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SK Innovation reports improved refining margins for Q3, Q2 losses worsen
SK Innovation Co Ltd, the owner of South Korea’s largest refiner SK Energy said that it expected third-quarter margins for refining to improve, after losses increased in the second quarter. In a press release, SK Innovation stated that "Sales and Operating Profit fell compared to previous quarters due to difficult external environments such as global economic insecurity, tariff impact and falling oil price." It said that "further improvements are expected in refining profit margins in the third quarter. (And) easing of tariff risks, and increased sales volume in Europe for the battery business in Europe will positively impact earnings improvement." The company reported an operating loss for the period April to June of 418 billion won (about 301.20 millions dollars), compared to a loss of about 45.8 billion won one year ago. The results were lower than the average analyst's forecast of a 140 billion won (US) loss compiled by LSEG SmartEstimate. $1 = 1,387.8000 Won (Reporting and Editing by Himani Sark and Neil Fullick; Reporting by Joyce Lee and Heekyong Yay)
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Sources: Supertanker delivers oil from sanctioned Nayara Energy refinery to Vadinar
Five sources with knowledge of the situation said that the supertanker Kalliopi is currently discharging Iraqi crude oil for India's Nayara Energy. This is the first delivery of crude oil to the refiner after it was sanctioned. One source reported that more than half the two million barrels Basrah on the vessel were discharged. A second source stated that the unloading was expected to be complete on Thursday. Kpler's ship tracking data revealed that the supertanker was the first vessel to deliver crude oil to Nayara Vadinar Refinery in the last 12 days. Nayara didn't immediately respond to our request for comment. On July 18, the EU announced new sanctions against Russia and its energy industry that targeted Nayara. One source said that Nusa Merdeka has also delayed the discharge of Russian crude oil in Nayara port. The tanker, which was supposed to discharge Urals at Vadinar on July 26, has been hovering around the anchorage since then. The tanker's failure to discharge on time was not immediately apparent. Last week, the oil carrier Omni that was carrying Russian Urals crude from Nayara Energy Vadinar diverted to the port of Mundra (India) in order to discharge its cargo. Nayara has reported that its crude production at the 400,000 barrels per day site, owned in majority by Russian companies, is now between 70 and 80 percent. While product tankers loaded with fuel from Nayara Energy’s Vadinar facility are still afloat, they have not been discharged as traders and shippers avoid the issue. (Reporting and editing by Jan Harvey, Nidhi verma, Mohi narayan)
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Airbus asks Dassault to make a decision after tensions between fighters
Europe's Airbus challenged its partner Dassault Aviation on Wednesday to "decide what it wants to do" after Dassault questioned arrangements for a new fighter, in the latest sign of tensions over the Franco-German-Spanish project. Dassault Airbus, two rivals in the industry who were asked to collaborate after French President Emmanuel Macron launched the Future Combat Air System initiative (SCAF) in 2017, and the then German Chancellor Angela Merkel announced the launch of the initiative. They have been at odds over the management of the project that aims to replace the current warplanes before 2040. Last week, Dassault Aviation CEO Eric Trappier demanded a clearer leadership for the project. He accused Airbus, of interfering with the core crewed-fighter part of the Pillar One project, which is being led by Dassault, and causing delays. Dassault is representing France, and Airbus represents Germany and Spain, in this project. It is currently in an early design phase known as Phase 1B. A second phase will be launched next year, aimed at building the demonstrator. Airbus CEO Guillaume Faury said to reporters on Wednesday at a results mid-year briefing that "there is an agreed governance" for the launch Phase 1B. We are part of this governance. He said, "If there is an industrial partner in one of the pillars who is unhappy with the governance they can decide what to do. I will leave it up to them." "But we will continue to serve Airbus and the countries that have contracted with us for Phase 1B and continue the program." When it comes to Airbus we continue. Dassault was not available for immediate comment. The project is under threat of collapse due to rising tensions. This follows France's decision in the 1980s to abandon the Eurofighter program and develop the Rafale. Trappier responded that the future of the program was at risk when asked last week whether Dassault feared to abandon the current project. The project is known as SCAF in French. He said, "It's not about leaving SCAF. It's about deciding whether it will continue or not." He denied that Dassault wanted 80% of the control. Airbus, which represents Germany and Spain, covers two thirds of the project under the current framework. Each company is also responsible for the day-today management of certain parts of the project. This includes a system of drones that are paired with each fighter. Defense News reported that Germany's Boris Pistorius, after meeting with his French counterpart the previous week, said Germany and France will seek to clarify the current situation by the end the year. (Reporting and editing by Jamie Freed; Tim Hepher)
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Panama auditor files lawsuit to cancel CK Hutchison's port contract
Anel Flees, Panama's comptroller-general, announced on Wednesday that he filed a lawsuit in the Supreme Court of the country against a contract for the operation of ports near the Panama Canal held by a firm owned by Hong Kong's CK Hutchison. Flores stated that the two lawsuits were filed to declare the unconstitutionality of the port contracts for Balboa & Cristobal and nullify them. The Supreme Court must still accept the request for the complaint of the comptroller. The lawsuits are the result of a month-long audit led by Flores who publicly complained about the contract not serving the nation's interest. Flores did not make the audit public but stated on Wednesday that "many irregularities" had been revealed. A complaint can throw you for a loop In a planned deal, a consortium of MSC, the family-owned shipping company of Italian billionaire Gianluigi Aponte BlackRock, a U.S. investment company, has bought out the majority of CK Hutchison’s global port business including both ports. CK Hutchison owns 90% of the local Panama Ports Company. The company's 25-year concession for the operation of the ports was renewed in 2021. Reports indicate that the Chinese state-owned shipping company COSCO has been under pressure to sell its shares. You can also bring in other parties to the deal Flores stated, "They're talking about billion dollar deals, but they don't include Panama as the real owner of the Panamanian port." "We are not satisfied, and that is why we took the actions we did." Reporting by Elida Moreno; writing by Kylie Madry, editing by Brendan O'Boyle
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Heathrow Airport expansion plans are being considered by Britain in comparison with rival proposals
The British government will examine rival plans for expanding Heathrow, the country's largest airport in the next few months. This comes after the Arora Group announced on Thursday that it had submitted a proposal to build a new terminal and runway. Rachel Reeves, the Finance Minister, said that she wants Heathrow Airport to build a second runway in January. She is firmly in favor of expansion after years of indecision as governments have weighed environmental concerns versus growth. Heathrow Airport's plans for expansion will be submitted. Based on a plan from 2020, it is likely that a full length runway and the relocation of a portion of London's M25 autobahn are included. The government will compare that plan with the Arora Group. Heathrow Airport, located west of London is Europe's busiest hub. It operates at maximum capacity. Heathrow's two runways are in direct competition with the four runways at Charles de Gaulle Airport in Paris, Frankfurt Airport and Schiphol Airport Amsterdam. Arora Group which owns hotels, land and other properties near Heathrow has announced its Heathrow West plan. The plan includes a new terminal, a 2,800-metre runway (3,062-yards) which is too short to accommodate some of the largest aircraft. Arora Group stated that the plan is a "cost efficient solution" and does not require moving the M25. The cost of the development is estimated to be 25 billion pounds ($33.22billion). British Airways, IAG and other airlines have complained for years that Heathrow airport is among the most expensive in the world. They are worried about the impact of expansion on fees. A shorter runway that is suitable for modern aircrafts is part of the answer. IAG spokesperson stated that avoiding the M25 would reduce complexity, lower costs and improve value for passengers. $1 = 0.7527 pounds (Reporting and editing by Barbara Lewis; Sarah Young)
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Public Storage lifts 2025 forecast, misses Street estimates; shares fall
Public Storage, the operator of storage facilities, raised its core 2025 funds from operations forecast (FFO), citing an increased pace of acquisitions as well as stabilizing operations. The company expects to achieve annual core FFO of between $16.45 per share and $17, as opposed to the previous expectation of $16.35 per share and $17. The midpoint is below analyst estimates of $16.84 a share, according LSEG data. After-hours, shares of the company dropped by 1.3%. CEO Joe Russell said, "We have raised our outlook due to stabilizing operations and an increased acquisition volume." Russell said that "we are investing more than $1 billion in acquisitions and developments this year." The company's profit has been affected by higher operating costs due to inflation and a decline in the occupancy of storage units. Public Storage, a company that leases monthly storage space for both personal and commercial use, has reported revenue of $945.2 million for the three months ended June 30. This compares to analyst estimates of $1.19billion. Core FFO was $4.28 per share for the second quarter, compared with Wall Street expectations of $4.24. The company announced that it has appointed Luke Petherbridge to its board as a new trustee, with immediate effect. He will be a member in the committees for nominating, sustainability, and governance. (Reporting from Abhinav Paramar in Bengaluru, Editing by Mohammed Safi Shamsi.)
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Extra Space Storage's core FFO for the second quarter is below expectations
July 30th - Extra Space Storage, the U.S. operator of self-storage units, missed analyst's expectations for core funds generated from operations (FFO), for the second quarter. This was due to a decline in net operating income at same-stores. Salt Lake City-based real estate trust, a real estate investment trust, has also lowered its forecast for full-year core fund from operations (FFO), from $8.00 per share to $8.25. After-hours trading saw a 4.1% drop in the shares of the company. Since the beginning of the year, they have lost 0.2% in value. As they deal with fluctuating occupancy rates and increasing competition in key markets, self-storage REITs such as Extra Space face a growing challenge of weakened pricing power. The Company said that as of June 30, it managed 1,749 retail stores for third parties, and 414 in joint ventures unconsolidated. The REIT reported an occupancy rate of 94.6% in its same-stores for the quarter compared to 94% during the same period last year. The company reported that the same-store net income had declined by 3.1%. It reported core FFO for the second quarter of $2.05 per common share, which was lower than analysts' expectations of $2.06 a share. The total revenue for the three months ended on June 30 increased from $810.7 millions in the same period last year to $841.6. Analysts expected revenue of $761.9 million on average for the quarter.
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C.H. Robinson's profits beat Q2 estimates due to cost-cutting and weaker revenue
Global freight forwarder C.H. Robinson, a global freight forwarder, reported a second-quarter profit that was above Wall Street expectations on Wednesday. Cost-cutting measures including job cuts helped offset the impact of declining revenue in its ocean and truckload shipping businesses. According to LSEG data, the Minnesota-based firm reported an adjusted profit of $1.29 for the quarter ending June 30 compared to analysts' average estimates of $1.16. Total direct expenses decreased 9.2% during the quarter due to cost-saving measures and the divestiture from its European Surface Transport business. The number of employees at the company decreased by 1,616 or 11.2% on an annual basis, to 12,858. Revenue fell 7.7%, to $4.14 Billion. This was below expectations of $4.17 Billion largely because the ocean services were priced lower and fuel surcharges on truckload operations were reduced. C.H. C.H. After-hours, the shares of the company increased by more than 2%. Since the beginning of the year, they have dropped close to 6%. (Reporting from Abhinav Paramar in Bengaluru, Editing by Tasim Zaid)
As tariffs hit, Peru, the top blueberry supplier in the USA, looks to China.
Blueberry bushes as tall as two meters stretch to the horizon in Peru's Pisco Desert before giving way to dunes. Genetic innovations have allowed varieties such as Eureka Sunset to grow in this type of arid terrain, some 250 km (155 miles south of Lima). Since more than a century, the healthy berries are being shipped north to U.S. grocery shelves. But there's a new competitor in town: China.
The United States is fighting a trade war with other countries, and Peruvian growers are seeking new markets to sell their products. Their best customer, America, has been increasing the tariffs on its partners. China is insatiable and built a new port near Lima to cut shipping times across the Pacific by half.
The export share will change to other markets, said Miguel Bentin. He is the general manager of the Valle y Pampa Farm, a major blueberry producer that began production in 2012. At the time, the harvest was a tenth the size of what it is now.
Deserts have long been used to grow grapes for Pisco brandy (the base of Pisco Sour cocktail). But blueberry farmers transformed the landscape, drilling up to 100 meters deep wells to provide water to the crops, and hiring workers to take care of them. Bentin claims that they are now looking for new customers. Bentin said at the farm that the full potential of China's market for our products had not yet been realized. Valle y Pampa ships 60 percent of its blueberries in the United States, and the other 40 percent to Europe. It is, however, planning to make its first large shipment to China this year in order for it not be affected by the 10% U.S. duty on all Peruvian goods.
According to a half dozen ministers and officials from the agriculture and export sector, as well as government presentations, Peru will surpass Chile by 2021 in terms of exports. The blueberry industry has also been expanding into new markets.
In mid-May, Ursula Leon, Peru's Minister of Foreign Trade and Tourism, said that the search for new markets for agricultural exports in Asia, Europe, and Oceania has intensified. She explained that U.S. Tariffs could slow down the booming growth of deep purple fruits that boosted Peru exports by $2.3 billion in 2013. The 2025-2026 crop is expected to increase by 25%, to 400,000 tonnes. After a meeting, Leon said that if the U.S. Tariff Measure is maintained, there will be a decline in shipments in the agricultural and textile sectors, as well as in mining. She listed India, Indonesia and China among the markets that have growth potential. Peru is in negotiations to eliminate U.S. Tariffs that it claims violate a free-trade agreement. Prices will rise for U.S. customers if supplies from Peru decline. Andean countries are the top suppliers of blueberries in the United States, ahead of Mexico and Chile. Tariffs could affect product availability because a large portion of produce is imported into the U.S., and cannot be produced locally. Ben Wynkoop, Global Industry Strategist of Grocery & Convenience at Blue Yonder which provides supply-chain software to global retailers, said.
He added that, depending on the severity, small retailers with little negotiation power could face inventory shortages. This is especially true for blueberries.
Gabriel Amaro is the head of the Peruvian Association of Agricultural Producers' Guilds. He said that farmers are lobbying government to find a way to protect the free-trade agreement and soften the impact.
Our strategy is to diversify the market. We have a list of products to help us open markets in Asia.
David Magana is a senior research analyst with Rabobank who has a specialization in the global fruit markets. He downplayed any impact tariffs may have had. He said that China produces more berries than the United States for more months in the year.
Magana added, "I don't believe anyone in the industry expects China to overtake the U.S.A. as the primary source of Peruvian blueberries."
CHINA-OWNED, PORT A IS A GAME CHANGER
Peru's larger farm exports, which include grapes and avocados, rose by 22% last year to $12.8 billion. These were mainly exported to the United States of America and Europe. Blueberry exports fell 30% in the first quarter this year compared to last year due to a shift in harvest timing. Even as U.S. quarterly shipments decreased, shipments to China increased, albeit from a lower baseline. Chancay in Peru, the new Chinese-controlled Port, reduces sea travel times to Asia by half, to 20 days. This is a great advantage for fruit preservation. Guangzhou, a port in China, opened a direct route from Chancay to the rest of Asia.
Chancay was used by Fruitist to ship 15-18 containers worth of blueberries from the United States to China in late 2018. Fruitist is a U.S.-based fruit company that exports most of its blueberries out of Peru. John Early, Fruitist’s director of global business, said that the system transforms the logistics and shipping for anyone who is involved in the fresh fruit industry in Peru. There is a great opportunity to grow that business in China.
Bentin, the manager of Valle y Pampa in the Pisco desert, agreed. He predicted a noticeable rise to China once the harvest peaks around August. He said that the port of Chancay is a game-changer, due to its lower costs and quicker transit times.
(source: Reuters)