Commodities Update — Corn, soybean futures slide; Malaysia aims to regain palm oil market share

Commodities Update — Corn, soybean futures slide; Malaysia aims to regain palm oil market share
Soybeans and corn ended the week lower and extended weekly losses.
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Updated 08 May 2022

Commodities Update — Corn, soybean futures slide; Malaysia aims to regain palm oil market share

Commodities Update — Corn, soybean futures slide; Malaysia aims to regain palm oil market share

RIYADH: Chicago corn and soybean futures slid on Friday as rising interest rates and currency pressures weighed on US exports and forecasts of warm, dry weather opened a window for Midwestern farmers to get their crops planted.

Meanwhile, Chicago wheat futures rose on technical buying and tight world supplies.

The most-active wheat contract on the Chicago Board of Trade settled the day up 2 cents, at $11.08-1/2 a bushel, and posted a weekly gain of 4.99 percent.

Soybeans and corn ended the week lower and extended weekly losses.

The CBOT’s most active soybean contract slid 25 cents to $16.22 a bushel, while the most-active CBOT corn settled down 12-3/4 cents at $7.84-3/4 a bushel.

Gold prices steady

Gold prices were on track for a third straight weekly decline on Friday as investors fretted over the prospects of aggressive rate hikes from the US Federal Reserve, though a slight pullback in the dollar helped the precious metal to tick higher on Friday. 

Spot gold rose 0.3 percent to $1,88.80 per ounce but was down 0.7 percent for the week. US gold futures were up 0.4 percent at $1,883.81.

Silver fell 0.08 percent to $22.37 per ounce, while platinum is priced at $962.24. 

Palladium is currently priced at $2,051.92. 

Malaysia aims to regain palm oil market share in EU amid global shortage

Malaysia, the world’s second-largest palm oil producer, on Friday said it plans to leverage the global edible oil shortage and “political tension in Europe” to regain market share after buyers shunned the commodity over environmental concerns.

Palm oil is used to make everything from lipstick to noodles, but top producers Indonesia and Malaysia have faced boycotts after being accused of clearing rainforests and exploiting migrant workers for the rapid expansion of plantations.

Some companies have introduced “palm oil-free products” in recent years, and the EU, the world’s third-biggest palm buyer, has ruled to phase out palm oil-based biofuels by 2030.

But retailers like British supermarket chain Iceland, which removed palm oil from its own-brand food starting in 2018, have been forced to return to the controversial commodity in recent months due to a global edible oil shortage triggered by the Russia-Ukraine war and Indonesia’s ban on palm oil exports.

Zuraida Kamaruddin, Malaysian Minister for Plantation Industries and Commodities, said in a statement the government “will not want to waste a good crisis.”

“It is time we step up efforts to counter adverse propaganda to undermine palm oil’s credibility and for us to showcase the numerous health benefits the golden oil has to offer,” she said.

Zuraida said global edible oil prices are likely to remain high in the first half of 2022 and EU demand is expected to increase in the near term due to tight sunflower and soy oil supplies.

Ukraine war drives global food prices to a near-record high

War in Ukraine that disrupted crop trade has driven global food prices to a near-record high, according to Bloomberg.

This happens as Russia’s invasion of Ukraine has reduced its exports, resulting in holding supplies from one of the world’s largest vegetable oil and wheat shippers. 

Additionally, high fertilizer prices and weather concerns are contributing to the mounting threats on global crop supplies, which includes drought limiting US wheat crops.

The UN food index declined less than 1 percent in April due to the fall in demand for vegetable oil and weaker corn prices, Bloomberg reported. 

“Prices are still definitely very high and definitely still very much a concern, especially for low-income food-deficit countries,” Erin Collier, an economist at the UN’s Food and Agriculture Organization, said to Bloomberg. 

(With inputs from Reuters & Bloomberg) 


Riyadh hopes to ‘work out an agreement with OPEC+ which includes Russia,’ says energy minister

Riyadh hopes to ‘work out an agreement with OPEC+ which includes Russia,’ says energy minister
Updated 22 May 2022

Riyadh hopes to ‘work out an agreement with OPEC+ which includes Russia,’ says energy minister

Riyadh hopes to ‘work out an agreement with OPEC+ which includes Russia,’ says energy minister
  • Prince Abdulaziz says OPEC+ will be needed to bring about ‘orderly adjustments’ in the future

RIYADH: Saudi Energy Minister Prince Abdulaziz bin Salman has said Riyadh was “hoping to work out an agreement with OPEC+ which includes Russia.”

Talking to Financial Times, the minister said politics should be kept out of OPEC+ and insisted the “world should appreciate the value” the alliance of oil producers.

Oil prices have reached their highest levels in a decade, a set of OPEC+ production quotas put in place in April 2020 is set to expire in three months.

With the havoc you see now it’s too premature to try to pinpoint (an agreement).

Prince Abdulaziz bin Salman

Prince Abdulaziz said it was too early to say what a new agreement might look like given the uncertainties in the market, but added that OPEC+ would increase production “if the demand is there.” 

“With the havoc you see now it’s too premature to try to pinpoint (an agreement),” he said in the interview. “But what we know is what we have succeeded to deliver is sufficient for people to say so far there is a merit, there is a value of being there, working together.”

OPEC+ has stuck to its 2020 agreement, under which the alliance members raise total production each month by the modest amount of 430,000 barrels a day. But Russia’s output has dropped since the start of the Ukraine war, falling from about 11 million barrels per day in March to an average of 10 million bpd in April, according to data provider OilX.

Prince Abdulaziz blamed soaring prices on a lack of global refining capacity and taxes. “The determinant of the market is refinery capacity, and how do you unlock it,” he said. “At least for the last three years, the whole world lost around 4 million barrels of refining capacity, 2.7 million of them just from the beginning of COVID-19.” 

The Saudi energy minister said the OPEC+ alliance would be needed to bring about “orderly adjustments” in the future amid uncertainty about coronavirus lockdowns in China, global growth and supply chains.

He said to ease bottlenecks in production and refinery capacity governments have to encourage the industry to invest in hydrocarbons even as nations switch to cleaner energy sources. “This situation needs people to sit together, focus, take out the masquerade and the so-called political correctness … it’s about trying to relate to existing reality and find remedies to it.”

 

 


Uplift projects worth $247m inaugurated in Al-Qassim


Uplift projects worth $247m inaugurated in Al-Qassim

Updated 22 May 2022

Uplift projects worth $247m inaugurated in Al-Qassim


Uplift projects worth $247m inaugurated in Al-Qassim


RIYADH: Saudi Arabia’s Al-Qassim region on Sunday witnessed the inauguration of 27 development projects in the environment, water and agriculture sectors valued at SR927 million ($247 million). 

The newly launched projects are inclusive of everything related to the Ministry of Environment, Water and Agriculture, Saudi Press Agency reported citing Gov. Faisal bin Mishaal bin Saud. 


Lucid Motors delivers 300 EV units in April, to launch Air Pure later this year

Lucid Motors delivers 300 EV units in April, to launch Air Pure later this year
Updated 22 May 2022

Lucid Motors delivers 300 EV units in April, to launch Air Pure later this year

Lucid Motors delivers 300 EV units in April, to launch Air Pure later this year
  • By 2025, the company will accelerate its technology to reduce cost, energy consumption

JEDDAH: US-based electric vehicle manufacturer Lucid Motors delivered 360 cars to consumers during the first quarter of 2022. In contrast, the company sold 300 vehicles last month alone.
It is an encouraging sign considering that the EV manufacturer started its production last year and delivered its first car in October 2021.
“We are growing rapidly, and the Arizona factory can extend its production to 350,000 units a year by 2025,” Peter Rawlinson, CEO of Lucid Motors, told Arab News.
The prices of Lucid’s units range from $87,000 to $179,000, and it is planning to launch an edition later this year named Air Pure at the price of $87,000. Air Pure could cover over 400 miles on a single charge.

No one is even close to us. I think we are several years ahead of everyone else.

Peter Rawlinson

“We are defining a luxury brand with a high-end product, and when you look at what’s available in the market, that is a very good value,” he added.
By 2025, the company will accelerate its technology to reduce cost and energy consumption.
“The obstacle of EV is the prices of a vehicle. We can use our technological advantage to make cars that go further with fewer batteries, which means we can make the cars more affordable to buy and run because it consumes less energy,” said Rawlinson.
“When we move to the middle of the decade, our middle-size platform will become available, and that’s when we can drive the price down to closer to $50,000 in today’s prices,” he added.
 

Setting out on Arabian Safari
The company partnered with Saudi Arabia’s Public Investment Fund in 2018, which Rawlinson described as a turning point for Lucid Motors. The company was short on capital, and the PIF backed it up.
“We have got an alignment of mindset here with Saudi Arabia’s Vision 2030, and this could extend beyond just the cars. Certainly, it will extend into stimulating the economy with a supply chain and the infrastructure supporting manufacturing,” he said.
The EV startup went public in July last year. Its shares began trading on the Nasdaq stock exchange, where it raised $4.5 billion in fresh capital.
“In theory, we can break even in a few years. The question is do you want to do that?” said Rawlinson on the sidelines of Lucid’s factory signing ceremony.
To Rawlinson, the best value for shareholders is to continue on a rapid expansion, maximizing the share value return for an investor, rather than meeting short-time demands of breaking even.
Lucid Motors signed agreements on May 18 to build a production factory in King Abdullah Economic City, the western part of the Kingdom, with an annual capacity of 150,000 zero-emission EVs.
With this deal, Lucid is estimated to receive up to $3.4 billion in finance and incentives over the next 15 years to build and run the manufacturing facility in the Kingdom.

HIGHLIGHTS

The prices of Lucid’s units range from $87,000 to $179,000. It is planning to launch an edition later this year named Air Pure at the price of $87,000.

Air Pure could cover over 400 miles on a single charge.

Lucid Motors signed agreements on May 18 to build a production factory in King Abdullah Economic City with an annual capacity of 150,000 zero-emission EVs.

 

Production plans in the Kingdom
“We will ship semi-knocked-down kits of Lucid Airs from Arizona to KAEC, and we assemble those SKD kits here in Saudi Arabia,” Rawlinson said.
The production will start next year, and a complete assembly will be ready by 2025.
“And we will grow this volume up through 2026 to get to 150,000 units a year as soon as possible, and that’s the installed capacity of the factory we are building,” he added
Part of the factory’s function in KAEC will manufacture all-electric powertrains in-house, including battery packs, motors, inverters and transmissions.
“We make the most advanced battery pack globally, and we are well known for that,” he said.


The strategy will involve sending workers from Saudi Arabia to Arizona, where they will be trained to replicate the whole process in the Kingdom.
“This is not just an assembly plot where we build cars together; the core technology is actually built in-house,” he added.
Besides Lucid, only Tesla builds its technology in-house, which Rawlinson believes is the reason behind Tesla’s success. 
“I think they are four to five years ahead of everybody else, but today if you look at our technology, we are probably about three years ahead of what Tesla is,” he said.
Rawlinson measures this on efficiency, as he believes that the right way of measuring an EV technology is in miles per kilowatt-hour efficiency, given the size and sector the car is in.
“No one is even close to us. I think we are several years ahead of everyone else,” he said.


NEOM's The Line project to receive bids for spine's water infrastructure by June 1

NEOM's The Line project to receive bids for spine's water infrastructure by June 1
Updated 22 May 2022

NEOM's The Line project to receive bids for spine's water infrastructure by June 1

NEOM's The Line project to receive bids for spine's water infrastructure by June 1

RIYADH: Saudi Arabia’s The Line project, a 170-km long linear urban development in NEOM, is set to receive bids for its main work package to build spine water transmission by June 1, MEED reported. 

This package, which will be the latest in a series of tenders for the Line and Spine components, includes design, build, testing and commissioning work for a pressurized permanent water system. 

As part of the project, the contractors are required to create the complete design — right from the concept to the detailed design — besides providing supply, construction and installation services for the SWT line.

The water system includes the SWT line within a reinforced concrete box culvert running along the length of NEOM’s Spine.

According to MEED, some bidders have requested an extension of the deadline for the package.

The SWT culvert will run parallel to the Spine’s alignment about 360 meters north of the centreline of the Line alignment. The estimated 35-km SWT line will provide potable water for NEOM's Spine infrastructure and Line buildings. 

Whereas, contractors of the 160-km long rail line are also expecting NEOM to issue requests for prequalification within the next two months for the work on the high-speed rail line that forms the backbone of The Line. 

This development stretches from the coast towards Tabuk.


Saudi Arabia launches national military academy to train locals

Saudi Arabia launches national military academy to train locals
Updated 22 May 2022

Saudi Arabia launches national military academy to train locals

Saudi Arabia launches national military academy to train locals

RIYADH: Saudi Arabia’s General Authority for Military Industries has announced the establishment of the National Academy of Military Industries to train national cadres to work in the sector. 

The announcement comes as part of an extension of the military industry sector’s strategy that was approved by the council of ministers in April last year, the governor of GAMI said in a statement. 

The academy will be the largest supporter of the sector’s strategy that bets on the national human resource, Ahmed Al-Ohali added.

The move aims to achieve the sector’s target of localizing 50 percent of government spending on military equipment and services by 2030.