2024-03-13 19:44

ELIZABETHTOWN, Kentucky, March 13 (Reuters) - Treasury Secretary Janet Yellen said on Wednesday clean energy investments in parts of the U.S. historically reliant on fossil fuels have more than doubled to $4.5 billion per month due to Biden administration tax credits targeting such communities. Yellen said in remarks in central Kentucky that Treasury Department research using Rhodium Group data , opens new tab also shows clean energy investment in other communities has risen to $3.5 billion per month - a $1 billion increase - thanks to the incentives in the 2022 Inflation Reduction Act (IRA). Yellen is visiting Kentucky, a heavily Republican state that Democratic President Joe Biden is not expected to win in the Nov. 5 U.S. election, to promote the state's growing supply chain for electric vehicle (EV) battery production that Biden touted in his State of the Union address to Congress last week. "We've seen investments grow significantly. Companies have announced almost $650 billion in investments in clean energy and manufacturing across the country since the start of the administration," Yellen said. Yellen is visiting Advanced Nano Products, a South Korean-owned battery materials manufacturer that has invested $49 million in a new factory in Elizabethtown, Kentucky that will employ around 100 workers after it starts production in May. The facility will supply carbon nanomaterials to the $5.8 billion BlueOval SK battery manufacturing complex under construction a few miles to the south by Ford Motor Co and South Korea's SK Group. The plant will eventually employ more than 5,000 workers. Japan's AESC is also building a $2 billion battery factory in Bowling Green, Kentucky that will employ 2,000 people. All of these facilities are taking advantage of IRA clean energy manufacturing tax credits that provide up to 30% of the investment costs, with a 10% bonus if located in a community historically dependent on fossil fuel energy or one that is economically disadvantaged. They also will benefit from consumer EV tax credits of up to $7,500 on the purchase of vehicles that meet U.S. production and battery content requirements. Kentucky accounted for just under 5% of U.S. coal production in 2022, ranking it fifth among the states producing the fossil fuel, according to the U.S. Energy Information Administration. The right-to-work state has captured over $11.6 billion in EV-related investments partly because it sits at the center of a growing Mid-South auto manufacturing belt stretching from Georgia to Texas. The BlueOval SK venture also is benefiting from a $9.2 billion Department of Energy loan. SALES HURDLES The investments have faced some obstacles, including a slowdown in U.S. EV sales and Ford's decision to freeze $12 billion in EV investments last year, including delaying one of two plants at the BlueOval SK site in Glendale, Kentucky. Yellen told Fox Business in an interview that while sales may not have met rosy expectations over the past year, consumers will want EVs as they become more affordable and more charging stations are built, partly with federal infrastructure funding. "The future for EVs is extremely bright in the United States. More subsidies will come into play that'll help make these cars affordable, and over time, their costs will decline." Yellen said the Treasury would take further steps to encourage leaders and businesses in more than 150 U.S. cities with high poverty rates to take advantage of the tax credits to attract investment. The Reuters Daily Briefing newsletter provides all the news you need to start your day. Sign up here. https://www.reuters.com/sustainability/sustainable-finance-reporting/yellen-says-biden-tax-credits-boost-clean-energy-investment-coal-country-2024-03-13/

2024-03-13 19:31

GSAM property head says bottom of market is in sight Brookfield says US office market world's most oversupplied Investors gather in Cannes amid plunging prices CANNES, France, March 13 (Reuters) - Goldman Sachs Asset Management will resume "actively investing" in U.S. commercial property this year because the market is bottoming out, its real estate head said, while other investors said the market downturn still had further to run. Prices of U.S. offices and other commercial properties have fallen sharply in the face of higher interest rates and soaring vacancy rates that have outpaced other countries since the pandemic. The plunge in prices has rattled confidence in U.S. regional banks with large exposure. Investors gathered on the French Riviera this week for the MIPIM property conference, said the office sector would continue to struggle. A Brookfield Asset Management (BAM.TO) , opens new tab executive on Wednesday called the U.S. "the most oversupplied office market in the world" and said investors had taken on too much debt. Jim Garman, GSAM's head of real estate, said he saw a buying opportunity. "The reason is a combination of interest rates coming down, we feel like the market is bottoming out, and because we're starting to see a floor in prices set by buyers who are in the market," Garman told Reuters at MIPIM. Garman said GSAM, the asset management arm of Goldman Sachs (GS.N) , opens new tab, had begun to deploy more cash in real estate in Europe and Japan over the past three months, without quantifying its investment. The underlying strength of the U.S. economy should support a rebound in the U.S. market too, although he cautioned about the speed of a recovery. "We don't think its going to be a very sharp V-shaped recovery – we think we're going to bump along the bottom for a while, as a lot of these over-levered situations in the asset class get worked through," he said. British fund manager Schroders (SDR.L) , opens new tab is also preparing to pounce. It plans to buy up U.S. commercial property in the billions of dollars over time and has begun hiring a team locally, with a focus on multi-family rental accommodation, its global head of real estate, Sophie van Oosterom, told Reuters. Schroders has begun hiring a real estate team in the U.S. and is looking at various potential strategies, including potential acquisitions or buying stakes in local firms, van Oosterom said. Speaking at a panel in Cannes earlier on Wednesday, executives said some parts of commercial real estate were holding up well, and clients were interested in investing in logistics and data centres rather than offices. Blackstone's global head of real estate debt capital markets, Michael Lascher, said that there was a polarisation in values between high-quality sustainable offices and the rest. Plunging real estate values have raised concerns about a wider financial spillover should banks have to realise large losses on their property loans. Regulators were putting a "clear focus" on CRE exposures at banks, said David Bouton, a senior commercial real estate executive at Citi. But he said that lenders were more accommodating to investors than during the 2007-09 global financial crisis because they had higher capital buffers. Others were also keen to play down comparisons with the global financial crisis. Richard Spencer, GSAM's head of real estate in Europe, the Middle East and Africa, said that banks today were in better shape with "the capital cushion to take action". Get a look at the day ahead in U.S. and global markets with the Morning Bid U.S. newsletter. Sign up here. https://www.reuters.com/business/finance/goldman-sachs-asset-management-says-resume-us-real-estate-investment-2024-03-13/

2024-03-13 19:23

Firm to close 600 Family Dollar stores in first half Forecasts 2024 sales and profit below estimates Posts Q4 sales of $8.63 bln vs estimate of $8.67 bln Reports adj profit of $2.55/share vs estimate of $2.65/share Shares down about 14% March 13 (Reuters) - Dollar Tree (DLTR.O) , opens new tab missed market expectations for holiday-quarter sales and profit on Wednesday and laid out plans to shutter 970 of its Family Dollar stores, as the retailer looks to revamp the struggling business. Shares of Dollar Tree fell about 14% after it also forecast 2024 sales and profit below expectations. Shares of rival Dollar General Corp (DG.N) , opens new tab fell 2.8%. Dollar stores have struggled following competition for consumer spending from Chinese e-commerce platform Temu, owned by PDD Group (PDD.O) , opens new tab, which sells $4 home decor items and other low-cost discretionary merchandise in the United States. Other rivals seeking to draw penny-pinchers to their stores include Walmart (WMT.N) , opens new tab, which is keeping its prices low, particularly on groceries, and Target (TGT.N) , opens new tab, which is launching hundreds of home, personal care and electronics products below $10. "Our biggest problem right now is getting enough merchandise into the stores fast enough so the consumer can respond," said CEO Rick Dreiling, adding that Family Dollar was continuing to be hurt by macroeconomic uncertainties. In November, Dollar Tree said it would be reviewing its Family Dollar business, including potentially shutting underperforming stores, to return to growth. The company, which operates around 16,774 stores, said it would close about 600 Family Dollar stores in the first half of fiscal-year 2024 and 370 more over a period of a few years, along with 30 Dollar Tree outlets, as their lease terms expire. Meanwhile, Temu is investing in digital and television marketing to attract customers from dollar stores and other brick-and-mortar retailers. As a result, Dollar Tree took a $594.4 million charge for a portfolio optimization review and incurred a goodwill impairment charge of $1.07 billion, as well as $950 million in other asset impairment charges in the reported quarter. Dollar Tree reported a net loss of $1.71 billion, or $7.85 per share, in the quarter ended Feb. 3, compared with a year-ago profit of $452.2 million, or $2.04 per share. It expects 2024 sales between $31 billion and $32 billion, the mid-point of which is below Wall Street's estimate of $31.65 billion, according to LSEG data. Annual profit is expected to be between $6.70 and $7.30 per share, putting the midpoint of the range slightly below expectations of $7.04 per share. The Reuters Daily Briefing newsletter provides all the news you need to start your day. Sign up here. https://www.reuters.com/business/dollar-tree-close-nearly-1000-stores-2024-03-13/

2024-03-13 19:21

WASHINGTON, March 13 (Reuters) - U.S. President Joe Biden plans to express concern over Nippon Steel's proposed $14.9 billion purchase of U.S. Steel, a person familiar with the matter said on Wednesday, pushing the U.S. company's stock nearly 13% lower on bets the deal could face greater political opposition. The issue has the potential to overshadow an April 10 summit between Biden and Japanese Prime Minister Fumio Kishida aimed at boosting the long-standing security alliance between their countries in the face of growing Chinese strength. In December, Nippon Steel (5401.T) , opens new tab clinched a deal to buy the 122-year-old iconic U.S. steelmaker for a hefty premium, betting that U.S. Steel (X.N) , opens new tab would benefit from the spending and tax incentives in Biden's infrastructure bill. However, several Democratic and Republican U.S. senators have criticized the deal, citing national security concerns or raising questions about why the two companies did not consult U.S. Steel's main union ahead of the announcement. Donald Trump, Biden's rival in the November U.S presidential election, has said he would block the acquisition of U.S. Steel if elected. The White House said , opens new tab in December the deal needed to be carefully scrutinized given U.S. Steel's core role in producing a material that is critical to national security. The White House declined to comment on Wednesday, but a person familiar with the matter said Biden would issue a statement about the planned acquisition before Kishida arrives for his state visit. U.S. officials and lawyers have drafted the statement and the White House has privately informed the Japanese government of Biden's decision, according to the Financial Times, which first reported the news. Japan's embassy in Washington did not immediately respond to a request for comment. Matthew Goodman, a trade and economics expert at Washington's Council on Foreign Relations think tank, said the issue could overshadow the summit and be damaging for Kishida, who is already struggling politically at home. "A prime minister of Japan has to demonstrate that he has the U.S. relationship not only under control, but that he's enhancing it," Goodman said. "So to the extent this runs counter to that narrative politically at home, it's problematic." Goodman said he thought the case of the acquisition being a risk to U.S. national security was "dubious" and questioning investments from a supposedly trusted security partner could be very damaging to the relationship. "It's much more to do with politics in an election year when both nominees are appealing to support from steel workers and unions," he said of Biden and Trump. In a joint statement, Nippon Steel and U.S. Steel said they welcomed the Biden administration's scrutiny of the transaction, as "an objective and comprehensive review of this transaction will demonstrate that it strengthens U.S. jobs, competition, and economic and national security." Goodman said there have been long-standing concerns in the United States about Japanese labor practices and "non-support for unionization of workers in Japanese-owned factories in the U.S. well beyond steel." The companies said they have had "active, dedicated discussions with the United Steelworkers, which are ongoing." U.S. Steel, founded in 1901 by some of the biggest U.S. magnates, including Andrew Carnegie, J.P. Morgan and Charles Schwab, became intertwined with the industrial recovery following the Great Depression and World War Two. Last year, the Pittsburgh-based company launched a formal review of its strategic options after rebuffing a takeover offer from steelmaker Cleveland-Cliffs (CLF.N) , opens new tab. Its shares had come under pressure following several quarters of falling revenue and profit, making it an attractive takeover target for rivals looking to add a maker of steel used by the automobile industry. U.S. Steel shares closed 12.8% lower at $40.86 on Wednesday, well below Nippon's offer of $55 per share. Get weekly news and analysis on the U.S. elections and how it matters to the world with the newsletter On the Campaign Trail. Sign up here. https://www.reuters.com/world/us/biden-express-concern-over-nippon-steels-deal-us-steel-ft-reports-2024-03-13/

2024-03-13 19:20

Processing plants cannot afford to buy beans Consumers around the world to pay more for chocolate Market could be heading for fourth year of deficit LONDON/ACCRA, March 13 (Reuters) - Major African cocoa plants in Ivory Coast and Ghana have stopped or cut processing because they cannot afford to buy beans, four trading sources said, meaning chocolate prices around the world are likely to soar. Chocolate-makers have already increased prices to consumers, after three years of poor cocoa harvests, with a fourth expected, in the two countries that produce nearly 60% of the world's cocoa. Cocoa prices have more than doubled over the last year, scaling numerous all-time highs. "We need massive demand destruction to catch up with the supply destruction," Tropical Research Services' Steve Wateridge, a world expert on cocoa, said. Chocolate-makers cannot produce chocolate using raw cocoa and rely on processors to turn beans into butter and liquor that can be made into chocolate. But the processors say they cannot afford to buy the beans. State-controlled Ivorian bean processor Transcao, one of the country's nine major plants, said it had stopped buying beans because of their price. It said it was still processing from stock, but did not say what capacity it was running at. Two industry sources said the plant was almost idle. They asked not to be named because they were not authorised to speak publicly on the issue. One of the two sources said more major state run plants could shut soon in top grower Ivory Coast, which produces nearly half the world's cocoa. The same two sources said even global trader Cargill struggled to source beans for its major processing plant in Ivory Coast, halting operations for about a week last month. Cargill did not respond to a request for comment. In No. 2 cocoa grower Ghana, most of its eight plants, including state-owned Cocoa Processing Company (CPC), have repeatedly suspended work for weeks since the season started in October, two separate industry sources said. CPC said it is operating at about 20% of capacity because of the shortage of beans. DISRUPTION AT THE FARM GATE The price rally has derailed a long-established mechanism for global cocoa trade, through which farmers sell beans to local dealers who sell them on to processing plants or global traders. Those traders then sell beans or cocoa products - butter, powder and cocoa liquor - to global chocolate giants such as Nestle (NESN.S) , opens new tab, Hershey (HSY.N) , opens new tab and Mondelez (MDLZ.O) , opens new tab. In normal times, the market is heavily regulated - traders and processors purchase beans from local dealers up to a year in advance at pre-agreed prices. Local regulators then set lower farmgate prices that farmers can charge for beans. However, in times of shortage like this year, the system breaks down - local dealers often pay farmers a premium to the farmgate price to secure beans. The dealers then sell the beans on the spot market at higher prices instead of delivering them at pre-agreed prices. As global traders rush to purchase those beans at any price to meet their obligations with the chocolate firms, local processors are often left short of beans. Ivorian and Ghanian authorities normally try to protect local plants by issuing them with cheap loans or by limiting volumes of beans that global traders can purchase. This year, however, plants are not getting the cocoa they pre-ordered and cannot afford to buy at higher spot prices. Already, chocolate-makers have raised prices. U.S. retail stores charged 11.6% more for chocolate products last year compared with 2022, data from market research firm Circana shows. The International Cocoa Organisation (ICCO) expects global cocoa production will fall by 10.9% to 4.45 million metric tons this season. Grindings - a measure of demand - will fall by 4.8% to 4.78 million as processors struggle to buy beans, and supply less butter at a higher price to chocolate-makers, which in turn raise prices. The supply-demand mismatch will leave the market with a deficit of 374,000 tons this season, up from 74,000 tons last season, according to the ICCO. This means processors and chocolate firms will have to draw on cocoa stocks to fully cover their needs. The ICCO expects global cocoa stocks to fall to their lowest in 45 years by the season end. Wateridge of Tropical Research said the cocoa market could post another deficit next season based on the severity of bean disease in West Africa. The market has not seen four successive years of deficit since the late 1960s, ICCO data shows. Get a look at the day ahead in U.S. and global markets with the Morning Bid U.S. newsletter. Sign up here. https://www.reuters.com/markets/commodities/african-cocoa-plants-run-out-beans-global-chocolate-crisis-deepens-2024-03-13/

2024-03-13 19:20

March 13 (Reuters) - Hundreds of anti-war protesters demanding a ceasefire in Gaza and calling for an end to U.S. military assistance for Israel blocked the international terminal at the San Francisco International Airport on Wednesday. Footage from the scene showed protesters carrying banners with messages such as "Permanent Ceasefire Now," "Stop the World for Gaza" and "Stop Arming Israel." An ABC News affiliate put the number of demonstrators at over 300. Protests demanding a ceasefire in Gaza have occurred in many U.S. cities in recent months, including near airports , opens new tab and bridges in New York City , opens new tab and Los Angeles, vigils outside the White House and marches in Washington , opens new tab. This month, large protests were seen ahead of U.S. President Joe Biden's State of the Union address , opens new tab and the Oscars , opens new tab. Demonstrators have regularly interrupted Biden's campaign events and speeches. Airport officials said the international terminal remained open but passengers were re-routed around the activity. Activists blocked the roadway outside the airport, marched in circles and chanted slogans. Passengers planning to reach the terminal were told to get dropped off at the rental car center and take an air train to the terminal. There were no known flight delays. Most of Gaza has been flattened in Israel's offensive that the health ministry says has killed over 31,000 people, displaced nearly all its 2.3 million population and led to a starvation crisis in the narrow coastal enclave. Israel's assault on Hamas-governed Gaza followed an Oct. 7 attack on Israel by the Palestinian Islamist group that killed about 1,200 people. While the United States has called for a temporary ceasefire to send more aid to Gaza and get hostages taken by Hamas on Oct. 7 released, it has rejected calls for a permanent ceasefire, saying such a step would let Hamas regroup. Get weekly news and analysis on the U.S. elections and how it matters to the world with the newsletter On the Campaign Trail. Sign up here. https://www.reuters.com/world/us/protesters-demanding-gaza-ceasefire-block-terminal-san-francisco-airport-2024-03-13/