Cautious miners leave room for new swashbucklers 17 Aug 2018 Heavyweights like BHP have retreated from promising projects in tough spots. Even daring Glencore is fretting about Congo. The result is a long list of untapped resources and few buyers outside China. An intrepid fresh player could step in - if it can access private capital.
Soybeans strain Beijing’s trade war messaging 15 Aug 2018 China is likely to buy more of the animal feed ingredient from the United States, even after tariffs. That's despite government assurances it can diversify away from more than $12 bln of annual U.S. purchases. Markets sense it coming; others might soon see through bluster too.
Antofagasta shows markets’ low bar to trade panic 14 Aug 2018 Shares in the London-listed Chilean copper miner slumped after it said U.S.-China trade tensions may hit demand for the metal. Antofagasta had a weak first half, but its guidance is unchanged. Macro jitters mean investors are unwilling to give companies the benefit of the doubt.
It’s time to take away Trump’s tariff toys 13 Aug 2018 Using steel duties to punish Turkey over a detained U.S. pastor is an abuse of the president's powers. While national security is a legitimate reason to restrict trade, doing so on a whim hurts America. Congress can be more muscular even if it's not yet prepared to rein Trump in.
Bayer’s cancer scare makes a bad deal worse 13 Aug 2018 The German group's market value fell nearly $10 bln after a court awarded $289 mln to a user of weed killer made by U.S. division Monsanto. That may overstate the likely losses, but the verdict undermines a deal that already destroyed value, and left shareholders without a say.
Glencore risks writ large in balance sheet caution 8 Aug 2018 The $60 bln commodities giant only narrowly missed first-half EBITDA forecasts, despite a slew of Congo and U.S. subpoena-related woes. Given its swashbuckling image, investors might have expected more of a splash. The fact they got deleveraging instead flags the group’s concern.
White House’s small trade deals don’t add up 7 Aug 2018 U.S. officials hailed Morocco’s opening to U.S. poultry, just as they did recent moves by Colombia on rice and Argentina on pork. But projected export gains of $35 mln are chicken feed relative to the $114 bln in American goods threatened by other countries’ retaliatory tariffs.
Oil investors are complacent on climate change 6 Aug 2018 Shareholders in the likes of Shell aren’t holding companies to account on carbon targets. A Breakingviews analysis suggests why: they may suffer only mild losses if oil majors just run down their reserves. But doing nothing may backfire if governments take more radical action.
Rio’s shareholder bonanza hints at elusive M&A 1 Aug 2018 The giant miner reported a sturdy 12 pct rise in first-half earnings, narrowly missing forecasts. It will, though, hand back $7.2 bln, including a record dividend. That suggests long-expected deals are hard to find despite shaky markets, cheaper shares and M&A noise elsewhere.
Saudi’s Aramco plan B is too clever by half 27 Jul 2018 With the oil giant’s listing stalled, Riyadh wants to lever it up to buy a stake in chemicals group SABIC. It shouldn’t overburden Aramco, and offers a roundabout way of getting money to the state. But compared to an IPO it’s riskier, and does less to boost Saudi capital markets.
BP takes worthwhile gamble with shale deal 27 Jul 2018 The $10.5 bln that the oil major is paying for BHP’s U.S. shale assets is a full price and allows the miner to finally extricate itself from an expensive mistake. But BP is plugging a strategic gap and can easily cut costs. That makes the price appear more reasonable.
Conoco escapes squeeze on Big Oil’s golden goose 26 Jul 2018 Infrastructure bottlenecks are depressing oil prices in America’s resource-rich Permian Basin. New pipelines should be running by next year if labor and steel problems don’t cause delays. While the $84 bln Conoco’s U.S. business is holding up, others may not be so fortunate.
Indian tycoon winner of Trump-China metals scrap 26 Jul 2018 Hindalco is snagging aluminium producer Aleris for $2.6 bln after CFIUS concerns torpedoed a previous bid from a Chinese buyer. Hindalco’s U.S. arm Novelis is paying more, but the numbers stack up. Mogul Kumar Mangalam Birla is smartly taking advantage of the trade war for now.
Shell and Total can hand investors even more cash 26 Jul 2018 The Anglo-Dutch major has begun a $25 bln share buyback, months after its French peer. That may signal Shell lacks growth ideas, yet investing in new oil projects and green energy is also risky. Sharing windfalls from high oil prices with shareholders is the lesser of the evils.
Trump hardball may still become Iran oil softball 23 Jul 2018 The president’s Twitter attack on Tehran counterpart Hassan Rouhani doesn’t sound great for importers of Iranian crude. Yet U.S. sanctions policy is volatile - just ask Russia’s Rusal. Another Trump goal - low petrol prices - implies Iranian exports will still be tolerated.
Aramco’s downstream diversion solves few problems 19 Jul 2018 Buying a stake in petrochemical maker SABIC would enable the Saudi oil giant to diversify its business. But it complicates the government’s plans to open state companies to private capital. And the holding is too small to pump up Aramco’s valuation in an initial public offering.
Viewsroom: Trump’s Supreme Court pick 12 Jul 2018 The U.S. president has chosen a friend of big business in Brett Kavanaugh. But he faces bigger questions from Senate democrats about executive power. Plus: Commodity giant Glencore faces mounting risks in Washington, and what’s behind the Chinese yuan’s downward slide.
U.S. salvo at Glencore has unintended consequences 12 Jul 2018 A request for details on anti-corruption practices wiped more than $6 bln off the commodities giant's value in a week, raising questions over its future. Yet action is not without a sting for Washington too - if it leaves China even more dominant in resource-rich trouble spots.
Aramco fail hits Saudi ambition more than coffers 10 Jul 2018 If the state oil firm's IPO doesn't fly, Crown Prince Mohammed bin Salman will be $100 bln short. That's huge, but higher crude prices will help the budget and Riyadh can borrow too. The bigger problem is finding other ways to lure the foreign capital his 2030 vision depends on.
India’s Cairn Energy fire sale is short-sighted 9 Jul 2018 Tax authorities have sold part of a stake in Vedanta Limited seized from the UK company in a $1.3 bln tax dispute, weeks before the pair go to arbitration. India only pockets $216 mln, half what the shares were worth at the start of the year. The timing and the logic look flawed.