2024-11-05 07:19

BERLIN, Nov 5 (Reuters) - The business climate in Germany's chemical industry improved significantly in October, though it was still in negative territory, as companies pin their hopes on the government's electricity price package, according to a survey on Tuesday. The Ifo economic institute's indicator on the sector jumped to -3.1 points in October from a seasonally adjusted -13.0 points in September on the back of improved expectations. The sub-indicator measuring business expectations rose to 4.7 points in October from -15.9 points the month prior. With the extended and expanded package, the German government wants to ensure competitive electricity prices for companies in the long term, including the abolition of a green power surcharge and further measures to reduce grid fees. "These policy measures have been positively received by the chemical industry," said Ifo. In October, companies therefore assessed their competitiveness less negatively than recently. However, that mood was tempered by ongoing weakness in manufacturing, where demand for chemical products remained subdued in October and the order backlog fell once again. Against this backdrop, financing bottlenecks increased, further hampering willingness to invest in the sector. "It is right to ease the burden on chemical companies now in order to maintain production capacities in Germany throughout the economic crisis," said Ifo industry analyst Anna Wolf. Sign up here. https://www.reuters.com/markets/commodities/mood-german-chemicals-sector-brightens-electricity-support-finds-ifo-2024-11-05/

2024-11-05 07:18

JOHANNESBURG, Nov 5 (Reuters) - South Africa's rand edged higher on Tuesday after the release of a local purchasing managers' index and as the United States headed to the polls to elect its next leader. At 1523 GMT, the rand traded at 17.445 against the U.S. dollar , up 0.33% from its previous close. The dollar last traded about 0.3% softer against a basket of currencies. South Africa's private sector maintained its growth trajectory in October, bolstered by a decline in business costs and selling prices, a PMI survey showed. Global investor focus is firmly on what is expected to be a tight race between Republican candidate Donald Trump and Democrat Kamala Harris. The outcome of the vote may not be known for days. "The Federal Reserve's decision to cut rates, anticipated on Thursday, will likely add further volatility to an already tense market atmosphere," said Wichard Cilliers, director and head of market risk at TreasuryONE. The U.S. Federal Reserve is expected to cut rates by 25 basis points on Thursday. On the stock market, the Top-40 (.JTOPI) , opens new tab index closed nearly 0.6% higher. South Africa's benchmark 2030 government bond was marginally weaker, with the yield up 1 basis point to 9.315%. Sign up here. https://www.reuters.com/markets/currencies/south-african-rand-stable-markets-gear-up-us-vote-2024-11-05/

2024-11-05 07:14

FRANKFURT, Nov 5 (Reuters) - German utility Uniper (UN0k.DE) , opens new tab has sold sizeable quantities of its future hydropower output as part of a hedging strategy, the company said on Tuesday. Uniper has sold 75% of its German hydropower output for 2025 at an average price of 124 euros ($134.86) per megawatt hour (MWh) and 30% of the output in 2026 at an average of 88 euros/MWh, it showed in a presentation for an analyst call on earnings for the first three quarters of 2024. By comparison, the wholesale benchmark price for round-the-clock German power from all generation sources in 2025 closed at 87.0 euros on Monday, and at 82.2 euros for 2026, LSEG data showed. The discrepancies come from differently-priced fuel elements in the overall wholesale levels. Those levels also reflect fossil-generated power and renewable sources that are subject to national support schemes and hard-to-predict weather patterns. Producers use hedging to reduce the impact of price volatility and to lock in forward production prices considered favourable at a certain point in time. The wholesale market uses the rates to track price trends and assess a utility's physical asset position. Uniper has so far sold 95% of its 2024 German output at 51 euros after achieving an average price of 34 euros for sales of its 2023 output, it said. The company also operates coal, gas-fired and nuclear plants elsewhere in Europe as well as wind and solar power generation units that were not reflected. Regarding Nordic region prices, Uniper said it sold 65% of nuclear and hydropower for 2025 and 35% of output for 2026 at average prices of 38 euros each, after achieving 45 euros for 85% of 2024 output, and 41 euros in 2023. Sector peer Vattenfall said last week it has hedged 52% of its 2025 Nordic generation at an average of 48 euros/MWh. ($1 = 0.9195 euros) Sign up here. https://www.reuters.com/business/energy/uniper-sells-german-hydropower-2025-2026-part-hedging-strategy-2024-11-05/

2024-11-05 07:04

BOJ likely aiming to hike rates to 1.5% or 2% by early 2028-Sakurai Renewed yen falls could prod BOJ to hike as soon as December BOJ may hold till January given political, market uncertainty Huge debt issuance may keep BOJ from accelerating QT TOKYO, Nov 5 (Reuters) - The Bank of Japan is likely to raise interest rates in coming months with January emerging as the most likely timing, when there will be more clarity on political and market developments, former BOJ board member Makoto Sakurai said on Tuesday. The central bank will eventually aim to raise short-term borrowing costs - currently at 0.25% - to 1.5% or 2% by the end of Governor Kazuo Ueda's term in April 2028, he said. "The BOJ probably wants to hike rates once more by March next year. The exact timing will depend much on market and political developments," Sakurai told Reuters in an interview. "With domestic politics still in flux, acting in December might be tricky. January seems to be more likely as the BOJ would have more data including on whether consumption and wage growth will hold up," said Sakurai, who retains close contact with incumbent policymakers. But the chance of a December rate hike would heighten if the yen resumes its decline towards the three-decade trough near 162 to the dollar hit in July, Sakurai said. The dollar stood at 152.45 yen on Tuesday. "Governor Ueda emphasised his resolve to keep raising rates at last week's news conference, which seems to reflect the BOJ's desire to avoid triggering excessive yen falls," Sakurai said. The dollar fell below 152 yen on Thursday when the BOJ kept rates steady, but signaled the chance of near-term action by dropping language that it can "afford to spend time" scrutinising the fallout from U.S.-related downside risks. The BOJ next meets for a policy meeting on Dec. 18-19, followed by another meeting on Jan. 23-24. The BOJ made a landmark exit from a decade-long stimulus programme in March and raised its short-term policy target to 0.25% in July on the view Japan was making progress towards sustainably hitting its 2% inflation target. Ueda has stressed the BOJ's readiness to keep raising rates if the economy and prices move in line with its forecast. While most analysts expect the BOJ to hike again by the March end of the current fiscal year, they are split on whether the bank would act in December - or wait until January or March. The loss of a majority by Japan's ruling coalition in an election on Oct. 27 has heightened concerns about policy paralysis with Prime Minister Shigeru Ishiba being forced to court opposition parties to stay in power. The political uncertainty, coupled with potential market turbulence after the U.S. presidential election, could prod the BOJ to stand pat in December, Sakurai said. Another key factor for the BOJ is whether wage hikes would broaden to smaller firms and underpin consumption, he added. After hiking rates again by March next year, the BOJ will probably aim to raise short-term rates once or twice a year from fiscal 2025 to 2027, to bring it to 1.5% or 2%, Sakurai said. "There's too much uncertainty to predict the exact pace of further rate hikes. But the BOJ is probably hoping to hike rates to around 2% in the long-term horizon," he added. Japan's expected huge debt issuance and political calls for bigger fiscal spending, however, could constrain the BOJ's plan to taper its bond purchases, Sakurai said. The BOJ announced in July a plan to halve its monthly JGB buying to 3 trillion yen ($19.7 billion) as of January-March 2026, which would reduce its huge balance sheet by up to 8%. The central bank will conduct a review of its existing quantitative tightening (QT) programme in June next year, to come up with a tapering plan from April 2026 onward. While the BOJ may prefer to further reduce its bond buying, it may find it hard to do so given expected increases in debt issuance to pay for roll-overs of maturing bonds and additional spending plans, Sakurai said. "The BOJ may be forced to keep buying roughly 3 trillion yen worth of bonds well beyond fiscal 2026," he said. ($1 = 152.3900 yen) Sign up here. https://www.reuters.com/markets/rates-bonds/boj-raise-rates-again-most-likely-january-says-ex-policymaker-2024-11-05/

2024-11-05 07:00

Production costs hinder commercial use despite potential benefits Two South Korean firms launch new push to mass-produce allulose Health experts call for more research on long-term effects SEOUL, Nov 5 (Reuters) - South Korea has become a top testing ground for the sweetener allulose, a potential rival to sugar substitutes like stevia that is finding favour among both local food influencers and big domestic food companies, which are ramping up production. Found naturally in figs, kiwis and other fruits, allulose has been approved by both U.S. and South Korean regulators. It can be found in candies and protein bars in the U.S. but commercialised sweetener products of allulose are mostly sold online or at select grocery stores. In South Korea, however, it has caught on more widely and is now easily available in supermarkets for less than 10,000 won($7.26) per 700 ml bottle. That is still pricey at about four times the cost of table sugar, but manufacturers and researchers say it is 70% as sweet as sugar and almost calorie-free. "It tastes the closest to table sugar," said Renaud Joly, a French vegan influencer based in Seoul. But even as top South Korean food and beverage companies Daesang Corp (001680.KS) , opens new tab and Samyang Corp (145990.KS) , opens new tab invest in new production facilities, health experts warn that more research is needed into the long-term health effects of allulose. It also has yet to gain widespread approval by regulatory authorities worldwide, and high production costs limit its use as a commercial sweetener. "Allulose isn't the first sugar substitute to make headlines for being the 'best new food product'," said Elizabeth Traxler, a registered dietician at University Hospitals, a U.S.-based academic medical centre. It does, however, have slight benefits for weight loss and can be helpful to individuals with diabetes, she added. When consumed in combination with sugars like sucrose, allulose can lower the blood glucose response, a benefit not many other sweeteners can produce. Samyang said it now sells more than 1,000 metric tons of allulose to retail customers annually, citing sales growth at a double-digit pace since 2020 and business-to-business revenue of more than 10 billion won in 2022. Earlier this year, it opened a 140 billion won factory that can produce 13,000 tons of allulose annually, more than quadruple its previous output. The company, which supplies allulose to Coca-Cola Korea Co for a zero-calorie soft drink, said it has been cleared to begin selling its allulose products in Australia and New Zealand later this year. Market research firm Grand View Research estimates the global market for allulose will grow to more than $500 million by 2030 from about $310 million this year. By comparison, the global market for stevia was more than $514 million in 2023. But the European Union, Canada and other countries view it as a "novel food" that has yet to be sufficiently assessed for safety. The World Health Organization last year issued a guideline advising against using non-sugar sweeteners for weight control purposes, citing potential undesirable long-term effects. Two groups linked to the WHO last year declared the popular sweetener aspartame a "possible carcinogen", but said it remained safe to consume at already-agreed levels. University Hospitals dietician Traxler said that, when allulose is consumed in large quantities, possible side effects include gastrointestinal distress such as diarrhoea and bloating. Samyang's Head of Specialty Food Ingredients Park Sung-won said the biggest challenge has been making the sweetener affordable and raising consumer awareness, but added: "We believe allulose is a material with potential for the future." ($1 = 1,378.2600 won) Sign up here. https://www.reuters.com/world/asia-pacific/south-korean-companies-foodies-bet-sugar-substitute-allulose-2024-11-05/

2024-11-05 06:41

KARACHI, Nov 5 (Reuters) - Two Chinese nationals were shot at and injured on Tuesday in Pakistan's commercial hub of Karachi, police and hospital officials said, after a string of attacks that spurred Beijing to demand tougher security for its citizens. Faizan Ali, a senior superintendent of police, said two Chinese nationals had been shot, but gave no further details. A spokesperson for Liaquat National Hospital in the southern port city said it was treating the two, one of whom was in serious condition. It was not immediately clear who was responsible or if militant violence was behind the attack, one of several that have prompted Beijing to urge Pakistan to roll out more stringent security measures for its citizens. In October, a bombing near Karachi's international airport killed two Chinese engineers, in an attack claimed by separatist militant group the Baloch Liberation Army (BLA). A decades-long insurgency in the southwestern region by separatists demanding a share in regional resources has led to frequent attacks against the government, army and Chinese interests. Sign up here. https://www.reuters.com/world/asia-pacific/two-chinese-nationals-injured-after-being-shot-pakistans-karachi-authorities-say-2024-11-05/