2024-06-25 07:53

PARIS, June 25 (Reuters) - A heatwave due to spread throughout Europe this week is set to take a heavy toll on summer crops in the southeast but is good news for farmers on the other side of the region after prolonged rains flooded fields and hampered plants' growth, analysts said. Meteorologists forecast scorching temperatures in most parts of the European Union this week, just as record heat and dry weather are threatening crops in other major global growing regions, hitting world supplies and pushing prices higher. Weather is key for crops as harvest nears in the northern hemisphere and any sign of damage, or relief, can make prices swing. High yield reports and showers in parched wheat fields in top exporter Russia sent global wheat prices off 10-months highs in recent weeks. Summer crops in eastern Europe and the Balkans, mainly in the EU's second largest maize producer Romania, were most at risk from the heatwave, set to continue for another week or two, analysts said. "We are approaching a critical stage. One week will already lead to a fall in output. If there are two weeks like that there will be major damage and it could go very fast," Vincent Braak, an analyst at consultancy Strategie Grain, said. Strategie Grains had already lowered its EU 2024 maize crop forecast earlier this month. EU crop monitor MARS on Monday cut its yield estimate for Romania's maize and sunflower crops to below the five-year average, saying lasting dry weather made them very vulnerable to dry and hot conditions. In contrast, the expected warm and dry weather is welcome in the western part of the EU where crops have suffered from excessive and prolonged rainfall since the autumn. "The French farmers will be delighted. That's what they have been expecting for a while to give their crops a boost," Braak said. Hot and sunny weather will also be welcome in Germany, Denmark and Poland, a German grains analyst said. "Germany has had a prolonged cool and rainy start to the summer and sunshine would be excellent to push wheat to ripeness," the analyst said, adding it would also help prevent fungal infections in the cereal. MARS lowered most of its yield forecasts for this year's crops in the EU on Monday, citing excess water in western Europe and dry weather in some southeastern countries. Sign up here. https://www.reuters.com/business/environment/hot-spell-hits-summer-crops-east-europe-relief-northwest-2024-06-25/

2024-06-25 07:45

TOKYO, June 25 (Reuters) - Japanese households are bearing the brunt of the central bank's snail-pace normalisation of loose monetary policy which is giving investors a perfect excuse to push down the yen, Izuru Kato, a prominent Bank of Japan watcher, said on Tuesday. The weak yen has become a headache for Japanese policymakers by boosting the cost of imported raw materials, pushing up inflation and hurting consumption. Mindful of the negative economic impact of the weak currency , the BOJ could raise interest rates in July and move them up to 1% by the end of next year, said Kato, chief economist at Totan Research who has close ties with incumbent policymakers. "Real rates remain very low in Japan and the BOJ's balance sheet extraordinarily huge," he told Reuters in an interview. "The longer it keeps rates low, the bigger the risk of causing a damaging spiral of a weakening yen and rising inflation." The yen has depreciated more than 10% against the U.S. dollar so far this year. As wages failed to rise more than inflation, Japan's real consumption remains below levels before the BOJ deployed its massive asset-buying programme in 2013, he said. While the BOJ ended eight years of negative rates and other remnants of its radical stimulus in March, it keeps short-term rates around zero and continues to buy roughly 6 trillion yen ($37.6 billion) of government bonds each month. "Even as it whittled down stimulus, the BOJ's priority has been to keep bond yields stably low. That came at the cost of accelerating the yen's declines," Kato said. "With the yen so weak now, the central bank needs to reconsider its priorities. In the end, exchange-rate stability is as important as bond market stability," he said, calling on the BOJ to speed up the pace of policy normalisation. The BOJ next meets for a policy meeting on July 30-31, when it will announce a detailed plan on how it will taper its bond buying and reduce its nearly 600-trillion-yen balance sheet. The BOJ could reduce its monthly bond buying to 5 trillion yen for the first three months, then make bigger cuts once every quarter, Kato said. While the 10-year government bond yield could rise to around 1.5% from current levels below 1%, the BOJ can probably trim its balance sheet by around 200 trillion yen without upending markets as private financial institutions would take up bonds sold by the central bank, Kato said. "The BOJ has said the risk of being behind the curve in addressing too-high inflation is low," Kato said. "In reality, it doesn't have much time to waste." ($1 = 159.4100 yen) Sign up here. https://www.reuters.com/markets/currencies/veteran-boj-watcher-warns-japanese-households-facing-more-pain-weak-yen-2024-06-25/

2024-06-25 07:44

AHMEDABAD, June 25 (Reuters) - Indian ports-to-power conglomerate Adani Group will increase capital expenditures in fiscal year 2025 to 1.3 trillion rupees ($15.6 billion) from 700 billion rupees a year earlier, Chief Financial Officer Jugeshinder Singh said on Tuesday. Adani Green Energy (ADNA.NS) New Tab, opens new tab, the renewable energy arm of the group, will spend 340 billion rupees to add 6 gigawatts of capacity, Singh told reporters at a media briefing in Ahmedabad in Gujarat state. The comments came a day after billionaire owner Gautam Adani told investors the group is "well positioned" to capitalize on opportunities in the country's booming infrastructure sector. The group, which has businesses across ports, power utilities, transmission and coal trading, is betting on infrastructure spending, which is expected to grow at a compounded annual growth rate of 20%-25%, Adani said on Monday. On Tuesday, Singh denied reports the group is planning to take a stake in payments firm Paytm (PAYT.NS) New Tab, opens new tab, but said it will "evaluate any opportunities" in the fintech space. ($1 = 83.4375 Indian rupees) Sign up here. https://www.reuters.com/business/indias-adani-group-sees-fiscal-2025-capex-156-bln-cfo-says-2024-06-25/

2024-06-25 07:37

LONDON, June 25 (Reuters) - Britain's biggest wine producer Chapel Down (CDGP.L) New Tab, opens new tab is considering putting itself up for sale as part of a review into options to fund its future growth as it plans to plant new vineyards and build a new winery, it said on Tuesday. "As part of the review, the board will consider all alternatives, including investment from existing shareholders, investment from new shareholders, a sale of the company, and other relevant transactions," the company said. Its shares on Britain's junior AIM market closed on Monday at 65.5 pence, giving it a market value of 112 million pounds ($142 million). Founded in 2002, Chapel Down is based in Kent, southeast England, and has grown into Britain's best-known and largest producer with last year's harvest expected to make about 3.4 million bottles of sparkling and still wines. While England's wine industry is still small scale, temperatures warmed by climate change have in recent decades provided better growing conditions for grapes, and there is strengthening demand for local fizz in the home market. The quality of the wines being produced in England has also attracted international interest. Taittinger and Pommery, two of France's best-known Champagne houses, have bought land and planted vines in England, while the world's biggest sparkling wine company, Henkell Freixenet, acquired an English wine estate, Bolney, in 2022. "There can be no certainty that a transaction will be pursued by the company, nor as to the terms of any eventual transaction," Chapel Down said in a statement. The company said that Rothschild & Co was acting as the lead financial adviser in relation to the strategic review. After posting revenue of 18 million pounds ($23 million) for 2023, the company said it was on track for double-digit sales growth in 2024 and added it had a strong balance sheet with headroom on its debt facility of 12 million pounds and a deal to extend this facility. ($1 = 0.7884 pounds) Sign up here. https://www.reuters.com/business/uk-wine-producer-chapel-down-could-be-sold-funding-review-launched-2024-06-25/

2024-06-25 07:20

June 25 (Reuters) - Australia's Macquarie Group (MQG.AX) New Tab, opens new tab said on Tuesday its European infrastructure fund will sell its 40% stake in Italian energy firm Hydro Dolomiti Energia to a consortium for an implied valuation of about 1 billion euros ($1.07 billion). ($1 = 0.9321 euros) Sign up here. https://www.reuters.com/business/energy/macquarie-fund-sell-stake-italys-hydro-dolomiti-energia-11-bln-2024-06-25/

2024-06-25 07:15

Russian military clout dwarfs Ukraine, Europe tries to catch up European Investment Bank eyes multi-billion backing for defence EIB chief says that will accelerate this year BERLIN, June 24 (Reuters) - (This June 24 story has been corrected to add currency in the headline and fix the name of a strategic institute in paragraph 9) The European Investment Bank (EIB) intends to ramp up its investments in European defence such as drones, satellites and cyber security, aiming to inject a further 6 billion euros ($6.4 billion) into the sector, its head told Reuters. The plan underscores an increasing willingness in Europe to lend to defence companies after Russia's invasion of Ukraine changed an entrenched view that the region was safe from attack and could rely on the United States for protection. "It's clear we need to reinforce Europe´s security and defence industry," EIB president Nadia Calvino told Reuters. "We have earmarked 8 billion euros to invest in this area, of which only 2 billion have been invested." The move marks another modest attempt by Europe to keep up with Russia, which has put its entire economy on a war footing. Calvino said a special team had been set up to invest the money. "We have established a dedicated office to accelerate the deployment of the 6 billion euros earmarked," she said. "We are engaging actively with the European industry so it is to be expected that a pipeline of projects will be developed in the second part of the year," she said, highlighting border security, military mobility, de-mining and military hospitals. The EIB, backed by countries in the region, has large financial clout, although it is treading carefully in backing defence. It has backed a satellite project in Poland and a German drone maker but steers clear of ammunition, for instance. The EIB recently changed the rules underpinning its activity, allowing it to lend to, or indirectly invest in, defence firms. Tim Lawrenson of the International Institute for Strategic Studies, said the move was symbolically important and would send a signal to other banks, which often took their lead from the EIB, that it was acceptable to back defence companies. "Any European tank is made up of thousands of parts built by hundreds of small defence suppliers across Europe," he said. "These companies have struggled to borrow and stand to benefit most." "Of course 8 billion euros is small when compared with 2024 European defence spending of $476 billion, still less the $968 billion U.S. spend," he said. The change will do little to address how Russian arms production is dwarfing that of Ukraine. "Ukraine's state budget for defence is 10 billion euros," said Herman Smetanin, CEO of JSC UDI, Ukraine's state-owned weapon maker. "Russia is spending ten times as much. It's hard to fight a war with such an imbalance." The European Union, which with other Western allies wants to contain Russian advances and repel an increasingly assertive rival, launched an initiative in March 2023 to deliver one million artillery shells to Ukraine within 12 months. But it delivered little more than half that amount by the deadline. ($1 = 0.9324 euros) Sign up here. https://www.reuters.com/business/aerospace-defense/european-investment-bank-steps-up-multi-billion-defence-investments-2024-06-24/