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Scholz plans to negotiate with Canada to replace russian ban on raw materials

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russian raw materials exports

During his visit to Canada, German Chancellor Olaf Scholz is planning to reach an agreement on replacing the Russian ban on raw materials.

In response to questions from journalists in Montreal, he said that Canada was rich in natural resources.

“So we are opening up new areas of cooperation,” Scholz told reporters. It is specified that during the working trip the Chancellor plans to sign an agreement on cooperation between Germany and Canada in the sphere of green hydrogen.

The parties also plan to discuss the issues of supply of minerals and liquefied natural gas from Canada to Germany. This should cause serious damage to Russian raw materials exports. 

Earlier, Robert Habek, Minister of Economic Affairs and Climate Protection of Germany, said that he expected further reduction of gas supplies to Germany by Russia.

In July, Bloomberg agency reported that Germany is considering the possibility of signing agreements with Shell and a number of other companies on the supply of liquefied natural gas to replace the Russian fuel.

Previously, we reported on what will happen to oil prices in the near future.


Farmers’ financial pain spills from Kansas wheat fields to Main Streets

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By Heather Schlitz

SMITH CENTER, Kansas (Reuters) – In a tiny town surrounded by miles of rippling wheat fields, Brady Peterson’s restaurant sits nearly empty during what should be a Saturday lunch rush. Normally, Pete’s would be filled with farmers ordering fried chicken and cheeseburgers, but as farm income thins, so does Peterson’s business.

Sluggish sales have slashed his income so much that he can’t afford to run his home air conditioner during the baking Kansas summers or pay for a suit to wear to a close friend’s funeral.

“I ended up wearing a T-shirt I wear to work and a nice pair of jeans,” Peterson said. 

As U.S. farm incomes are forecast to plunge in 2024 due to a sharp reversal in commodity crop prices, less government support and high borrowing and labor costs, farmers’ economic pain is spreading from the fields to Main Street.

The situation in U.S. prairie states is particularly severe. Farmers here are facing the worst economic situation in over a decade, and small cities are at risk of becoming ghost towns, sources told Reuters. 

Two years of severe drought followed by national farm economic problems including inflated seed and chemical costs, higher interest rates and lower crop prices have sapped money from the surrounding communities, ten business owners, two chambers of commerce directors, two economists and three farmers in Kansas told Reuters.

Business owners noted anywhere from a 20% to 30% decline in revenue compared to the previous year. Nationally, farm income is forecast to fall 25% from last year according to the U.S. Agriculture Department. That would be the largest annual decrease in dollar terms.

“We’re a farming community, and the farmers just don’t have the money to spend,” Megan Jensen, owner of Meg’s Grooming and Pet Salon in Concordia, Kansas, said through tears. “Every penny I own is invested in this. If I fail, I’m homeless.”

U.S. farm income hit a record high in 2022, before a steep drop in commodity crop prices due to large harvests in South America and waning demand from importers and meatpackers upended U.S. farmers’ fortunes. Corn, soy and wheat futures are trading around three-year lows.

Farm income in Kansas and other prairie states has fallen even more and is forecast to be the lowest since at least 2010 this year, according to U.S. Department of Agriculture data. 

Kansas is the biggest U.S. wheat-producing state, and economists say the nationwide downturn has particularly hurt regions that produce the grain as demand for U.S. wheat shrinks.


The mayor of Smith Center, Bryce Wiehl, is a tanned farmer with a scraggly white beard and gruff voice. Over fried chicken at Pete’s, he described the foreclosures, the town of 1,500’s dwindling population and downward economic spiral.

“It’s hard to find an industry that doesn’t rely on farm product prices. It has a dramatic impact on the community,” he said.

Rural downtowns in Kansas are dotted with shuttered businesses, and residents noted the streets are emptier than ever. 

“Things are incredibly volatile here. It’s either feast or famine,” said Shane Wyatt, owner of a gun shop in rural Norton, Kansas. “I wouldn’t quite call it a ghost town, but you can really see the impact of the low prices.”

While the broader U.S. economy is growing strong, researchers at Creighton University reported in May that the nation’s rural Main Street economy in the Midwest and Great Plains had fallen as farm equipment sales slumped and agricultural land prices dropped for the first time in five years.

Russ Erbert, a jeweler in Norton, Kansas, delights in showing young couples how a good diamond will sparkle even under dim light and seeing a newly engaged woman smile when she sees her ring. During an economic downturn in a small farm town, these scenes happen less often. 

“Some of the young farm kids are waiting until the following year to get married,” he said. “They’re budget conscious.”

When customers do trickle into businesses, they often buy less expensive items: pocketknives instead of firearms at a gun shop and modest gems over two-carat diamonds at a jewelry store. At pawn shops, residents are pawning more possessions for quick cash, and fewer return to buy them back.

High inflation and interest rates hit farmers particularly hard as they depend on short-term, variable-rate loans to pay for everything from seeds and fertilizer to livestock and machinery with the goal of paying them back after the harvest. 

Lingering inflation is also pressuring business owners, though they’re reluctant to raise prices in a community where even a minute price hike elicits complaints and may steer customers away. 

“I feel like I have to work three times harder to get the same amount of money,” said Tammy Britt, the owner of a soda fountain and gift shop in Concordia.

© Reuters. Crop scouts survey a wheat field near Colby, Kansas, U.S., May 15, 2024. REUTERS/Heather Schlitz

Some said they were suffering health problems from the constant pressure and unrelenting workload. 

“There’s days (sic) where the stress mounts and you want to pull your hair out. Sometimes you got to run to the back of the building and scream a little bit and come back in,” restaurant owner Peterson said. “But you’ve got to be optimistic. 

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Oil prices stable as demand uncertainty persists

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By Paul Carsten

LONDON (Reuters) – Oil prices were stable on Tuesday, as traders awaited signs of a hoped-for summer demand boost to prop up prices even as strong supply threatens to blunt gains.

Benchmark futures were down 2 cents to $84.23 per barrel at 1231 GMT after climbing in the previous session. U.S. West Texas Intermediate crude futures, which also rose on Monday, were up 3 cents to $80.36 a barrel.

Both benchmarks gained around 2% on Monday, closing at their highest levels since April. Brent has clambered back from an early-June close of $77.52, though remains off its $90 peaks in mid-April.

“The oil market shifted its focus back to fundamentals, which have been soft for some time,” said BoFA commodity and derivatives strategist Francisco Blanch in a note, adding that global crude oil inventories and refined product storage in the United States and Singapore, among other places, was higher.

Meanwhile, global oil demand growth slowed to 890,000 barrels per day year on year in the first quarter, and data suggests consumption growth likely slowed further in the second quarter, he said in the note.

But inventories are expected to have fallen by 2.3 million barrels in the week to June 14, according to analysts polled by Reuters.

“The critical data set this week, at least for us, will be the U.S. oil inventory data as it could confirm or refute the developing optimism that demand has started its ascent at the dawn of the summer driving season,” Tamas Varga of oil broker PVM wrote in a note.

Some analysts remained bullish on the price impact of an extension by the OPEC+ group of supply cuts in the near term.

“The latest guidance provided by OPEC+, as well as their unchanged 2.25 million barrels per day demand growth outlook, signals a stagnation in oil supply growth for 2024 and an apparent downside risk to production in 2025,” said Patricio Valdivieso, Rystad Energy vice president and global lead of crude trading analysis.

“Under these conditions — and the disconnect between the OPEC+ demand outlook and all other agencies — it is hard to remain fully bearish when global oil supply growth appears decimated,” he added.

© Reuters. FILE PHOTO: Storage tanks are seen at Marathon Petroleum's Los Angeles Refinery, which processes domestic & imported crude oil into California Air Resources Board (CARB), gasoline, diesel fuel, and other petroleum products, in Carson, California, U.S., March 11, 2022. Picture taken with a drone. REUTERS/Bing Guan/File Photo

In China, oil refinery output in May slipped 1.8% from year-ago levels, statistics bureau data showed on Monday, as refiners undertook planned maintenance and processing margins were pressured by rising crude costs.

Investors were also looking out for further clues on interest rates, and how U.S. demand will develop, as several U.S. Federal Reserve representatives are scheduled to speak later on Tuesday.

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Oil edges up as summer demand hopes offset downbeat China data

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By Alex Lawler

LONDON (Reuters) -Oil edged higher on Monday as hopes for a boost to demand from the summer driving season in the northern hemisphere offset Chinese data that underscored a bumpy recovery for the world’s biggest crude importer.

Apart from retail sales that beat forecasts due to a holiday boost, the flurry of Chinese data on Monday was largely downbeat. The data followed a survey on Friday showing U.S. consumer sentiment fell to a seven-month low in June.

Global benchmark futures were up 33 cents, or 0.4%, to $82.95 a barrel at 1212 GMT. U.S. West Texas Intermediate crude futures gained 25 cents, or 0.3%, to $78.70.

Last week, both benchmarks posted their first weekly gain in four weeks on elevated confidence that oil inventories are set to plunge as the summer season gets under way in the northern hemisphere amid continued OPEC+ supply cuts.

“The market initially responded negatively to mixed data from China,” said Ole Hansen of Saxo Bank.

“But the outlook for strong fuel demand into the coming quarter and Saudi reassurance about the October hike being subject to prevailing conditions and added focus on quota breakers to bring production down and into line all seems to be supporting.”

Saudi Arabia has said OPEC+’s planned fourth-quarter increase in output can be can paused or reversed if needed. Russia and Iraq, which have been pumping more than their OPEC+ quotas, pledged last week to meet their obligations.

Reports from OPEC and the International Energy Agency last week, although differing on the strength of oil demand growth this year, had supported confidence that inventories would be drawn down in the second half.

Still, BofA analysts said in a report that while the market consensus is for higher oil prices in the third quarter, there is a risk to prices if weak supply and demand balances persist.

© Reuters. FILE PHOTO: A view shows oil tanks of Transneft oil pipeline operator at the crude oil terminal Kozmino on the shore of Nakhodka Bay near the port city of Nakhodka, Russia August 12, 2022. REUTERS/Tatiana Meel/File Photo

“It is not yet clear whether balances will firm enough in the third quarter to tip the market from a large apparent surplus into a deficit that can lift prices,” BofA analysts including Francisco Blanch wrote.

On the geopolitical front, concerns of a wider Middle East war lingered after the Israeli military said on Sunday that intensified cross-border fire from Lebanon’s Hezbollah movement into Israel could trigger serious escalation.

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