you already know them.
Just imagine being a leader in three years. What steps and answers will get you there?

- Are you testing new sales channels?
- are you starting to trade high?
- How do you find trustworthy partners?
- would you take a risk by shipping goods under a letter of credit?
- Why wouldn't you be afraid of losing customers?

What questions do you ask yourself to increase sales? Or do you only think about production? Ochish/sharhlash