Hon Hai Precision Industry Co (鴻海精密) has increased its investments in the Czech Republic and China by more than NT$6 billion (US$196 million) as part of its global expansion. The company, known as Foxconn Technology Group (富士康科技集團) internationally, has also begun shipping electric pickup trucks produced for US brand Lordstown Motors Corp. In a Taiwan Stock Exchange filing on Friday, Hon Hai said it has raised investments in its Czech subsidiary Foxteq CZ by US$58.98 million through its PCE Paragon Solutions Kft unit. In the Czech Republic, Hon Hai has a research-and-development center and a product design center, and it assembles monitors, cellphones, wireless communication devices and cloud servers. The iPhone assembler has also invested 1 billion yuan (US$142.4 million) in a subsidiary in Taiyuan, China, which produces electronic components, mobile communications devices and cell phones. The latest fund injection increases Hon Hai’s investment in the Taiyuan subsidiary to 1.5 billion yuan, the company said. Hon Hai has in the past few years boosted its efforts to develop electric vehicles (EVs) as it seeks to broaden its product portfolio and boost its profit margin. Lordstown last week announced that shipments of its Endurance electric pickup trucks made by Hon Hai on a contract manufacturing basis had started. Lordstown said Hon Hai would ship the first batch of 500 trucks direct to customers after the model has received the needed certificates from the US Environmental Protection Agency and the California Air Resources Board. Hon Hai makes the trucks at a factory in Ohio that the manufacturer acquired earlier this year from the US company for US$230 million. The plant is Hon Hai’s first EV manufacturing hub in the US. It is equipped to produce 500,000 to 600,000 vehicles per year. In addition to the pickups, Hon Hai is planning to produce electric agriculture tractors at the plant from the first quarter
SUSTAINABILITY FOCUS: More than 250 volunteers helped conserve the wetlands and protect their biodiversity as part of HSBC Taiwan’s long-term commitment to the park
To promote environmental sustainability, HSBC Bank Taiwan Ltd (滙豐台灣商銀) held a nature conservation activity at Guandu Nature Park (關渡自然公園) on Saturday. HSBC Taiwan CEO Adam Chen (陳志堅) led more than 250 colleagues, together with family and friends, to help conserve the wetlands, find out about the local ecology, and explore the importance of biodiversity and the relationship between the wetlands’ carbon sequestration function and climate change. HSBC Taiwan corporate sustainability head Janice Hwang said that “the decline of Earth’s biodiversity has become a major topic in global environmental conservation, and wetlands are one of the key areas for biodiversity conservation because of their unique and diverse habitats.” “Guandu Nature Park has a special natural ecology, nurturing diverse wetland organisms, and is classified by BirdLife International as one of the Important Bird Areas,” she said. “HSBC Taiwan is the first private company in Taiwan to sponsor Guandu Nature Park on a long-term basis, and has pro-actively invested in wetland conservation, helping establish the park as a nature education center in this country,” Hwang said, adding that since 2002, more than 17,000 volunteers from HSBC have devoted more than 30,000 hours to the park. “Today, Guandu Nature Park is a rich ecological resource environment and an ecological classroom that both teaches and entertains,” she said. This year’s activity was focused on environmental education and wetland protection. Through fun activities, HSBC volunteers learned about climate change and ecological conservation, and cleaned up the environment to help protect the wetlands through various tasks, including relocating frogs into ditches, removing weeds and trash, clearing areas around saplings and removing invasive species to help indigenous species return. In addition, the HSBC Taiwan management team planted indigenous tree species to help preserve the biodiversity of the park. HSBC has been operating in Taiwan for nearly 40 years and has always
California-based start-up OpenAI Inc has released a chatbot capable of answering a variety of questions, but its impressive performance has reopened the debate on the risks linked to artificial intelligence (AI) technologies. The conversations with ChatGPT, posted on Twitter by fascinated users, show a kind of omniscient machine, capable of explaining scientific concepts and writing scenes for a play, university dissertations or even functional lines of computer code. “Its answer to the question ‘what to do if someone has a heart attack’ was incredibly clear and relevant,” said Claude de Loupy, head of Syllabs, a French company specialized in automatic text generation. “When you start asking very specific questions, ChatGPT’s response can be off the mark,” but its overall performance remains “really impressive,” with a “high linguistic level,” he said. OpenAI, cofounded in 2015 in San Francisco by Tesla Inc CEO Elon Musk, who left the AI business in 2018, received US$1 billion from Microsoft Corp in 2019. The start-up is best known for its automated creation software: GPT-3 for text generation and DALL-E for image generation. ChatGPT is able to ask its interlocutor for details, and has fewer strange responses than GPT-3, which, in spite of its prowess, sometimes spits out absurd results, De Loupy said. “A few years ago chatbots had the vocabulary of a dictionary and the memory of a goldfish,” said Sean McGregor, a researcher who runs a database of AI-related incidents. “Chatbots are getting much better at the ‘history problem,’ where they act in a manner consistent with the history of queries and responses,” McGregor said. “The chatbots have graduated from goldfish status.” Like other programs relying on deep learning, mimicking neural activity, ChatGPT has one major weakness: “It does not have access to meaning,” De Loupy said. The software cannot justify its choices, such as explaining why it picked the words that
Taiwan and Slovakia on Friday signed three memorandums of understanding (MOUs), pledging to boost bilateral trade, exchanges between start-ups and collaborations on nurturing talent for the semiconductor sector. The memorandums were signed between the Importers and Exporters Association of Taipei and the Council of Slovak Exporters; Taiwan’s Startup Terrace and Slovak Business Agency; and National Sun Yat-sen University and the Slovak University of Technology in Bratislava. The signing in Bratislava was part of the second session of the Taiwanese-Slovak Commission on Economic Cooperation attended by a Taiwanese delegation led by Deputy Minister of Foreign Affairs Tsai Ming-yen (蔡明彥). During the session, Tsai and Slovak State Secretary of the Ministry of the Economy Peter Gerhart exchanged ideas on how to boost bilateral trade and economic cooperation. Taiwan and Slovakia have seen warming relations over the past few years, and the two sides hope to expand their collaborations on semiconductors, electric vehicles and the space industry, Tsai said. He invited Slovak officials to attend next year’s session of the commission in Taiwan. Other topics discussed on Friday included renewable energy, biotechnology, and space and science programs, he said. The two sides agreed to continue to consolidate their substantial partnership, he said. The Taiwanese delegation comprised representatives from the Ministry of Economic Affairs, the Bureau of Energy, the National Science and Technology Council and the partly government-funded Development Center for Biotechnology. The Slovak delegation consisted of representatives from the Slovak Ministry of the Economy, the Slovak Ministry of Foreign and European Affairs, the Slovak Investment and Trade Development Agency, the Slovak Academy of Sciences and the Slovak Ministry of Education, Science, Research and Sport. Then-Slovak State Secretary of the Ministry of the Economy Karol Galek led a delegation to Taipei in December last year for the first session of the commission.
Gasoline and diesel prices are to rise NT$0.2 per liter this week following a decline of NT$0.1 per liter last week, CPC Corp, Taiwan (CPC, 台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. Effective today, gasoline prices at CPC stations are to increase to NT$29.3, NT$30.8 and NT$32.8 per liter for 92, 95 and 98-octane unleaded gasoline respectively, while the price of premium diesel is to rise to NT$27.1 per liter, the state-run refiner said in a statement. Formosa said that its prices for 92, 95 and 98-octane unleaded gasoline would be NT$29.3, NT$30.8 and NT$32.8 per liter respectively, while premium diesel would cost NT$26.9 per liter. Formosa said crude oil prices rose last week as several positive factors boosted market sentiment. “As China is relaxing its COVID-19-related restrictions that would boost crude oil demand, while the US reported a sharp decrease in its crude oil inventories, international oil prices rose mildly last week,” Formosa said in the statement. A decline in the US dollar against other major currencies also contributed to the trend, it said. The US’ plan to lift oil sanctions on Venezuela also weighed on the market, CPC said.
From left, Taiwan Cooperative Financial Holding Co chairman Lei Chung-dar, Democratic Progressive Party legislators Chen Ting-fei and Kuo Kuo-wen, Minister of Finance Su Jain-rong and Tainan Mayor Huang Wei-che wave during a running event organized by the Ministry of Finance in Tainan yesterday.
AFTER PRODUCTION CUT: A meeting of 23 oil-producing nations would be ‘low-profile,’ analysts said, as the effects of new sanctions on Russia remain unknown
Major oil-producing countries led by Saudi Arabia and Russia looked set to maintain their current output levels at a meeting yesterday, ahead of fresh sanctions against Moscow coming into force. OPEC, which represents 13 of the world’s top oil-producing nations, was due to consult with 10 other oil producers, including Russia, to review their decision in October to cut production by 2 million barrels per day. The OPEC+ videoconference was to take place after press time last night. On Friday, the EU, G7 and Australia agreed a US$60-per-barrel price cap on Russian oil, which is to come into effect today or soon after, alongside an EU embargo on maritime deliveries of Russian crude oil. The measure seeks to prevent seaborne shipments of Russian oil to the EU, which account for two-thirds of the bloc’s oil imports from Russia, an attempt to deprive Moscow’s war chest of billions of euros. While Russia on Saturday denounced the incoming price cap, threatening to suspend deliveries to any country that adopted the measure, Ukraine said the cap should have been set even lower. For OPEC+, the big unknown in the oil equation is how heavily sanctions will hit Russian supply. “The uncertainty for Russian supply is significant,” DNB analysts said. OPEC would therefore “aim for a low-profile meeting that leaves existing production quotas unchanged,” they said. Moscow’s threat to suspend deliveries to countries abiding by the price cap would put “some in a very uncomfortable position,” Oanda Corp analyst Craig Erlam said. “Choosing between losing access to cheap Russian crude or facing G7 sanctions.” The choice of a virtual OPEC+ meeting instead of an in-person conference at the Vienna headquarters indicated a policy rollover, UniCredit SpA analyst Edward Moya said. However, “deeper oil output cuts” could still not be ruled out at this stage, Moya added. Amid economic gloom fueled by soaring inflation and
Nissan Motor Co chief executive officer Makoto Uchida is heading to France for more talks with French partner Renault SA aimed at resetting a two-decade-old alliance, people familiar with the situation said. Uchida is to attend a board meeting of the operating alliance at Renault headquarters in Boulogne-Billancourt tomorrow, said the people, who asked not to be identified discussing private matters. Nissan chief operating officer Ashwani Gupta is also expected to attend, one person said. Nissan, Renault and junior alliance member Mitsubishi Motors Corp are trying to reboot a partnership that has become problematic over the past few years. Tentative plans for a meeting in London on Wednesday to discuss the alliance’s future were scrapped, the people said. Discussions with Nissan started earlier this year as Renault began work to carve out its Ampere electric vehicle brand. Nissan might invest US$500 million to US$750 million for a stake of about 15 percent in Ampere, but the agreement hinges on a wider deal that would see Renault gradually trim its 43 percent stake in Nissan to about 15 percent. The shift would alleviate a power imbalance that has been a source of friction between the companies for years. The three-way alliance holds meetings every month. Renault chairman Jean-Dominique Senard, chief executive officer Luca de Meo and senior vice president of international development and partnerships Francois Provost, along with the company’s entire board of directors, flew to Tokyo last month for in-person meetings, the people said. Nissan is in talks “every day” with Renault to bring the alliance “to the next step” and “become stronger together,” Uchida said in an interview with Bloomberg in New York on Thursday. De Meo and Uchida still aim to sign a nonbinding agreement before the end of this year, but the talks could also drag on or collapse, with differences over shared technology and
As China’s easing of COVID-19 restrictions starts to take shape, the focus of investors is increasingly shifting from frenzied stock bets to longer-term plays, such as consumer and healthcare shares. Money managers are zeroing in on companies that are expected to benefit from a reopening-led economic recovery instead of travel and catering firms, whose shares have jumped sharply in the early days of the rally. “With the trajectory of the economy set to be back on track, it is time to shift focus from stocks primed to jump on short-term changes,” Shenzhen Zhengyuan Investment Co (深圳正圓投資) fund manager Hua Tong (華通) said. “We can now afford to take the longer-term view to seek out opportunities — and the biggest unrealized opportunity is in the consumer sector.” Recent updates from health authorities include allowing some low-risk COVID-19 cases to isolate at home and loosening curbs in select cities, with the official rhetoric on the disease also coalescing around a softer tone. “The reopening trade will be led by consumption and healthcare in the coming months,” Snowball Wealth (雪球投資) fund manager Li Changmin (李昌民) said. “Guangzhou’s surprise reopening, even with its high case count, has fired the first shot, and this could expedite the timeline for ending COVID zero.” Li expects a full reopening to occur before annual parliamentary meetings in March next year. “Life returning to normal would mostly benefit the blue-chip names which have suffered huge valuation discounts, whereas the upside for travel and airlines stocks has been mostly priced in,” he said. The CSI 300 Index’s consumer staples subindex was trading close to 22 times its one-year forward earnings, compared with an average of almost 27 times over the past three years. The initial leg of the reopening trade has seen more volatile stocks lead the charge. Shares linked to the travel, catering and pharmaceutical
LedgerX LLC, one of the few solvent pieces of FTX Group cofounder Sam Bankman-Fried’s crumbled conglomerate, is for sale and attracting interest from would-be buyers including cryptocurrency giants Blockchain Ltd and Gemini Trust Co, people familiar with the matter said. The unit, which is registered with the US Commodity Futures Trading Commission (CFTC) as a derivatives exchange, was a cornerstone of Bankman-Fried’s efforts in Washington. It is also considered one of the most valuable assets associated with FTX after more than 100 other entities filed for bankruptcy. New FTX CEO John Ray and restructuring advisers have been poring over the company’s books in search of cash, cryptocurrency and assets that could be sold to help repay creditors. It is unclear how much LedgerX, which had about US$303 million in cash as of a Nov. 17 filing, might fetch in a sale. In addition to Blockchain and Gemini, cryptocurrency exchange Bitpanda GmbH and event contracts trading platform Kalshi Inc, which is also registered with the CFTC and uses LedgerX to clear trades, have expressed interest, the people said. There are about half a dozen other potential buyers and more could be added, one of the people said. Representatives for LedgerX, FTX, Blockchain, Gemini and Kalshi did not respond to requests for comment. Bitpanda chief executive officer Eric Demuth said the firm was not interested or considering the purchase. In a sign that talks are becoming more serious, at least some of the parties have signed nondisclosure agreements, some of the people said. After FTX US purchased it last year, LedgerX sought approval for a controversial plan to clear crypto derivatives trades without intermediaries. The firm withdrew its application with the CFTC as the corporate group of companies filed for bankruptcy. As early as Wednesday, LedgerX planned to make US$175 million available for use in FTX’s bankruptcy proceedings from
A local fishing ban off the southern French coast has won praise from environmentalists and fishers alike, a rare example of biodiversity protection dovetailing with business interests. Almost two decades after the ban, Cap Roux, a coastal tip of the Esterel mountain range near the commune of Saint-Raphael on the Mediterranean coast, is a biodiversity haven. It stands in stark contrast to many other places on the Cote d’Azur where unbridled construction, overfishing and heavy shipping traffic have spoiled the once-pristine natural environment. More than 80 species of marine life thrive off Cap Roux, attracted by meadows of seagrass and so-called “living rock” beneath the waves, a fusion of coral and algae. Fishing here has been forbidden since 2004, a ban covering 450 hectares. Surprisingly to some, local fishers called for the restriction, saying fish needed a safe place to breed and grow to renew stocks. “Fishermen were worried about their future, and said: ‘Let’s find a space for a nursery that will replenish the surrounding waters,’” said Christian Decugis, Saint-Raphael’s first fishing mediator. The fish sanctuary lies in the heart of an EU-protected reserve, chosen because it is a relatively unspoilt natural spot, far from the coast’s commercial ports. “There would have been no point creating a reserve in an area that’s already been messed up,” Decugis said. The ban has resulted in “many more fish and bigger fish, and an abundance of species,” he said — an observation backed by scientific studies and experiments. Evidence shows the haven status has helped protect populations of grouper and corb, with scorpion fish and sea bream doing particularly well. A 2017 study by the Association for Fisheries and Maritime Activities (APAM), which promotes sustainable fishing, said that income for fishers was “significantly higher” near the sanctuary than in zones farther away. Beyond financial benefits, the new system also improves the reputation of
At LanzaTech’s lab in the Chicago suburbs, a beige liquid bubbles away in dozens of glass vats. The concoction includes billions of hungry bacteria, specialized to feed on polluted air — the first step in a recycling system that converts greenhouse gases into usable products. Due to licensing agreements, LanzaTech’s novel microorganisms are already being put to commercial use by three Chinese factories, converting waste emissions into ethanol. That ethanol is then used as a chemical building block for consumer items such as plastic bottles, athletic wear and even dresses, via tie-ins with major brands such as Zara and L’Oreal. “I wouldn’t have thought that 14 years later, we would have a cocktail dress on the market that’s made out of steel emissions,” said microbiologist Michael Kopke, who joined LanzaTech a year after its founding. To date, LanzaTech has kept 200,000 tonnes of carbon dioxide out of the atmosphere, while producing 190 million liters of ethanol, the company said. That is a small drop in the bucket when it comes to the actual quantities needed to combat climate change, Kopke said. However, having spent 15 years developing the methodology and proving its large-scale feasibility, the company is now seeking to ramp up its ambitions and multiply the number of participating factories. “We really want to get to a point where we only use above-ground carbon, and keep that in circulation,” Kopke said — in other words, avoid extracting new oil and gas. LanzaTech, which employs about 200 people, compares its carbon recycling technology to a brewery — but instead of taking sugar and yeast to make beer, it uses carbon pollution and bacteria to make ethanol. The bacterium used in its process was identified decades ago in rabbit droppings. The company placed it in industrial conditions to optimize it in those settings, “almost like an athlete that we trained,” Kopke
US radio host Alex Jones reaped millions spouting conspiracy-laden falsehoods that helped drive up sales of products such as libido boosters, exploiting an Internet ecosystem that experts say makes misinformation a lucrative business. Jones, a serial provocateur who founded the far-right Web site InfoWars, has been ordered to pay nearly US$1.5 billion in damages for calling a 2012 mass shooting in an elementary school, which left 20 first graders and six adults dead, a “hoax.” Defamation cases in Texas and Connecticut against Jones have spotlighted the challenge of curbing misinformation on the Internet, where false and inflammatory content often spreads faster, generates more engagement and more revenue than the truth. “The modern Internet business model consists of building an audience and then monetizing that audience, either through ads, merchandise sales or direct donation,” said Danny Rogers, cofounder of the nonprofit Global Disinformation Index. “Alex Jones perfected that model by peddling the most adversarial narratives in the form of virulent conspiracy theories and unbridled anger, building a receptive audience, and then soaking that audience for profit.” Jones — who was this week back in the spotlight when rapper Kanye West declared his admiration for Adolf Hitler on his show — has amassed what experts call a fortune by successfully merging the conspiracy theories with merchandise and dietary supplements from his InfoWars store. Jones has hawked male vitality supplements and testosterone boosters, while saying the government was feminizing men or turning them gay by using chemical pollutants. He accused the government of putting fluoride in drinking water, while his store peddled fluoride-free toothpaste. He said his audience can survive various doomsday scenarios with other products that his store can supply — storable food, body armor and even components for homemade guns. BANKRUPTCY The extent of his wealth is opaque, but a forensic economist testified during the Texas trial that the combined
INVESTOR FOCUS POINT: Wage growth has been accelerating since August, a trend that would have to be reversed for the Fed to halt its rate hike cycle, a strategist said
The S&P 500 on Friday closed slightly lower, although major indices rallied off their worst levels of the day, as last month’s payrolls report fueled expectations the US Federal Reserve would maintain its path of interest rate hikes to combat inflation. Nonfarm payrolls rose by 263,000, above expectations of 200,000, and wage growth accelerated even as recession concerns increased, the US Department of Labor’s jobs report showed. As expected, the US unemployment rate remained unchanged at 3.7 percent. “Wage growth has been in an uptrend since August,” said Brian Jacobsen, senior investment strategist at Allspring Global Investment in Menomonee Falls, Wisconsin. “We will have to see that trend reverse for the Fed to be comfortable with a pause. Until then, they’ll continue to taper toward a pause,” Jacobsen said. Investors have been looking for signs of weakness in the labor market, especially wages, as a precursor to faster cooling of inflation that will enable the Fed to slow and eventually stop its current rate hike cycle. Stocks rallied earlier in the week after Fed Chairman Jerome Powell spoke about scaling back interest rate hikes as early as this month. On Friday, the Dow Jones Industrial Average rose 34.87 points, or 0.1 percent, to 34,429.88, the S&P 500 lost 4.87 points, or 0.12 percent, to 4,071.7 and the NASDAQ Composite dropped 20.95 points, or 0.18 percent, to 11,461.5. Still, equities ended the session off their lowest levels of the day that saw each of the major indices tumble at least 1 percent, with the Dow managing a slight gain. “If anything, I am actually encouraged by how the market is clawing its way back from the level we were at today. It is another indication the market is looking for at least a seasonal December rally,” said Sam Stovall, chief investment strategist at CFRA in New York. “The market is beginning
European shares fell back on Friday after two days of solid gains that helped the STOXX 600 index notch its seventh straight week of rises amid signs of China re-opening its economy and easing worries about interest rate hikes. The pan-European index closed 0.15 percent lower at 443.29 after rallying 1.5 percent in the past two sessions. The index gained 0.58 percent over the week, and registered its longest weekly winning streak since April last year. Energy and technology stocks were among the biggest drags on the broader index, offsetting gains in real estate and retailers. “There appears to be some profit-taking after sessions characterized mostly by risk-on appetite. Optimism toward the economic reopening in China has helped drive gains,” Interactive Investor head of investment Victoria Scholar said. Chinese officials this week softened their stance on strict COVID-19 curbs that have impacted global growth amid protests in the country. Rate-sensitive tech stocks also took a hit as eurozone government bond yields rose in line with a move in US Treasury yields after data showed that US employers hired more workers than expected last month and increased wages, despite mounting worries of a recession. “Strong job creation and a big increase in wages underscore the [US] Federal Reserve’s argument that a lot more work needs to be done to get inflation under control,” ING Group chief international economist James Knightley said in a note. “It has certainly jolted the market, but with recessionary fears lingering, market participants will remain skeptical over how long the strong performance can last,” he said. Data this week from Europe showing cooling inflation and falling German retail sales and exports have also made the case for the European Central Bank (ECB) to opt for a smaller hike. However, ECB Vice President Luis de Guindos on Friday said that the central bank needs to focus on
Oil recorded its biggest weekly gain in a month, after a volatile week marked by China loosening its COVID-19 restrictions and speculation about OPEC+ output policy. Front-month volatility spiked to 53 percent earlier this week, the highest it has been since September, with crude trading in a US$10 range. West Texas Intermediate (WTI) for December delivery dropped 1.53 percent to US$79.98 a barrel on Friday, but rose 4.85 percent from a week earlier. Brent crude for December delivery declined 1.51 percent to US$85.57 a barrel, posting a 2.32 weekly gain. Speculation of OPEC+ output cuts sent crude swinging as traders tried to foretell what the cartel might decide over the weekend, while prices got a boost as China, facing extraordinary unrest, began to ease COVID-19 policies, aiding the outlook for energy consumption. The gyrations have become too much for many traders to stomach. Open interest for WTI stands at its lowest since 2014. Analysts expect the liquidity crisis to continue as positions continue to be closed out before year end. Oil staged a sharp rebound this week after hitting its lowest level since last year on Monday, with demand prospects improving due to the scaling back of China’s “zero COVID” policy following protests. The rally was aided by broader market sentiment reacting optimistically to signals from US Federal Reserve officials early in the week that the pace of interest rate hikes would slow. However, the four-day rally on Friday came to a halt after bearish headwinds reasserted themselves into the market. Faster-than-expected US employment growth figures reignited fears that the Fed would tighten further to slow down growth, while the EU agreed to a US$60 a barrel price cap on Russian oil. The move is intended to allow Russian oil to keep flowing to global markets while limiting financial gains for Russian President Vladimir Putin. Biden administration officials
Dirty bulk ships used to carry iron ore are being scrubbed clean so that they can transport grain to Asia, in an unusual shift of cargoes prompted by a slump in demand for the steelmaking ingredient. China’s downturn in the housing market has weighed on iron ore, driving freight rates for bulk carriers down 50 percent from a year earlier. That has made it more attractive for some of the world’s biggest agriculture traders to book iron ore vessels for shipments of corn and soybeans. While the number of such cargo switches are relatively small, it is the latest shift by traders wrestling with dramatic changes in commodities markets sparked by Russia’s invasion of Ukraine and China’s weakening economy. The war has created extreme volatility in global grain markets, allowing trading houses such as Cargill Inc to post bumper profits. Large iron ore ships typically stay away from grain as it involves a time-consuming cleaning process to make the vessels safe for carrying food. Washing a huge cargo hold dirty from iron ore is a necessary step to ensure that consumers of the grain do not ingest rust, metallic sand or dirt. Before picking up grain, cleaning gangs have to lower themselves by winch into black-stained cargo holds. They blast water and chemicals against the walls before using brushes to scrub out gunk and then siphon the muddy water away. The deep-cleaning process can cost between US$7,000 and US$8,000 and requires a few extra days of chartering, one trader said. This could extend to a week and require shipyard workers to sand down and repaint the walls if the dirty coating cannot be removed. The ships of choice are Baby Capes, the smallest of Capesize vessels with a carrying capacity of about 91,000 tonnes. That is much bigger than Panamax bulk vessels that normally carry grain
Shares in Asia retreated on Friday after a mixed day on Wall Street as optimism over signs that the US Federal Reserve might temper its aggressive interest rate hikes was replaced by worries that the economy might be headed for a recession. A US measure of inflation that is closely watched by the Fed eased in October, raising questions over the central bank’s determination to keep raising interest rates to tame price increases. In addition, activity in US manufacturing contracted last month for the first time since May 2020, the Institute for Supply Management said. The report also showed that prices are falling. Slower growth due to tighter monetary policies has slowed new orders and order backlogs, “which saw manufacturing conditions contracting for the first time since June 2020,” IG Asia Pte market strategist Yeap Jun Rong (葉俊榮) said in a report. That might suggest that with “inflation risks behind us now, ‘bad news’ in economic data may not be ‘good news’ for markets, as recession fears could be brewing,” he said. Signs of weakening trade, especially for export dependent economies in Asia, have deepened worries over slowing growth in China and its implications for the global economy. In Taiwan, the TAIEX closed down 42.12 points, or 0.28 percent, at 14,970.68. Turnover totaled NT$223.099 billion (US$7.29 billion). The index gained 1.3 percent from a week earlier. Tokyo’s Nikkei 225 dropped 1.59 percent to 27,777.9, down 1.79 percent on the week, while the broader TOPIX declined 1.64 percent to 1,953.98, losing 3.17 percent weekly. Hong Kong’s Hang Seng fell 0.33 percent to 18,675.35, but posted a weekly gain of 6.27 percent, while the Shanghai Composite index lost 0.29 percent to 3,156.14, up 1.76 percent week-on-week. South Korea’s KOSPI shed 1.84 percent to 2,434.33, dipping 0.14 percent from a week earlier. Australia’s S&P/ASX 200 slipped 0.72 percent to 7,301.5, but increased
The US dollar on Friday dipped as a US Federal Reserve official said rate hikes are likely to slow and investors took profits from earlier gains after last month’s US jobs data and wage inflation were surprisingly robust, obscuring the outlook for how hawkish the US central bank would be. The greenback initially jumped after data showed that employers added 263,000 jobs last month, well above estimates of 200,000. “Stronger-than-expected hiring can buy the Fed more time to stay aggressive,” said Joe Manimbo, senior market analyst at Convera in Washington. Investors zeroed in on an increase in average hourly earnings by 0.6 percent in the month, above expectations of a 0.3 percent gain, and the participation rate, which declined to 62.1 percent, said Marc Chandler, chief market strategist at Bannockburn Global Forex in New York. “Both of those measures reflect more than the nonfarm payroll growth number the tightness of the labor market,” he said. However, the US dollar gave back gains as investors took profits before the weekend and as Fed officials spoke on the outlook. Chicago Fed President Charles Evans said that the pace of increases is likely to slow, but the US central bank would likely need to raise borrowing costs to a “slightly higher” peak than envisioned in forecasts from September. Richmond Fed President Thomas Barkin said the US is likely in a sustained period in which there would continue to be a shortage of workers, complicating the Fed’s aim of getting labor demand back into balance. The US dollar index on Friday closed down 0.21 percent against a basket of currencies at 104.51, declining 1.37 percent weekly. The New Taiwan dollar rose against the US dollar on Friday, gaining NT$0.028 to close at NT$30.605, up 0.97 percent from NT$30.905 a week earlier. The greenback slipped 0.76 percent against the Japanese yen to ￥134.31, while the
Workers yesterday sort bunches of bananas to be auctioned at a wholesale fruit market in Karachi, Pakistan.