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India banned wheat exports without government approval Saturday after its hottest March on record hit production, in a blow to countries reeling from supply shortages and soaring prices since Russia’s invasion of Ukraine.

The announcement drew sharp criticism from the Group of Seven industrialized nations’ agriculture ministers meeting in Germany, who said that such measures “would worsen the crisis” of rising commodity prices.

“If everyone starts to impose export restrictions or to close markets, that would worsen the crisis,” German Agriculture Minister Cem Ozdemir said at a press conference in Stuttgart.

Global wheat prices have soared on supply fears following Russia’s February invasion of Ukraine, which previously accounted for 12% of global exports.

The spike in prices, exacerbated by fertilizer shortages and poor harvests, has fueled inflation globally and raised fears of famine and social unrest in poorer countries.

It has also led to concerns about growing protectionism following Indonesia’s halting of palm oil exports and India putting the brakes on exports of wheat.

India, the world’s second-largest wheat producer, said that factors including lower production and sharply higher global prices meant it worried about the food security of its own 1.4 billion people.

Export deals agreed to before the directive issued Friday could still be honored, but future shipments need government approval, it said.

But exports could also take place if New Delhi approved requests from other governments “to meet their food security needs”.

“We don’t want wheat to go in an unregulated manner where it may either get hoarded and is not used for the purpose which we are hoping it will be used for –- which is serving the food requirements of vulnerable nations and vulnerable people,” said BVR Subrahmanyam, India’s commerce secretary.

On Thursday New Delhi said it was sending delegations to Morocco, Tunisia, Thailand, Vietnam, Turkey, Algeria and Lebanon “for exploring possibilities of boosting wheat exports from India”.

It was unclear whether these visits would still take place.

Global help

Possessing major buffer stocks, India previously said it was ready to help fill some of the supply shortages caused by the Ukraine war.

“Our farmers have ensured that not just India but the whole world is taken care of,” Commerce and Industry Minister Piyush Goyal said in April.

India said that it planned to increase wheat exports this financial year, starting April 1, to 10 million tons from seven million tons the year before.

While this is a tiny proportion of worldwide production, the assurances provided some support to global prices and soothed fears of major shortages.

Egypt and Turkey recently approved wheat imports from India.

But India endured its hottest March on record – blamed on climate change – and has been wilting in a heatwave in recent weeks, with temperatures upwards of 45 degrees Celsius.

This has hit farmers hard, and this month the government said that wheat production was expected to fall at least five percent this year from 110 million tons in 2021 — the first fall in six years.

Indian wheat exports in the past have been limited by concerns over quality and because the government buys large volumes at guaranteed minimum prices.

The country’s exports have also been held back by World Trade Organization rules that limit shipments from government stocks if the grain was bought from farmers at fixed prices.

Urgent need

The Ukrainian agriculture minister has traveled to Stuttgart for discussions with G-7 colleagues on getting its produce out.  

About “20 million tons” of wheat were sitting in Ukrainian silos and “urgently” needed to be exported, Ozdemir said.

Before the invasion, Ukraine exported 4.5 million tons of agricultural produce per month through its ports – 12% of the planet’s wheat, 15% of its corn and half of its sunflower oil.

But with the ports of Odesa, Chornomorsk and others cut off from the world by Russian warships, the supply can only travel on congested land routes that are much less efficient.

G-7 ministers urged countries not to take restrictive action that could pile further stress on the produce markets.  

They “spoke out against export stops and call as well for markets to be kept open”, said Ozdemir, whose nation holds the rotating presidency of the group.

“We call on India to assume its responsibility as a G-20 member,” Ozdemir added.

The agriculture ministers would also “recommend” the topic be addressed at the G-7 summit in Germany in June, which India’s prime minister, Narendra Modi, has been invited to attend.
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Chinese Premier Li Keqiang has suggested that China’s current job market is “complicated and severe” as the country maintains “unswerving adherence” to the “zero-COVID” policy, whose lockdowns are causing a severe economic contraction throughout the nation.

Derived from a survey of 430 private industrial companies, the Caixin purchasing managers’ index, a reliable indicator for assessing the economy, fell to 36.2 in April from 42 in March, according to a survey released by IHS Markit last week. A reading below 50 indicates contraction, while anything above that gauge shows expansion.

“Demand was under pressure, external demand deteriorated, supply shrank, supply chains were disrupted, delivery times were prolonged, backlogs of work grew, workers found it difficult to return to their jobs, inflationary pressures lingered, and market confidence remained below the long-term average,” said Wang Zhe, senior economist at Caixin Insight Group.

“Keeping market players and securing jobs will win the future,” Li said Saturday, during a national video and teleconference on stabilizing employment, according to the China Daily, a state-controlled news outlet.

Li, who holds the number two position in the Chinese Communist Party (CCP), urged all regional government departments to “conscientiously implement the decisions and arrangements” of the party’s Central Committee and the State Council to maintain jobs and economic stability.

“Stabilizing employment is critical to people’s livelihood and is the key support for the economy to run within a reasonable range,” he said, as he recommended steps for local and provincial governments.

Li asked enterprises to resume production while adhering to the controls designed to contain the spread of COVID-19.

Lockdowns in more than 20 cities, including Shanghai, have frustrated residents and constrained China’s economic growth. WHO Director-General Tedros Adhanom Ghebreyesus said on Tuesday that China’s zero-tolerance strategy was not sustainable, a comment Foreign Ministry spokeperson Zhao Lijian called “irresponsible” a day later.

Global banks such as UBS, Standard Chartered, DBS, Barclays and Bank of America have downgraded their 2022 GDP (gross domestic product) forecasts for China.

China’s first-quarter GDP for 2022 expanded by 4.8% year-on-year, higher than expected but still below Beijing’s full-year target of 5.5%, according to Xinhua, a state-affiliated news outlet.

Liu Meng-chun, managing director at Chung-Hua Institution for Economic Research in Taipei, Taiwan, said the slowdown is attributable not only to China’s COVID policies but also to a crackdown on private enterprise, especially in the technology sector.

He foresees the state taking a financial stake in some of the technology giants to get more control over their operations but said the change would be more one of style than of substance.

“If 1% equity is used to enter the core decision-making circle of its (technology companies) and becomes internal supervision, it represents a change in the supervision model,” Liu said.

Ming-Fang Tsai, a professor at the Department of Industrial Economics at Tamkang University in Taipei, said that even if Beijing stops suppressing tech giants, it would be difficult to return to the era of rapid economic growth.

“Alibaba and Tencent are laying off workers significantly, and now (Beijing) has said that it will stop (the suppression). It will not have any impact on China’s economy,” Tsai told VOA Mandarin.

The tech layoffs fit into a larger picture as China’s economy has been hit by the “five crises” of employment, exports, private investment, real estate and debt defaults, leading its economy into a downward cycle, according to Wu Jialong, a Taipei economist.

Reduced demand for China’s exports, “will reduce employment, income and consumption power, which will affect real estate,” Wu said. “In addition, industrial supervision and common prosperity will also make things worse, which will hurt the willingness and ability of private investment and eventually lead to a crisis of debt default.”

According to Taiwanese economist Liu, if China’s zero-COVID policy lasts for a long time, industries such as real estate, finance and technology will be hit hard, as will retail and consumer services. The combination, he said, will delay the country’s “common prosperity” campaign launched by President Xi Jinping.

“The control of the epidemic will make income distribution more uneven. Polarization will become more serious,” Liu told VOA Mandarin.

According to Xie Tian, an associate professor of marketing at the University of South Carolina Aiken, even if the zero-COVID policy caused the Chinese economy to collapse, Chinese authorities would be more likely to return to the planned economy of the Mao Zedong era than to adjust to current forces.

“Now the CCP has launched a lot of ‘supply and marketing cooperatives,’ ‘unified purchase and unified sales,’ just to deal with the economic impact that the city lockdowns may bring, because it wants to suppress the people, and the government controls all goods, sources of goods and channels to achieve its political goals.” Xie told VOA Mandarin.

“Unified purchase and unified sales” refers to a policy implemented by China from the 1950s to the 1980s to exert state control over agricultural resources such as grain and cotton. The Chinese government purchased these products in rural areas and rationed them out to city dwellers.

In July last year, China began a pilot program of “supply and marketing cooperatives.” This recalls how the CCP acted as it established a government in 1949 during a post-civil war period of material scarcity.
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Elon Musk said on Friday his $44-billion deal for Twitter Inc was temporarily on hold, citing pending details on spam and fake accounts.

“Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users,” Musk said in a tweet.

Shares of the social media company fell 20% in premarket trading. Twitter did not immediately respond to a request for comment.

The company had earlier this month estimated that false or spam accounts represented fewer than 5% of its monetizable daily active users during the first quarter.

It also said it faced several risks until the deal with Musk is closed, including whether advertisers would continue to spend on Twitter.

Musk, the world’s richest man and the chief executive of Tesla Inc, had said that one of his priorities would be to remove “spam bots” from the platform.
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California’s minimum wage will rise to $15.50 an hour for workers at all businesses, large and small, on Jan. 1, 2023, under an automatic inflation trigger built into state law and never previously activated, the governor’s office projected on Thursday.

The announcement came a day before Governor Gavin Newsom, a first-term Democrat, was slated to present his revised budget plan to the state legislature controlled by his party, including a proposed $11.8 billion inflation-relief spending package.

The economic stimulus proposal, similar to one enacted last year to help California recover from the COVID-19 pandemic, includes a plan Newsom previewed in recent weeks offering $400 tax rebates to vehicle owners to help offset escalating gasoline costs.

Newsom said his package taps into a “historic” state budget surplus to help individuals and families cope with rising costs of living, which the state Finance Department projects will grow 7.6% between fiscal year 2021 and fiscal 2022.

Regardless of whether Newsom’s package becomes law, the Finance Department estimates that some 3 million workers stand to benefit from the first inflation-based minimum wage hike expected to take effect under a labor statute enacted in 2016.

That law requires an automatic 50-cent-per-hour increase above California’s prevailing minimum wage levels – already the highest any state requires for larger companies – whenever the U.S. consumer price index rises more than 7% from year to year.

That means the statewide minimum wage for companies employing 26 or more workers, and those with 25 or fewer workers, will both go to $15.50 in the new year. Without an inflation trigger, the minimum wage for smaller companies was due to have topped out at $15 in January, catching up with the level now required at larger firms.

Only two states — Massachusetts and Washington state — exceed California’s existing $14 minimum wage for smaller companies. They require at least $14.25 and $14.49 per hour, respectively, at businesses of all sizes, U.S. Labor Department figures show.

The District of Columbia is higher still, at $15.20 an hour. The U.S. federal minimum hourly wage is currently set at $7.25.

Other highlights of Newsom’s inflation package include $2.7 billion in emergency rental assistance for low-income tenants and $1.4 billion to help utility customers pay overdue bills.

The California Republican Party issued a statement urging the legislature to suspend state gasoline taxes as “the most effective way to relieve pain at the pump.”
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Canadian energy experts see the global spike in oil prices – exacerbated by the war in Ukraine – as a two-edged sword, spurring a rush to develop renewable energy sources while simultaneously encouraging increased production of environmentally damaging fossil fuels.

For Canada, a major energy exporter with the potential to fill part of the gap created by the broadening boycott of Russian energy sources, the balancing act is especially delicate.

The left-leaning government led by Prime Minister Justin Trudeau has pledged to make major investments in renewable energy. But the country is also home to the Alberta tar sands, described by National Geographic magazine as “the world’s most destructive oil operation.”

Speaking in Vancouver in late March, Trudeau announced a plan to spend $9.1 billion by 2030 to reduce carbon emissions through support for electric vehicles, energy-efficient homes and vehicles, wind and solar projects, support for sustainable farming and other measures.

“The leaders I spoke with in Europe over the past few weeks were clear,” Trudeau told reporters at the time. “They don’t just want to end their dependence on Russian oil and gas, they want to accelerate the energy transformation to clean and green power.

“The whole world is focusing on clean energy and Canada cannot afford not to do that,” he said.

But Trudeau’s long-term ambition may be complicated in the short term by the rising demand for oil from Canada – the world’s fourth largest exporter – and a renewed interest in the Alberta tar sands, which have become more profitable than they have been for years.

The environmental group Greenpeace Canada last year called for a halt to development of the heavy and hard-to-extract bitumen, saying, “The world can’t afford to expand the Alberta tar sands, not if we want to preserve this planet for future generations.”

And with world oil prices as low as $50 a barrel in recent years, many producers had in fact shelved plans to expand production, mainly because of high start-up costs that made the effort unprofitable. But with current prices topping $100 a barrel, the heavy sludge is suddenly much more appealing.

“It is certainly true that higher oil prices will increase interest in all oil resources, including the Canadian oil sands,” said Mark Finley, a former manager and analyst with an energy focus at the CIA. He is currently with Rice University’s Baker Institute for Public Policy. 

“Moreover, a growing interest in resilient supply chains and what U.S. Treasury Secretary [Janet] Yellen has called ‘friend-shoring’ will also work to the advantage of Canadian producers,” Finley said in an interview.

Hadrian Mertins-Kirkwood, an expert with the Canadian Center for Policy Alternatives, said it is “too soon to tell” what impact the war in Ukraine will have on energy investment in Canada. “We’re not seeing a lot of investment into new fossil fuel projects at this point, but that could change if the war drags on and prices stay high.”

Mertins-Kirkwood said industry announcements show “that investment in fossil fuels is up this year. That’s mainly due to rising oil prices, which started last year but really picked up after the Russian invasion.”

“Specifically, oil companies in Canada are intensifying production, which means they’re trying to get more oil out of existing projects to take advantage of the current price environment.”

On the green energy side, Mertins-Kirkwood suggested the Trudeau government’s spending plans fall far short of what its own calculations show will be needed to reach its goal of net-zero carbon emissions by 2050.

The most recent federal budget says Canada will need to between $125 billion and $140 billion of investment every year to reach that goal, he said, far beyond the current rate of investment in the climate transition of $15 billion to $25 billion.

But Finley said the Trudeau administration’s green ambitions are not necessarily in conflict with the renewed interest in Alberta’s tar sands. 

“The outcome of this situation, I think, could be both more investment in oil and gas, and an accelerated interest in pursuing the transition [to renewable energy],” he said. “In that sense, there should be common ground to be found between the government in Ottawa and government/industry in Alberta.

Finley noted that Canada is a natural partner for other Western countries as it belongs to many of the same key institutions, including the International Energy Agency, NATO and OECD, as well as being a major energy exporter.

“As the United States and Europe focus on diversifying supplies away from Russia, what kind of countries are likely to be perceived as reliable partners?” he asked.  “Canada would certainly be high on the list.”
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Calling US farms the ‘breadbasket of democracy,’ president vows to do more to offset food supply issues amid Russian invasion
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Though inflation may be soaring, supply chains remain snarled, and the coronavirus won’t go away, America’s casinos are humming right along, recording the best month in their history in March.

The American Gaming Association, the gambling industry’s national trade group, said Wednesday that U.S. commercial casinos won more than $5.3 billion from gamblers in March, the best single-month total ever. The previous record month was July 2021 at $4.92 billion.

The casinos collectively also had their best first quarter ever, falling just short of the $14.35 billion they won from gamblers in the fourth quarter of last year, which was the highest three-month period in history.

Three states set quarterly revenue records to start this year: Arkansas ($147.4 million); Florida ($182 million), and New York ($996.6 million).

The numbers do not include tribal casinos, which report their income separately and are expected to report similarly positive results.

But while the national casino economy is doing well, there are pockets of sluggishness such as Atlantic City, where in-person casino revenue has not yet rebounded to pre-pandemic levels.

“Consumers continue to seek out gaming’s entertainment options in record numbers,” said Bill Miller, the association’s president and CEO. He said the strong performance to start 2022 came “despite continued headwinds from supply chain constraints, labor shortages and the impact of soaring inflation.”

The trade group also released its annual State of the States report on Wednesday, examining gambling’s performance across the country.

As previously reported, nationwide casino revenue set an all-time high in 2021 at $53.03 billion, up 21% from the previous best year, 2019, before the coronavirus pandemic hit.

But the report includes new details, including that commercial casinos paid a record $11.69 billion in direct gambling tax revenue to state and local governments in 2021. That’s an increase of 75% from 2020 and 15 percent from 2019. This does not include the billions more paid in income, sales and other taxes, the association said.

It also ranked the largest casino markets in the U.S. in terms of revenue for 2021. The Las Vegas Strip is first at $7.05 billion, followed by:

Atlantic City ($2.57 billion)
the Chicago area ($2.01 billion)
Baltimore-Washington D.C. ($2 billion)
the Gulf Coast ($1.61 billion)
New York City ($1.46 billion)
Philadelphia ($1.40 billion)
Detroit ($1.29 billion)
St. Louis ($1.03 billion)
the Boulder Strip in Nevada ($967 million)

The association divides most of Pennsylvania’s casinos into three separate markets: Philadelphia, the Poconos and Pittsburgh. Their combined revenue of nearly $2.88 billion would make them the second largest market in the country if judged as a single entity. It also counts downtown Las Vegas, and its $731 million in revenue, as a separate market.

Seven additional states legalized sports betting and two more added internet gambling in 2021.

The group reported many states saw gamblers spending more in casinos while visiting them in lower numbers compared to pre-pandemic 2019.

The average age of a casino patron last year was 43 1/2, compared to 49 1/2 in 2019.

Americans bet $57.7 billion on sports last year, more than twice the amount from 2020. That generated $4.33 billion in revenue, an increase of nearly 180% over 2020.

Internet gambling revenue reached $3.71 billion last year, and three states — New Jersey, Pennsylvania and Michigan — each won more than $1 billion online. West Virginia’s internet gambling market reached $60.9 million in revenue in its first full year of operation, while Connecticut’s two internet casinos reported combined revenue of $47.6 million after launching in October.
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China’s export growth slumped in April to its lowest level in almost two years as the country’s “zero-COVID” policy continues to impact manufacturers and, according to trade experts, pushes many foreign businesses to reconsider operations in China.

Exports in terms of dollars grew 3.9% in April from the year-ago period, marking the slowest pace since June 2020, according to China’s customs administration.

They also dropped sharply from the 14.7% growth reported in March, according to official figures.

Import growth was essentially flat in April, improving slightly from a 0.1% decline in March and a bit better than the 3.0% contraction by a Reuters poll.

The weak figures reflect the state of China’s trade sector, which accounts for about one-third of gross domestic product. The sector has been losing momentum as COVID-19 restrictions across the country disturb supply chains in major centers such as Shanghai, which has been under a lockdown since late March.

It’s not clear when authorities will fully lift the restrictions. The city tightened them over the weekend as President Xi Jinping pledged to “unswervingly” double down on the zero-COVID policy.

Auto factories and other manufacturers that tried to keep operating by having staff live at their facilities were forced to reduce production because of supply chain disturbances and logistics issues.

Tesla Inc. has halted most production at its Shanghai plant because of problems securing parts for its electric vehicles, according to an internal memo seen by Reuters.

According to the memo, the plant planned to manufacture fewer than 200 vehicles at its Shanghai factory on Tuesday, far below the roughly 1,200 units a day it was producing shortly after reopening on April 19 after a 22-day closure.

“Shanghai’s lockdown had impacted components of China’s economy that are the most vulnerable — service workers, delivery drivers and other people still working,” Rui Zhong, program associate at the Wilson Center’s Kissinger Institute on China and the United States, said in an email. “This includes Tesla workers who are producing luxury vehicles in conditions that have been described as them sleeping in factories.”

Tesla’s sales in China slumped by 98% in April, according to data released Tuesday by the China Passenger Car Association (CPCA). After reopening, the factory sold 1,512 vehicles in April, down from 65,814 cars sold in March, according to CPCA.

Other automakers also reported a steep slowdown in sales and production for April. Toyota, the world’s largest carmaker, reported that it was halting some operations in eight plants in Japan from May 16 to 21 because of a parts shortage resulting from the lockdown in Shanghai, according to the Automotive News website. More foreign businesses in China are cutting revenue expectations and plans for future investment because of China’s recent COVID-19 outbreak and related restrictions.

A survey released Monday by the American Chamber of Commerce in China shows that 58% of survey respondents said they have decreased their 2022 revenue projections, up from 54% in a similar survey in April. Meanwhile, 52% of respondents have already either delayed or decreased investments in China.

The latest study, conducted from April 29 to May 5, covered 121 companies with operations in China.

Gordon Chang, author of the 2021 book “The Coming Collapse of China,” told VOA Mandarin in an email that despite concerns raised by foreign businesses, China would stick to its strict coronavirus containment policy at least through the end of May.

“Many, however, think the lockdown of Shanghai will continue through at least the end of this month and the ‘zero-COVID’ policy will continue through the (Chinese Communist) Party’s 20th National Congress, which will be held in the fall if tradition holds,” Chang said. The congress is scheduled to convene in the second half of 2022.

Some information for this report came from Reuters and Agence France-Presse.
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President Joe Biden on Wednesday hailed American farmers as the “backbone of freedom,” pledging hundreds of millions of dollars’ worth of support and calling on them to offset a global grain shortage caused by Russian President Vladimir Putin’s invasion of Ukraine.

“You’re literally the backbone of our country, it’s not hyperbole,” he said, speaking at a family farm in Kankakee, Illinois, where, earlier in the day, he stood in front of a tractor and gazed over growing waves of grain. “But you also feed the world. And we’re seeing, with Putin’s war in Ukraine, you’re like the backbone of freedom.”

Russia’s 11-week-old invasion of Ukraine has imperiled global supplies of wheat, corn, barley, oilseeds and cooking oil, and it has disrupted fertilizer supplies. World food prices have risen nearly 13% in the wake of the invasion, the White House says.

Biden has announced a number of interventions for American farmers. Those include support that would allow farmers to plant two sets of crops in one year; access to technology that would allow for less fertilizer use, and the doubling of funding for domestic fertilizer production, to $500 million.

Biden told the gathered farm community that blame for the crisis rested on Putin, whose navy is blocking Ukrainian exports from Black Sea ports.

“But we’re doing something about it,” Biden said. “And our farmers are helping … on both fronts, reducing the … price of food at home and expanding production and feeding the world in need.”

The head of the European Investment Bank (EIB) this week sounded the alarm, saying that Ukraine is sitting on a staggering amount of wheat it can’t export.

“Ukraine is a rich country,” EIB President Werner Hoyer said. “Ukraine is the wheat basket of Europe, and it’s sitting on €8 billion (U.S. $8.5 billion) worth of wheat right now from last year’s harvest. They cannot export it; they have no access to the sea.

“This is one of the key issues that we must address, because they are industrious people,” he added. “They are sowing like crazy right now, and they will expect probably a good harvest, maybe 70% of last year’s harvest, in a couple of months — and then what to do with it? So these are issues that need to be addressed immediately, in addition to the social needs and the daily problems that Ukrainian citizens face.”

Worldwide effects

The European Union’s top diplomat warned of global impact.

“They are causing scarcity,” EU foreign affairs chief Josep Borrell said of the Russian military, which invaded Ukraine on February 24. “They are bombing Ukrainian cities and provoking hunger in the world.”

Already the effects have spread across the world. Last month, farmers in Sri Lanka participated in strikes over rising food and fuel prices. That movement ultimately resulted in the resignation of the island nation’s Cabinet and prime minister.

And the crisis is likely to hit hardest in parts of the world where resources are already stretched thin, analysts said.

“This is a real reversal for the global economy,” Desmond Lachman, a senior fellow at the American Enterprise Institute, told VOA. “And those are the countries that are impacted the most — countries that are very reliant on food and energy imports are really going to get hit very hard. And politically, it’s going to be extremely difficult for those countries.”

Analysts say food price inflation could lead to instability on the world’s least-developed continent.

“Most African governments will scramble to cushion the loss of purchasing power stemming from higher inflation,” said Jacques Nel, head of economic-focused research firm Africa Macro. “Many will not be able to provide the necessary relief. Unrest is a matter of when and where, and not if.”

History shows that the humble grain holds immense power, perhaps no more famously than when the price of bread nearly doubled in 1788 France. Peasants revolted against the monarchy, hungry for governance ruled by the principles of liberty, equality and fraternity. Revolution came the following year.
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In any country, the currency exchange rate is an indicator of stability and the economy’s strength. With unprecedented sanctions being imposed on Russia, many economists are closely watching the ruble. Anna Rice narrates the story of the Russian ruble, and the effect economic sanctions are having.
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A top U.S. energy official says Russia’s war on Ukraine has driven home the need to diversify supply chains, and that Africa can benefit from this. Jose Fernandez made the comment to VOA Wednesday at an annual conference on African mining in Cape Town, South Africa.

Jose Fernandez, the U.S. Undersecretary for economic growth, energy, and the environment, is the highest-ranking American official ever to attend the Investing in African Mining conference, or Indaba. Indaba is a Zulu word for discussions.

Speaking to VOA, Fernandez said the U.S. is very interested in working with African partners to make the kind of investments that will benefit both sides.

“That’s a message that I’m not sure has been made here in the last few years,” he said.

He said Russia’s attempts to weaponize its oil and gas exports to Europe highlights the fact that the U.S., and other countries, cannot depend on one, or two, or even three suppliers for important products.

“Something we need to diversity is our sources of energy. We need to invest more in renewables. That requires wind turbines, it requires solar panels, it requires electric batteries and other components that are going to be critical for the energy future,” he said.

Fernandez said the U.S. geological service has identified almost 40 critical minerals that are going to be needed for a clean energy future as well as in products like cars, computers and chips — noting that Africa has many of them.

How could the continent benefit?

“In order to do that, it’s going to require foreign investment and one way or the best way to attract foreign investment is to have clear rules and a transparent regulatory regime. What I am here to do, is to see how the U.S. can help Africa take advantage of the opportunity and create jobs,” said Fernandez.

Tony Carrol, executive advisor of the conference, says the importance of Fernandez’s attendance cannot be overstated.

“It’s the first truly high-ranking U.S. government official we’ve had at the mining indaba in the 28 years. He is responsible for the energy and natural resource portfolio within the State Department and reports directly to the secretary of state. His meetings here were meaningful and I think they were enthused about this event and looking forward to coming back,” he said.
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Indonesia’s “unpredictable” palm oil export policies may help Malaysia emerge as the dominant supplier to India, the world’s top buyer of the edible oil, industry sources said.

Indonesia is the world’s biggest palm oil producer but its erratic export policies, including the most recent ban announced on April 22, have pushed Indian consumers to increase their dependence on Malaysia, the world’s second-largest producer whose output is less than half of its rival.

Malaysia is positioning itself to take advantage of Indonesia’s ban by cutting palm oil export taxes by as much as half, Malaysia’s Commodities Minister Zuraida Kamaruddin said on Tuesday.

The combination of lower export taxes and the Indonesian ban may mean Indonesia’s share of palm oil exports to India will fall to 35% in the current marketing year ending on Oct. 31, from more than 75% a decade ago, according to an estimate from the Solvent Extractors’ Association of India (SEA), a vegetable oil trade body.

“Malaysia is the biggest beneficiary from Indonesia’s unpredictable policies,” said B.V. Mehta, executive director of Mumbai-based Solvent Extractors’ Association of India (SEA), a vegetable oil trade body.

“As Indonesia is not in the market, Malaysia is selling more, and at near record high prices.”

In the first five months of the 2021/22 marketing year, India has bought 1.47 million tons of Malaysian palm oil compared to 982,123 from Indonesia, data compiled by SEA showed.

Trader estimates for May show India imported around 570,000 tons of palm oil, with 290,000 from Malaysia and 240,000 from Indonesia.

If Indonesia’s export ban stays in place for two more weeks, then India’s June palm oil imports could fall to 350,000 tons, mostly from Malaysia.

New normal?

The flip in Indian palm oil imports would upend an established pattern of Indonesian dominance across South Asia.

However, Indian oil refiners feel they have to protect their supply chains against policy shake-ups after Indonesia’s interventions in the palm oil market since 2021.

“You can’t just rely on Indonesia and run a business. Even if Indonesia offers you a discount over Malaysia, one has to secure supplies from Malaysia to hedge against Indonesia’s unpredictable polices,” a Mumbai-based refiner said.

“Refiners commit sales of finished goods in advance and we cannot back out just because raw material is not available,” he said.

But, Malaysia’s relatively tight palm oil inventories are a lingering concern following an enduring labor shortage that has slashed plantation yields.

“Malaysia has limited stocks. Many producers in Malaysia are well-sold nearby,” said an official with a Malaysian planter with operations across Indonesia and Malaysia.

Malaysia produces roughly 40% of Indonesia’s output so it cannot completely replace Indonesian supplies.

Even so, Indian oil consumers are keen to increase Malaysian deals and reduce their reliance on Indonesia.

“Indonesia may lift the ban on exports sometime this month, but there is no guarantee it will not restrict exports again. Malaysia’s export policy is far more stable and that’s what we want,” said an Indian buyer, who declined to be named.
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The Senate confirmed economist Lisa Cook on Tuesday to serve on the Federal Reserve’s board of governors, making her the first Black woman to do so in the institution’s 108-year history. 

Her approval was on a narrow, party-line vote of 51-50, with Vice President Kamala Harris casting the decisive vote. 

Senate Republicans argued that she is unqualified for the position, saying she doesn’t have sufficient experience with interest rate policy. They also said her testimony before the Senate Banking Committee suggested she wasn’t sufficiently committed to fighting inflation, which is running at four-decade highs. 

Cook has a doctorate in economics from the University of California, Berkeley, and has been a professor of economics and international relations at Michigan State since 2005. She was also a staff economist on the White House Council of Economic Advisers from 2011 to 2012 and was an adviser to President Joe Biden’s transition team on the Fed and bank regulatory policy. 

Some of her most well-known research has focused on the impact of lynchings and racial violence on African American innovation. 

Cook is only the second of Biden’s five nominees for the Fed to win Senate confirmation. His Fed choices have faced an unusual level of partisan opposition, given the Fed’s history as an independent agency that seeks to remain above politics. 

Some critics charge, however, that the Fed has contributed to the increased scrutiny by addressing a broader range of issues in recent years, such as the role of climate change on financial stability and racial disparities in employment. 

Biden called on the Senate early Tuesday to approve his nominees as the Fed seeks to combat inflation. 

“I will never interfere with the Fed,” Biden said. “The Fed should do its job and will do its job, I’m convinced.” 

Fed Chair Jerome Powell is currently serving in a temporary capacity after his term ended in February. He was approved by the Senate Banking Committee by a nearly unanimous vote in March. 

Fed governor Lael Brainard was confirmed two weeks ago for the Fed’s influential vice chair position by a 52-43 vote. 

Philip Jefferson, an economics professor and dean at Davidson College in North Carolina, also has been nominated by Biden for a governor slot and was approved unanimously by the Finance Committee. He would be the fourth Black man to serve on the Fed’s board. 

Biden has also nominated Michael Barr, a former Treasury Department official, to be Fed’s top banking regulator, after a previous choice, Sarah Bloom Raskin, faced opposition from West Virginia Democratic Sen. Joe Manchin. 

Cook, Jefferson, and Barr would join Brainard as Democratic appointees to the Fed. Yet most economists expect the Fed will continue on its path of steep rate hikes this year. 
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Wall Street is tumbling toward its lowest point in more than a year on Monday as renewed worries about China’s economy pile on top of markets already battered by rising interest rates. 

The S&P 500 was 2.3% lower in afternoon trading after coming off its fifth straight losing week, its longest such streak in more than a decade. It joined a worldwide swoon for markets. Not only did stocks fall across Europe and much of Asia, but so did everything from old-economy crude oil to new-economy bitcoin. 

The Dow Jones Industrial Average was down 374 points, or 1.1%, at 32,520, as of 3:16 p.m. Eastern time, and the Nasdaq composite was 3.4% lower as tech-oriented stocks again took the brunt of the sell-off. Monday’s sharp drop leaves the S&P 500, Wall Street’s main measure of health, down roughly 16% from its record set early this year. 

Most of this year’s damage has been the result of the Federal Reserve’s aggressive flip away from doing everything it can to prop up financial markets and the economy. The central bank has already pulled its key short-term interest rate off its record low of near zero, where it sat for nearly all of the pandemic. Last week, it signaled additional increases of double the usual amount may hit in upcoming months, in hopes of stamping out the high inflation sweeping the economy. 

The moves by design will slow the economy by making it more expensive to borrow. The risk is the Fed could cause a recession if it moves too far or too quickly. In the meantime, higher rates discourage investors from paying very high prices for investments, because investors can get more than before from owning super-safe Treasury bonds instead. 

That’s helped cause a roughly 29% tumble for bitcoin since April’s start, for example. It dropped 10.8% Monday, according to Coindesk. Worries about the world’s second-largest economy added to the gloom Monday. Analysts cited comments over the weekend by a Chinese official warning of a grave situation for jobs, as the country hopes to halt the spread of COVID-19. 

Authorities in Shanghai have again tightened restrictions, amid citizen complaints that it feels endless, just as the city was emerging from a month of strict lockdowns after an outbreak. 

The fear is that China’s strict anti-COVID policies will add more disruptions to worldwide trade and supply chains, while dragging on its economy, which for years was a main driver of global growth. 

In the past, Wall Street has been able to remain steady despite similar pressures because of the strong profit growth that companies were producing. 

But this most recent earnings reporting season for big U.S. companies has yielded less enthusiasm. Companies overall are reporting bigger profits for the latest quarter than expected, as is usually the case. But discouraging signs for future growth have been plentiful. 

The number of companies citing “weak demand” in their conference calls following earnings reports jumped to the highest level since the second quarter of 2020, strategist Savita Subramanian wrote in a BofA Global Research report. Tech earnings are also lagging, she said. 

The tech sector is the largest in the S&P 500 by market value, giving it additional weight for the market’s movements. Many tech-oriented companies saw profits boom through the pandemic as people looked for new ways to work and entertain themselves while locked down at home. But slowdowns in their profit growth leave their stocks vulnerable after their prices shot so high on expectations of continued gains. 

The higher interest rates engineered by the Fed are also hitting their stock prices particularly hard because they’re seen as some of the market’s most expensive. The Nasdaq composite’s loss of roughly 25% for 2022 so far is much sharper than that for other indexes. 

Electric automaker Rivian Automotive slumped 19.1% Monday as restrictions expired that prevented some big investors from selling their shares following its stock market debut six months ago. It’s lost more than three quarters of its value so far this year. 

The yield on the 10-year Treasury has shot to its highest level since 2018 as inflation and expectations for Fed action rose. It moderated Monday, dipping to 3.07% from 3.12% late Friday. But it’s still more than double the 1.51% level where it started the year. 

In Asian stock markets, Japan’s Nikkei 225 fell 2.5%, and South Korea’s Kospi lost 1.3%. Stocks in Shanghai inched up 0.1%. 

In Europe, France’s CAC 40 fell 2.8%, and Germany’s DAX lost 2.1%. London’s FTSE 100 slid 2.3%. 

Apart from concerns about inflation and coronavirus restrictions, the war in Ukraine is still a major cause for uncertainty. More than 60 people were feared dead after a Russian bomb flattened a school being used as a shelter, Ukrainian officials said. Moscow’s forces pressed their attack on defenders inside Mariupol’s steel plant in an apparent race to capture the city ahead of Russia’s Victory Day holiday Monday. 

Even the energy sector, a star performer in recent weeks, was under pressure on Monday. Benchmark U.S. crude fell 6.1% to settle at $103.09 per barrel, though it’s still up about 40% this year. Brent crude, the international standard, fell 5.7% to settle at $105.94 a barrel. 

 
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When you think about places to get some rest, airplanes don’t normally come to mind. Aerotel is trying to change all that. Romain Chanson reports for VOA from northern South Africa, in this piece narrated by Carol Guensburg.
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Ukrainian officials say farmland used for planting spring crops could more than halved this year because of the war.
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The U.N. Food and Agriculture Organization (FAO) says global food prices stabilized last month at a very high level but were slightly lower than in March, which saw the highest ever jump in food prices.

FAO officials see little prospect of a significant decrease in the price of food as long as the Russian-Ukrainian war goes on. Both countries combined account for nearly a third of the world’s wheat and barley exports and up to 80% of sunflower seed oil shipments.

The FAO’s deputy director in the markets and trade division, Josef Schmidhuber, said disruption in the export of those and other food commodities from Ukraine is taking a heavy toll on global food security. He said poor countries are suffering most because they are being priced out of the market.

“It is an almost grotesque situation that we see at the moment,” he said. “In Ukraine, there are nearly 25 million tons of grain that could be exported but they cannot leave the country simply because of the lack of infrastructure and the blockade of the ports. At the same time…there is no wheat corridor opening up for exports from Ukraine.”

Ukraine’s summer crop of wheat, barley, and corn will be harvested in July and August. Despite the war, Schmidhuber said harvest conditions are not dire. He said about 14 million tons of grain should be available for export.

However, he notee there is not enough storage capacity in Ukraine. He added there is a great deal of uncertainty about what will happen over the next couple of months as the conflict grinds on.

“And what we also see, and that is, of course, only anecdotal evidence, that grain is being stolen by Russia and is being transported on trucks into Russia,” Schmidhuber said. “The same goes for agricultural implements, tractors, etc., etc. And all that could have a bearing on agricultural output.”

The FAO official said the situation in Ukraine indicates that the current problem is not one of availability, but one of access. He said there is enough grain to go around and feed the world. The problem, he said, is the food is not moving to the places where it is needed.
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