US Congress passes waterways bill

Spanish Market: Agriculture, Biofuels, Chemicals, Coal, Crude oil, Fertilizers, Metals, Oil products, Petroleum coke
19/12/24

The US Senate has passed a bipartisan waterways infrastructure bill, providing a framework for further investment in the country's waterways system.

The waterways bill, also known as the Water Resources and Development Act (WRDA), was approved by the Senate in a 97-1 vote on 18 December after clearing the US House of Representatives on 10 December. The WRDA's next stop is the desk of President Joe Biden, who is expected to sign the bill.

The WRDA has been passed every two years, authorizing the US Army Corps of Engineers (Corps) to undertake waterways infrastructure and navigation projects. Funding for individual projects must still be approved by Congress.

Several agriculture-based groups voiced their support for the bill, saying it will improve transit for agricultural products on US waterways. The bill also shifts the funding of waterways projects to 75pc from the federal government and 25pc from the Inland Waterways Trust Fund instead of the previous 65-35pc split.

"Increasing the general fund portion of the cost-share structure will promote much needed investment for inland navigation projects, as well as provide confidence to the industry that much needed maintenance and modernization of our inland waterway system will happen," Fertilizer Institute president Corey Rosenbusch said.

The bill includes a provision to assist with the damaged Wilson Lock along the Tennessee River in Alabama.

By Meghan Yoyotte

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19/12/24

Trump backs new deal to avoid shutdown: Update

Adds updates throughout Washington, 19 December (Argus) — US president-elect Donald Trump is offering his support for a rewritten spending bill that would avoid a government shutdown but leave out a provision authorizing year-round 15pc ethanol gasoline (E15) sales. The bill — which Republicans rewrote today after Trump attacked an earlier bipartisan agreement — would avoid a government shutdown starting Saturday, deliver agricultural aid and provide disaster relief. Trump said the bill was a "very good deal" that would also include a two-year suspension of the "very unnecessary" ceiling on federal debt, until 30 January 2027. "All Republicans, and even the Democrats, should do what is best for our Country, and vote 'YES' for this Bill, TONIGHT!" Trump wrote in a social media post. Passing the bill would require support from Democrats, who are still reeling after Trump and his allies — including Tesla chief executive Elon Musk — upended a spending deal they had spent weeks negotiating with US House speaker Mike Johnson (R-Louisiana). Democrats have not yet said if they would vote against the new agreement. "We are prepared to move forward with the bipartisan agreement that we thought was negotiated in good faith with House Republicans," House minority leader Hakeem Jeffries (D-New York) said earlier today. That earlier deal would have kept the government funded through 14 March, in addition to providing a one-year extension to the farm bill, $100bn in disaster relief and $10bn in aid for farmers. The bill would also provide a waiver that would avoid a looming ban on summertime sales of E15 across much of the US. Ethanol industry officials said they would urge lawmakers to vote against any package without the E15 provision. "Pulling E15 out of the bill makes absolutely no sense and is an insult to America's farmers and renewable fuel producers," Renewable Fuels Association chief executive Geoff Cooper said. If no agreement is reached by Friday at 11:59pm ET, federal agencies would have to furlough millions of workers and curtail services, although some agencies are able to continue operations in the event of a short-term funding lapse. Air travel is unlikely to face immediate interruptions because key federal workers are considered "essential," but some work on permits, agricultural and import data, and regulations could be curtailed. The US Federal Energy Regulatory Commission has funding to get through a "short-term" shutdown but could be affected by a longer shutdown, chairman Willie Phillips said. The US Department of Energy expects "no disruptions" if funding lapses for 1-5 days, according to its shutdown plan. The US Environmental Protection Agency would furlough about 90pc of its nearly 17,000 staff in the event of a shutdown, according to a plan it updated earlier this year. By Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

USDA awards more funding to increase fertilizer output

19/12/24

USDA awards more funding to increase fertilizer output

Houston, 19 December (Argus) — The US Department of Agriculture (USDA) awarded over $100mn this week across nine states to increase domestic fertilizer production as the effort to make farmer affordability more favorable continues. About $116mn will be invested through the USDA's Fertilizer Production Expansion Program (FPEP) to help eight facilities expand output in California, Colorado, Georgia, Indiana, Iowa, Kansas, Michigan, Oklahoma and Wisconsin. Recipients include the Michigan Potash Company, where the construction of a new facility should yield 400,000 metric tonnes (t) annually of high-grade potash, and Farmers Cooperative Association, where funding will expand its existing dry fertilizer facility with additional storage and processing capacity. "When we invest in domestic supply chains, we drive down input costs and increase options for farmers," USDA secretary Tom Vilsack said. Through the FPEP, the USDA has invested $517mn in 76 fertilizer production facilities across 34 states and Puerto Rico. President Joe Biden's administration committed up to $900mn in the program through the Commodity Credit Corporation, which is expected to support long-term investments by strengthening supply chains. Higher US fertilizer prices throughout this year deterred fall demand as lower crop prices forced farmers to sell more of a crop to afford nutrients. The last USDA FPEP funding announcement was in August , when $35mn was granted to boost seven domestic production projects. By Taylor Zavala Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Q&A: Xcelsior aims to derisk minor metals investment

19/12/24

Q&A: Xcelsior aims to derisk minor metals investment

London, 19 December (Argus) — When UK-based Xcelsior Capital started exploring the investment landscape in the mining industry it noticed a significant interest in base metals but a lack of attention toward the lesser-known minor metals. These critical materials are often opaque and complex, leaving investors uncertain about where to start. Argus spoke with chief executive Liam Farley about Xcelsior's partnership with trading firm Wogen, the opportunities and risks associated with its investments, the influence of geopolitics, and Xcelsior's recent involvement in the Hillgrove antimony mine in Australia. What is Xcelsior Capital, and what is its investment model? Xcelsior is primarily a private credit investor that focuses on providing senior secured loans and working capital facilities and prepayments. As a financing partner of a physical commodity trader, Wogen Resources, we aim to establish a long-term sales and distribution agreement or offtake as part of our transactions. We work with mining companies entering production, expanding existing mine operations, or establishing new or existing processing and recycling facilities. We built Excelsior around Wogen's 50-year heritage of being integrated into more than 30 critical metals from upstream, concentrates, intermediate products and finished metals. As a result, we have a solid grasp of the risk-reward on the market side and strong relationships with end-users. This provides a great insight to derisk some of those market and value chain challenges and now allows us to focus on identifying opportunities and the operational risk as a key component. What are the main risks of investing in critical minerals? There is a lot of appetite for financing mineral projects in well-understood markets like gold, copper or iron ore. However, there is a lack of financing and understanding when it comes to critical commodities like antimony or tungsten. Minor metals have multiple end-uses, each with its different market dynamics. You must have a very deep understanding of the commodities themselves, the pricing mechanism, and the material specifications… these supply chains can be opaque. They can be very complex and fast-changing. Being able to navigate them is quite challenging for a lot of more generalist investors. It fundamentally creates a market risk component for critical metals, which can be a barrier. Additionally, many larger mining companies have traditionally avoid these markets because the assets are smaller and may not yield the expected revenue and profits compared with larger copper or iron ore mines. Which metals are on your radar? We are looking very closely at all the major commodities where Wogen has a prominent trading platform, including antimony, tungsten, vanadium, mineral sands, chrome and magnesium. We also are very interested in cobalt, but more on the recycling and processing side. In base metals, we are looking at tin. We focus on those commodities with energy transition links to new demand centres. New demand from sources like solar in small markets can significantly impact overall percentages and returns. For instance, electrification drives substantial demand growth for larger markets like copper, but its impact is smaller than that of markets like antimony. You recently signed an antimony deal with Larvotto Resources in Australia. Could you tell us more about it? We have signed a binding agreement with Larvotto Resources, whose subsidiary owns the brownfield antimony/gold Hillgrove project in New South Wales, Australia. We provided a $4mn loan in return for a seven-year production offtake agreement with Wogen, which will obtain the antimony concentrate from the mine and sell it globally through its customer base. Antimony prices have soared this year in part because of China's export restrictions. Do geopolitics play a significant role in investment decisions? There are large opportunities arising from the dislocation of value chains caused by geopolitics. We're now seeing this almost bifurcation in any material classified as dual-use in China like gallium, germanium and now antimony. This will result in increased volatility. The challenge is that you always want to underwrite projects based on long-term fundamentals, and we still do that. But we see the geopolitical shifts as an upside where we can capture that volatility in our investment strategy rather than rely on it as the sole basis for success. As global trade become more complex, do you see a need for more collaboration across different actors in the value chain? Private-public partnerships in critical metals are an absolute must for the success of western supply chains. One of our big focuses is to work with western groups, including government agencies, to facilitate the reshoring of critical metals and to figure out ways to incentivise new processing downstream. As a standalone investment, they can be challenging. They require very niche capital with great understanding. We are also looking for long-term partnerships with end-users and OEMs to form alliances and secure the supply of materials. There is a big opportunity in this area, but it takes a partnership approach, and that's something that everyone in our industry should prioritise in the next five to 10 years. By Cristina Belda Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Viewpoint: Politics, economy key to bitumen recovery

19/12/24

Viewpoint: Politics, economy key to bitumen recovery

London, 19 December (Argus) — Political change and uncertainty will come to dominate the European bitumen market more than usual in 2025, while demand could decline further than it did in 2024. Market participants are trying to pin down the bottom of the market for bitumen demand, after falling for several years in most of Europe. And support for demand seems far from certain in 2025 given spiralling public debt, political uncertainty and a lack of funding for road maintenance and projects in most European countries. But there could be some positive economic news as interest rates start to fall and inflation returns to more normal levels, while the outlook for oil prices in 2025 is less bullish than previously with plentiful supply forecast. Increased supply and lower crude prices would tend to pressure lower bitumen prices, which could support consumption, given road budgets can be stretched further. Politics seems more unpredictable than ever, with various elections and other changes expected in 2025, often shifting to the right or populist wing in Europe. The necessity of road maintenance and project work to support economies is plain to see for governments, but there is uncertainty on the priority they will be given by some new political forces emerging. Bitumen production is still going to be plentiful in the new year, despite some refinery closures and problems in the past year and more. Issues at both Greek and Turkish refineries, which are powerhouses for Mediterranean bitumen exports, will not have a major impact given the weaker demand in much of north Africa and the lack of available arbitrage routes. Outlets to the US and east of Suez are closed at present and show little sign of re-emerging strongly in the period ahead. Spring maintenance, particularly a February to May shutdown at Algerian Sonatrach's 198,000 b/d Augusta refinery in Sicily, will also limit supply just when demand starts to seasonally rise. In the last viewpoint Argus expected a weaker year for 2024 demand, while also looking at pricing and how differentials to high-sulphur fuel oil (HSFO) could go negative. As winter approaches at the end of 2024 this has happened in the north of Europe and fob cargo discounts have been seen in the eastern Mediterranean all year. Bitumen market fundamentals have drifted further away from those of crude and HSFO in the last year, although a relationship still exists with HSFO maintaining a persistent standing as a price marker for inland bitumen markets for weekly or monthly calculations and for export waterborne prices as the basis with a differential. But Argus expected that traders would seek more arbitrage movements from the European Mediterranean, and this did not come to fruition in 2024, with little seen moving to the US and even less to the Asia-Pacific region. There is not much indication this will change in 2025 with lower prices and plentiful supply in Asia and US supply points. Poorer refining margins may have an impact in 2025 after the strength post-Covid, which will put more renewed pressure on older and simpler refiners to close. These facilities are more likely to produce bitumen. Instead traders will rely on large new ships to feed supply and move bitumen longer distances, a trend already well underway with a number of new ships entering service. Freight costs should stay at elevated levels given the ETS scheme comes into fuller effect in 2025 after first being implemented in 2024. The inclusion of shipping in this EU scheme will oblige shipowners and charterers of vessels from 5,000 gross tonnes to purchase carbon allowances, rising from 40pc of carbon emissions in 2024, to 70pc in 2025, before 100pc in 2026. From uncertainty can come opportunity and with the worst of the economic outlook now behind us then perhaps 2025 can be the beginning of the end in the downtrend for bitumen demand and we start to see vital road maintenance work and infrastructure projects get the funding they need. By Jonathan Weston Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

EU HRC imports drop a quarter on safeguards, AD probe

19/12/24

EU HRC imports drop a quarter on safeguards, AD probe

London, 19 December (Argus) — EU hot-rolled coil (HRC) imports have dropped by 24pc year on year in October, as a result of the safeguards changes introduced earlier in the year and the anti-dumping (AD) probe on key suppliers launched in August. Volumes amounted to 1.16mn t. The drop was underpinned by sharp declines from Japan, Egypt, Vietnam, Taiwan and South Korea. Meanwhile, other countries stepped in to fill the supply gap, such as Turkey, Ukraine and Serbia — deemed less risky for buyers, with all ramping up their volumes year on year by 292pc, 69.5pc and 172.8pc, respectively. Turkey was the top supplier with 222,760t in October. Imports from Indonesia also notably increased, by 41.5pc on the year to 29,140t. This volume will be likely to grow over November-March, but the country is expected to no longer be exempt from the safeguard measures from April onwards, market participants said. The European Commission this week launched an early review of the tariff-rate quotas, with changes, including on the developing countries list, to be introduced from April. Import supply is likely to drop further over the rest of the year, and into the first quarter, with January the last month in which residual larger volumes from countries under investigation can be custom cleared. Sales from Japan, Egypt, Vietnam and India, all under the scope of the AD probe , have mostly stopped over the current quarter. Cold-rolled coil (CRC) imports are meanwhile on the rise, with 281,336t clearing in October, up by 33.4pc on the year and 53.5pc on the month. Taiwan was the top supplier with 64,208t, followed by Turkey and India with just over 40,000t each. The increase in Taiwanese imports, which are expected to rise further, have fuelled talks in the market of a potential AD investigation. Similarly, hot-dipped galvanised (HDG) imports rose by 60.1pc on the year to 802,688t, of which 270,226t was from Vietnam, representing a 279.1pc increase year on year. Market participants have expected a probe on Vietnamese HDG for a while, but following the safeguards review launch said that a reduction in quota volumes might hit downstream products such as HDG and CRC in particular. Plate imports have also nudged up, but more modestly, by 6.9pc on the year in October to 222,133t. Rebar and wire rod arrivals were up by 170.6pc and 46.5pc on the year, respectively. By Lora Stoyanova EU HRC imports t Oct-24 ±% Oct-23 Total 1,164,750 -24 Turkey 222,760 292 Japan 164,691 -38.2 Egypt 148,979 -19.7 Vietnam 144,512 -54.7 Taiwan 127,350 -54.5 Ukraine 103,003 69.5 South Korea 90,674 -45.9 Serbia 55,372 172.8 Australia 30,690 -62.4 Indonesia 29,140 41.5 — GTT Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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