2025-07-15 12:01

Apple to pre-pay $200 mln for MP's rare earth magnets Deliveries slated to start in 2027 Analysts say move boosts Apple's image in Washington MP's shares jump to all-time high July 15 (Reuters) - Apple (AAPL.O) , opens new tab has signed a $500-million deal with Pentagon-backed MP Materials (MP.N) , opens new tab for a supply of rare earth magnets, becoming one of the first tech companies to ink a U.S. supply agreement after China curbed exports earlier this year. The move reflects strong backing for Las Vegas-backed MP by one of the world's most-valuable companies, coming just days after the U.S. government said it would become MP's largest shareholder. Both mark an amazing about-face for MP after it contemplated merging , opens new tab with an Australian rival last year just to survive. Sign up here. MP shares jumped 21% in Tuesday trading to a record high, while Apple's stock gained under 1%. The deal, announced on Tuesday, guarantees Apple a steady flow of rare earths and magnets free from China - the world's largest producer. For Apple, the cost to support U.S. magnet production paled in comparison to the long-term risk that it could lose access entirely to the critical components, analysts said. MP last week agreed to a multibillion-dollar deal with the U.S. Department of Defense that will see the Pentagon become MP's largest shareholder and financial backstop. "Any time you have government ownership, that's a huge vote of confidence," said Gracelin Baskaran, director of the critical minerals security program at the Center for Strategic and International Studies. "We're in an era where executives are willing to pay a significant premium for a reliable supply chain. They don't want stoppage." Neither the precise length of the deal nor the specific volumes of magnets to be supplied was provided, although the agreement does call for magnets produced from recycled material, in keeping with Apple's long-standing goal of ending its reliance on the mining industry. Rare earths are a group of 17 metals used to make magnets that turn power into motion, including the devices that make cell phones vibrate. They are also used to make weapons, electric vehicles, and many other electronics. China halted exports in March following a trade spat with U.S. President Donald Trump that showed some signs of easing late last month, even as broader tensions underscored demand for non-Chinese supply. As part of the agreement, Apple will prepay MP Materials $200 million for a supply of magnets slated to begin in 2027. The magnets will be produced at MP's Fort Worth, Texas, facility using magnets recycled at MP's Mountain Pass, California, mining complex, the companies said. "Rare earth materials are essential for making advanced technology, and this partnership will help strengthen the supply of these vital materials here in the United States," Apple CEO Tim Cook said in a statement. Bob O'Donnell, president at market research firm TECHnalysis Research, said Tuesday's move "makes complete sense" given that Apple requires significant amounts of rare earth magnets for its devices. "Plus, by focusing on a U.S.-based supplier, it does help position Apple more positively in Washington," he said. Apple, which said the deal is part of its $500 billion four-year investment commitment to the U.S., has faced threats from Trump over iPhones not made in the U.S. But many analysts have said making the iPhone in the U.S. is not possible, given labor costs and the existing smartphone supply chain. Apple, which sold about 232 million iPhones last year, according to data from IDC, did not disclose which devices in which it will use the magnets. MP said the deal will supply magnets for hundreds of millions of devices, which would constitute a significant share of any of Apple’s product lines, which also include wearable devices such as watches and earbuds. MP already produces mined and processed rare earths and has said it expects to start commercial magnet production in its Texas facility by the end of this year. The company already has a magnet supply deal with General Motors (GM.N) , opens new tab and Germany's Vacuumschmelze. Last week's deal between MP and the U.S. government includes a price floor for rare earths designed to spur investment in domestic mines and processing plants, which has been lagging partly due to low prices set in China. https://www.reuters.com/business/apple-invest-500-million-rare-earths-mine-operator-mp-materials-fox-business-2025-07-15/

2025-07-15 12:00

LAUNCESTON, Australia, July 15 (Reuters) - China's imports of major commodities presented a mixed picture in the first half, but if there is a clear trend it is that the world's top buyer of natural resources is increasingly sensitive to prices. Crude oil imports were barely higher over the first six months from the same period last year, liquefied natural gas (LNG) arrivals were weak, as were coal imports. Sign up here. Copper was mixed, with lower arrivals of refined metal, but higher shipments of ores and concentrates, while iron ore imports were slightly softer, according to official data released on Monday. The traditional market view in commodities is that demand and supply fundamentals lead prices, but China is increasingly a case where its level of imports react more to prevailing prices. Crude oil is a good example of this. For the first quarter of 2025 China, the world's largest importer, saw declining arrivals, with imports dropping 1.5% from the same period in 2024. However, the second quarter saw increasing crude imports, culminating in arrivals of 12.14 million barrels per day (bpd) in June, the strongest month since August 2023. The increase in second quarter imports was enough to turn the first half total positive, with arrivals up 1.4% from the first six months of 2024. The main driver of the change in imports in the second quarter was prices. Global benchmark Brent futures were on a declining trend during the period when second quarter-arriving cargoes would have been arranged. The price dropped from a high of $75.47 a barrel on April 2 to a four-year low of $58.50 on May 5. Conversely, the soft imports from the first quarter came against a backdrop of rising prices during the window when those cargoes would have been bought. Brent went from a low of $70.85 a barrel on December 6 to a six-month high of $82.63 on January 15, meaning China's refiners were facing rising import costs for cargoes arriving in the first quarter. The same price dynamic was at work with LNG, with spot prices for delivery to North Asia reaching a 15-month high of $16.10 per million British thermal units (mmBtu) in the week to February 14. Strong European demand for LNG has kept Asian spot prices elevated, with the usual seasonal decline after the winter peak being far less pronounced in 2025. This in turn has led to a sharp drop in LNG imports, with commodity analysts Kpler estimating a 22% drop over the first half to 30.24 million metric tons. The weaker LNG imports were enough to drag China's total natural gas imports of both the super-chilled fuel and from pipelines down by 7.8% in the first half, according to official data. TARIFFS DRIVE COPPER Copper is another example of price effects on China's imports, albeit in a somewhat different form. China's imports of unwrought copper dropped 4.6% in the first half to 2.633 million tons. This was largely because copper imports by the United States surged as traders anticipated the imposition of tariffs by President Donald Trump, with a 50% duty being announced last week. In effect, copper cargoes destined for China were diverted to the United States, netting a profit for both the Chinese buyers, who received a premium, and for the traders as they were able to get cargoes into the United States prior to the tariff, and now can take advantage of massive premium that now exists for the industrial metal. But while imports of refined copper were lower, arrivals of ores and concentrates rose 6.4% in the first half to 14.75 million tons, a sign that demand from smelters remained robust. Iron ore also shows the impact of prices, although this is largely a picture of modestly lower imports amid largely steady prices. Iron ore imports dropped 3.0% in the first half to 592.21 million tons amid slightly lower steel output and declining port inventories. Singapore-traded iron ore contracts ended at $97.70 a ton on Monday, and have traded in a $15 range so far in 2025 with a midpoint around $99. This stability has contrasted with the far wider ranges seen in other commodities such as crude oil and copper. Perhaps the only major commodity imported by China that isn't showing price sensitivity is coal, where both import volumes and prices have been declining. China's coal imports dropped 11.1% in the first half to 221.7 million tons, while the main Indonesian and Australian grades supplied to China fell to four-year lows, according to assessments by commodity price reporting agency Argus. China's domestic coal output rose a solid 6% in the first five months of 2025 compared to the same period in 2024, cutting the need for imports. But the overall message from China's commodity imports is that for commodities that it doesn't control the supply chains or dominate buying, China is becoming far more responsive to changes in prices and will adjust import volumes accordingly. Enjoying this column? Check out Reuters Open Interest (ROI), your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis of everything from swap rates to soybeans. Markets are moving faster than ever. ROI can help you keep up. Follow ROI on LinkedIn , opens new tab and X , opens new tab. The views expressed here are those of the author, a columnist for Reuters. https://www.reuters.com/markets/commodities/chinas-imports-major-commodities-show-rising-price-sensitivity-2025-07-15/

2025-07-15 11:53

BENGALURU, July 15 (Reuters) - U.S. Treasury yields will trade in a tight range over the coming months, with a strong majority of bond strategists surveyed by Reuters predicting demand for Treasuries lagging an expected deluge of new supply. President Donald Trump's sweeping tax-cut and spending bill, which cleared its final hurdle in the U.S. Congress earlier this month, is expected to add $3.4 trillion to the nation's $36.2 trillion debt pile, according to the nonpartisan Congressional Budget Office. Sign up here. Inflation risks from a renewed U.S.-led trade war, which includes Trump threatening a 30% tariff on imports from Mexico and the European Union starting August 1, has also pushed the U.S. "term premium" - the compensation investors demand for holding longer-term bonds - higher. With net Treasury issuance expected to approach nearly half a trillion dollars this quarter a rising risk premium makes it considerably harder to finance those expenses at higher interest rates. Nearly 77% of bond strategists, 23 of 30, responding to a July 10-15 Reuters survey said demand for U.S. Treasuries would lag supply slightly both this quarter and the next. Those respondents generally held a higher yield view than the wider monthly panel of 71 bond yield forecasters. Most bond strategists in Reuters surveys over the past year have repeatedly overestimated declining yields. "I think rates will over time structurally drift higher until either they're too restrictive in the real economy or the administration...has to rein in spending in order to right-size the budget," said Connor Fitzgerald, fixed income portfolio manager at Wellington Management. "While the government will be fine financing all the supply they need it will, over time, come at a slightly higher risk premium or cost." Sustained expectations the U.S. Federal Reserve will cut interest rates is one main reason strategists expect the benchmark 10-year Treasury yield , currently 4.42%, to roughly hold that level in coming months, falling a bit to 4.40% by end-September and 4.30% by year-end. "We think we're going to be in a range-trade for the next few months, maybe a marginal drop by year-end - not a huge move. There's a limit to the sell-off in the long end, but then there's a limit to a rally and lower yields too," said Jason Williams, director of U.S. rates research at Citi. "There are certainly risks the unemployment rate can go higher and though we haven't seen much tariff-led inflation yet there are definitely risks tariffs will cause a one-time price shift and that really complicates the Fed's reaction function." U.S. consumer prices likely rose sharply in June, potentially signaling the start of a long-anticipated tariff-driven rise that could limit how much the Fed can cut rates. That would further strain the already-tense relationship between Trump and Fed Chair Jerome Powell. "A key risk is the impact inflation will have on consumer spending and the extent to which firms will pass that on. If firms are unable to absorb the cost pressures and pass them off to consumers...that would be a major factor in driving an economic slowdown," said Matthew Vegari, head of research at Clearwater Analytics. The interest-rate-sensitive 2-year Treasury yield , currently 3.90%, will decline 27 basis points to 3.63% at year-end, survey medians showed. If realized, that would steepen the yield curve, widening the spread with the 10-year yield to 67bps from around 50bps. https://www.reuters.com/business/us-treasury-yield-forecasts-anchored-despite-rising-debt-load-inflation-concerns-2025-07-15/

2025-07-15 11:43

FRANKFURT, July 15 (Reuters) - Renewable energy accounted for 54.5% of Germany's power consumption in the first six months of the year, down 2.7 percentage points from a year earlier, as slow wind speeds curbed generation, data showed on Tuesday. Germany has boosted its green power capacity as it seeks to shift towards a low-carbon economy and hit a political goal for renewables to account for 80% of consumption by 2030. Sign up here. It also needs renewable generation to fill the gap after it halted its imports of Russian gas in response to the Ukraine war. But Tuesday's data from utility association BDEW underlines the need for back-up power when weather conditions are unfavourable. For now Germany still relies on coal and some gas to supplement renewables. Between January and June 2024, the renewables share was 57.2%, according to the data from BDEW and the Centre for Solar Energy and Hydrogen Research, or ZSW. "The decline in electricity generation from wind energy in the first half of the year was primarily due to the historically exceptionally weak wind conditions in the first quarter of 2025," said a joint statement. The preliminary figures showed onshore wind production by volume fell 18.3% and offshore volumes by 17.0% year-on-year in the first six months. Hydropower volumes fell by 29% due to declines in precipitation and too little snow melt left to fill rivers after a warm winter. However, photovoltaic generation increased by 23.0%. National electricity usage fell 0.7% to 258.6 terawatt hours in the period under review, while domestic production edged down 0.2% to 251.2 TWh, with the balance accounted for by imports. https://www.reuters.com/sustainability/boards-policy-regulation/slow-wind-speeds-reduce-renewable-share-german-power-2025-07-15/

2025-07-15 11:40

BAGHDAD, July 15 (Reuters) - A drone attack halted production at the Sarsang oilfield in Iraq’s Kurdistan region on Tuesday only hours before its U.S. operator signed a deal to develop another field. The Sarsang field is operated by HKN Energy, a privately held U.S. oil and gas company active in Iraq’s Kurdistan region and owned by Hillwood Energy, part of the Hillwood group founded by Ross Perot Jr. Sign up here. Two hours after the morning attack, HKN Vice President Matthew Zais was in Baghdad with Oil Minister Hayan Abdel-Ghani to sign a preliminary agreement to develop the Himreen oilfield in northern Iraq, the oil ministry said. The signing ceremony was also attended by U.S. Ambassador Steven Fagin, whose embassy condemned the drone attacks on oil infrastructure in the Kurdistan region and urged the Iraqi government to investigate and hold those responsible accountable. Washington said such attacks undermine Iraq’s sovereignty and efforts to attract foreign investment. Production at the Sarsang field was halted as a precautionary measure after an explosion, two engineers told Reuters. Kurdistan regional authorities confirmed that the blast was from a drone attack. No group has claimed responsibility for the attack, but Iraqi Kurdistan security sources said that initial investigations suggested that the drone came from areas under the control of Iran-backed militias. Heavy plumes of smoke were seen rising from the Sarsang field in the Dohuk region of northern Iraq, said one oil engineer at the field. Field operator HKN said that the halt to production was to allow firefighters to extinguish the fire, later adding that emergency response teams contained the damage. There were no casualties, Iraqi Kurdistan's ministry of natural resources and HKN said. The incident is under investigation and a full assessment of the damage has been initiated, the company said without providing further detail on the cause of the explosion. On Monday two drones fell on the Khurmala oilfield near Erbil in Iraqi Kurdistan, damaging the water pipes at the field. https://www.reuters.com/business/energy/drone-attack-halts-sarsang-oil-output-iraqi-kurdistan-ministry-says-2025-07-15/

2025-07-15 11:35

UK finance minister gives annual Mansion House speech Reeves widens her message to scrap regulation Plans include encouraging people to invest in stocks Latest bid by government to get elusive growth going LONDON, July 15 (Reuters) - British finance minister Rachel Reeves pledged on Tuesday to ease regulation further and announced measures to boost the finance sector, including reforming requirements for banks to separate retail and investment banking activities and a plan to get more savers investing in stocks. Under pressure to get lacklustre economic growth going, Reeves doubled down on her message since Labour came to power last year: that post-financial crisis regulation is stifling growth and needs to be pared back. Sign up here. She promised "meaningful reform" of bank ring-fencing - rules designed to shield depositors from volatile investment banking. She also pledged simpler regulatory approvals for smaller financial companies and confirmed an easing of access to mortgages. "In too many areas, regulation still acts as a boot on the neck of businesses choking off the enterprise and innovation that is the lifeblood of growth," she told an audience of financial executives at the City of London's annual "Mansion House" dinner. She described her package of reforms as the most wide-ranging in a decade for financial services, and said she wanted to slash red tape much more widely too. "Regulators in other sectors must take up the call I make this evening not to bend to the temptation of excessive caution," she said. Financial executives have welcomed Reeves' promises - including at her last Mansion House speech - to reduce red tape and encourage risk-taking. But her pitch to the City comes with the industry worried about a stuttering economy and about rival financial centres stealing market share. While the FTSE 100 (.FTSE) , opens new tab index hit a record high on Tuesday, fundraising from companies listing on the London Stock Exchange has sunk to its lowest in decades. With Reeves and Prime Minister Keir Starmer's promise to speed up Britain's economy largely elusive, fears are mounting that taxes will rise further to balance public finances. The government last month announced a 10-year industrial strategy that included the financial services sector. On Tuesday, Reeves backed changes announced by the Bank of England to help banks free up capital, including a delay to the implementation of part of the Basel banking reforms, and an easing in capital requirements for mid-sized lenders. Barclays (BARC.L) , opens new tab CEO, C.S. Venkatakrishnan, who was at the Mansion House dinner with Reeves, said the regulatory changes would support UK financial sector competitiveness. "We applaud the underlying ambition and initiative, even as we wish greater change in some areas, like bank capitalisation, in order to boost support for the real economy, and much less in others, like UK ring-fencing, which is a core of depositor protection," he said in an emailed statement. Karim Haji, KPMG's global and UK head of financial services, said the critical test for reforms "will be in their execution and how quickly these proposals can translate into real, measurable benefits for firms, investors, and consumers." ALERTING CUSTOMERS Britain has the lowest level of retail investment among the Group of Seven rich countries, the finance ministry said, and the government has been looking for levers to get more money into stocks. From April 2026, the Financial Conduct Authority - a regulator - will allow banks to alert customers about specific investment opportunities so they can consider shifting money from low-return current accounts. Before then, banks will run an advertising campaign to promote share investments. Regulators will review the risk warnings given for different financial investments. The government stopped short of reducing tax incentives for savers using cash-only Individual Savings Accounts to aid investment in shares, but Reeves said she would consider further changes. As well as consumers, the finance minister has targeted British pension funds. Reeves said she was "confident" she would not need to use new powers to force funds to invest in a wider range of assets, although the new pension bill reserves that right. As well as long-term reform, greater "near-term incentives" were needed to unlock more pension fund money, Anne Glover, CEO of venture capital investor Amadeus Capital Partners, said following Reeves' speech. Other changes announced on Tuesday included reforming how the Financial Ombudsman Service resolves consumer complaints and for the FCA to review the impact of its consumer duty policy. The Senior Managers and Certification Regime - set up after the 2008 financial crisis - will be streamlined, Reeves said. Prospectus requirements for listing companies issuing new shares will be scrapped. New rules to support a more competitive captive insurance sector were proposed while the FCA said it would accelerate the process for authorising new companies. https://www.reuters.com/sustainability/boards-policy-regulation/uk-finance-minister-launches-retail-investment-push-2025-07-15/