Taiwan bids on 80,000 T of wheat with U.S. origin

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• China Shipbuilders Criticize Trump's "short-sighted" US Port Fees

  China's Shipbuilders on Sunday blasted the U.S. Port Fees announced by Donald Trump's Administration on China-linked vessels as "shortsighted". The measure was aimed at China's shipbuilding sector. Trump signed an executive order on Wednesday to revive U.S. shipbuilding while reducing China's hold on the global shipping market. The next day, his government diluted the measures by protecting domestic exporters and vessel owner serving the Great Lakes region, Caribbean and U.S. territory. The dispute over ocean shipping, which carries 80% of all global trade, is just the latest in a trade war that has intensified between China and the U.S., pushing levies against each other's imported goods beyond 100%. China Association of the National Shipbuilding Industry has expressed "extreme anger and resolute resistance" against the U.S. measures, joining the protests of the government and the country's owners of ships. The shipbuilders stated that the decline of the U.S. industry of shipbuilding is due to its protectionist policies and has nothing whatsoever to do with China. It warned that the U.S. restriction would disrupt the global shipping system, cause a rise in shipping costs and increase U.S. prices, as well as harming the interests of the U.S. public. The industry group said that it expected the Chinese authorities to take strong measures to counteract the shortsighted U.S. behavior. On Friday, the government condemned "discriminatory steps" and urged Washington to "correct any wrongdoings." In a press release, the Ministry of Commerce pledged to "resolutely" take the necessary measures to protect our interests, saying that the fees "fully reveal its unilateralist and protective policies and are typical non-market practices". (Reporting and editing by Beijing Newsroom)

• Shippers around the world are waiting to hear if the US will be imposing port fees on vessels linked to China

  The U.S. Trade Representative will announce on Thursday its plan to levy port fees on China linked ships, as part of President Donald Trump’s efforts to revitalize domestic shipbuilding and combat China's dominance in the high seas. The USTR has a statutory deadline of April 17 to complete its remedies. After concluding that China is using unfair policies and practices in order to dominate global shipping, the agency concluded its investigation one year ago. U.S. trade representative Jamieson Greer said last week that the agency will not implement all aspects of its initial fee proposal. The original proposal outlined a variety of options for penalizing China, including million dollar port fees for vessels with ties to China. USTR did not comment immediately on its plans. This apparent revision was a result of a wave of public and privately expressed opposition by the global maritime sector, including domestic ports and vessel operators and U.S. importers and exporters of all kinds of commodities from bananas to coal. Greer stated that the fees could not be cumulative, and were designed to prevent economic harm. Separately, it was reported that the administration had been considering different options to soften its proposed port fee after receiving feedback in private meetings with industry representatives or through hundreds of online comments. Three sources who are tracking the issue and declined to identify themselves said that implementation could come as late November. The industry executives warned that the U.S. taxpayers and workers, as well as the U.S. shipbuilders, owners and operators the government wants to support, could be hurt if the plan is adopted without any adjustments. This is because the vast majority of the global shipping fleet will be subject to these huge fees. Ports of all sizes, including small-to-medium-sized ports, have expressed concern that ships would stop calling at their port if the USTR assessed a fee for each U.S. visit. Port executives warn that concentrating calls on larger ports will overwhelm these facilities and starve secondary ports, which have invested billions in infrastructure improvements. In a press release, Scott Chadwick said that the rule, as it is currently written, could have a significant impact on supply chains, which may cause unintended effects that hurt U.S. port and those who depend on global supply chains. The Southern California port houses General Dynamics' National Steel and Shipbuilding Co., which builds and repairs vessels. It also hosts cargo carrier Pasha with its U.S. built and flagged Jones Act vessel named Jean Anne, which makes two-weekly trips to Hawaii. Chadwick didn't elaborate on the impact of fees, but fewer ports calls in San Diego could translate into less ship repair activities for NASSCO as well as financial stress for terminal operators who serve Pasha and others customers. General Dynamics, as well as other U.S. military shipbuilders including Huntington Ingalls Industries, have standalone or in-port facilities. They didn't immediately respond. The Shipbuilders Council of America (which represents the industry) said that it supported Trump's efforts to restore and strengthen shipbuilding and ship repairs in the United States. In a letter addressed to USTR, Cary Davis, CEO of the American Association of Port Authorities, said that the proposed fees would undermine federal investments made in ports over many years, including dredging, new cargo handling equipment and expanded cargo terminals. He stated that some of these investments were made in Trump's first year. Davis wrote: "This proposal could turn many of these valuable investment that have created thousands of jobs, into assets that are stranded." AAPA declined to comment further. The Northwest Seaport Alliance, the Ports of Los Angeles Long Beach and Seattle and representatives from USTR met with officials in advance of the public hearings on cargo diversion that took place late March. The International Longshore and Warehouse Union, which represents the longshore workers of Union Pacific and Berkshire Hathaway's BNSF on the West Coast, joined them. Matt Leech is the CEO of Ports America in New Jersey, one of the biggest U.S. ports operators. You can't increase capacity by building new railroad lines or relocating an entire trucking fleet overnight. Reporting by Lisa Baertlein, Andrea Shalal and Jonathan Saul from Los Angeles; editing by Matthew Lewis

• Asian spot prices remain at a 1-year low amid supply disruptions

  The Asian spot LNG prices remain at an all-time low, following supply disruptions in three export facilities. Some buying interest has also been seen to help offset the overall lackluster demand. Average LNG price for delivery to North-East Asia in June Industry sources estimate that the price of a million British thermal unit (mmBtu) was $11,50, down from $11,80/mmBtu a week ago but still its lowest level since mid-May. "Lower Asian gas prices this week encouraged opportunistic purchases by some East Asian importers while supply disruptions in Australia and Brunei supported otherwise falling regional fundamentals," stated Rystad senior analysts Masanori Odaka. He added that Korea Gas Corporation of Taiwan, CPC Corporation of China and a Chinese buyer had made recent spot purchases. While some Asian importers took the opportunity to buy at a discount, others waited and watched as they assessed turbulent market conditions while maintaining sufficient storage levels. Inpex Corp., the company that operates Australia's Ichthys LNG plant, has said the rate at which production is being carried out temporarily decreased, but did not specify why or when it would be restored to full production. Sources in Southeast Asia said that the Bintulu LNG plant and the Brunei LNG facility were both experiencing production problems. Brunei LNG cancelled a tender it issued for a cargo delivered in June. Martin Senior, director of LNG pricing for commodities pricing agency Argus, said that despite production outages in Pacific, the interbasin arbitrage remained closed to ensure prompt deliveries. Only one carrier diverted in mid-Atlantic toward Asia on 16 April. Since the production interruptions, he stated that "Asian buyers" have not made any significant moves to compete for Atlantic Basin cargoes. S&P Global Commodity Insights, a commodity research firm in Europe, assessed the daily North West Europe (NWM) LNG Marker price benchmark on April 16 at $11.124/mmBtu. This is a $0.735/mmBtu reduction from the June gas prices at the Dutch TTF Hub. Spark Commodities set the price of the June delivery at $10.94/mmBtu. Argus, on the other hand, put the price for May at $10.945/mmBtu. Senior said that "discounts for the TTF in May remain $0.20/mmBtu higher than in June, due to maintenance on regasification terminals in Northwest Europe in May, which has forced buyers to look for regasification slots at more expensive terminals or terminals delivering fuel to hubs with lower prices than the TTF." According to Spark Commodities analyst Qasim Afghanistan, the U.S. forward month arbitrage for north-east Asia through the Cape of Good Hope now points only marginally to Europe. He added that in LNG freight, Atlantic rates have dropped for the fourth consecutive week, to $21,750/day, on Thursday. Pacific rates, meanwhile, are now at $23,250/day. Emily Chow reported on this story.

• Sources say that STS transfers have helped to boost Russian Arctic oil exports from China.

  According to traders and Vortexa data, Russia's Arctic Oil exports to China will rise dramatically this month. This is due to a surge in ship-to -ship transfers on the seas to ensure that tankers arriving at ports are not listed as U.S. sanctioned ships. In January, the U.S. imposed broader sanctions on all crude oil tankers such as ARCO, Novy Port, and Russian producer Gazprom. According to traders and Vortexa Senior Analyst Emma Li, to avoid the curbs, STS transfers of cargoes take place in international waters near Singapore and Malaysia, where cargoes will be loaded onto Very Large Crude Carriers that aren't subject to sanctions, before heading to Chinese ports. Li estimated that at least 4 million barrels Arctic oil finished STS last month and 16 millions more are arriving, or will arrive in the South China Sea, this month. She added that China's Arctic Oil imports have risen due to the abundance of oil. However, the final volume will depend on logistical hurdles and whether Chinese refiners show interest in buying it. Gazprom, the Russian oil exporter, did not respond immediately to a request for a comment. Vortexa reports that China imported Arctic oil from Russia at an average of 25,000 barrels a day (bpd) in March. China has stated that it is opposed to unilateral sanctions imposed by the United States and other countries in order to curb Russian, Iranian and Venezuelan energy revenues. According to one trader STS transfers have been used because Chinese buyers are wary about secondary sanctions, and willing to pay more for STS cargoes. Kpler data show that the VLCC Atila, for example, loaded 2,07 million barrels ARCO in March from two tankers sanctioned in Singapore waters and delivered the cargo in April to China's Dongying port in eastern Shandong Province. Atila has previously been involved in STS transfers of Iranian oil. Arctic grades, ARCO, Novy Port and Varandey, are produced in Russia’s northern regions where harsh winter weather impacts production and oil project investments require huge investment. It is difficult to track the exports of these grades because they are usually shipped from oilfields into floating storage in Murmansk, and then sent to end users. The STS adds to the shipping costs. The North Sea Route to China (NSR), the shorter route, is closed until July. One trader stated that the route was very expensive and long. "The only solution is to evacuate the barrels." The traders stated that light Arctic oil was offered at a discount to Brent benchmark prices. Previously, it had been sold at a premium. Some of the Arctic oil cargoes will not be able to find a new home anytime soon, as they are currently being stored on vessels. LSEG data shows that the tanker Fast Kathy, for example, loaded Arctic oil at Murmansk in March and has been cruising off Port Said (Egypt) since April 9. Traders said that India, which was previously the largest buyer of Arctic oil due to sanctions has reduced purchases. Traders said that the majority of Arctic oil sold to India by Litasco is Varandey, supplied by Russia's Lukoil. Lukoil didn't immediately respond to our request for comment. The Indian authorities have banned a tanker, carrying a cargo of Russian crude oil, from conducting an STS operation near the port of Mumbai. Myanmar and Syria are also Arctic oil buyers. Myanmar received its first shipment of Arctic oil earlier this year.

• Sources say that exports of Russian Arctic oil sanctioned to China are expected to increase in April.

  The export of Russian Arctic oil to China is expected to increase sharply in April, after sellers offered large discounts and shipped on non-sanctioned tanks to counter an embargo by the United States. This was according to two Russian oil traders and analytics firm Vortexa. The Arctic oil trade accounts for a tenth (or 10%) of Russia's seaborne crude oil exports. This business was disrupted when Washington imposed sweeping sanctions in January against nearly all tankers that carried supplies of grades like ARCO, Novy port, Varandey and Gazprom Neft. The traders and Vortexa Senior Analyst Emma Li said that to avoid the curbs such cargoes are transferred via international waters near Singapore and Malaysia, to Very Large Crude Carriers without sanction, a transfer process known as Ship-to-Ship (STS), before they head to China. Li estimates that at least 4,000,000 barrels of Arctic Oil completed STS last Monday and 16,000,000 more are arriving, or will arrive in the South China Sea during this month. The abundant supply of Arctic oil will likely lead to a rebound in China's imports. However, the final volume discharged may vary depending on logistical challenges and the buying interest of Chinese refiners. Lukoil and Gazprom Neft didn't immediately respond to requests for comment. In March, China imported 250.000 barrels of Arctic oil per day. A trader said that such transfers were used by many Chinese buyers who require their oil to be transported on vessels not sanctioned to avoid secondary sanctions. They are also willing to pay a higher price for these cargoes. Kpler data show that, for example, non-sanctioned VLCC Atila discharged 2.07 million barrels ARCO from two sanctioned tanks in Greater Singapore waters in March and then loaded the cargo in Dongying Port in eastern Shandong Province in April. Atila was previously involved in STS transfer for Iranian oil. The harsh climate in the northern regions of Russia affects production and logistics. Therefore, setting up a project to produce oil requires huge investments. Lukoil produces light Varandey, while Gazprom is the producer of heavy ARCO and Novy Port. The traders stated that the STS adds to the shipping costs and delays the shipments to China by two months. One trader stated that the route was very expensive and long. "The only solution is to evacuate the barrels." The traders stated that light Arctic oil was offered at a discount to Brent prices, compared to the premiums charged previously. Traders said that India, the former top buyer of Arctic Oil, has reduced purchases due to sanctions. Traders said that Litasco supplies most of the Varandey oil to India. The Indian authorities have prohibited a tanker from moving its Russian oil cargo on to another vessel in the sea. Myanmar and Syria are also potential buyers of Arctic oil. The first shipments took place in the early part of this year.

• China's Cofco hires dozens of farm workers in Brazil

  Cofco International, The building is constructing its biggest export port Terminal in the World in Brazil said Tuesday that China's state run food group is hiring dozens of people in South America's farm powerhouse. The move highlights the importance of Brazil for the company in the midst of an escalating trade war between the United States of America and China. This tends to increase sales of agricultural products such as soybeans from South American to Asian nations. Cofco's hiring spree in Brazil also comes as U.S.-headquartered competitors like Archer-Daniels-Midland Co and Cargill cut costs and headcount worldwide. Cofco responded to a question after a recruitment event by saying that there are vacancies in various departments and hierarchy levels. The majority of these are in the areas of operations, sales and trading, and administrative. It did not comment on the specific effects of tariffs on the Brazilian operation nor did it indicate how many jobs are available at the moment. Cofco has invested in Santos, the top soybean port of Brazil. It is also one of Brazil's biggest grain exporters, as well as a source and exporter for oilseeds, cotton, sugar and coffee. Cofco, as part of its expansion plan, is building a new grain terminal in Santos. It is expected to become operational by the end of this year. Cofco has already begun the tests for the first phase of the construction. The company's capacity to export grains at Santos, which is currently 4.5 million tons, will rise next year when the second phase should be completed. (Reporting from Roberto Samora, Sao Paulo. Writing by Ana Mano. Editing by Margueritachoy.)

• Swedish investigation finds no conclusive proof of intentional cable damage by Chinese ships

  The Swedish Accident Investigation Authority announced on Tuesday that there was no conclusive proof to support the claim that a Chinese vessel deliberately dragged anchors to damage two Baltic Sea cable. However, a separate investigation is still underway. On November 17-18, last year, the Yi Peng 3 Bulk Carrier was under investigation after it was found to have dragged its anchor in Swedish waters and damaged two fibre-optic communication cables, one connecting Finland and Germany, and another connecting Sweden and Lithuania. In a press release, the government agency that investigates accidents, incidents and other mishaps said: "It is not possible to determine with certainty whether or not a Chinese vessel intentionally damaged data cable in the Baltic Sea." Henrik Soderman, the Swedish prosecutor, said he is still investigating this case as part of a separate investigation. He declined to give any further details. It said that investigators were restricted by the fact that Chinese authorities still maintained jurisdiction over this vessel and prohibited criminal investigations or recording of interviews on board. In December, China said that it had given information and documents to the investigation of the severing cables. Meanwhile, its ally Russia denied any involvement in the Baltic infrastructure incidents. After a series of power outages, telecom links and gas pipelines, the Baltic Sea region has been on high alert. The NATO military alliance increased its presence by adding aircraft, frigates and naval drones. (Reporting by Louise Breusch Rasmussen, editing by Stine Jacobsen, William Maclean)

• Document shows that China and Vietnam will assess the viability of new rails.

  According to an agreement reviewed by, China and Vietnam agreed to begin feasibility studies on two new lines during Chinese President Xi Jinping’s visit to Hanoi last week. Both neighbours have been talking about upgrading two railways built by France more than 100 years ago and developing a third direct connection along their adjacent coast. In response to growing concern over U.S. Tariffs, Xi urged Vietnam Monday to strengthen its supply chains. Components made in China are often assembled before they are exported in the north of Vietnam. To Lam, Vietnam's top leader, said that the construction of three railways is "the highest priority" for infrastructure cooperation between China and Vietnam. He also encouraged China to provide concessionary loans. According to a two-page document of cooperation dated April 14 and seen by the, they agreed that China would carry out feasibility for two of the rail links planned, at a price of 9.95 million Yuan ($1.36million). According to the document which did not specify a deadline for the completion of the selection process, the studies will be conducted within 12 months after the selection of the contractor who will conduct the work. The agreement involves a railway that connects southern China's Guangxi Region to Vietnam's Hanoi capital, as well as a new line connecting the port cities Shenzhen Haiphong. The railway line between Nanning, Guangxi and Hanoi already exists. However, passengers and goods must switch trains at the border due to the Vietnamese gauge dating back to French colonial days not being compatible with China's high-speed tracks. The mistrust between two Communist-run nations, who fought a short border war in late 1970s, and clashed often over the disputed South China Sea has hindered progress on rail connections for many years. However, in recent months, economic considerations seem to have trumped security concerns. The Vietnamese Parliament announced in February that construction of a third railway connecting Vietnam's northern coastline to Kunming, China, will start this year. It is estimated the section through Vietnam will cost $8.3billion and partly be covered by loans from China. The French colonial period is also the origin of the Vietnamese section. No loan has been announced so far during Xi’s visit. The visit will conclude on Tuesday, after the official launch of "Vietnam China Railway Cooperation". It was not possible to determine what this cooperation involves and whether there are new commitments. Reporting by Francesco Guarascio, Phuong Nguyen and Kate Mayberry

• Chinese official: US tariffs aim to 'take Hong Kong's Life'

  Xia BAOLONG, one of China's highest officials in charge of Hong Kong affairs, stated on Tuesday that US tariff war is "extremely shameless", and aims to take away Hong Kong's "life". Xia said that bullying has never worked for Chinese people or Hong Kong residents. Xia stated that "let the peasants of the United States weep in front of 5,000 years of Chinese civilization". The Chinese do not create trouble nor are they scared of it. "Pressure, threats, and blackmail is not the way to deal China," Xia stated in a televised address on Hong Kong's National Security Education Day. These comments were made after China raised its tariffs on U.S. imports to 125%. This was in response to U.S. president Donald Trump's decision that China should be singled out for raising tariffs to 145% on Chinese goods. JD Vance, the U.S. vice president, said in China this month that the U.S. buys and borrows from "Chinese farmers". His remarks were condemned by China. Hong Kong, an administrative region of China that is a part of China but is not considered to be a separate entity, Washington has imposed tariffs on China because it no longer considers Hong Kong as a separate trading unit. This is due to a long-term crackdown by Washington under the National Security Law. Hong Kong's leader John Lee stated last week that unlike the mainland, Hong Kong as an international hub for free trade does not plan to impose retaliatory duties on the U.S. at this time. Beijing dismissed President Trump's tariff policy as "a joke." (Reporting and editing by Himani Sarkar, Stephen Coates and Himani Jim in Hong Kong.

• Bloomberg News reports that an Italian tycoon is the lead investor in CK Hutchison Ports

  Bloomberg News, citing sources familiar with the situation, reported that Gianluigi Aponte, an Italian billionaire, is the main investor in a group looking to purchase 43 ports from the conglomerate CK Hutchison. Bloomberg reported that the Terminal Investment Ltd. (TIL) of the Aponte family, which according to their website manages a portfolio of diverse container terminals, will become the sole owner of the ports after the deal has been completed. Two of the ports in Panama would then be controlled by BlackRock Inc. BlackRock Global Infrastructure Partners, a subsidiary of BlackRock, will own 51% and TIL the remainder of the two Panama Canal ports. CK Hutchison refused to comment. Port facilities along the strategic waterway make up about 4% the value of the entire deal. Bloomberg reported that Li Ka-shing is expected to receive more than $19 Billion in cash from CK Hutchison, citing a source familiar with the details. CK Hutchison is facing increasing criticism from China over its decision to sell the majority of its $22.8billion port business to BlackRock. Deal has become very political as conglomerate finds itself in the crosshairs an escalating trade war between the United States and China. After the report, shares of CK Hutchison rose by 3.1%, compared to a 2.1% increase in the Hang Seng Index.

• The Asian spot price of GLOBAL LNG has fallen to a near-year low due to weak demand and recession concerns

  The Asian spot price of liquefied gas (LNG), which is a product of the United States, fell to its lowest level in almost a year, due to weak demand, excessive stocks, and fears of a global economic recession caused by President Trump's tariffs. Average LNG price for delivery to North-east Asia in May Industry sources estimate that the price per million British Thermal Units (mmBtu) was $11,80, its lowest level since mid May. Estimated June delivery prices were $11,30/mmBtu. The price of Asian LNG is under pressure due to a weak seasonal demand and high inventories, as well as recession fears linked to the elevated U.S. China trade tensions, said Kpler analyst Go Katayama. He was referring to stocks in Japan and Korea. The 90-day tariff suspension by the U.S. may have sparked some optimism, but it's limited. And the continued tariffs against Chinese goods keep the market cautious, according to him. Restocking in Northeast Asia is subdued. It's unlikely that it will pick up until prices fall below $12/mmBtu, or unless weather forecasts become hotter. Trump's tariffs on dozens countries have roiled the global markets, causing concerns about a possible recession and escalating tensions between China and America. As a result of the tariffs, LNG importers are reselling cargoes sourced from the United States. Wei Xiong, a Rystad analyst, says that China's halt on U.S. LNG exports will likely continue. However, a muted growth in gas demand will limit the incremental LNG demand. She said that "the ongoing trade tensions, and higher tariffs, may increase the downside of the industrial sector as the export economy will likely slow down." S&P Global Commodity Insights, a commodity research firm in Europe, assessed the daily North West Europe (NWM) LNG Marker price benchmark on April 10 at $10.127/mmBtu for cargoes to be delivered by May ex-ship. This represents a discount of $0.805/mmBtu compared to the gas price at Dutch TTF hub. Spark Commodities set the price at $10.184/mmBtu for delivery in May, while Argus put it at $10.195/mmBtu. Angola LNG sold a cargo to France rather than Asia, despite the closure of the inter-basin west African arbitrage holding. According to Spark Commodities analyst Qasim Afghanistan, amid U.S. Tariff announcements on Monday, the U.S. Front Month Arbitrage to North-East Asia via Cape of Good Hope briefly achieved breakeven levels, before closing and pointing back to Europe. He added that in LNG freight, Atlantic rates had dropped for the third consecutive week, to $22,500/day, on Friday. Pacific rates were down to $24,750/day. (Reporting and editing by Shailesh Kumar)

• Cold winds sweep Beijing, closing key sites, disrupting travel

  China's capital, Beijing, hunkered in on Saturday after rare typhoons-like gales hit northern regions. The storms forced the closure of historical sites and disrupted travel. They also brought late snowfalls as well as hailstone showers to some areas. Wind gusts shook windows and cars, driven by a cold front from Mongolia. The vortex dropped temperatures by more than 12 degrees Celsius. The official Xinhua News Agency said that the winds will continue to blow over the weekend with gusts up to 150 kph. The winds brought hailstones to southern China and late snowfalls to Inner Mongolia. Beijing has issued its second highest gale warning this weekend for the first decade. It warned 22 million residents not to travel unless it was absolutely necessary, as the winds could break records from 1951. Flight Master, an app that tracks flights, showed 838 cancellations at the two main airports in the capital by 11.30 am. Historic sites and parks had also been closed, and some trees were trimmed to prepare for the cold. Winds forced the cancellation of a half marathon scheduled for Sunday, which featured humanoid robotics competing against humans to show off China's technological advancements. Xinhua, CCTV and other state media reported that sandstorms ravaging a stretch of road from Inner Mongolia up to the Yangtze River region had crippled travel in eight provinces. The spring winds that bring sand from Mongolia can be extreme, but climate changes have made them more frequent. Reporting Liam Mo in Beijing, writing by Greg Torode from Hong Kong and editing by Clarence Fernandez.