2024-06-12 07:58

Tribunal allows Uniper to terminate dormant Gazprom contracts Also awards Uniper with 13 billion euro damage title Terminated contracts remove major risk for planned re-IPO FRANKFURT, June 12 (Reuters) - German utility Uniper has won a multi-billion euro arbitration against former long-time supplier Gazprom (GAZP.MM) New Tab, opens new tab, it said on Wednesday, allowing it to tear up dormant gas supply contracts and potentially setting a precedent for similar cases. The ruling marks a landmark victory for Uniper, which had to be rescued by the German government in 2022 after Gazprom first cut and later suspended supplies, forcing the group to buy replacement volumes at sky-high prices on the spot market. It also severs the last remaining ties of what was a decade-long energy partnership between Berlin and Moscow, which came to an abrupt halt in the wake of Russia's attack on Ukraine in 2022. Uniper said the ruling by the arbitration tribunal in Stockholm on June 7, part of a process the company launched in late 2022, enabled it to terminate existing gas supply contracts, which legally still exist even though no gas is flowing. The tribunal also awarded the firm more than 13 billion euros ($14 billion) in damages for the gas volumes not supplied by Gazprom since mid-2022, when the Russian state-owned group first cut contractually agreed deliveries. Sources told Reuters last month that the arbitration tribunal could allow Uniper to terminate the 250 terawatt hours in dormant Russian gas contracts, some of which run until the middle of the next decade. Cancelling those will remove a major risk ahead of Uniper's planned return to the stock exchange next year, the sources said at the time. "This ruling provides legal clarity for Uniper. With the right of termination that we received in the arbitration ruling, we are ending the contracts with Gazprom Export," Uniper CEO Michael Lewis said in a statement. IPO RISK REMOVED Gazprom did not immediately reply to a request for comment. The damages award primarily marks a symbolic victory for Germany, as it is unlikely that large sums will flow, legal sources told Reuters last month, something Uniper's Lewis confirmed. Gazprom Export, the Russian company's exporting arm, successfully challenged the case in a St Petersburg court, which ruled in March that Uniper and a subsidiary would be fined 14.3 billion euros should they proceed with the arbitration. If any money flows, it will go to the German government, which holds more than 99% of Uniper. Germany's Finance Ministry, which oversees the government's stake in Uniper, said the Federal Government was not a party or involved in the arbitration proceedings, adding that Berlin had no influence on the company's operational management. Terminating the contracts removes the last risk Uniper faced with regard to its Russian exposure after the group wrote down its financing in the Nord Stream 2 pipeline as well as the holding in its Russian subsidiary Unipro (UPRO.MM) New Tab, opens new tab. Uniper has also been involved in talks to find a solution to keep gas supply flowing through Ukraine to southeastern Europe after Kyiv announced in March that it would not extend a transit deal with Russia's Gazprom beyond the end of this year, Bloomberg reported on Monday. The German government is also taking part in the discussions between the European Commission and those countries that are still dependent on Russian gas, Economy Minister Robert Habeck said on Tuesday. "I am personally very involved in it," Habeck said, adding that the talks aim to ensure secure gas supply for southeastern Europe without filling Russia's coffers. ($1 = 0.9311 euros) Sign up here. https://www.reuters.com/markets/commodities/uniper-terminates-russian-gas-supply-contracts-after-arbitration-ruling-2024-06-12/

2024-06-12 07:35

OSLO, June 12 (Reuters) - Danish renewables group European Energy has entered into several long-term power purchasing agreements (PPAs) with Microsoft to supply the U.S. tech firm with green electricity, the Copenhagen-based company said on Wednesday. "The renewable energy will be produced by a portfolio of wind and solar assets in Sweden and Denmark," European Energy said in a statement. It will under the agreements deliver more than 3.6 terawatt hours (TWh) over the contract period, supporting Microsoft's goal to meet all its energy demand with power from renewable sources by 2025 and be carbon negative by 2030, it said. Sign up here. https://www.reuters.com/business/energy/denmarks-european-energy-signs-long-term-power-deals-with-microsoft-2024-06-12/

2024-06-12 07:17

MUMBAI, June 12 (Reuters) - India's monsoon rains have lost momentum after covering western regions ahead of schedule, and their arrival in northern and central states could be delayed, extending a heatwave in the grain-growing plains, two senior weather officials told Reuters. Summer rains, critical to spur economic growth in Asia's third-largest economy, usually begin in the south around June 1 before spreading nationwide by July 8, allowing farmers to plant crops such as rice, cotton, soybeans, and sugarcane. "The monsoon has slowed down after reaching Maharashtra and may take a week to regain momentum," an official of the India Meteorological Department (IMD) told Reuters. The monsoon arrived nearly two days ahead of schedule in the western state home to the commercial capital of Mumbai, but its progress in central and northern states will be delayed by a few days, added the official, who sought anonymity. The lifeblood of the nearly $3.5-trillion economy, the monsoon brings nearly 70% of the rain India needs to water farms and refill reservoirs and aquifers. In the absence of irrigation, nearly half the farmland in the world's second-biggest producer of rice, wheat and sugar depends on the annual rains that usually run from June to September. The maximum temperature in India's northern states ranges between 42 degrees Celsius and 46 degrees C (108 degrees Fahrenheit to 115 degrees F), which is nearly 3 degrees C to 5 degrees C (5 degrees F and 9 degrees F) above normal, the IMD data showed. India's northern and eastern states, such as Uttar Pradesh, Bihar, Punjab, Haryana, Uttarakhand and Odisha, are likely to experience days of heatwave in the next two weeks, another weather official said. "Weather models are not indicating any early respite from the heatwave," the official said. "The delay in the monsoon's progress will increase temperatures in the northern plains." Both officials sought anonymity because they were not authorised to speak to the media. India is among several parts of Asia wilting in an unusually hot summer, a trend scientists say has been worsened by human-driven climate change. This month, the capital New Delhi recorded its highest ever temperature at 49.9 degrees C (122 degrees F) in some places, while grappling with a water shortage in heat hovering as high as 44 degrees C (112 degrees F). Rains in central, northern and some western states are likely to fall below normal in the next two weeks, the second official said. India has received 1% less rainfall than normal since the season began on June 1, the IMD says. Sign up here. https://www.reuters.com/world/india/indias-fizzling-monsoon-could-prolong-heatwave-north-sources-say-2024-06-12/

2024-06-12 07:10

NEW DELHI, June 12 (Reuters) - India's finished steel imports touched a five-year high in the first two months of the fiscal year that began in April, with the country continuing to be a net importer, according to provisional government data seen by Reuters. Steel demand has been buoyant in India, the world's second-biggest crude steel producer, as the country remained a bright spot globally with robust demand from its construction and automotive sectors. India imported 1.1 million metric tons of finished steel between April and May, up 19.8% from a year earlier, the data showed. India's steel mills, alarmed by a sharp rise in imports, have repeatedly called for government interventions and safeguard measures. The federal Ministry of Steel has resisted such calls, citing strong local demand. China was a top exporter of steel to India in recent months, alongside South Korea. Major Indian steel producers such as Tata Steel (TISC.NS) New Tab, opens new tab have flagged Chinese imports as a "growing concern." Meanwhile, India's finished steel consumption jumped 10.5% to a six-year high at 23 million tons in April-May, reflecting buoyant demand for the alloy in one of the world's fastest-growing economies. Rapid economic growth and higher infrastructure spending have turned India into a lucrative market for Indian and global steel makers, particularly with steel demand slowing down in Europe and the United States. India was a net importer of finished steel during the previous fiscal year that ended in March. The country imported 8.3 million metric tons of finished steel, up 38.1% from the prior year. The country's finished steel exports fell to their lowest in at least six years. Overseas shipments of steel totalled 0.9 million tons between April and May, down 39.6% year-on-year, the data showed. Crude steel output stood at 24.6 million tons, up 4.9% from a year earlier. Sign up here. https://www.reuters.com/markets/commodities/indias-april-may-steel-imports-hit-five-year-high-buoyant-domestic-demand-2024-06-12/

2024-06-12 07:09

CANBERRA, June 12 (Reuters) - Australia's largest sugar producer temporarily halted operations on Wednesday at a mill that began processing cane two days ago, after unions agitating for better pay said workers would lay down tools, the company said. The mill in the Burdekin region is the only one of eight run in Australia by Wilmar Sugar and Renewables that has begun its cane crushing season, with the others due to begin operating by the end of next week. The start of processing at all eight mills was delayed by the pay dispute, which poses an increasing threat to Australian sugar production and exports as it could shorten the crushing season and cause cane to be left unharvested. The cane crushing season on Australia's hot and humid northeast coast begins in June and runs to around November. "The only sugar mill operating in the Burdekin, Inkerman Mill, has been forced to shut down overnight after union delegates advised that workers plan to stop work at that site, and at least two other sites, for one hour at midday today," Wilmar said in a statement. The company later said it aimed to resume crushing as soon as possible on Wednesday afternoon and would start two more Burdekin region mills, Invicta and Kalamia, on Thursday despite the threat of continuing industrial action. Wilmar operations manager Mike McLeod said the company had stopped the mill - a process that takes about 12 hours - for operational and safety reasons because it was unclear whether workers would stop work again on Wednesday, something a union representative said was not true. Cane growers said they had been blindsided and disappointed when told late on Tuesday the mill would shut without processing cane that was already being harvested. Wilmar was "only using this as an opportunity to apply leverage against the unions," the local wing of the CANEGROWERS industry group wrote in an email to members seen by Reuters. Wilmar Sugar and Renewables produces over 2 million metric tons of sugar a year, more than half of Australia's total production. It is owned by Singapore's Wilmar International (WLIL.SI) New Tab, opens new tab. Unions want an 18% pay increase over three years. A company offer of 14.25% over 3.5 years and an A$1,500 ($1,000) sign-on bonus was rejected by workers at a vote this week, leading to a resumption of short-term work stoppages and bans. Sign up here. https://www.reuters.com/markets/commodities/strikes-force-mill-shutdown-australias-largest-sugar-maker-2024-06-12/

2024-06-12 07:02

Ghana looking to roll 350,000 tons of cocoa deliveries to next season Previous expectations was for 250,000 tons to be roll Cocoa prices have more than doubled this year alone Chocolate makers raise prices as struggle to find beans LONDON/ACCRA, June 12 (Reuters) - The world's second largest cocoa producer Ghana is looking to delay delivery of up to 350,000 tons of beans to next season due to poor crops, five sources told Reuters in a further worsening of the outlook for the global chocolate industry. Chocolate makers around the world are raising prices for consumers after cocoa more than doubled in value this year alone following a third year of poor harvests in Ghana and Ivory Coast, responsible for 60% of global production. The market had previously estimated Ghana would roll forward some 250,000 metric tons of cocoa, equivalent to about half its current crop. Cocobod, Ghana's cocoa regulator, said the country was looking to roll over "some volumes, but not in those (350,000 ton) quantities". The country's cocoa crop has been ravaged by adverse weather, bean disease and illegal gold mining, which often displaces cocoa farms. Ghanian farmers are also smuggling more beans to neighbouring countries to sell them at higher prices than the state purchasing price, further eroding what little crop is available for delivery in Ghana. Five sources with knowledge of the matter said Ghana pre-sold some 785,000 tons worth of beans for the current 2023/24 (October-September) season, but will likely only be able to deliver some 435,000 tons. Ghana regularly sells one year forward about 80% of its crop - which usually totals 750,000-850,000 tons. However, its crop fell to around 670,000 tons last season and is not expected to exceed 500,000 tons this season. Traders and the industry fear it might not rebound significantly next season either. The International Cocoa Organisation expects global cocoa production will fall 10.9% to 4.45 million tons this season. This means processors and chocolate firms will have to draw on cocoa stocks to fully cover their needs. FORWARD SALES The price rally is derailing a long-established mechanism for cocoa trade. Authorities in Ghana use the average of their forward sales to set the minimum price at which traders can purchases cocoa from farmers the following season. With some 350,000 tons of forward sold beans missing from this season's crop, Ghana is struggling with forward sales for next season, traders said. Two sources said the country has sold forward just 100,000 tons. Sources said the 100,000 tons, like the 350,000 tons being rolled into next season, were sold at less than a half of current world cocoa prices, meaning Cocobod will struggle to increase farmer prices next season based on these sales. Cocobod said forward sales were progressing as usual but declined to disclose volumes or prices. Failure to raise prices will likely tempt farmers to further ramp up bean smuggling, grow other crops or sell more of their farms to gold miners, said the sources. Sign up here. https://www.reuters.com/markets/commodities/ghana-delay-more-cocoa-deliveries-supply-crisis-worsens-2024-06-12/