Russia engaged in more extensive oil exports to North Korea than had been previously reported, by setting up an illicit trade network that is likely still being used today to evade United Nations sanctions, according a South Korean research organization.

A recent report issued by the Asan Institute for Policy Studies in Seoul used Russian customs data to document how “one North Korean state enterprise purchased 622,878 tons of Russian oil worth $238 million,” between 2015 and 2017.”

While China is North Korea’s main oil supplier, the ASAN estimate for Russian oil exports to North Korea is significantly higher than the $25 million in sales for the same period that was reported by the Korea International Trade Association (KITA) in Seoul.

“Smuggling has always been an important element in the cross-border trade between North Korea and it’s important allies. What the Chinese government and the Russian government to a lesser extent have been doing is to turn a blind eye to these activities,” said Go Myong-Hyun, a North Korea analyst with the Asan Institute For Policy Studies in Seoul.

Russian evasions

The Asan report comes amid allegations that Russia potentially violated international sanctions imposed on North Korea by granting thousands of new work permits to North Korean laborers. Moscow had denied any such actions.

The Trump administration also imposed targeted U.S sanctions on a Russian bank for allegedly doing business with a person blacklisted for involvement with North Korea’s nuclear weapons program.

On Friday U.S. Ambassador to the United Nations Nikki Haley called the allegations against Russia, “very troubling.” U.S. Secretary of State Mike Pompeo called on “the Russians and all countries to abide by the U.N. Security Council resolutions and enforce sanctions on North Korea,” while attending the ASEAN Regional Forum in Singapore on Saturday.

United Nations sanctions imposed in September of 2017 prohibit member countries from “providing work authorizations” permits to North Korean workers.

In December of 2017 the U.N. Security Council further strengthened the sanctions to cut North Korean oil imports by a third, and to impose a total export ban on North Korea’s $3 billion coal and other mineral industries, its $800 million clothing manufacturing output, and its lucrative seafood industry.

Shell companies

The ASAN report is centered on the activities of the Independent Petroleum Company (IPC), a Russian firm that the U.S. Treasury Department targeted in June 2017 for violating restrictions on selling oil to North Korea. IPC has since changed its name. 

IPC was found to have sold large quantities of oil to Russian affiliated companies, such as the Pro-Gain Group Corporation (PGGC) that was actually operating on behalf of North Korea’s state owned Foreign Trade Bank. The North Korean bank has been under U.S. sanctions since 2013.

“The entities involved tried to cover up the transactions by falsifying destination countries for the purchases,” said the ASAN report entitled The Rise of Phantom Traders.

The report notes that PGGC is owned by Taiwan citizen Tsang Yung Yuan. Tsang was sanctioned earlier this year by the U.S. for facilitating North Korean coal exports using a Russia-based North Korean broker. PGGC has headquarters listed both in Taipei and Samoa.

North Korea has also been accused of conducting illicit ship-to-ship transfers of oil, and to conceal these operations by disabling the Automatic Identification System (AIS) transponder of vessels in order to hide their location. There have also been reports of North Korea changing vessel names and identification numbers, even painting over or altering the numbers on the ships’ exteriors.

Rajin-Khasan Exemption

A large number of oil shipments were also delivered to the Russian-North Korean border village of Khasan, which is connected by rail to the North Korean port terminal at Rajin.

The Rajin-Khasan rail project was exempted from U.N. sanctions to allow Russia to use the North Korean seaport to export Russian coal.

Trade records show that oil deliveries arriving in Khasan were on their way to China, but the report suggests it is more likely North Korea was the final destination. Since 2015, the ASAN report says, only PGGC and Velmur, two companies with ties to North Korea, listed Khasan as the point of delivery for oil shipments. 

According to the ASAN report, Moscow and Pyongyang are likely exploiting the Rajin-Khasan rail exemption to evade restrictions on North Korean oil imports.

In 2016, South Korea suspended its participation in the Rajin-Khasan rail project to comply with U.S. unilateral sanctions imposed on North Korea trade.

Recently some officials in Seoul have called for these sanctions affecting the Rajin-Khasan Project to be lifted, so that investment can proceed in connecting South Korean rail both to North Korea, and to the intentional railway system beyond that can reach Europe.

Sanctions effectiveness

The sanctions are intended to cut North Korea off from foreign currency and materials needed for weapons production, and to impose economic pain on the leadership to persuade Pyongyang to give up its nuclear and ballistic missile development programs.

Despite increased reports of sanctions evasions, Cheong Seong-chang, a North Korea analyst with the Sejong Institute in South Korea, says the recent report of an 88 percent decline in North Korean trade in the first quarter of this year indicates the economic situation there is in dire condition.

“If the sanctions from the U.N. Security Council continue, economic breakdown in North Korea will be inevitable,” said Cheong.

Talks between Washington and Pyongyang have made little significant progress toward ending the North’s nuclear program since June, when North Korean leader Kim Jong Un reaffirmed his commitment to denuclearization during his meeting with U.S. President Donald Trump in Singapore.

The U.S. insists that the North completely end it nuclear weapons program before any concessions are granted, while Pyongyang wants early sanctions relief.

On Sunday Pompeo said that North Korean Foreign Minster Ri Yong Ho reiterated a “very clear” commitment to denuclearize when the two met at the ASEAN conference in Singapore.

Lee Yoon-jee contributed to this report.
…

Russia engaged in more extensive oil exports to North Korea than had been previously reported, by setting up an illicit trade network that is likely still being used today to evade United Nations sanctions, according a South Korean research organization.

A recent report issued by the Asan Institute for Policy Studies in Seoul used Russian customs data to document how “one North Korean state enterprise purchased 622,878 tons of Russian oil worth $238 million,” between 2015 and 2017.”

While China is North Korea’s main oil supplier, the ASAN estimate for Russian oil exports to North Korea is significantly higher than the $25 million in sales for the same period that was reported by the Korea International Trade Association (KITA) in Seoul.

“Smuggling has always been an important element in the cross-border trade between North Korea and it’s important allies. What the Chinese government and the Russian government to a lesser extent have been doing is to turn a blind eye to these activities,” said Go Myong-Hyun, a North Korea analyst with the Asan Institute For Policy Studies in Seoul.

Russian evasions

The Asan report comes amid allegations that Russia potentially violated international sanctions imposed on North Korea by granting thousands of new work permits to North Korean laborers. Moscow had denied any such actions.

The Trump administration also imposed targeted U.S sanctions on a Russian bank for allegedly doing business with a person blacklisted for involvement with North Korea’s nuclear weapons program.

On Friday U.S. Ambassador to the United Nations Nikki Haley called the allegations against Russia, “very troubling.” U.S. Secretary of State Mike Pompeo called on “the Russians and all countries to abide by the U.N. Security Council resolutions and enforce sanctions on North Korea,” while attending the ASEAN Regional Forum in Singapore on Saturday.

United Nations sanctions imposed in September of 2017 prohibit member countries from “providing work authorizations” permits to North Korean workers.

In December of 2017 the U.N. Security Council further strengthened the sanctions to cut North Korean oil imports by a third, and to impose a total export ban on North Korea’s $3 billion coal and other mineral industries, its $800 million clothing manufacturing output, and its lucrative seafood industry.

Shell companies

The ASAN report is centered on the activities of the Independent Petroleum Company (IPC), a Russian firm that the U.S. Treasury Department targeted in June 2017 for violating restrictions on selling oil to North Korea. IPC has since changed its name. 

IPC was found to have sold large quantities of oil to Russian affiliated companies, such as the Pro-Gain Group Corporation (PGGC) that was actually operating on behalf of North Korea’s state owned Foreign Trade Bank. The North Korean bank has been under U.S. sanctions since 2013.

“The entities involved tried to cover up the transactions by falsifying destination countries for the purchases,” said the ASAN report entitled The Rise of Phantom Traders.

The report notes that PGGC is owned by Taiwan citizen Tsang Yung Yuan. Tsang was sanctioned earlier this year by the U.S. for facilitating North Korean coal exports using a Russia-based North Korean broker. PGGC has headquarters listed both in Taipei and Samoa.

North Korea has also been accused of conducting illicit ship-to-ship transfers of oil, and to conceal these operations by disabling the Automatic Identification System (AIS) transponder of vessels in order to hide their location. There have also been reports of North Korea changing vessel names and identification numbers, even painting over or altering the numbers on the ships’ exteriors.

Rajin-Khasan Exemption

A large number of oil shipments were also delivered to the Russian-North Korean border village of Khasan, which is connected by rail to the North Korean port terminal at Rajin.

The Rajin-Khasan rail project was exempted from U.N. sanctions to allow Russia to use the North Korean seaport to export Russian coal.

Trade records show that oil deliveries arriving in Khasan were on their way to China, but the report suggests it is more likely North Korea was the final destination. Since 2015, the ASAN report says, only PGGC and Velmur, two companies with ties to North Korea, listed Khasan as the point of delivery for oil shipments. 

According to the ASAN report, Moscow and Pyongyang are likely exploiting the Rajin-Khasan rail exemption to evade restrictions on North Korean oil imports.

In 2016, South Korea suspended its participation in the Rajin-Khasan rail project to comply with U.S. unilateral sanctions imposed on North Korea trade.

Recently some officials in Seoul have called for these sanctions affecting the Rajin-Khasan Project to be lifted, so that investment can proceed in connecting South Korean rail both to North Korea, and to the intentional railway system beyond that can reach Europe.

Sanctions effectiveness

The sanctions are intended to cut North Korea off from foreign currency and materials needed for weapons production, and to impose economic pain on the leadership to persuade Pyongyang to give up its nuclear and ballistic missile development programs.

Despite increased reports of sanctions evasions, Cheong Seong-chang, a North Korea analyst with the Sejong Institute in South Korea, says the recent report of an 88 percent decline in North Korean trade in the first quarter of this year indicates the economic situation there is in dire condition.

“If the sanctions from the U.N. Security Council continue, economic breakdown in North Korea will be inevitable,” said Cheong.

Talks between Washington and Pyongyang have made little significant progress toward ending the North’s nuclear program since June, when North Korean leader Kim Jong Un reaffirmed his commitment to denuclearization during his meeting with U.S. President Donald Trump in Singapore.

The U.S. insists that the North completely end it nuclear weapons program before any concessions are granted, while Pyongyang wants early sanctions relief.

On Sunday Pompeo said that North Korean Foreign Minster Ri Yong Ho reiterated a “very clear” commitment to denuclearize when the two met at the ASEAN conference in Singapore.

Lee Yoon-jee contributed to this report.
…

British Trade Minister Liam Fox said “intransigence” from the European Union was pushing Britain toward a no-deal Brexit, in an interview published on Saturday by the Sunday Times.

With less than eight months until Britain quits the EU, the government has yet to agree a divorce deal with Brussels and has stepped up planning for the possibility of leaving the bloc without any formal agreement.

Fox, a promiment Brexit supporter in Prime Minister Theresa May’s cabinet, put the odds of Britain leaving the European Union without agreeing upon a deal over their future relationship at 60-40.

“I think the intransigence of the commission is pushing us towards no deal,” Fox told the Times after a trade mission in Japan.

“We have set out the basis in which a deal can happen, but if the EU decides that the theological obsession of the unelected is to take priority over the economic well-being of the people of Europe, then it’s a bureaucrats’ Brexit — not a people’s Brexit — [and] then there is only going to be one outcome.”

It was up to the EU whether it wanted to put “ideological purity” ahead of the real economy, Fox said.

If Britain fails to agree the terms of its divorce with the EU and leaves without even a transition agreement to smooth its exit, it would revert to trading under World Trade Organization rules in March 2019.

Most economists think this would cause serious harm to the world’s No. 5 economy as trade with the EU, Britain’s largest market, would become subject to tariffs.

Supporters of Brexit say there may be some short-term pain for Britain’s $2.9 trillion economy, but that in the long term it will prosper when cut free from the EU, which some of them cast as a failing German-dominated experiment in European integration.

On Friday, Bank of England Governor Mark Carney said the chances of a no-deal Brexit had become “uncomfortably high.”
…

Honeybees are essential to our food supply, but bee colonies around the world are declining. Among the main culprits are insecticides containing chemicals known as neonicotinoids, which are highly toxic to honeybees. In Europe, where about 80 percent of crops rely to some degree on insect pollination, the chemical is banned but exceptions allowed. Poland’s agriculture ministry has temporarily approved it for use in rapeseed crops, worrying the country’s beekeepers. VOA’s Julie Taboh has more.
…

Honeybees are essential to our food supply, but bee colonies around the world are declining. Among the main culprits are insecticides containing chemicals known as neonicotinoids, which are highly toxic to honeybees. In Europe, where about 80 percent of crops rely to some degree on insect pollination, the chemical is banned but exceptions allowed. Poland’s agriculture ministry has temporarily approved it for use in rapeseed crops, worrying the country’s beekeepers. VOA’s Julie Taboh has more.
…

China’s targeting of U.S. liquefied natural gas and crude oil exports opens a new front in the trade war between the two countries, at a time when the White House is trumpeting growing U.S. energy export  prowess.

China included LNG for the first time in its list of proposed tariffs on Friday, the same day that its biggest U.S. crude oil buyer, Sinopec, suspended U.S. crude oil imports due to the dispute, according to three sources familiar with the situation.

On Friday, China announced retaliatory tariffs on $60 billion worth of U.S. goods, and warned of further measures, signaling it will not back down in a protracted trade war with Washington.

That could cast a shadow over U.S. President Donald Trump’s energy dominance ambitions. The administration has repeatedly said it is eager to expand fossil fuel supplies to global allies, while Washington is rolling back domestic regulations to encourage more oil and gas production.

“The juxtaposition here is clear: It is hard to become an energy superpower when one of the biggest energy consumers in the world is raising barriers to consume that energy. It makes it very difficult,” said Michael Cohen, head of energy markets research at Barclays.

The U.S. is the world’s largest exporter of fuels such as gasoline and diesel, and is poised to become one of the largest exporters of LNG by 2019. U.S. LNG exports were worth $3.3 billion in 2017. China is the world’s biggest crude oil importer.

China had curtailed its imports of U.S. LNG over the last two months, even before its formal inclusion in the list of potential tariffs. It had also become the largest buyer of U.S. crude oil outside of Canada, but Kpler, which tracks worldwide oil shipments, shows crude cargoes to China have also dropped

off in recent months.

It comes at a time when the United States has several large-scale LNG export facilities under construction, and after Trump’s late 2017 trip to China that included executives from U.S. LNG companies.

China became the world’s second-biggest LNG importer in 2017, as it buys more gas in order to wean the country off dirty coal to reduce pollution.

“This will not affect the trade but will simply make gas more expensive to Chinese consumers,” said Charif Souki, chairman of Tellurian Inc, one of several companies seeking to build a new LNG export terminal.

China, which purchased almost 14 percent of all U.S. LNG shipped between February 2016 and May 2018, has taken delivery from just one vessel that left the United States in June and none so far in July, compared with 17 in the first five months of the year.

“The U.S. gas industry will be much harder hit by this as China imports only a small volume whereas U.S. suppliers see China as a major future market,” said Lin Boqiang, professor on energy studies at Xiamen University in China.

Crude exports to China

Meanwhile, according to Kpler, crude exports to China dropped to an estimated 226,000 barrels per day (bpd) in July, after reaching a record 445,000 bpd in March. Sinopec, through its Unipec trading arm, is the largest buyer of U.S. crude.

China would likely hike purchases from Saudi Arabia, Russia, the United Arab Emirates and Iraq if the tariffs slowed U.S. flows, said Neil Atkinson, head of the oil industry and markets division at the International Energy Agency.

There will be “others who will be offering barrels to China, so it could find itself able to replace lost volumes from the U.S.,” Atkinson said.

With LNG demand expected to skyrocket over the next 12 to 18 months, there are still some two dozen firms seeking to build new LNG export terminals in the United States and tariffs may limit their ability to secure sufficient buyers to finance their proposed projects.

“Cheniere continues to see China as an important growth market and LNG as a “win-win” between the United States and China,” said Eben Burnham-Snyder, a spokesman at Cheniere Energy Inc, which owns one of the two LNG export terminals currently operating in the United States. He added they do not see tariffs as productive.
…

China’s targeting of U.S. liquefied natural gas and crude oil exports opens a new front in the trade war between the two countries, at a time when the White House is trumpeting growing U.S. energy export  prowess.

China included LNG for the first time in its list of proposed tariffs on Friday, the same day that its biggest U.S. crude oil buyer, Sinopec, suspended U.S. crude oil imports due to the dispute, according to three sources familiar with the situation.

On Friday, China announced retaliatory tariffs on $60 billion worth of U.S. goods, and warned of further measures, signaling it will not back down in a protracted trade war with Washington.

That could cast a shadow over U.S. President Donald Trump’s energy dominance ambitions. The administration has repeatedly said it is eager to expand fossil fuel supplies to global allies, while Washington is rolling back domestic regulations to encourage more oil and gas production.

“The juxtaposition here is clear: It is hard to become an energy superpower when one of the biggest energy consumers in the world is raising barriers to consume that energy. It makes it very difficult,” said Michael Cohen, head of energy markets research at Barclays.

The U.S. is the world’s largest exporter of fuels such as gasoline and diesel, and is poised to become one of the largest exporters of LNG by 2019. U.S. LNG exports were worth $3.3 billion in 2017. China is the world’s biggest crude oil importer.

China had curtailed its imports of U.S. LNG over the last two months, even before its formal inclusion in the list of potential tariffs. It had also become the largest buyer of U.S. crude oil outside of Canada, but Kpler, which tracks worldwide oil shipments, shows crude cargoes to China have also dropped

off in recent months.

It comes at a time when the United States has several large-scale LNG export facilities under construction, and after Trump’s late 2017 trip to China that included executives from U.S. LNG companies.

China became the world’s second-biggest LNG importer in 2017, as it buys more gas in order to wean the country off dirty coal to reduce pollution.

“This will not affect the trade but will simply make gas more expensive to Chinese consumers,” said Charif Souki, chairman of Tellurian Inc, one of several companies seeking to build a new LNG export terminal.

China, which purchased almost 14 percent of all U.S. LNG shipped between February 2016 and May 2018, has taken delivery from just one vessel that left the United States in June and none so far in July, compared with 17 in the first five months of the year.

“The U.S. gas industry will be much harder hit by this as China imports only a small volume whereas U.S. suppliers see China as a major future market,” said Lin Boqiang, professor on energy studies at Xiamen University in China.

Crude exports to China

Meanwhile, according to Kpler, crude exports to China dropped to an estimated 226,000 barrels per day (bpd) in July, after reaching a record 445,000 bpd in March. Sinopec, through its Unipec trading arm, is the largest buyer of U.S. crude.

China would likely hike purchases from Saudi Arabia, Russia, the United Arab Emirates and Iraq if the tariffs slowed U.S. flows, said Neil Atkinson, head of the oil industry and markets division at the International Energy Agency.

There will be “others who will be offering barrels to China, so it could find itself able to replace lost volumes from the U.S.,” Atkinson said.

With LNG demand expected to skyrocket over the next 12 to 18 months, there are still some two dozen firms seeking to build new LNG export terminals in the United States and tariffs may limit their ability to secure sufficient buyers to finance their proposed projects.

“Cheniere continues to see China as an important growth market and LNG as a “win-win” between the United States and China,” said Eben Burnham-Snyder, a spokesman at Cheniere Energy Inc, which owns one of the two LNG export terminals currently operating in the United States. He added they do not see tariffs as productive.
…

George Kamau Githome uses a feather duster to clean off hardware and bootleg movies displayed for sale at his kiosk in Mathare, one of Nairobi, Kenya’s largest slums.

Githome and his family of 10 kids recently lost everything they owned in a fire. But he was able to rebuild because he had purchased micro-insurance, a new product making inroads among small-scale African farmers and business owners.

“When they came, they took photos, and saw how helpless I was. I had nothing,” he said. “Then they paid off my loan and supported me with something small. I started this business you see out here and the result you see inside.”

Most African farmers and small businesses operate with no way to protect themselves if disaster strikes. Insurers have been slow to tailor their products to the African continent, experts say, and their methods of operation, using complex contracts distributed through networks of agents, tends to only reach the urban elite.

But that may be starting to change. A handful of companies are now offering inexpensive, tech-driven micro-insurance and are making it easy for ordinary Africans to sign up.

The company Githome used, MicroEnsure, offers micro-insurance to small-business owners, ranging from farmers in the bush to small kiosk owners in downtown Nairobi.

The East Africa regional director for MicroEnsure, Kiereini Kirika, says mobile technology makes micro-insurance cheaper and easy to use.

“We enable them to be able to enroll as simple as using their mobile phone just by dialing a particular short code on their phone and then registering their product just by using their first name and their last name,” he said.

Henry Jaru, a smallholder farmer in northern Nigeria, is buying micro-insurance from another company, Pula, to protect his family farm from the impacts of poor rainfall, army worm infestations and other threats to their crops.

“Normally by this time the crops would have gone far but you see we’re still planting some of them,” he said. “So I think, we’re hoping that [will protect us if] we experience any shortcoming from the rain or the worms this year.”

Pula insures groups of farmers, using publicly available satellite data to track weather patterns, assess the risk and set prices.

“When Pula came into the country, they came with the idea of an index insurance, which means that you don’t need to necessarily visit every smallholder farmers,” said Samson Ajibola, Pula’s senior project manager in Nigeria. “You can insure aggregation of farmers under just one policy without necessarily needing to visit each of them.”

Pula also bundles the policies into small loans or purchases of fertilizer so small-hold farmers are automatically insured.

But older farmers, like Jaru’s father Thomas, are still skeptical because of bad experiences with insurance companies.

“Generally when the time comes for them to pay you, indemnify you, you will not find them,” said Thomas Jaru. “They begin to show you the small print — you didn’t do this, you didn’t do that out of the policy. So, it can ruin the whole thing and people get discouraged.”

Micro-insurance providers hope their services can change that perception  and turn a profit while giving Africa’s small farmers and businesses some protection if and when things go wrong.
…

U.S. President Donald Trump sought to ratchet up pressure on China for trade concessions by proposing a higher 25 percent tariff on $200 billion worth of Chinese imports, his administration said Wednesday.

U.S. Trade Representative Robert Lighthizer said Trump directed the increase from a previously proposed 10 percent duty because China has refused to meet U.S. demands and has imposed retaliatory tariffs on U.S. goods.

“The increase in the possible rate of the additional duty is intended to provide the administration with additional options to encourage China to change its harmful policies and behavior and adopt policies that will lead to fairer markets and prosperity for all of our citizens,” Lighthizer said in a statement.

There have been no formal talks between Washington and Beijing for weeks over Trump’s demands that China make fundamental changes to its policies on intellectual property protection, technology transfers and subsidies for high

technology industries.

Two trump administration officials told reporters on a conference call that Trump remains open to communications with Beijing and that through informal conversations the two countries are discussing whether a “fruitful negotiation” is possible.

“We don’t have anything to announce today about a specific event, or a specific round of discussions, but communication remains open and we are trying to figure out whether the conditions present themselves for a specific engagement between the two sides,” one of the officials said.

Derek Scissors, a China scholar at the American Enterprise Institute in Washington, said a 25 percent tariff rate is more likely to shut out Chinese products and shift American supply chains to other countries, as a 10 percent duty could be offset by government subsidies and weakness in China’s yuan currency.

“If we’re going to use tariffs, this gives us more flexibility and it’s a more meaningful threat,” he said, adding that Trump’s pressure strategy will not work if he does not resolve trade disputes with U.S. allies such as the European Union, Mexico and Canada.

Public comment period extended

The higher tariff rate, if implemented, would apply to a list of goods valued at $200 billion identified by the USTR last month as a response to China’s retaliatory tariffs on an initial round of U.S. tariffs on $34 billion worth of Chinese electronic components, machinery, autos and industrial goods.

Trump has ultimately threatened tariffs on over $500 billion in Chinese goods, covering virtually all U.S. imports from China.

The USTR said it would extend a public comment period for the $200 billion list to September 5 from August 30 because of the possible tariff rate rise.

The list, unveiled on July 10, hits American consumers harder than previous rounds, with targeted goods including such items as tilapia, dog food, furniture, lighting products, printed circuit boards and building materials.

China said Wednesday that “blackmail” would not work and that it would hit back if the United States took further steps hindering trade, including applying the higher tariff rate.

“U.S. pressure and blackmail won’t have an effect. If the United States takes further escalatory steps, China will inevitably take countermeasures and we will resolutely protect our legitimate rights,” Chinese Foreign Ministry spokesman Geng Shuang told a regular news briefing.

Investors fear an escalating trade war between Washington and Beijing could hit global economic growth, and prominent U.S. business groups, while weary of what they see as China’s mercantilist trade practices, have condemned Trump’s aggressive tariffs.
…

U.S. President Donald Trump sought to ratchet up pressure on China for trade concessions by proposing a higher 25 percent tariff on $200 billion worth of Chinese imports, his administration said Wednesday.

U.S. Trade Representative Robert Lighthizer said Trump directed the increase from a previously proposed 10 percent duty because China has refused to meet U.S. demands and has imposed retaliatory tariffs on U.S. goods.

“The increase in the possible rate of the additional duty is intended to provide the administration with additional options to encourage China to change its harmful policies and behavior and adopt policies that will lead to fairer markets and prosperity for all of our citizens,” Lighthizer said in a statement.

There have been no formal talks between Washington and Beijing for weeks over Trump’s demands that China make fundamental changes to its policies on intellectual property protection, technology transfers and subsidies for high

technology industries.

Two trump administration officials told reporters on a conference call that Trump remains open to communications with Beijing and that through informal conversations the two countries are discussing whether a “fruitful negotiation” is possible.

“We don’t have anything to announce today about a specific event, or a specific round of discussions, but communication remains open and we are trying to figure out whether the conditions present themselves for a specific engagement between the two sides,” one of the officials said.

Derek Scissors, a China scholar at the American Enterprise Institute in Washington, said a 25 percent tariff rate is more likely to shut out Chinese products and shift American supply chains to other countries, as a 10 percent duty could be offset by government subsidies and weakness in China’s yuan currency.

“If we’re going to use tariffs, this gives us more flexibility and it’s a more meaningful threat,” he said, adding that Trump’s pressure strategy will not work if he does not resolve trade disputes with U.S. allies such as the European Union, Mexico and Canada.

Public comment period extended

The higher tariff rate, if implemented, would apply to a list of goods valued at $200 billion identified by the USTR last month as a response to China’s retaliatory tariffs on an initial round of U.S. tariffs on $34 billion worth of Chinese electronic components, machinery, autos and industrial goods.

Trump has ultimately threatened tariffs on over $500 billion in Chinese goods, covering virtually all U.S. imports from China.

The USTR said it would extend a public comment period for the $200 billion list to September 5 from August 30 because of the possible tariff rate rise.

The list, unveiled on July 10, hits American consumers harder than previous rounds, with targeted goods including such items as tilapia, dog food, furniture, lighting products, printed circuit boards and building materials.

China said Wednesday that “blackmail” would not work and that it would hit back if the United States took further steps hindering trade, including applying the higher tariff rate.

“U.S. pressure and blackmail won’t have an effect. If the United States takes further escalatory steps, China will inevitably take countermeasures and we will resolutely protect our legitimate rights,” Chinese Foreign Ministry spokesman Geng Shuang told a regular news briefing.

Investors fear an escalating trade war between Washington and Beijing could hit global economic growth, and prominent U.S. business groups, while weary of what they see as China’s mercantilist trade practices, have condemned Trump’s aggressive tariffs.
…

The Federal Reserve is leaving its benchmark interest rate unchanged while signaling further gradual rate hikes in the months ahead as long as the economy stays healthy.

The Fed’s decision left the central bank’s key short-term rate at 1.75 percent to 2 percent – the level hit in June when the Fed boosted the rate for a second time this year.

The Fed projected in June four rate hikes this year, up from three in 2017. Private economists expect the next hike to occur at the September meeting.

In a brief policy statement, the Fed notes a strengthening labor market, economic activity growing at “a strong rate,” and inflation that’s reached the central bank’s target of 2 percent annual gains. Officials see economic risks as roughly balanced.
…

The Federal Reserve is leaving its benchmark interest rate unchanged while signaling further gradual rate hikes in the months ahead as long as the economy stays healthy.

The Fed’s decision left the central bank’s key short-term rate at 1.75 percent to 2 percent – the level hit in June when the Fed boosted the rate for a second time this year.

The Fed projected in June four rate hikes this year, up from three in 2017. Private economists expect the next hike to occur at the September meeting.

In a brief policy statement, the Fed notes a strengthening labor market, economic activity growing at “a strong rate,” and inflation that’s reached the central bank’s target of 2 percent annual gains. Officials see economic risks as roughly balanced.
…

European Union imports of U.S. soybeans were already rising substantially before a top EU official told President Donald Trump last week that the bloc would buy more.

EU Commission figures released Wednesday show that 37 percent of the bloc’s soybean imports last month were coming from the U.S., compared with 9 percent in July 2017.

Amid a looming trade war over tariffs, Trump and Commission President Jean-Claude Juncker agreed on July 25 to start talks intended to achieve “zero tariffs” and “zero subsidies” on non-automotive industrial goods.

The EU also agreed to buy more U.S. soybeans and build more terminals to import liquefied natural gas from the United States.

“The European Union can import more soybeans from the U.S. and this is happening as we speak,” Juncker said.

But a high level EU official said the increase in soybean purchases from the U.S. is due only to economics, as they are cheaper than imports from Brazil and Argentina. The official, who spoke only on condition of anonymity because of the sensitivity of the issue, said there was no political reason for the increase.

 
…

European Union imports of U.S. soybeans were already rising substantially before a top EU official told President Donald Trump last week that the bloc would buy more.

EU Commission figures released Wednesday show that 37 percent of the bloc’s soybean imports last month were coming from the U.S., compared with 9 percent in July 2017.

Amid a looming trade war over tariffs, Trump and Commission President Jean-Claude Juncker agreed on July 25 to start talks intended to achieve “zero tariffs” and “zero subsidies” on non-automotive industrial goods.

The EU also agreed to buy more U.S. soybeans and build more terminals to import liquefied natural gas from the United States.

“The European Union can import more soybeans from the U.S. and this is happening as we speak,” Juncker said.

But a high level EU official said the increase in soybean purchases from the U.S. is due only to economics, as they are cheaper than imports from Brazil and Argentina. The official, who spoke only on condition of anonymity because of the sensitivity of the issue, said there was no political reason for the increase.

 
…

Each morning, Kamarunisa Poovummada sips her cup of tea while watching waves from the Arabian Sea crash around a water treatment plant opposite her house on Kavaratti island, off India’s southwest coast.

She links the taste of her perfectly brewed cup to the desalination plant that has brought potable water to the doorsteps of islanders, and almost erased the memory of the brackish tea she hurriedly swallowed down until a decade ago.

“We first noticed the difference when we saw the golden color of the tea as we strained it into our cups,” Poovummada recalled. “And then we tasted the tea and it was magical.”

The “tasty” tea is celebrated daily by residents of Kavaratti, the capital of India’s smallest Union Territory Lakshadweep, an archipelago of 36 islands, of which only 10 are inhabited.

Surrounded by pristine beaches, lagoons and coral reefs, the islanders have for decades battled a shortage of clean water – a challenge facing many island inhabitants globally.

Over the years, the sea’s clear blue waters seeped into the islands’ limited groundwater reserves, making every sip saline.

Limited land availability also resulted in groundwater sources being too close to sewage sumps, causing contamination and making water unsafe for drinking, cooking or even bathing.

“The water system was a mess,” said Hidyathulla Chekkillakam, who grew up on the island and is an employee of the public works department that runs the desalination plant.

Different options were tried, from open wells to rainwater harvesting, he said – but they were either ineffective or too expensive.

“Good drinking water was a prized commodity,” he added.

Piped Dreams

When Purnima Jalihal and her team from the Chennai-based National Institute of Ocean Technology (NIOT) first arrived on Kavaratti in 2004, they were armed with blueprints for a desalination plant and cartons of bottled water.

They found themselves in the midst of a fragile ecosystem, with clear instructions from the island administration to “not destroy” anything. They were also warned about the tea, and soon found even a sip made them queasy.

“The salinity in the water was unbearable, and the people knew it was not good for their health. But they had no choice,” Jalihal said.

The project – and the fact it was headed by a woman – drew curious islanders to the site, where Jalihal’s team had to improvise designs to ensure construction did not harm the ecosystem.

“It was a struggle to get things going,” the scientist said. “There was no infrastructure and we couldn’t bring in heavy machinery. Everything had to be done manually.”

The team built floating structures and towed them into the sea, including an underwater pipeline.

In less than a year, the water treatment plant was up and running, producing 100,000 liters of potable water a day.

Pipelines were laid along the streets, with a community tap set up every 25 meters (82 ft). And in 2005, the water supply started.

“It was almost like a revolution,” housewife Rahiyanath Begum told the Thomson Reuters Foundation as she watched her children play on the beach.

“Tea is a part of our life. We drink it without milk and so the color and taste are important. If the tea is good, it means the water is good,” she said.

Poovummada, Begum and the 11,200 residents of Kavaratti – a tiny island measuring just 5.8 km (3.6 miles) long and 1.6 km wide – neatly line up buckets around the water taps for an hour each day.

Tourist Attraction

Abdul Latif is used to islanders visiting the plant to show it off to their children, and guests from the mainland.

“It’s almost like a tourist spot,” the 43-year-old operator said, smiling.

From walking visitors across the bridge to see the underwater pipeline to urging everyone to drink a glass of treated water, Latif has become a poster boy for the plant, which has withstood storms, including Cyclone Ockhi in 2017.

“It rarely breaks down, and the real challenge is when big jellyfish get stuck in the underwater pumps,” he said.

Built at a capital cost of about 50 million Indian rupees ($727,400) with government funding, the plant technology is robust, environmentally friendly and requires little effort to operate and maintain, Jalihal said.

Developed by the NIOT, it utilizes the temperature difference between sea-surface water and deep-sea water to evaporate the warmer water at low pressure and condense the vapour with the colder water to obtain fresh water.

Buoyed by its success, the NIOT set up two plants on Agatti and Minicoy islands in 2011, providing more than 15,000 residents with clean water. Construction of six more desalination plants is now underway on other inhabited islands.

Only one other water treatment plant in India, off the coast of Chennai city, uses the same home-grown technology. Others purify water with reverse osmosis, a costlier imported method.

Latif and his team work shifts to keep the motors of the plant running, to supply nine liters of water per day for each resident, including three for drinking and five for cooking.

“We discourage people from using it for a bath or washing clothes because we don’t want even a precious drop wasted,” said Chekkillakam. “Everyone understands because we have seen how quickly clean water sources dry up or get contaminated.”

Going Green

A decade after the Kavaratti desalination plant became operational, Jalihal is back at the drawing board, this time working on a new plant for the island that will draw power from the sea instead of running on diesel generators as now.

“It will be completely green, using ocean thermal energy to run. Then the system will be perfect,” she said.

Khadeeja Lavanakkal cannot wait for the second plant. She lives at the end of the pipeline, and sometimes gets only a trickle of clean water because others have filled extra buckets.

“We have an open well, but when officials come to check the water they tell us it is more saline than sea water. We could do with a little more clean water to drink.”

Nonetheless, Lavanakkal is grateful to the scientists.

“It’s not just the tea but even the curries we cook are so much tastier,” she said.

“And the best part is that we can close our eyes and drink a glass of water without worrying about falling ill.”

($1 = 68.7400 Indian rupees)
…

Each morning, Kamarunisa Poovummada sips her cup of tea while watching waves from the Arabian Sea crash around a water treatment plant opposite her house on Kavaratti island, off India’s southwest coast.

She links the taste of her perfectly brewed cup to the desalination plant that has brought potable water to the doorsteps of islanders, and almost erased the memory of the brackish tea she hurriedly swallowed down until a decade ago.

“We first noticed the difference when we saw the golden color of the tea as we strained it into our cups,” Poovummada recalled. “And then we tasted the tea and it was magical.”

The “tasty” tea is celebrated daily by residents of Kavaratti, the capital of India’s smallest Union Territory Lakshadweep, an archipelago of 36 islands, of which only 10 are inhabited.

Surrounded by pristine beaches, lagoons and coral reefs, the islanders have for decades battled a shortage of clean water – a challenge facing many island inhabitants globally.

Over the years, the sea’s clear blue waters seeped into the islands’ limited groundwater reserves, making every sip saline.

Limited land availability also resulted in groundwater sources being too close to sewage sumps, causing contamination and making water unsafe for drinking, cooking or even bathing.

“The water system was a mess,” said Hidyathulla Chekkillakam, who grew up on the island and is an employee of the public works department that runs the desalination plant.

Different options were tried, from open wells to rainwater harvesting, he said – but they were either ineffective or too expensive.

“Good drinking water was a prized commodity,” he added.

Piped Dreams

When Purnima Jalihal and her team from the Chennai-based National Institute of Ocean Technology (NIOT) first arrived on Kavaratti in 2004, they were armed with blueprints for a desalination plant and cartons of bottled water.

They found themselves in the midst of a fragile ecosystem, with clear instructions from the island administration to “not destroy” anything. They were also warned about the tea, and soon found even a sip made them queasy.

“The salinity in the water was unbearable, and the people knew it was not good for their health. But they had no choice,” Jalihal said.

The project – and the fact it was headed by a woman – drew curious islanders to the site, where Jalihal’s team had to improvise designs to ensure construction did not harm the ecosystem.

“It was a struggle to get things going,” the scientist said. “There was no infrastructure and we couldn’t bring in heavy machinery. Everything had to be done manually.”

The team built floating structures and towed them into the sea, including an underwater pipeline.

In less than a year, the water treatment plant was up and running, producing 100,000 liters of potable water a day.

Pipelines were laid along the streets, with a community tap set up every 25 meters (82 ft). And in 2005, the water supply started.

“It was almost like a revolution,” housewife Rahiyanath Begum told the Thomson Reuters Foundation as she watched her children play on the beach.

“Tea is a part of our life. We drink it without milk and so the color and taste are important. If the tea is good, it means the water is good,” she said.

Poovummada, Begum and the 11,200 residents of Kavaratti – a tiny island measuring just 5.8 km (3.6 miles) long and 1.6 km wide – neatly line up buckets around the water taps for an hour each day.

Tourist Attraction

Abdul Latif is used to islanders visiting the plant to show it off to their children, and guests from the mainland.

“It’s almost like a tourist spot,” the 43-year-old operator said, smiling.

From walking visitors across the bridge to see the underwater pipeline to urging everyone to drink a glass of treated water, Latif has become a poster boy for the plant, which has withstood storms, including Cyclone Ockhi in 2017.

“It rarely breaks down, and the real challenge is when big jellyfish get stuck in the underwater pumps,” he said.

Built at a capital cost of about 50 million Indian rupees ($727,400) with government funding, the plant technology is robust, environmentally friendly and requires little effort to operate and maintain, Jalihal said.

Developed by the NIOT, it utilizes the temperature difference between sea-surface water and deep-sea water to evaporate the warmer water at low pressure and condense the vapour with the colder water to obtain fresh water.

Buoyed by its success, the NIOT set up two plants on Agatti and Minicoy islands in 2011, providing more than 15,000 residents with clean water. Construction of six more desalination plants is now underway on other inhabited islands.

Only one other water treatment plant in India, off the coast of Chennai city, uses the same home-grown technology. Others purify water with reverse osmosis, a costlier imported method.

Latif and his team work shifts to keep the motors of the plant running, to supply nine liters of water per day for each resident, including three for drinking and five for cooking.

“We discourage people from using it for a bath or washing clothes because we don’t want even a precious drop wasted,” said Chekkillakam. “Everyone understands because we have seen how quickly clean water sources dry up or get contaminated.”

Going Green

A decade after the Kavaratti desalination plant became operational, Jalihal is back at the drawing board, this time working on a new plant for the island that will draw power from the sea instead of running on diesel generators as now.

“It will be completely green, using ocean thermal energy to run. Then the system will be perfect,” she said.

Khadeeja Lavanakkal cannot wait for the second plant. She lives at the end of the pipeline, and sometimes gets only a trickle of clean water because others have filled extra buckets.

“We have an open well, but when officials come to check the water they tell us it is more saline than sea water. We could do with a little more clean water to drink.”

Nonetheless, Lavanakkal is grateful to the scientists.

“It’s not just the tea but even the curries we cook are so much tastier,” she said.

“And the best part is that we can close our eyes and drink a glass of water without worrying about falling ill.”

($1 = 68.7400 Indian rupees)
…

Brazil’s three largest fuel distribution companies are under investigation for fixing prices at the pump, police said on Tuesday, reigniting debate over potential collusion among gas station owners in Latin America’s largest oil producer.

The firms targeted by the probe are Petrobras Distribuidora SA, a subsidiary of state oil company Petroleo Brasileiro SA; Ipiranga, a unit of Ultrapar Participacoes SA; and Raizen, a Cosan SA and Royal Dutch Shell Plc joint venture.

Police in the southern state of Parana were serving eight arrest warrants and 12 search and seizure warrants in connection with the probe in the city of Curitiba, the state capital, according to police.

The probe comes two months after Brazil’s economy was paralyzed by a trucker strike over soaring diesel fuel prices.

While the government resolved that protest with new subsidies and other measures, antitrust regulators also raised concerns about a lack of competition in the highly concentrated sector.

Investigation  a year old

Police said they were targeting managers and sales representatives of the three firms in the investigation, which has been underway for over a year.

They accused the fuel distribution companies of dictating the prices at the pump charged by individual gas station owners, a violation of Brazilian market rules that the owners should have freedom to set prices freely.

Shares in Petrobras Distribuidora, Ultrapar, and Cosan all tumbled at least 3.5 percent in late morning trade, dragging Brazil’s benchmark Bovespa index down some 1.3 percent.

To make sure the dictated prices were being applied by the gas station owners, the distribution companies hired people to ride motorbikes around the city of Curitiba to take pictures of the gas stations and their pricing banners, according to police.

Petrobras, Raizen offer statements

Petrobras Distribuidora, also known as BR Distribuidora, said in a statement that it follows “the best commercial, competitive and ethical practices toward the consumer”and demands the same behavior from its partners and workforce.

Raizen said in a statement fuel prices were set by individual gas station owners with no interference from the distributor.

“The company operates in total conformity with applicable legislation and always acts toward the consumer in a competitive way and in favor of free competition,” it said in a statement.

In a statement late on Tuesday, Raizen said it had access to the probe late in the day and was considering information provided by the investigation reports.

Ipiranga said that it “does not incentivize illegal practices,” and that it operates in compliance with competition regulations.

Three companies under investigation

The three companies under investigation together control more than two-thirds of the national fuel distribution market, according to data from oil regulator ANP.

The operation is the latest effort by Brazilian authorities to clamp down on collusion and price fixing in the fuel distribution market, which has been the most common target of accusations for cartel behavior by antitrust watchdog Cade.

The government had asked Cade earlier this year to investigate fuel stations for potential anticompetitive practices that could account for the large spread between fuel prices at refineries and at pumps.
…

Brazil’s three largest fuel distribution companies are under investigation for fixing prices at the pump, police said on Tuesday, reigniting debate over potential collusion among gas station owners in Latin America’s largest oil producer.

The firms targeted by the probe are Petrobras Distribuidora SA, a subsidiary of state oil company Petroleo Brasileiro SA; Ipiranga, a unit of Ultrapar Participacoes SA; and Raizen, a Cosan SA and Royal Dutch Shell Plc joint venture.

Police in the southern state of Parana were serving eight arrest warrants and 12 search and seizure warrants in connection with the probe in the city of Curitiba, the state capital, according to police.

The probe comes two months after Brazil’s economy was paralyzed by a trucker strike over soaring diesel fuel prices.

While the government resolved that protest with new subsidies and other measures, antitrust regulators also raised concerns about a lack of competition in the highly concentrated sector.

Investigation  a year old

Police said they were targeting managers and sales representatives of the three firms in the investigation, which has been underway for over a year.

They accused the fuel distribution companies of dictating the prices at the pump charged by individual gas station owners, a violation of Brazilian market rules that the owners should have freedom to set prices freely.

Shares in Petrobras Distribuidora, Ultrapar, and Cosan all tumbled at least 3.5 percent in late morning trade, dragging Brazil’s benchmark Bovespa index down some 1.3 percent.

To make sure the dictated prices were being applied by the gas station owners, the distribution companies hired people to ride motorbikes around the city of Curitiba to take pictures of the gas stations and their pricing banners, according to police.

Petrobras, Raizen offer statements

Petrobras Distribuidora, also known as BR Distribuidora, said in a statement that it follows “the best commercial, competitive and ethical practices toward the consumer”and demands the same behavior from its partners and workforce.

Raizen said in a statement fuel prices were set by individual gas station owners with no interference from the distributor.

“The company operates in total conformity with applicable legislation and always acts toward the consumer in a competitive way and in favor of free competition,” it said in a statement.

In a statement late on Tuesday, Raizen said it had access to the probe late in the day and was considering information provided by the investigation reports.

Ipiranga said that it “does not incentivize illegal practices,” and that it operates in compliance with competition regulations.

Three companies under investigation

The three companies under investigation together control more than two-thirds of the national fuel distribution market, according to data from oil regulator ANP.

The operation is the latest effort by Brazilian authorities to clamp down on collusion and price fixing in the fuel distribution market, which has been the most common target of accusations for cartel behavior by antitrust watchdog Cade.

The government had asked Cade earlier this year to investigate fuel stations for potential anticompetitive practices that could account for the large spread between fuel prices at refineries and at pumps.
…

The U.S. Treasury Department said on Tuesday that it had extended the deadline for investors to divest holdings in sanctioned Russian companies EN+, GAZ Group and Rusal to Oct. 23 from Aug. 5.

The U.S. Treasury in April imposed sanctions against billionaire Oleg Deripaska and eight companies in which he is a large shareholder, including aluminum exporter Rusal, in response to what it termed “malign activities” by Russia.

Deripaska has held a controlling interest in En+, which in turn controls Rusal, the world’s largest aluminum producer outside of China. Automaker GAZ is also part of his business empire.

U.S. Treasury Secretary Steven Mnuchin said last week that the United States was in productive talks with Rusal to remove it from Washington’s sanctions list.

The company has taken a number of steps, including revamping its board, in the hope of escaping the U.S. blacklist.
…

The U.S. Treasury Department said on Tuesday that it had extended the deadline for investors to divest holdings in sanctioned Russian companies EN+, GAZ Group and Rusal to Oct. 23 from Aug. 5.

The U.S. Treasury in April imposed sanctions against billionaire Oleg Deripaska and eight companies in which he is a large shareholder, including aluminum exporter Rusal, in response to what it termed “malign activities” by Russia.

Deripaska has held a controlling interest in En+, which in turn controls Rusal, the world’s largest aluminum producer outside of China. Automaker GAZ is also part of his business empire.

U.S. Treasury Secretary Steven Mnuchin said last week that the United States was in productive talks with Rusal to remove it from Washington’s sanctions list.

The company has taken a number of steps, including revamping its board, in the hope of escaping the U.S. blacklist.
…

Iran said on Tuesday U.S. President Donald Trump was mistaken to expect Saudi Arabia and other oil producers to compensate for supply losses caused by U.S. sanctions on Iran, after OPEC production rose only modestly in July.

The comments, from Iran’s OPEC governor, came a day after a Reuters survey showed OPEC production rose by 70,000 barrels per day in July. Saudi production increased but was offset by a decline in Iranian supply due to the restart of U.S. sanctions, the survey found.

“It seems President Trump has been taken hostage by Saudi Arabia and a few producers when they claimed they can replace 2.5 million barrels per day of Iranian exports, encouraging him to take action against Iran,” Hossein Kazempour Ardebili told Reuters. “Now they and Russia sell more oil and more expensively. Not even from their incremental production but their stocks.”

He said oil prices, which Trump has been pressuring the Organization of the Petroleum Exporting Countries to bring down by raising output, will rise unless the United States grants waivers to buyers of Iranian crude.

“They are also calling for the use of the U.S. SPR [Strategic Petroleum Reserve]. This will also mean higher prices. U.S. waivers to our clients if they come is due to the failure of bluffers [Saudi and the other producers] and, if not given, will again push the prices higher,” he said.

“So they hanged him [Trump] on the wall. Now they want to have a mega OPEC, congratulations to President Trump, Russia and Saudi Arabia.”

OPEC governors represent their respective country on the organization’s board of governors and are typically the second most senior person in a country’s OPEC delegation after the oil minister.

“The longer-term solution, Mr President, is to support and facilitate capacity building in all countries, proportionate to their reserves of oil and gas. And we will remain the biggest opportunity,” Kazempour said.

 
…

Iran said on Tuesday U.S. President Donald Trump was mistaken to expect Saudi Arabia and other oil producers to compensate for supply losses caused by U.S. sanctions on Iran, after OPEC production rose only modestly in July.

The comments, from Iran’s OPEC governor, came a day after a Reuters survey showed OPEC production rose by 70,000 barrels per day in July. Saudi production increased but was offset by a decline in Iranian supply due to the restart of U.S. sanctions, the survey found.

“It seems President Trump has been taken hostage by Saudi Arabia and a few producers when they claimed they can replace 2.5 million barrels per day of Iranian exports, encouraging him to take action against Iran,” Hossein Kazempour Ardebili told Reuters. “Now they and Russia sell more oil and more expensively. Not even from their incremental production but their stocks.”

He said oil prices, which Trump has been pressuring the Organization of the Petroleum Exporting Countries to bring down by raising output, will rise unless the United States grants waivers to buyers of Iranian crude.

“They are also calling for the use of the U.S. SPR [Strategic Petroleum Reserve]. This will also mean higher prices. U.S. waivers to our clients if they come is due to the failure of bluffers [Saudi and the other producers] and, if not given, will again push the prices higher,” he said.

“So they hanged him [Trump] on the wall. Now they want to have a mega OPEC, congratulations to President Trump, Russia and Saudi Arabia.”

OPEC governors represent their respective country on the organization’s board of governors and are typically the second most senior person in a country’s OPEC delegation after the oil minister.

“The longer-term solution, Mr President, is to support and facilitate capacity building in all countries, proportionate to their reserves of oil and gas. And we will remain the biggest opportunity,” Kazempour said.

 
…

McDonald’s is fighting to hold onto customers as the Big Mac turns 50, but it isn’t changing the makings of its most famous burger.

The company is celebrating the 1968 national launch of the double-decker sandwich whose ingredients of “two all-beef patties, special sauce, lettuce, cheese, pickles, onions and a sesame seed bun” were seared into American memories by a TV jingle. But the milestone comes as the company reduces its number of U.S. stores. McDonald’s said Thursday that customers are visiting less often. Other trendy burger options are reaching into the heartland.

The “Golden Arches” still have a massive global reach, and the McDonald’s brand of cheeseburgers, chicken nuggets and french fries remains recognizable around the world. But on its critical home turf, the company is toiling to stay relevant. Kale now appears in salads, fresh has replaced frozen beef patties in Quarter Pounders, and some stores now offer ordering kiosks, food delivery and barista-style cafes.

The milestone for the Big Mac shows how much McDonald’s and the rest of fast-food have evolved around it.

“Clearly, we’ve gotten a little more sophisticated in our menu development,” McDonald’s CEO Steve Easterbrook said in a phone interview.

As with many of its popular and long-lasting menu items, the idea for the Big Mac came from a franchisee.

In 1967, Michael James “Jim” Delligatti lobbied the company to let him test the burger at his Pittsburgh restaurants. Later, he acknowledged the Big Mac’s similarity to a popular sandwich sold by the Big Boy chain.

“This wasn’t like discovering the light bulb. The bulb was already there. All I did was screw it in the socket,” Delligatti said, according to “Behind the Arches.”

McDonald’s agreed to let Delligatti sell the sandwich at a single location, on the condition that he use the company’s standard bun. It didn’t work. Delligatti tried a bigger sesame seed bun, and the burger soon lifted sales by more than 12 percent.

After similar results at more stores, the Big Mac was added to the national menu in 1968. Other ideas from franchisees that hit the big time include the Filet-O-Fish, Egg McMuffin, Apple Pie (once deep-fried but now baked), and the Shamrock Shake.

“The company has benefited from the ingenuity of its small business men,” wrote Ray Kroc, who transformed the McDonald’s into a global franchise, in his book, “Grinding It Out.”

Franchisees still play an important role, driving the recent switch to fresh from frozen for the beef in Quarter Pounders, Easterbrook says. They also participate in menu development, which in the U.S. has included a series of cooking tweaks intended to improve taste.

Messing with a signature menu item can be taboo, but keeping the Big Mac unchanged comes with its own risks. Newer chains such as Shake Shack and Five Guys offer burgers that can make the Big Mac seem outdated. Even White Castle is modernizing, recently adding plant-based “Impossible Burger” sliders at some locations.

A McDonald’s franchisee fretted in 2016 that only one out of five millennials has tried the Big Mac. The Big Mac had “gotten less relevant,” the franchisee wrote in a memo, according to the Wall Street Journal.

McDonald’s then ran promotions designed to introduce the Big Mac to more people. Those kind of periodic campaigns should help keep the Big Mac relevant for years to come, says Mike Delligatti, the son of the Big Mac inventor, who died in 2016.

“What iconic sandwich do you know that can beat the Big Mac as far as longevity?” said Delligatti, himself a McDonald’s franchisee.
…

U.S. companies seeking to be exempted from President Donald Trump’s tariff on imported steel are accusing American steel manufacturers of spreading inaccurate and misleading information, and they fear it may torpedo their requests.

Robert Miller, president and CEO of NLMK USA, said objections raised by U.S. Steel and Nucor to his bid for a waiver are “literal untruths.” He said his company, which imports huge slabs of steel from Russia, has already paid $80 million in duties and will be forced out of business if it isn’t excused from the 25 percent tariff. U.S. Steel and Nucor are two of the country’s largest steel producers.

“They ought to be ashamed of themselves,” said Miller, who employs more than 1,100 people at mills in Pennsylvania and Indiana.

Miller’s resentment, echoed by several other executives, is evidence of the backlash over how the Commerce Department is evaluating their requests to avoid the duty on steel imports. They fear the agency will be swayed by opposition from U.S. Steel, Nucor and other domestic steel suppliers that say they’ve been unfairly hurt by a glut of imports and back Trump’s tariff.

U.S. Steel said its objections are based on detailed information about the dimensions and chemistry of the steel included in the requests. “We read what is publicly posted and respond,” said spokeswoman Meghan Cox. Nucor did not reply to requests for comment.

The 20,000-plus waiver applications that the Commerce Department has received illustrate the chaos and uncertainty ignited by Trump’s trade war against America’s allies and adversaries. It’s a battle that critics of his trade policy, including a number of Republican lawmakers, have warned is misguided and will end up harming U.S. businesses.

Trump and European leaders agreed this past Wednesday not to escalate their dispute over trade, but the tariff on steel and a separate duty on aluminum imports remains in place as the U.S. and Europe aim for a broader trade agreement. The metal taxes would continue to hit U.S. trading partners such as Canada, Mexico and Japan even if the U.S. and the EU forge a deal.

Miller bristled over insistence by Nucor and U.S. Steel that steel slab is readily available in the United States. “That’s just not true,” he said.

His company isn’t the only one looking overseas for a product described as being consistently in short supply. California Steel Industries, a mill east of Los Angeles in Fontana, described the slab shortage as “acute” on the West Coast and declared that its waiver request is critical to its survival.

Aiming to rebuild the U.S. steel industry, Trump relied on a rarely used 1962 law that empowers him to impose tariffs on particular imports if the Commerce Department determines those goods threaten national security. He added a twist: Companies could be excused from the tariff if they could show, for example, that U.S. manufacturers don’t make the metal they need in sufficient quantities.

But there are hurdles to clear on the path to securing an exemption. A single company may have to file dozens of separate requests to account for even slight variations in the metal it’s buying. That means a mountain of paperwork to be filled out precisely. If not, the request is at risk of being rejected as incomplete. All this can be time-consuming and expensive, especially for smaller businesses.

The requests are open to objections. The Commerce Department posts the exemption requests online to allow third parties to offer comments — even from competitors who have an interest in seeing a rival’s request denied. But objections are frequently being submitted just as the comment period closes, undercutting the requester’s ability to fire back.

Willie Chiang, executive vice president of Plains All American Pipeline, told the House Ways and Means subcommittee on trade last week that his company had no opportunity to respond to objections that contained “incorrect information” before the Commerce Department denied its exclusion request. Chiang didn’t say who submitted the inaccurate information.

“The intent here is to restrict imports on a broad scale,” said Richard Chriss, executive director of the American Institute for International Steel, a free trade group opposed to tariffs. “It wouldn’t make sense from the administration’s perspective to design a process that readily granted exclusions.”

The Commerce Department declined to comment for this story.

Department officials have so far made public only a small number of their rulings.

An analysis of the numbers by the office of Rep. Jackie Walorski, an Indiana Republican and one of the most vocal opponents of the steel tariff on Capitol Hill, shows that 760 requests have been approved while 552 have been denied. The department hasn’t yet approved a waiver request that triggered objections, according to Walorski’s review.

The congresswoman’s office also examined the more than 5,600 publicly available comments and found they were submitted on average about four days before the end of the 30-day comment period. More than 50 percent of the comments weren’t delivered until 48 hours or less before the comment window closed. It took department an average of nine days to post comments online after receiving them, according to the analysis. The most prolific commenters were Nucor and U.S. Steel with 1,064 and 1,009, respectively.

A waiver request Seneca Foods Corporation submitted for tinplated steel it had already agreed to purchase from China was among the denials. U.S. Steel had objected, calling the tinplate a “standard product” that’s readily available in the United States. In fact, U.S. Steel said it currently supplies the material to Seneca Foods, the nation’s largest vegetable canner.

The New York-based Seneca Foods declined to comment. But in its waiver application, the company said domestically made tinplate “is of inferior quality to imported material.” Seneca Foods also said it’s unclear, at best, if U.S. suppliers have the ability or willingness to expand their production in the long term to meet the company’s annual demand for the material.

Philadelphia-based Crown Cork & Seal, a manufacturer of metal packaging for food and beverages, submitted a sharply worded attachment to its waiver application that anticipated pushback from domestic manufacturers. American steel mills, the document said, cannot meet aggregate demand for tinplate and have no plans to increase their capacity.

“We anticipate the U.S. mills will attempt to rebut this statement when they object to this exclusion request, but we encourage the Department of Commerce to see through their manipulative attempt to exploit the rules of the exclusion request process,” the application said.

Daniel Shackell, Crown Cork & Seal’s vice president for steel sourcing, said he’s not optimistic about the company’s chances of getting all 70 of its waiver requests approved. Eight have been granted so far primarily because the metal specified in those requests is not made in the United States. Twelve others have been denied, leaving 50 still to be decided.

“It’s hard not to interpret that the Commerce Department wants domestic suppliers to have an edge,” Shackell said.

Jay Zidell, president of Tube Forgings of America, a small company in Portland, Oregon, said he’s filed 54 exclusion requests and U.S. Steel has objected to 38 of them. U.S. Steel declared it is “willing and ready to satisfy” Tube Forgings’ demands for carbon steel tubing. But Zidell said the comments ignored past problems with metal quality and workmanship that led his company to sever a prior relationship with U.S. Steel.

Still, he’s worried the Commerce Department won’t approve all of the requests. Tube Forgings already has spent $600,000 on tariffs, he said, and may be on the hook for much more than that.

“The entire system is just screwed up,” Zidell said.
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