EXCLUSIVE-Spain's Repsol suspends swap deal for have been anchored off Jose for over two months Venezuelan oil under U.S. pressure following payment complications from sanctions. U.S. President Donald Trump's national security adviser Spain's Repsol has suspended its swaps of refined John Bolton told Reuters last month the administration products for crude with Venezuela's state-run oil company was considering imposing sanctions on any PDVSA, people familiar with the matter said, as U.S. companies outside the United States that do business officials weigh penalties for foreign firms doing business with Venezuela. with Venezuela. On Wednesday in Miami, Bolton announced a series of The Spanish oil company has been swapping fuel and new sanctions against Cuba and Venezuela, ratcheting waiving payments due from a joint venture with PDVSA in up pressure on Maduro and the countries that support exchange for crude, even as the United States rolled out him. new sanctions aimed at ousting Venezuela's socialist In February, Spain imported some 75,920 barrels per day President Nicolas Maduro. (bpd) of Venezuelan oil, down from 84,650 bpd the month The arrangement made Repsol one of the OPEC- before, when arrivals were boosted by the Repsol- member nation's main fuel suppliers, alongside Russia's PDVSA swap. The European country imported an Rosneft and India's Reliance Industries, according to average of 12,630 bpd of the crude during 2018. three sources and vessel-tracking data. The Trump administration blames Maduro for a severe Aramco in talks to buy stake in refining business of economic crisis that has forced millions of Venezuelans to India's Reliance flee. The United States and dozens of other countries recognize Venezuelan opposition leader Juan Guaido as Saudi Aramco, the world's biggest oil producer, is in talks the nation's interim president. Maduro considers Guaido a to buy a stake of atleast 20 percent in the refining and U.S. puppet. petrochemicals businesses of India's Reliance Industries A final decision on whether Repsol will cancel the Ltd, sources familiar with the matter said on Venezuelan swap deal altogether, after it was first Wednesday. State-owned Aramco plans to boost arranged in late 2018, has not yet been made, the investments in refining and petrochemicals to secure new sources said. markets for its crude, and sees growth in chemicals as A Repsol spokesman declined to comment on the central to its downstream strategy to lessen the risk of a petroleum swaps. But one of the sources said the slowdown in oil demand. company had been communicating with the Trump Aramco's discussions with Reliance were for a roughly 20 administration through the U.S. embassy in Spain, which percent stake, one source said, adding that the current declined to comment. thinking was to create an entity covering that part of Repsol has said previously that it was complying with Reliance's refining, petrochemicals and marketing U.S. sanctions on PDVSA, which bar any use of the U.S. businesses. financial system or subsidiaries based in the United If the deal went ahead, it could mean a boost in Aramco's States for oil deals with Venezuela. crude oil supply to Reliance by possibly more than 50 Companies have been given until April 28 to wind down percent, the source added. their existing transactions. Another source said talks with Reliance were so far for a Repsol's most recent shipment of gasoline arrived in 25 percent stake. Venezuela on March 25 aboard the Torm Laura, "Reliance has offered an integrated deal - a stake in according to vessel-tracking data from Refinitiv Eikon and existing refineries and the planned 600,000 barrels per consulting firm Kpler. day (Jamnagar) refinery, along with petrochemical As of Wednesday, the Achilleas, a Suezmax tanker business," the second source said. chartered by Repsol, remained anchored off Venezuela's The Times of India reported earlier that Aramco was in Jose oil port, after loading about 1 million barrels of heavy talks to buy a stake of up to 25 percent, which could be crude on April 6, the Refinitiv data showed. worth around $10-15 billion, valuing the Indian company's Another Suezmax chartered by Repsol has been refining and petrochemicals businesses at some $55-60 anchored off Jose for at least a week after loading billion. Venezuelan oil, according to shipping sources and Aramco and Reliance declined to comment. Refinitiv data. Reliance, controlled by Asia's richest man, Mukesh The tankers are awaiting directions from Repsol before Ambani, is India's biggest refining and petrochemicals they set sail, according to one of the sources. company and runs a 1.4 million bpd refining complex at A separate group of 11 loaded tankers, chartered by U.S. Jamnagar in western India. It plans to expand capacity to firms Chevron Corp, Valero Energy and Citgo Petroleum 2 million bpd by 2030, according to plans shared with the
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Indian government. both in brewing and livestock feed. Last year, Aramco and the United Arab Emirates' national It exported 6.48 million tonnes in 2017, close to three- oil company ADNOC teamed up with state-run Indian quarters of China's roughly 8.86 million tonnes of imports refiners in a plan to build a 1.2 million bpd refinery and of the grain, worth about $1.5 billion, according to petrochemical project in Maharashtra state. Chinese customs. However, the planned refinery, which was initially The probes follow a period of tense relations between expected to cost $44 billion, faces delays, as thousands Australia and China, including allegations by Canberra of of farmers have refused to surrender land for it and the interference in domestic affairs, jostling for influence in Maharashtra government is looking to move the plant's the Pacific, and a move to block China's Huawei location. Technologies from building a 5G network. Saudi Crown Prince Mohammed bin Salman visited India GrainCorp also said ongoing drought in eastern Australia in February and said then that he expected investment "significantly" impacted summer crop production, opportunities worth more than $100 billion there over the especially sorghum. next two years. The adverse weather shows little sign of abating, with Ambani has travelled to Saudi Arabia at least twice since Australia's weather bureau forecasting a 70 percent December, discussing joint investment among other chance of an El Nino developing later this year, bringing issues with Saudi Energy Minister Khalid al-Falih and hot, dry weather across the country's east coast. Aramco's chief executive, Amin Nasser. The hit to earnings comes as GrainCorp plans a Nasser said in February that Aramco was in talks on significant restructuring after receiving a A$2.38 billion possible investments in Indian projects with companies takeover approach late last year. including Reliance. The company earlier this this month said it would separate into two, spinning off and listing its global Australia's GrainCorp flags $29 mln earnings hit as malting unit and restructuring its drought-hit grain China probes barley imports business. GrainCorp said at the time that it was still engaging with Australia's GrainCorp Ltd said on Thursday it will take a suitors vying for parts or all of the company. A$40 million ($28.7 million) hit to half-year earnings, blaming international trade tensions and a severe U.S. crude stockpiles drop unexpectedly last week - drought, sending its shares to a three-week low. EIA The country's largest listed agribusiness did not give further details, but industry sources said there had been a U.S. crude oil stockpiles fell unexpectedly last week as slowdown in Chinese demand for barley as Beijing imports dropped, while gasoline and distillate inventories considers whether to introduce tariffs on Australian decreased less than forecasts, the Energy Information supplies. Administration said on Wednesday. "The investigation has heightened uncertainty. China is Crude inventories fell by 1.4 million barrels in week to still unloading vessels but the market is concerned that April 12, compared with analysts' expectations for an tariffs could be introduced at any time," said one grain increase of 1.7 million barrels. A majority of the decline trader, who declined to be named as he is not authorised came from the Midwest region, where inventories fell 2.4 to talk to the media. million barrels to 135.3 million barrels. A spokesman for GrainCorp declined to comment. Net U.S. crude imports fell last week by 659,000 barrels In a statement to the Australian stock exchange, the per day (bpd). company said a disruption to grain trading conditions in Crude stocks at the Cushing, Oklahoma, delivery hub for the last six weeks to end-March would reduce expected U.S. crude futures fell by 1.54 million barrels, EIA said. half-year earnings before interest, tax, depreciation and Oil prices edged higher on the day as the markets amortisation (EBITDA) by A$40 million. focused on the inventory declines across the energy Shares in GrainCorp, which have been supported by complex. U.S. gasoline prices were up nearly 1 percent takeover activity, fell nearly 4 percent to their lowest since near the highest levels since October. March 28 before largely recovering to trade down 1.4 Gasoline stocks fell by 1.2 million barrels, less than percent at A$9.28. analysts' expectations in a Reuters poll for a 2.1 million- China late last year launched two probes into whether barrel drop. Australian barley was dumped into China, and whether Distillate stockpiles, which include diesel and heating oil, Canberra has subsidised sales - allegations widely seen fell 362,000 barrels, also not as much as forecasts for a as politically motivated. 846,000-barrel drawdown, the EIA data showed. Australia is by far China's top supplier of barley, used "With the refinery runs coming in a little higher, this is a
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(continued) very supportive report," said Phil Flynn, an analyst at "The supply can come from both OPEC and non-OPEC Price Futures Group in Chicago. nations like the U.S.," said M. K. Surana, chairman of Refinery crude runs fell by 22,000 barrels per day, EIA Hindustan Petroleum Corp, which purchased up to 1.5 data showed. Refinery utilization rates edged up 0.2 million tonnes per year of Iranian crude in 2018/19. percentage point to 87.7 percent of total capacity. The Organization of the Petroleum Exporting Countries "We still saw a big build in Gulf Coast crude supplies, so (OPEC) and other producers including Russia have it shows you there are still some issues on the Gulf Coast gradually tightened supply through 2019 to reduce a a little bit. We’re easing but not as much as you might global glut. OPEC and its partners may not renew the think," Flynn said. curbs when they expire after June because of the risk of Last week, Lyondell Basell Industries was holding over-tightening the market. production 9 percent below the 263,776-bpd capacity of IOC, India's top refiner and Iran's biggest Indian client, its Houston refinery because of shipping restrictions will cut Iranian oil imports to 6 million tonnes, or about following a late March chemical spill in the Houston Ship 120,000 barrels per day, in the 2019/20 period from 9 Channel. million in 2018/19, and has raised the optional volumes it Royal Dutch Shell's 275,000 bpd joint-venture Deer Park, can buy from other producers to 2 million tonnes, a Texas, refinery returned to normal production late last company official said. week after cutting production and came within days of "We have optional contracts with Saudi Arabia, Kuwait shutting down due to constrained crude shipments. and other suppliers," the official said, adding his firm would also buy more U.S. oil if required. Energy Secretary Perry planning to leave Trump IOC also hopes to buy 1.5 million tonnes of Mexican oil in administration -source 2019, compared with 1 million tonnes last year. A source at the state-owned National Iranian Oil Co U.S. Energy Secretary Rick Perry is planning to leave the declined to comment. Trump administration, but his departure is not imminent, a source familiar with the situation said on Wednesday. NO WATERTIGHT PLAN Perry, a former governor of Texas who has taken a Refinery officials said their 2019/20 import strategy was leading role in President Donald Trump's policy of not contingent on Iranian oil, and was more flexible than boosting energy production, has been finalizing his in previous years. departure, the source said. "We don't have a watertight plan for the year, we have Perry's plan was first reported by Bloomberg. optional quantities so that it is possible to find "There is no truth that Secretary Perry is departing the replacements if any country goes out for any reason," Administration any time soon. He is happy where he is said an MRPL official. serving President Trump and leading the Department of During previous sanctions against Iran, Saudi Arabia and Energy," said department spokeswoman Shaylyn Hynes. Iraq raised supplies to India to grow market share in the country, the world's third-biggest oil consumer and Indian refiners turn to OPEC, Mexico, U.S. to make up importer . Iran oil gap Last year, MRPL signed its first annual deal with Iraq to buy 1.5 million tonnes of Basra oil in 2019. Indian refiners are increasing their planned purchases BPCL has signed a deal to buy 5 million tonnes of Iraqi oil from OPEC nations, Mexico and the United States to in 2019 compared with 1.5 million tonnes in 2018, its make up for any loss of Iranian oil if the U.S. enforces head of refineries R. Ramachandran said, adding his sanctions more harshly from next month, sources and company is considering buying more oil from South company officials said. America. It recently bought Brazilian crude and plans to All four Indian state-owned refiners that buy Iranian oil are buy Mexican oil. confident of securing additional barrels from other producers, officials from the companies told Reuters. COLUMN-China still dominates U.S. soybean exports They have not yet placed orders for Iranian oil for May, despite trade war -Braun when the current waiver expires, pending clarity from the United States. Even with an ongoing trade war, China was the top India's Bharat Petroleum Corp (BPCL) and Mangalore destination for U.S. soybeans during the first half of the Refinery and Petrochemicals Ltd (MRPL) have tapped current marketing year, and the Asian country will help Iraq to make up for Iranian oil, while Indian Oil Corp determine whether American beans can meet the U.S. (IOC) has signed its first annual contract with U.S. government's full-year export targets. suppliers and raised supplies from Mexico. Data published by the U.S. Census Bureau on
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Wednesday showed that the United States exported 4.58 to meet USDA's target. million tonnes of soybeans in February, the largest Assuming the necessary sales are made, inspections – volume for the month in three years. Some 46 percent of which are a proxy for actual shipments – must average those shipments were to China, the largest monthly share around 920,000 tonnes per week through August. That in a year. would be record pace but not unreasonable given China's Those February soybean export figures are relatively irregular buying pattern this year. normal for the month, but the previous months were far But more Chinese buying might be the only hope for U.S. from it. In the first half of 2018-19 that began on Sept. 1, shippers to meet the full-year goal of 1.875 billion just 14 percent of total U.S. bean exports went to China bushels, some 12 percent smaller than last year. Non- compared with 65 percent in the first half of 2017-18. Chinese buyers have been significantly slowing their But China was still the top destination for U.S. soy purchases in recent weeks. shipments between September and February with a total Between Feb. 15 and April 4, China has accounted for a of 3.94 million tonnes. That is down 85 percent on the disproportionately large amount of U.S. soybean sales, year but comfortably ahead of No. 2 Mexico with 2.52 some 77 percent. Sales to all other countries totaled just million tonnes. This demonstrates the overwhelming 1.6 million tonnes, the smallest for that period in four importance of China in U.S. soybean trade. years. Argentina was third with 2.05 million tonnes and the Many non-China buyers loaded up on U.S. soybeans Netherlands and Spain round out the top five with just when they were super cheap relative to their South under 2 million apiece. First-half shipments to all American counterparts last year after the trade war broke European Union countries totaled 6.2 million tonnes, up out, but now Argentina and Brazil prices are very 132 percent on the year. competitive. The trade war is not the only abnormal factor in Chinese NOT THERE YET demand for U.S. soybeans this year. The deadly outbreak Through April 4, U.S. soybean commitments for 2018-19 of African swine fever, or ASF, that began last August is totaled 43.9 million tonnes, meaning that 7.1 million seen slashing pork production by anywhere from 20 to 30 tonnes were yet to be sold to reach the U.S. Department percent this year. of Agriculture's full-year export target of 51 million. Without the ASF problems, the United States could Under normal circumstances, those forward sales would probably squeak the necessary soybean sales out of be next to impossible in a year like this one where South China over the next four months if the trade talks lead to American soybean harvests are strong. Last year, U.S. a deal sometime soon. And the outlook for U.S. soybean sales reached 5.8 million tonnes between early April and exports to China beyond 2018-19 would likely be better. August, and 5 million were sold within the same period in But U.S. soybean purchases by the Chinese now are 2017. almost positively goodwill purchases headed straight for But the U.S.-China trade war and Beijing's 25 percent reserves. Poor feed demand in China due to smaller hog tariff on imports of the U.S. oilseed have created a far herds is also impacting top soybean exporter Brazil, from normal scenario in 2018-19. Trade tensions have which may end April with the lowest soy export total for cooled off since last year as the two sides continue to the month in four years. negotiate, and that has come with some Chinese pledges It could be argued that China’s struggles with ASF are to purchase U.S. soybeans. now a bigger threat to the future of U.S. soybean exports On average, about 91 percent of China's annual than the trade war, at least for the next year or so. purchases of U.S. soybeans are shipped in the first half of Increased sales to other countries certainly help, but they the marketing year, and that volume accounts for about do not come anywhere close to filling the void left by 52 percent of the United States’ total yearly soybean China. exports. But this year, only 30 percent of China's total U.S. U.S. shale producers see rising ultralight crude soybean commitments of 12.9 million tonnes were output hitting pricing shipped in the first half due to the lack of buying in the earlier months. Much of the new crude coming from the top U.S. shale field is so light that it is starting to affect pricing for the MORE HURDLES region's oil, producers attending an energy conference Taking official export statistics through February and this week said. considering weekly export inspections through April 11, Permian producers generally sell their crude at WTI the United States would need to ship around 18.7 million benchmark prices, but rising supplies of ultralight oil may tonnes of soybeans in the remaining 20 weeks of 2018-19 require them to offer $1 to $2 a barrel discounts to
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(continued) refiners requiring heavier grades, some said. Newer headquarters of Petrobras, as the company is known, production coming from the Permian Basin in West Texas Chief Executive Roberto Castello Branco announced a and New Mexico has API gravity in the low 50s degrees, diesel price hike of 10 cents per liter and compared to 40 to 44 degrees for West Texas said Petrobras has complete control over its pricing Intermediate. strategy. Refiners on the U.S. Gulf Coast, whose plants are geared Speaking only minutes before at an event in Sao Paulo, to run heavier crudes, are having to pay higher prices for Chief Financial Officer Rafael Grisolia said Petrobras was those supplies because of slowing output and transport looking at selling off assets such as deepwater pipelines problems at heavy-oil producers Venezuela, Mexico and and Petrobras Distribuidora SA which includes a gas Canada. station chain stretching across the country. Whether buyers increasingly demand a discount for The comments come as executives scramble to contain Permian oil "just depends on how much everyone keeps the fallout from the company's cancellation on Friday of a growing the lighter production, and the vast majority of diesel price hike at the behest of Brazilian President Jair the growth is in lighter crude," Rob MacAskie, finance Bolsonaro, stirring fears of political interference and chief at Zarvona Energy LLC, said in an interview at a tanking Petrobras shares. Hart Energy conference in Fort Worth. While Bolsonaro´s government has promised a hands-off Zarvona has been selling its oil, most of which has a approach to Petrobras, investors are wary of a return to gravity of 38-42 degrees, at WTI pricing, he said. The policies enacted under past administrations, in which the U.S. benchmark generally is classified as 44.1-49.9 company was forced to sell fuel at a discount to degrees. international rates. Price reporting agency Argus Media last week launched a On Tuesday, Bolsonaro´s spokesman and Economy daily WTL price assessment based on trading at Midland, Minister Paulo Guedes sought to characterize the Texas, the heart of the Permian Basin. canceled price hike as a one-time error that would not be The discount for that lighter crude is running between $1 repeated. and $2 a barrel, said Allen May, executive vice president According to an information posted on Petrobras' website, at Scala Energy LLC. the company increased the price of diesel at refineries by Colgate Energy LLC, another Permian producer, has had 4.7 percent after canceling a 5.7 percent increase on its output blended with heavier West Texas grades, Friday. insulating it from potential pricing pressure, said Will Castello Branco said Petrobras "rigorously" keeps its Hickey, the company's co-CEO. prices in line with international rates and has no plans to "The whole world is scared of this really high API. We change its policy of adjusting fuel prices every 15 days. haven't seen it (price pressure) yet but it's something that could happen, he said. "You're at the mercy of what your PIPES AND PUMPS acreage produces," said Hickey. Petrobras is analyzing the best model for selling three The Permian produces some heavy oil as low as the 20s, offshore natural gas pipelines, Grisolia said, including but the average for the field is around 51 degrees, said whether they will be sold individually or in a package. Allen Gilmer, co-founder of energy research firm Grisolia said the company would "probably" reduce its Drillinginfo. stake in Petrobras Distribuidora to below 50 percent from Newer production is so light it is "not WTI anymore," he the current 71 percent, effectively privatizing the unit said. through a secondary share offering. While producers can blend lighter with heavier grades to Investors have cheered Petrobras' recent push to cut raise density, resulting blends often do not have enough debt and refocus on oil exploration and production via an middle grades for refiners, Gilmer said. "I could see them aggressive divestment program. turning away a load," Gilmer said. Reuters reported earlier this month that Petrobras was preparing to sell three more gas pipelines after Petrobras hikes diesel price, eyes divestments amid successfully selling its larger TAG unit to France's investor unease Engie for $8.6 billion. Reuters reported on Tuesday the company had hired nine Brazilian state-run oil firm Petroleo Brasileiro SA hiked banks to manage Petrobras Distribuidora's share offering. diesel prices on Wednesday, and executives said the firm could expand its already aggressive divestment plan COLUMN-White House will tie Iran sanctions review while arguing the company was completely free of to response by Saudi Arabia: Kemp political interference. In an impromptu news conference at the Rio de Janeiro The White House will have to weigh costs and benefits
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(continued) carefully before tightening sanctions on Iran and costs of other petroleum products, such as asphalt, and Venezuela further – and decide whether the economic benefits from sale of other liquids, such as natural gas price is worth the diplomatic gains. liquids, but the overall picture does not change much.) If the White House toughens sanctions on Iran and Venezuela significantly (and the next decision on Iran POLITICAL CALCULATION sanctions is scheduled for the first week of May) any The problem for the White House is that the households decision is likely to be tied to production increases by and businesses hurt by cost increases for gasoline and Saudi Arabia. diesel fuel are not the same households and businesses The White House is likely to agree to scale back Iran that benefit from higher crude prices. sanctions waivers if, and only if, Saudi Arabia commits to Oil price increases hit motorists, manufacturers, farmers replacing the lost barrels at least one-for-one to leave the and transportation companies across the country, while global production-consumption balance unchanged. the gains are more concentrated in oil-producing states High-level discussions between the two countries over and communities. sanctions and production policy are likely to have begun Price changes therefore have distributional effects and already. political consequences within the United States. President Donald Trump spoke with Saudi Arabia's Most net oil-producing communities and states backed Crown Prince Mohammed bin Salman by telephone the president strongly in the 2016 election and are earlier this month about maintaining pressure on Iran and expected to do so again in 2020. human rights, according to a statement from the White By contrast, net-consuming communities include swing House. states that provided the president's electoral college The content of the discussions was not made public but it majority in 2016 and that he will need again to secure re- is safe to assume that oil prices, production and sanctions election next year. formed part of the discussion since they are central to the In general, higher gasoline and diesel costs fall most bilateral relationship as well as policy towards Iran. heavily on swing voters, which is why the president has If sanctions are tightened, it will be because the White focused on the need to keep prices down rather than the House believes it has an undertaking from Saudi Arabia benefits from price increases. to increase production by at least the equivalent amount, And the United States and global economies have slowed if not more, to contain the impact on U.S. motorists. significantly since the first half of 2018 which will make another round of price increases more painful for U.S. COSTS AND BENEFITS consumers and businesses. The United States consumed 3.4 billion barrels of The president has already warned OPEC, via messages gasoline and 1.5 billion barrels of distillate fuel oil in 2018, published on Twitter, that global economy and financial according to the U.S. Energy Information Administration markets are "fragile" and "cannot take a price hike". ("Petroleum Supply Monthly", EIA, March 2019). The political and economic cost-benefit calculation For every $1 benchmark oil price rise because of explains why the president has been pressing Saudi sanctions, the first round costs for households and Arabia hard to increase its production to offset any further businesses amount to roughly $5 billion per year loss of barrels from Iran and Venezuela. (assuming increased crude prices are passed on by If sanctions are tightened, it will indicate the refiners). administration has secured the necessary deal on Brent prices have already risen by $22 per barrel since production from Saudi Arabia, even if the commitments the start of the year, as a result of output cuts by the remain private. OPEC+ group of oil exporting countries as well as sanctions policies and other supply disruptions. Green economy good news for copper producers - The impact has been similar to a tax increase of $110 Antofagasta chairman billion per year on U.S. households and businesses and will rise to $150 billion if prices continue heading upward The global fight against climate change will boost demand towards $80 per barrel. for copper, a key metal used in the production of electric Net costs to the United States are much smaller because vehicles, Antofagasta chairman Jean-Paul Luksic said on the country has also become a substantial producer of Wednesday. crude and condensates as a result of the shale revolution. Luksic, speaking to reporters at Antofagasta's Los Domestic crude production is running at 4.3 billion barrels Pelambres mine in north-central Chile, said the global per year, so price rises have so far boosted domestic "green economy" would put Chile, the world´s top producers' revenues by around $95 billion per annum. producer of the red metal, at a strategic advantage over (Further refinements are possible to include the domestic the competition.
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"We´re the world's top producers of copper, but also ... production of electric vehicles. we have the world´s largest known reserves,¨he said. Lithium is a key component in the batteries that power Luksic added that Antofagasta had committed to reducing everything from cellphones to electric cars. its production of greenhouse gases by 300,000 tonnes by Tianqi's U.S. nominee, businessman Robert Zatta, 2022, and said the company was shifting its energy worked as a chief financial officer until 2015 for supply to more renewable sources in order to achieve Rockwood Holdings, a top competitor of SQM in Chile's that goal. Salar de Atacama, before it was purchased by the U.S.- Antofagasta began construction of a major infrastructure based Albemarle, now the world's top lithium producer. project at Los Pelambres on Wednesday, which the Previously, Zatta had worked as an executive with the company said will allow it to boost production by 15 Campbell Soup Company. percent. Tianqi also nominated Chilean attorney Francisco Ugarte, who represented the Chinese lithium producer in its 2018 InVivo's grain trading chief leaving French firm purchase of the stake in SQM
China's Tianqi taps 'safe choices' for board of top Australia's Fortescue pares annual iron ore lithium miner SQM shipments guidance after cyclone
China's Tianqi Lithium Corp said on Wednesday it Iron ore miner Fortescue Metals Group Ltd on Thursday would nominate two Chileans and a U.S. businessman to reported flat third-quarter iron ore shipments and joined the board of lithium miner SQM, candidates seen as 'safe other big miners in trimming its annual shipments forecast choices' for the world's No. 2 lithium producer as it faces because of disruptions caused by a tropical cyclone. booming demand. The world's no. 4 miner of the steelmaking commodity cut Tianqi last year paid $4.1 billion for a near-quarter stake its fiscal 2019 shipments estimate to 165 million-170 in SQM, as Chinese companies scoured the globe for the million tonnes, down from 165 million-173 million tonnes. ultralight battery metal needed to ramp up Chinese Fortescue shipped 38.3 million tonnes in the quarter to
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March 31, compared with 38.7 million tonnes in the same deliver 8-10 million tonnes of the new product in fiscal period last year, but above an average of estimates of 2019. 36.5 million tonnes by Goldman Sachs and UBS. The combination of the mid-grade iron ore and higher "Closure of the Port Hedland port, combined with prices for the steelmaking material helped drive localised flooding in the area caused by Tropical Cyclone Fortescue's average realised price 47 percent higher over Veronica in late March, resulted in the loss of five days of the previous quarter to $71 per dry metric tonne in the shipments equating to 2.5 million tonnes," Chief period, it said. Executive Officer Elizabeth Gaines said. Earlier in April, the miner said it would spend about $2.6 The impact of the cyclone, coupled with a dam disaster in billion with a Taiwanese partner to develop a "premium Brazil that restricted Vale SA's production, has led to a product" iron ore project in Western Australia. surge in iron ore prices this year, propelling Fortescue's "The Iron Bridge product will increase our average grade, stock about 80 percent higher in 2019. providing Fortescue with the ability to deliver the majority Fortescue has been attempting to shore up demand by of our products at greater than 60 percent iron grade," moving to produce higher grade iron ore, given that its Gaines said. lower grade products had fallen out of favor with Chinese Bigger rivals BHP Group and Rio Tinto both cut their buyers facing environmental restrictions. forecasts for annual iron ore output earlier this week due The company recently started shipping mid-grade iron ore to Cyclone Veronica. to pump up its margins, and reiterated that it expected to
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