2025-10-20 06:34

China's exports of rare earth magnets fell 6.1% in September Fall in exports fuels trade leverage concerns Xi-Trump summit in S. Korea may tackle rising trade tension BEIJING, Oct 20 (Reuters) - China's exports of rare earth magnets fell in September, reigniting fears that the world's top supplier could wield its dominance over a component key for U.S. defence firms and makers of items from cars to smartphones as leverage in trade talks. In April and May, Beijing squeezed global automakers with export curbs on a range of rare earths items and related magnets, while negotiators faced off over triple-digit U.S. tariffs on goods from the world's second-largest economy. Sign up here. Four months on, after Washington and Beijing unexpectedly reprised threats of fresh tariffs and rare earth export curbs, worry is growing that China could return to the same playbook. That would mean it reneges on a June deal with the United States to ease the flow of critical minerals. China's shipments of rare earth magnets fell 6.1% in September from August, customs data showed on Monday, ending three months of gains, and dropping even before Beijing unveiled a dramatic expansion of its export licensing regime this month. "The sharp swings in rare earth magnet exports show that China knows it holds a key card in international trade talks," said Chim Lee, senior analyst at the Economist Intelligence Unit. EXPORTS FALL FROM AUGUST'S SEVEN-MONTH HIGH The September fall to 5,774 tons from a seven-month high of 6,146 tons in August aligns with reports that China is already making it harder for firms to secure licences for exports of rare earth magnets. Its commerce ministry is applying scrutiny similar to that seen in April, at the height of the trade war. On an annual basis, September shipments rose 17.5%. Last week, China's commerce ministry accused the United States of stoking global panic over its rare earth controls by deliberately misunderstanding the curbs, and said it would approve export licences intended for civilian use. Still, analysts worry China could once again entangle civilian commercial users in curbs aimed at choking U.S. defence firms' access to critical materials. "China's ability to throttle rare earth exports is an exceptionally powerful tool," said Dan Wang, China director at Eurasia Group. Apart from disrupting production, such measures would fuel insecurity over access to critical industrial inputs and growing reliance on China, she added. "The world has to adjust to its management style," she said, adding that Western countries are not used to complying with a monopolistic control of critical resources from countries on 'the other side'. By country, Germany, South Korea, Vietnam, the United States and Mexico were the top five export destinations for Chinese rare earth magnets by volume last month. Over the nine months of the year, exports of such magnets totalled 39,817 tons, a fall of 7.5% from the corresponding 2024 period. NO SIGN OF BEIJING BACKING DOWN Shipments to the United States fell 28.7% in September on the month, the data showed, while exports to Vietnam rose 57.5% over the same period. The Netherlands processed 109% more rare earth magnets than in August, though the figure is skewed by the huge Rotterdam port, a major transit hub for Europe-bound trade. Just before the release of the data, President Donald Trump told reporters aboard Air Force One that he did not want China to "play the rare earth game with us". He suggested he might hold off on raising tariffs back to levels in excess of 100% if the world's top agricultural buyer committed to purchasing U.S. soybeans. But Beijing shows no sign of backing down, adamant that its new wider curbs, set to take effect just days before the November 10 expiry of the latest 90-day tariff truce with the United States, are consistent with measures in other major economies. President Xi Jinping is set to meet Trump in South Korea later this month, but economists warn that trade friction between the two biggest economies may be the new normal. "The surge in exports during the third quarter came after it (China) eased export controls earlier in the year, but that's likely to drop again following the tighter restrictions introduced recently," added EIU analyst Chim Lee. https://www.reuters.com/world/asia-pacific/china-september-rare-earth-magnet-exports-fall-6-seven-month-high-2025-10-20/

2025-10-20 06:07

Trump says India pledged to cut Russian crude imports India bought 40% of Russian crude exports so far in 2025 Halting purchases will hurt Moscow, but is unlikely to cut its exports LONDON, Oct 20 (Reuters) - Donald Trump is putting more pressure on India to slash its Russian oil purchases. This could deprive Moscow of vital revenue, but it will mostly just push more Russian oil into an increasingly large shadow market. The U.S. president said on Wednesday that Indian Prime Minister Narendra Modi has pledged to stop buying oil from Russia, an agreement India has yet to confirm. Sign up here. India has become a major trade buyer of Russian oil since Moscow’s invasion of Ukraine in 2022. It purchased 1.9 million barrels per day (bpd) of Russia’s crude in the first nine months of 2025, 40% of its total exports, according to the International Energy Agency. This U.S. pressure on New Delhi comes as Kyiv has been striking Russia’s energy infrastructure. Moreover, Trump appears to be focused once again on resolving the conflict in Ukraine after negotiating a ceasefire in Gaza. He announced last week that he and Russian President Vladimir Putin will be meeting for another summit after a “successful” phone call. This all suggests that we may be entering a new stage in the West’s efforts to squeeze the Kremlin, so barring a breakthrough at the upcoming summit, the pressure on India to trim its Russian crude purchase is unlikely to let up. A FINANCIAL HIT India probably will acquiesce to U.S. pressure as part of a broad trade deal. Washington has already hit Indian goods with a 25% import tariff in retaliation for New Delhi’s purchases of Russian oil. Indeed, some Indian refiners are already preparing to cut Russian oil imports, though any drop won’t be visible before December at the earliest. Meanwhile, Indian refiners face another challenge. The European Union will impose a ban on imports of fuel refined from Russian crude as of January 21 next year. Europe accounts for over a third of India’s diesel and aviation fuel exports. The new U.S. and EU measures will likely be financially painful for India's refineries, as they have been enjoying healthy margins by buying Russian crude at significant discounts to international prices. And the two countries’ energy markets are already heavily intertwined. Private refiner Reliance (RELI.NS) , opens new tab, which operates one of the world's largest refining complexes in western India, last year signed a giant 10-year deal with Russian state-owned oil firm Rosneft (ROSN.MM) , opens new tab to supply nearly 500,000 bpd of crude. Rosneft also owns a 49% stake in another major Indian refiner, Nayara, whose 400,000 bpd Vadinar refinery relies exclusively on Russian oil imports. It already faces EU and British sanctions, which have caused it to reduce its operating rates, though it is unlikely to fully cease importing Russian crude. CHINA TO THE RESCUE? But let’s assume that India can severely cut its Russian oil purchases, even if it can’t reduce them to zero. What would happen to the Russian crude volumes India stops buying? First, Chinese refiners may opt to increase their purchases, particularly if the discount with international prices widens. China remains the biggest buyer of Russian oil, importing 2.1 million bpd between January and September via land and sea, roughly 18% of the country's total crude imports. It has also tightened its energy ties with Moscow this year and is importing liquefied natural gas from a heavily sanctioned Russian plant , opens new tab. Yet Beijing has historically refrained from relying on one country for more than 20% of its oil imports. So by that measure, refiners would likely have little capacity to increase Russian barrels that India could reasonably be expected to reduce. Moreover, Trump is also putting pressure on China to reduce Russian oil purchases amid simmering trade tensions between the world’s two largest economies. Beijing might therefore be wary of further provoking Washington, particularly given that it can already buy crude at attractive prices. INTO THE SHADOWS Any remaining Russian barrels will thus likely move into the rapidly growing shadow market. Russia has developed a vast network of ageing tankers to evade international sanctions. In September, 69% of Russia's seaborne crude exports were carried on "shadow fleet" tankers, according to the Centre for Research on Energy and Clean Air. This vast trade scheme often uses ship-to-ship oil transfers in mid-ocean to obscure the oil supplies’ origins. It is therefore likely that any Russian oil that would typically have gone to India directly will simply end up in the shadow market. At that point, its country of origin would be obscured, meaning it could end up in many places, including India. To be sure, the loss of a major market such as India will certainly narrow Russia’s pool of buyers, forcing it to sell oil at bigger discounts, eating into Moscow’s revenue. Already, lower oil and gas prices are hitting Moscow’s budget , opens new tab. But the West’s efforts to squeeze Russia’s vast oil industry are unlikely to lead to a drop in Russian production or exports. They may simply reduce visibility in what is becoming an increasingly opaque market. Want to receive my column in your inbox every Monday and Thursday, along with additional energy insights and links to trending stories? Sign up for my Power Up newsletter here. Enjoying this column? Check out Reuters Open Interest (ROI), , opens new tabyour essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis. Markets are moving faster than ever. ROI , opens new tab can help you keep up. Follow ROI on LinkedIn , opens new tab and X. , opens new tab https://www.reuters.com/business/energy/trumps-india-squeeze-push-russian-oil-further-into-shadows-2025-10-20/

2025-10-20 05:58

Trump keeps up pressure on India to stop buying Russian oil U.S.-India trade talks 'congenial', Indian official says ABOARD AIR FORCE ONE, Oct 19 (Reuters) - U.S. President Donald Trump reiterated on Sunday that Indian Prime Minister Narendra Modi told him India will stop buying Russian oil, while warning that New Delhi would continue paying "massive" tariffs if it did not do so. "I spoke with Prime Minister Modi of India, and he said he's not going to be doing the Russian oil thing," Trump told reporters aboard Air Force One. Sign up here. Asked about India's assertion that it was not aware of any conversation between Modi and Trump, Trump replied: "But if they want to say that, then they'll just continue to pay massive tariffs, and they don't want to do that." Russian oil has been one of the main irritants for Trump in prolonged trade talks with India - half of his 50% tariffs on Indian goods are in retaliation for those purchases. The U.S. government has said petroleum revenue funds Russia’s war in Ukraine. India has become the biggest buyer of seaborne Russian oil sold at a discount after Western nations shunned purchases and imposed sanctions on Moscow for its 2022 invasion of Ukraine. Trade talks between India and the U.S. are going on in a "congenial" manner, an Indian government official said on Saturday, declining to be identified due to the sensitivity of talks. An Indian delegation which was in the U.S. last week for talks has returned, the official said, declining to share further details. An email to India's trade ministry was not immediately answered on Monday, which was a public holiday. Trump on Wednesday said Modi had assured him that day that India would stop its Russian oil purchases. India's foreign ministry said it was not aware of any telephone conversation between the leaders that day, but said that New Delhi's main concern was to "safeguard the interests of the Indian consumer." A White House official said on Thursday that India has halved its purchases of Russian oil, but Indian sources said no immediate reduction had been seen. The sources said Indian refiners already placed orders for November loading, including some slated for December arrival, so any cut may start showing up in December or January import numbers. India's imports of Russian oil are set to rise about 20% this month to 1.9 million barrels per day, according to estimates from commodities data firm Kpler, as Russia ramps up exports after Ukrainian drones hit its refineries. https://www.reuters.com/world/india/trump-vows-keep-massive-tariffs-india-until-russian-oil-imports-cease-2025-10-20/

2025-10-20 05:32

MUMBAI, Oct 20 (Reuters) - The Indian rupee trimmed most of its intraday gains but still ended higher on Monday, with traders citing likely intervention by the Reserve Bank of India through state-run banks to support the currency near the 88/dollar level. The currency opened marginally higher at 87.9350 to the U.S. dollar, up from 87.9750 on Friday. It advanced in early trade to touch the day's high of 87.7475. Sign up here. Traders said the rupee rose with support from state-run banks, likely acting on behalf of the Reserve Bank of India, adding that the unit strengthened after these banks stepped in early and the momentum continued once their dollar sales slowed, before the currency settled at 87.9275. "Once there was clarity that the central bank had become less active, importers took over, which led to a 20-paisa move," a senior trader with a state-run bank said. The RBI had stepped in aggressively last week, conducting pre-market interventions on at least two occasions to stem the rupee's slide past record lows. Dollar sales from the central bank triggered a pullback in USD/INR, flushing out speculative long positions and improving the near-term outlook for the local currency. Equity flows have also turned supportive, with overseas investors buying a net of more than $1 billion over the past week. "The rupee commenced the week on a front footing, buoyed by the resilience of risk assets augmented by foreign fund inflows and the gain was further accelerated by the backdrop of a holiday-truncated week," said Dilip Parmar, a foreign exchange research analyst at HDFC Securities. The discernible, yet susceptible, intervention by the central bank also helped, he added. Meanwhile, the market showed little reaction to U.S. President Donald Trump’s comments, in which he reiterated that India would face "massive" tariffs if it failed to comply. https://www.reuters.com/world/india/rupee-enters-new-week-balancing-rbi-boost-importer-demand-lacklustre-asia-2025-10-20/

2025-10-20 05:32

US CPI data due on Friday Spot gold hit all-time high of $4,378.69/oz last week US government shutdown enters its 20th day Oct 20 (Reuters) - Gold prices rose by over 2% on Monday, buoyed by expectations of further U.S. interest rate cuts and sustained safe-haven demand, as investors awaited upcoming U.S.-China trade talks and inflation data out of the U.S. this week. Spot gold was up 2.3% at $4,346.39 per ounce, as of 1:47 p.m. ET (1746 GMT). U.S. gold futures for December delivery settled 3.5% higher at $4,359.40 per ounce. Sign up here. Gold prices notched a record high of $4,378.69 on Friday, but closed 1.8% lower — their steepest drop since mid-May — after comments from U.S. President Donald Trump alleviated some concerns around U.S.-China trade tensions. Political and economic concerns are driving prices higher after Friday's sharp sell-off, said CPM Group managing partner Jeffrey Christian. "Our expectation is that the price is going to rise higher over the next several weeks and several months, and we wouldn't be surprised at $4,500/oz soon," he added. The U.S. government shutdown stretched to its 20th day on Monday, after senators failed for the tenth time last week to break the impasse. The shutdown has also delayed key economic data releases, leaving investors and policymakers in a data vacuum ahead of the Federal Reserve's policy meeting next week. U.S. consumer price index data, delayed due to the shutdown, is scheduled for Friday. Meanwhile, traders are pricing in a 99% chance that the Federal Reserve will cut interest rates next week, with another cut in December. Gold, a non-yielding asset, tends to do well in low-interest rate environments. Investors are also looking out for further updates on U.S.-China trade talks, after Trump said on Friday that a planned meeting with Chinese President Xi Jinping would go ahead. "I would not be surprised to see gold get to $5,000/oz at some point next year. That would be predicated on ongoing political problems and worsening political problems, which is actually what we have right now," Christian said. Spot silver rose 0.6% to $52.17 per ounce. The metal fell 4.4% on Friday, after hitting a record high of $54.47 earlier that day. Elsewhere, platinum rose 1.9% to $1,640.90 per ounce and palladium gained 1.5% to $1,496.59 per ounce. https://www.reuters.com/world/china/gold-ticks-up-us-rate-cut-hopes-us-china-trade-talks-focus-2025-10-20/

2025-10-20 05:20

Rare earths deal aims to counter China's supply control US, Australia to invest $1 billion each in mining projects Trump backs AUKUS submarine deal despite prior review Trump tells Ambassador Rudd: 'I don't like you either' WASHINGTON, Oct 20 (Reuters) - U.S. President Donald Trump and Australian Prime Minister Anthony Albanese signed a critical minerals agreement aimed at countering China on Monday at a meeting marked by Trump's jab at Australia's envoy to the United States over past criticism. China loomed large at the first White House summit between Trump and Albanese, with the U.S. president also backing a strategic nuclear-powered submarine deal with Australia to bolster security in the Indo-Pacific. Sign up here. While Trump and Albanese greeted each other warmly, the U.S. president expressed ire about past criticism of him by Australia's U.S. ambassador Kevin Rudd, a former prime minister. Rudd in 2020 called Trump "the most destructive president in history," later deleting the comment from social media. Trump said he was not aware of the critical comments and asked where the envoy was now. Upon seeing him across the table, Trump said, "I don't like you either, and I probably never will." The visit otherwise appeared to go smoothly, with Albanese and Trump signing a minerals deal that Trump said had been negotiated in recent months. Albanese described it as an $8.5 billion pipeline "that we have ready to go." A copy of the agreement released by both governments said the two countries will each invest $1 billion over the next six months into mining and processing projects as well as set a minimum price floor for critical minerals, a move that Western miners have long sought. A White House statement on the agreement added that the investments would target deposits of critical minerals worth $53 billion, although it did not provide details on which types or locations. "In about a year from now, we'll have so much critical mineral and rare earths that you won't know what to do with them," Trump told reporters. China's foreign ministry did not comment directly on the deal but said on Tuesday that market and business choices form the global production and supply chain. "Key mineral resource countries should play an active role in ensuring the safety and stability of the industrial and supply chain, and ensure normal economic and trade cooperation," ministry spokesperson Guo Jiakun told a regular news briefing. EXIM ANNOUNCES OVER $2.2 BILLION IN INVESTMENTS The U.S. Export-Import Bank, which acts as the U.S. government's export credit agency, later announced seven letters of interest totaling more than $2.2 billion to advance critical minerals projects in Australia. It said the letters went to Arafura Rare Earths (ARU.AX) , opens new tab, Northern Minerals (NTU.AX) , opens new tab, Graphinex, Latrobe Magnesium (LMG.AX) , opens new tab, VHM (VHM.AX) , opens new tab, RZ Resources (RRZ.AX) , opens new tab, and Sunrise Energy Metals (SRL.AX) , opens new tab. EXIM said the projects span a range of critical minerals essential to advanced defense systems, aerospace components, communications equipment, and next-generation industrial technologies. The investments would help support the re-industrialization of America’s high-tech manufacturing base, while helping to "counter China's export dominance and ensure Western supply-chain resilience," it said. Additionally, the Pentagon plans to build a gallium refinery in Western Australia. China blocked gallium exports to the United States last December. The United States has been looking to boost its access to critical minerals around the world as China takes steps to strengthen control over global supply. Trade tensions between the United States and China have escalated ahead of Trump's meeting with Chinese President Xi Jinping in South Korea next week. The term critical minerals applies to a range of minerals, including rare earths, lithium and nickel. China has the world's largest rare earths reserves, according to U.S. Geological Survey data, but Australia also has significant reserves. The minerals are used for products ranging from electric vehicles to aircraft engines and military radars. TRUMP SIGNALS SUPPORT FOR SUBMARINE DEAL Albanese got welcome support from Trump for the A$368 billion ($239.46 billion) AUKUS agreement, reached in 2023 under then-President Joe Biden. Under the deal, Australia is to buy U.S. nuclear-powered submarines in 2032 before building a new submarine class with Britain. While Trump has been eager to roll back Biden-era policies, he signaled his intent to back the AUKUS submarine agreement, months after his team launched a review of the deal over concerns about the ability of the United States to meet its own submarine needs. Navy Secretary John Phelan told the meeting the United States and Australia were working closely to improve the original AUKUS framework for all three parties "and clarify some of the ambiguity that was in the prior agreement." Trump said these were "just minor details," adding that "there shouldn't be any more clarifications, because we're just - we're just going now full steam ahead, building." Ahead of Monday's meeting, Australian officials emphasized that their country is paying its way under AUKUS, contributing $2 billion this year to boost production rates at U.S. submarine shipyards, and preparing to maintain U.S. Virginia-class submarines at its Indian Ocean naval base from 2027. The delay of 10 months in an official meeting since Trump took office had caused some anxiety in Australia as the Pentagon urged the Australian government to increase defense spending. The two leaders met briefly on the sidelines of the United Nations General Assembly in New York last month. The rare earths agreement came a week after U.S. officials condemned China's expansion of rare earth export controls as a threat to global supply chains. Resource-rich Australia, wanting to extract and process rare earths, put preferential access to its strategic reserve on the table in U.S. trade negotiations in April. As part of the rare earths agreement, Trump and Albanese agreed to cut permitting for mines, processing facilities and related operations in order to boost production. The deal called for cooperation on the mapping of geological resources, minerals recycling and efforts to stop the sale of critical minerals assets "on national security grounds." This was an oblique reference to China, which has bought major mining assets across the planet in the past decade, including the world's largest cobalt mine in Congo, from U.S.-based Freeport-McMoRan (FCX.N) , opens new tab in 2016. $1 = 1.5368 Australian dollars) https://www.reuters.com/world/asia-pacific/australias-albanese-discuss-rare-earths-security-first-trump-summit-2025-10-20/