2025-01-08 20:45
SANTIAGO, Jan 8 (Reuters) - Copper production from Chile's Codelco, the world's largest producer of the red metal, reached 1.328 million metric tons last year, according to an internal document seen by Reuters on Wednesday. The closely watched final number had not previously been reported but Chairman Maximo Pacheco said earlier this week that 2024 output was "slightly higher" than the 1.325 million tons produced in 2023. Faced with declining ore grades, accidents and mistakes at major construction projects, Codelco has been struggling to boost production from 25-year lows and revved up production at the end of the year to hit its 2024 target. Sign up here. https://www.reuters.com/markets/commodities/copper-output-chiles-codelco-rose-1328-mln-tons-2024-document-shows-2025-01-08/
2025-01-08 20:41
NEW YORK, Jan 8 (Reuters) - Chocolate maker Hershey Co (HSY.N) , opens new tab has requested permission from the Commodity Futures Trading Commission (CFTC) to buy an amount of cocoa from the stocks of ICE exchange that is much larger than the maximum allowed, a report said on Wednesday. According to a report from Bloomberg News, Hershey wants to receive as much as 90,000 metric tons of cocoa from ICE certified stocks using futures contracts, which would equal 9,000 contracts. The current position limit set by CFTC is 4,900 contracts. Hershey did not confirm or deny having made the request. The company said that it is "well covered" for its cocoa needs for 2025 in response to a Reuters request for comment. Hershey shares were falling 2.6% on late trading on Wednesday. The CFTC, which is the top U.S. regulator for futures trading, declined to comment. The Bloomberg report said lawyer Joshua Sterling from law firm Milbank LLP was working for Hershey regarding the request to the CFTC. Sterling, a former CFTC official, declined to comment. A U.S. cocoa broker said that a potential clearance by the CFTC for that amount of buying would empty ICE certified cocoa stocks, considering both the volumes in ICE New York and the amount stored in London. ICE New York stocks are currently at around 61,000 tons, while London stocks are close to 21,000 tons. "It would take certs to zero and more than likely further dry out liquidity (in the futures market)," said the broker, adding that the potential move would be negative for other market participants. A second broker, working for a New York firm, does not expect the trade to go ahead. "I don't think the CFTC will grant them - or anyone - a 9,000 lots exemption," he said. Sign up here. https://www.reuters.com/markets/commodities/hershey-seeking-cftc-approval-buy-more-ice-cocoa-than-allowed-says-report-2025-01-08/
2025-01-08 20:24
US fuel stocks rose more than expected last week, EIA says Dollar rose for a second straight session OPEC production falls in December, Reuters survey shows NEW YORK, Jan 8 (Reuters) - Oil prices fell more than 1% on Wednesday as a stronger dollar and large builds in U.S. fuel inventories last week pressured prices, reversing earlier gains driven by tightening supplies from Russia and other OPEC members. Brent crude settled down 89 cents, or 1.16%, to $76.23 a barrel. U.S. West Texas Intermediate crude fell 93 cents, or 1.25%, to $73.32. Both benchmarks had risen more than 1% earlier in the session. "The oil market is being weighed down by the significant increases in gasoline and diesel inventories that we've seen over the last couple of weeks," said Andrew Lipow, president of Lipow Oil Associates. Fuel inventories swelled as refiners continued ramping up production, he added. Gasoline stocks rose by 6.3 million barrels last week to 237.7 million barrels, compared with analysts' expectations in a Reuters poll for a 1.5 million-barrel build, according to data released on Wednesday from the U.S. Energy Information Administration. Distillate stockpiles rose by 6.1 million barrels in the week to 128.9 million barrels, versus expectations for a 600,000-barrel rise. "I would be concerned if we saw more substantial products builds over the next few weeks. And in the meantime, the cold snap could constrain crude oil supply and increase heating oil demand," said Josh Young, chief investment officer at Bison Interests. Crude inventories fell by 959,000 barrels to 414.6 million barrels in the week, compared with analysts' expectations for a 184,000-barrel draw. A stronger dollar also pressured prices by making oil more expensive for holders of other currencies. Limiting the losses, oil output from the Organization of the Petroleum Exporting Countries fell in December after two months of increases as field maintenance in the United Arab Emirates offset a Nigerian output hike and gains elsewhere in the group. In Russia, oil output averaged 8.971 million barrels a day in December, below the country's target, Bloomberg reported, citing the energy ministry. Analysts expect oil prices to be down on average this year from 2024 due in part to production increases from non-OPEC countries. "We are holding to our forecast for Brent crude to average $76/bbl in 2025, down from an average of $80/bbl in 2024," BMI, a division of Fitch Group, said in a client note. Sign up here. https://www.reuters.com/business/energy/oil-trims-gains-dollar-strength-tight-supplies-provide-support-2025-01-08/
2025-01-08 19:53
Ukrainian, Moldovan presidents propose using coal to ease crisis Residents of separatist enclave endure power, heating cuts Finnish foreign minister to visit both sides Jan 8 (Reuters) - Ukrainian President Volodymyr Zelenskiy and Moldovan President Maia Sandu on Wednesday discussed using Ukrainian coal to ease the energy crisis which has subjected Moldova's separatist Transdniestria region to blackouts and a heating shortage. Pro-Russian Transdniestria, which broke away from Moldova in the final days of Soviet rule, has long relied on supplies of Russian gas. But flows to the region through Ukraine were halted on Jan. 1 after Ukraine refused to renew an agreement on allowing gas to transit through its territory. "We are ready to assist Moldova, including with coal supplies," Zelenskiy said in his nightly video address after discussing the crisis with Sandu by telephone. He said the crisis stemmed from "Russia's attempt to manipulate energy resources" to the detriment of Moldova's pro-European government. He added that it was "crucial to maintain stability and provide all people in Moldova with the conditions to live peacefully". Sandu, in a statement issued on the presidential website, said the two leaders "agreed to identify common solutions to prevent the worsening of the humanitarian crisis ... including through the use of alternative energy sources, such as coal". Ukrainian coal could be used to keep operating a thermal plant which provides electricity for the separatist region and also accounts for most of the power needs in government-controlled areas of Moldova. Officials have already made the adjustment to enable the plant to operate on coal. Finnish Foreign Minister Elina Valtonen was due to hold talks on Thursday in both government-controlled Moldova and Transdniestria. Finland currently chairs the 57-nation Organisation for Security and Cooperation in Europe, which has long spearheaded efforts to resolve the separatist conflict. CANDIDATES TO JOIN EU Ukraine and Moldova are engaged in negotiations to secure membership of the European Union, promoted by both leaders as the cornerstone of their foreign policies. Sandu has denounced the Russian invasion of Ukraine and accused Moscow of trying to unseat her government. Transdniestria has been dependent on financial support from Moscow while living side-by-side with Moldova for more than 30 years without enjoying any international recognition. Its 450,000 residents are subjected to four-hour rolling blackouts twice daily. Its self-styled president, Vadim Krasnoselsky, accuses Moldova of failing to tackle the crisis and rejects statements by central authorities that they have offered help to ease the effects of the New Year gas cutoff. Transdniestria's official Telegram news channel said careful use of energy since the New Year meant enough gas reserves remained in the region for a further 24 days. It also said factories forced to close down, apart from those with high energy consumption, would be allowed to operate after midnight when the strain on the power grid was lower. The end of gas transit has also affected flows of Russian gas to other countries, like Slovakia and Austria. Slovak Prime Minister Robert Fico said on Wednesday he had secured the country's gas supply during talks with Russian President Vladimir Putin in Moscow last month. Fico provided no further details and the government office did not immediately respond to a request for comment. Fico was due to discuss the end of Russian gas transit through Ukraine with the European Commission on Thursday in Brussels. Sign up here. https://www.reuters.com/world/europe/ukraines-zelenskiy-moldovas-sandu-discuss-ukrainian-coal-ease-transdniestria-2025-01-08/
2025-01-08 19:44
US 10-yr Treasury yields hit highest since April UK 10-yr gilt yields at highest since 2008 Bonds selloff ripples into currencies, stocks LONDON/NEW YORK, Jan 8 (Reuters) - A sharp selloff in the world's biggest government bond markets and a continued rise in the dollar sent shockwaves through financial markets, with pain seen deepening as uncertainty grows over U.S. President-elect Donald Trump's policies. On Wednesday, the 10-year Treasury yield , underpinning trillions of dollars in daily global transactions, jumped above 4.7% to the highest since April, and UK peers hit their highest levels since 2008 , . Yields rise when bond prices fall. There was no obvious trigger for the latest wave of heavy selling. Germany's 10-year Bund yield touched a more than five-month high amid accelerating euro zone inflation, and elevated bond supply. The yield , the euro zone benchmark, was up nearly four basis points to 2.524% at the end of Wednesday. Japan's 10-year benchmark hit a 13-1/2 year high of 1.185% in morning trade in Asia on Thursday. The moves unleashed a fresh wave of selling in currencies against the greenback, especially for sterling , which slid more than 1% before slightly recovering, and the euro , which was headed closer toward the $1 mark. The S&P 500, which has rallied post Trump's win, has recently started to falter, although it closed more or less flat on Wednesday. Trump, in a press conference at Mar-a-Lago on Tuesday, decried high U.S. interest rates despite the Federal Reserve being in the midst of an easing cycle. "Inflation is continuing to rage, and interest rates are far too high," the president-elect said. Central banks all but declared victory over inflation in 2024, but a number of metrics show price pressures are rising again. Trump's plans for higher trade tariffs, tax cuts and deregulation threaten to push up inflation and strain government finances, thereby also limiting the Federal Reserve's scope to cut interest rates. "What it really boils down to is the term premium," said Chip Hughey, managing director of fixed income at Truist Advisory Services in Richmond, Virginia, referring to the premium investors demand for holding long-term bonds. "85% of the rise in yields that we have seen since mid-September is accounted for by the term premium," he said. "That is a reflection that fiscal policy uncertainty continues to climb as we head to the new administration being sworn in." Hughey pointed out that the current term premium for the 10-year note is 54 bps, up from negative 29 bps in mid-September. This means that 10-year yields are 54 bps higher than what can be justified by Fed policy expectations. SUPPLY WAVE Other governments are busy repairing their own finances and shoring up their economies, while ramping up bond sales. Long-dated yields, which tend to be less susceptible to short-term swings in expectations for monetary policy, have hit multi-year highs globally, partly because of the tidal wave of new bonds this year. Europe's bond markets are having to absorb heavy issuance to start the year, with Germany selling 5 billion euros of 10-year Bunds and Italy selling new 10-year and 20-year green bonds via syndication. Byron Anderson, head of fixed income at Laffer Tengler Investments in Scottsdale, Arizona, cited about $14.6 trillion of Treasury debt maturing over the next two years, which means there is a lot of debt to extend beyond one year. Traders say the incoming Trump administration will need to change the current focus on relying more on short-term debt. Thirty-year Treasury bond yields have risen 60 basis points in a month - the largest such increase since October 2023. They are now perilously close to 5%, a level rarely seen in the past two decades. This has pushed the premium of 30-year yields to two-year yields to its highest in nearly three years - a dynamic known as "curve steepening". "There's a big pipeline of bonds that needs to be sold, so that gives you a steeper curve as well as a higher term premium in longer bonds. I think that's one of the main drivers," said Danske Bank chief analyst Jens Peter Soerensen. UK 30-year gilt yields have hit their highest since 1998 to around 5.4%, adding to worries about the impact of higher borrowing costs on the British government's already shaky finances. Chinese government bonds have been going the other way and rallying, pushing yields to record lows as the economy stalls and investors expect rate cuts. But even that rally took a breather on Thursday with ten-year yields flat at 1.6%. Sign up here. https://www.reuters.com/markets/rates-bonds/global-markets-yields-2025-01-08/
2025-01-08 19:30
SAO PAULO, Jan 8 (Reuters) - Brazil registered a total net outflow of $18.01 billion in 2024, the largest amount since 2020, central bank data showed on Wednesday, amid a historic depreciation of the Brazilian real in the final weeks of the year. The result was driven by net outflows on the financial segment, according to the data, including foreign investments, profit remittances, and interest payments, despite a net inflow on the commercial segment, related to exports and imports. The Brazilian real depreciated by more than 27% last year, its biggest swing since 2020. The currency hit record lows in the last two months of 2024 amid market worries over government spending as well as currency outflows. In December alone, Latin America's largest economy reported a net outflow of $26.41 billion, the central bank data showed. In 2025, the real has so far regained some ground, strengthening about 1% against the U.S. dollar in the spot market. Sign up here. https://www.reuters.com/world/americas/brazil-posts-largest-yearly-dollar-outflow-since-2020-2025-01-08/
