Baltic Dry Index. 2544 -23 Brent Crude 120.65
Spot Gold 1958 Wheat 11.02
Nothing is so admirable in politics as a short memory.
John Kenneth Galbraith.
Russia warns West: gas bills in roubles are just days away
March 25, 2022 3:28 PM GMT
· Russia bites back with gas rouble payments
· Gazprom has 4 days to work out rouble payments
· Russia exports $880 million of gas a day
LONDON, March 25 (Reuters) - Russia warned the West on Friday that billing in roubles for billions of dollars of natural gas exports to Europe could be just days away, Moscow's toughest response yet to crippling sanctions imposed by the West for the invasion of Ukraine.
With the Russian economy facing its gravest crisis since the years that followed the break-up of the Soviet Union, President Vladimir Putin on Wednesday hit back at the West, ordering that Russian gas exports should be paid for in roubles. read more
Putin said the West had declared economic war by freezing Russian assets, and so Russia saw no point in receiving dollars or euros for Russian exports anymore.
The Kremlin on Friday said Putin had ordered Gazprom (GAZP.MM), the world's biggest natural gas company, which supplies 40% of Europe's gas, to accept export payments in roubles, and that it had just four days left to work out how.
"There is an instruction to Gazprom from the president of the Russian Federation to accept payments in roubles," Kremlin spokesperson Dmitry Peskov told reporters. "This information will be brought to the purchasers of Gazprom products."
Gas buyers have been seeking guidance on how they could get the roubles to make any such payments, given the extent of the sanctions on Russia.
"Rouble payments are somewhere between very difficult and not possible for the majority of European buyers to organise, and certainly not at short notice," Jonathan Stern, Distinguished Research Fellow at the Oxford Institute for Energy Studies, told Reuters.
If Gazprom insisted on rouble payments and stopped deliveries if payments were not made in roubles, "then in my view this would be a violation of contract terms," he said.
Payments in roubles would shore up the Russian currency, which has plummeted since the invasion on Feb. 24. Putin's speech lifted the rouble 9% against the dollar on Wednesday.
Meanwhile Dutch gas prices, the European benchmark, have spiked due to concerns over whether countries will be willing or even able to pay in roubles.
POLICY UPHEAVAL
Putin's move, announced just as the European Union was debating additional sanctions on Russia, amounts to one of the sharpest turns in Russian gas politics since the Soviets built gas pipelines to Europe from Siberia in the early 1970s.
The man who has been Russia's paramount leader since 1999 has long railed against the dominance of the U.S. dollar, which he casts as an instrument of a U.S. "empire of lies" aimed at destroying Russia.
Moscow was blindsided by the West's ability to freeze the $300 billion of Russia's $640 billion "rainy day" reserve that was parked abroad.
Russia says the West has defaulted on its obligations to Russia, and that Moscow's post-Soviet delusions about the West, and the use of dollars and euros, are over.
---- The mechanism by which up to $320 billion a year of gas exports will be paid for in roubles is still unclear. Euros account for 58% of Gazprom exports, U.S. dollars 39% and sterling around 3%, according to the company.
German Finance Minister Christian Lindner on Friday advised German energy providers not to pay for Russian gas in roubles, as demanded by Moscow. read more
More
Next, the collateral economic damage from the war the west’s top diplomats abjectly failed to prevent.
Countries brace for hit to tourism from Russia-Ukraine war
BELEK, Turkey (AP) — After losing two years to the COVID-19 pandemic, shopkeepers in the heart of the Turkish Riviera had hoped for a strong tourism season this year to help keep their businesses afloat. But Russia’s war in Ukraine is fast dampening their spirits.
“We’re trying to earn our bread through tourism, but it looks like the war has finished off this (tourism) season, too,” Devrim Akcay said outside his clothing shop in the resort town of Belek, along the Mediterranean coast’s Antalya province.
Nowhere is the threat of just one ripple effect of the war — lost tourism — felt more strongly than in Antalya, a region dotted with shimmering beaches and archeological sites where visitors from Russia and Ukraine, along with Germany, make up the top contributors to tourism revenue.
Countries from Turkey to Thailand, Egypt and Cuba are bracing for the loss of Russian and Ukrainian visitors just as their travel sectors were looking to rebound from the pandemic. With many tourist-dependent economies also struggling with surging inflation and other woes, hotel workers, guides and others who serve visitors from the two warring nations expect more pain.
The turquoise waters and white sand beaches of the Cuban resort of Varadero, which until recently received a significant number of tourists — mainly Russians — are now almost empty.
Russians accounted for almost a third of Cuba’s visitors last year — more than 146,000 — and some saw them as the way to get some oxygen to an industry ailing from the pandemic and tighter sanctions imposed by former U.S. President Donald Trump.
“Now, we also have to get by without the Russian tourism,” said José Luis Perelló Cabrera, a Cuban economist and tourism expert.
----The expectation before the war was “maybe 10, 15 million Russians would be visiting Turkey this summer that will be spending 10 billion dollars, a shot in the arm for Turkey’s ailing economy,” Cagaptay said.
Now, business groups say they’re seeing erosion in trade both ways, including a fall in demand for Turkish produce because Russian buyers are struggling to make payments. That’s despite Turkey not joining in sanctions against Moscow.
Agricultural grower and exporter Nevzat Akcan worries he may not be able to ship the red bell peppers he grows in greenhouses in the district of Aksu solely for Russian and Ukrainian markets.
“May God protect us if we join the sanctions against Russia. This would be a disaster for Turkish agriculture. We would be ruined and finished,” Akcan said. “I don’t even want to think about it.”
NATO-member Turkey, which has cultivated close ties with both Russia and Ukraine, is trying to balance those relations and has positioned itself as a neutral party trying to mediate.
More
Next, that European war that no one wanted. For this diplomacy failure, how many lives were lost, destroyed, maimed, ruined. How poor Ukraine got played.
What’s now done will take decades to undo, if it can ever happen at all.
How the West Sabotaged Ukraine
Natylie Baldwin Posted on March 25, 2022
Vladimir Putin is responsible for his decision to illegally invade Ukraine. But that doesn’t make it any easier to watch western governments and their mainstream media outlets with their self-righteous displays of concern about Ukraine. After virtue signaling an implied commitment to allowing Ukraine into the EU, it is now being made clear that it will not be admitting Ukraine any time soon. Neither Washington nor Europe is using its power and influence to conduct diplomacy with Russia to facilitate a settlement to the conflict. Indeed it appears that all the US-led West is willing to do is throw a lot of weapons at Ukraine, which will keep the war going, maximize death and destruction for Ukrainians that will never lead to a victory over Russia, and create blowback risks to the West.
More
https://original.antiwar.com/Natylie_Baldwin/2022/03/24/how-the-west-sabotaged-ukraine/
Why Did Russia Give Away Crimea Sixty Years Ago?
Crimea was part of Russia from 1783, when the Tsarist Empire annexed it a decade after defeating Ottoman forces in the Battle of Kozludzha, until 1954, when the Soviet government transferred Crimea from the Russian Soviet Federation of Socialist Republics (RSFSR) to the Ukrainian Soviet Socialist Republic (UkrSSR). The transfer was announced in the Soviet press in late February 1954, eight days after the Presidium of the USSR Supreme Soviet adopted a resolution authorizing the move on 19 February. The text of the resolution and some anodyne excerpts from the proceedings of the Presidium of the USSR Supreme Soviet meeting on 19 February were published along with the very brief announcement.[1] Nothing else about the transfer was disclosed at the time, and no further information was made available during the remainder of the Soviet era.
More
https://www.wilsoncenter.org/publication/why-did-russia-give-away-crimea-sixty-years-ago
Finally, some disturbing news from Antarctica.
Ice shelf collapses in previously stable East Antarctica
An ice shelf the size of New York City has collapsed in East Antarctica, an area long thought to be stable and not hit much by climate change, concerned scientists said Friday.
The collapse, captured by satellite images, marked the first time in human history that the frigid region had an ice shelf collapse. It happened at the beginning of a freakish warm spell last week when temperatures soared more than 70 degrees (40 Celsius) warmer than normal in some spots of East Antarctica. Satellite photos show the area had been shrinking rapidly the last couple of years, and now scientists wonder if they have been overestimating East Antarctica’s stability and resistance to global warming that has been melting ice rapidly on the smaller western side and the vulnerable peninsula.
The ice shelf, about 460 square miles wide (1200 square kilometers) holding in the Conger and Glenzer glaciers from the warmer water, collapsed between March 14 and 16, said ice scientist Catherine Walker of the Woods Hole Oceanographic Institute. She said scientists have never seen this happen in this part of the continent, making it worrisome.
“The Glenzer Conger ice shelf presumably had been there for thousands of years and it’s not ever going to be there again,” said University of Minnesota ice scientist Peter Neff.
The issue isn’t the amount of ice lost in this collapse, Neff and Walker said. That is negligible. It’s more about the where it happened.
Neff said he worries that previous assumptions about East Antarctica’s stability may not be correct. And that’s important because if the water frozen in East Antarctica melted — and that’s a millennia-long process if not longer — it would raise seas across the globe more than 160 feet (50 meters). It’s more than five times the ice in the more vulnerable West Antarctic Ice Sheet, where scientists have concentrated much of their research.
More
The Arctic and Antarctic sea ice.
http://nsidc.org/arcticseaicenews/
John Kenneth Galbraith. The Great Crash: 1929.
Global Inflation/Stagflation Watch.
Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.
PLANTED ACRES IN UKRAINE COULD FALL BY HALF
Mar. 24, 2022
Blog by Keith Good, University of Illinois
Reuters writer Pavel Polityuk reported yesterday that, "Ukraine's spring
crop sowing area may more than halve this year from 2021 levels to some 7
million hectares, its Agriculture Minister Roman Leshchenko said on Tuesday,
versus 15 million hectares expected before the Russian invasion.
"He said farmers could sow up to 3.3 million hectares of corn this year
versus 5.4 million hectares in 2021," the Reuters article said, adding
that, "Leshchenko said the ministry had urged farmers to sow more spring
wheat, buckwheat, oats, millet and spring barley. He gave no forecast for the
sown area of those specific crops, but said overly dry weather could affect the
sowing."
World Agricultural
Supply and Demand Estimates Report of March 9, 2022. Secretary's Briefing-
Interagency Commodity Estimates Committee Forecasts.
The Reuters article added that, "Leshchenko
said farmers sowed a total of 6.5 million hectares of winter wheat for the 2022
harvest, but the harvested area could be only around 4 million hectares due to
war in many Ukrainian regions.
"He declined to forecast the 2022 grain harvest,
because 'the situation has not fully stabilized,' he said."
Also yesterday, Reuters writer Natalia Zinets
reported that, "Ukraine's northwestern Rivne region has started sowing
spring crops, and aims to sow 420,000 hectares and support regions whose harvests
may be more heavily disrupted by the war with Russia, Governor Vitaliy Koval
said on Tuesday.
To view the complete report, click here.
https://www.agrimarketing.com/s/140303
A third of fields in occupied areas, hostile zones will not be planted, says Ukrainian ag journalist
By Iurii Mykhailov 3/22/2022
The seeding season in Ukraine has started. The main question is how well positioned are producers to plant. The answer is not that simple. There are big producers who lost up to 90% of their producing area due to Russian occupation or because of proximity to hostilities, especially in East and Southeast Ukraine. In general, the first balanced estimates of spring sowing show that up to one third of Ukrainian fields in the occupied areas or hostile zones will be unsown.
There are also producers whose areas are sufficiently far from the lines of war and can be tilled provided that these producers have sufficient inputs, mainly fuel, seed, and fertilizers. While the shortage of seed and fertilizer may be easily resolved when necessary through imports and domestic production, the situation with fuel is more complicated.
The restrictions on exports and issues with seed also are driving producers to change their production plans. It is expected that this year the areas in Ukraine that planted corn and sunflowers will be replaced with wheat and buckwheat (which is the most popular cereal in Ukraine). Considering the sharp increase in demand for grain on the international markets and the restricted capacity of the railroad, this introduces the possibility to increase the export of flour instead of grain. So the situation is not as gloomy as it may look.
Before the war, Ukraine imported half of its oil and produced the other half in country. The total annual volume of crude oil available was about 3 million tons. Of the 1.5 million tons of imported oil, 70% was supplied by Russia and Belarus. For now, this channel is cut off. Another 30% of oil and its derivatives were imported from the countries of Azerbaijan, Algeria, and Libya. Due to mining by Russia of the Black Sea waterways to/from Ukraine, it is impossible to import oil by sea, so essentially Ukraine has to rely on its own oil supply to get by.
Is there a possibility to increase the domestic production of oil? Theoretically, there is. There are oil fields in Eastern and Western Ukraine. The oil fields in Eastern Ukraine are close to the front lines, so they may be the targets of ground and/or air attacks. So this is risky. While the oil fields in Western Ukraine are depleted, some extraction increase is possible.
However, all these measures will not cover the loss of the Russian and Belarus oil.
----There are large stocks of unexported commodities like corn, sunflower seeds and oil, and soybeans. It is impossible to export commodities by sea, and railway restrictions only allow the export of 10% of the previous year’s volumes. It is possible to expand the production of biofuels as substitutes for the mineral ones thus replenishing the supply of fuel for farmers and the army, though it may require some improvements to equipment.
Early this morning, the Mykolaiv seaport infrastructure suffered a lot of damage as a result of a Russian air strike.
More
Soaring Bread Prices Should Make Arab Leaders Nervous
Anger at food inflation could easily spur political unrest as it did a decade ago, especially in Egypt, the world’s No. 1 importer of wheat.
By Bobby Ghosh25 March 2022, 09:30 GMT
When Muslims in the Arab world congregate at sundown during Ramadan to chew the fat during the fast-breaking “iftar” meal, the conversations tend to drift toward politics, and good-natured gabfests can quickly turn into group grumbling. Nothing leavens a gripe session more than the rising price of the staple of every Middle Eastern meal: bread.
The grousing is guaranteed to be heated when Ramadan begins next week. The price of wheat, already rising toward the end of last year, has skyrocketed with Russia’s invasion of Ukraine. The two countries are among the world’s biggest exporters of wheat and major suppliers of the Arab world.
More
Virus Outbreaks in Mexico’s Hog Herd to Drive U.S. Meat Prices Higher
25 March 2022, 11:00 GMT
The U.S. is shipping record amounts of pork to Mexico as hog diseases shrink herds there, in a move that will likely push American meat prices up even further.
Pork is being sold to Mexico at a torrid pace. The country was the top buyer of American product in the latest week, U.S. government data on Thursday showed. The sales are of interest because strong exports of U.S. red meat have been underpinning rising consumer prices and contributing to the highest overall inflation in four decades.
Outbreaks of deadly porcine epidemic diarrhea virus, known as PEDv, and porcine reproductive and respiratory syndrome, or PRRS, have been killing pigs in Mexico, according to Christine McCracken, a protein analyst at Rabobank. At the same time, farmers are probably cutting back herds because animals are getting too expensive to feed. Russia’s invasion of Ukraine has sent grain prices soaring.
Lower supplies of animal protein in Mexico “is part of their need to import more,” McCracken said.
The price of pork chops at U.S. grocery stores was an average $4.03 a pound at the end of February, according to Bureau of Labor Statistics data. That’s the highest for the time of year in at least 30 years. Some recent seasonal wholesale pork prices have also been among the highest in a decade or more.
Meanwhile, lean hog futures in Chicago neared an eight-year high amid tight animal supplies. The U.S. Department of Agriculture is due to release its quarterly hog and pigs inventory report March 30.
More
Below, why a “green energy” economy may not be possible, and if it is, it won’t be quick and it will be very inflationary, setting off a new long-term commodity Supercycle. Probably the largest seen so far.
The “New Energy Economy”: An Exercise in Magical Thinking
https://media4.manhattan-institute.org/sites/default/files/R-0319-MM.pdf
Mines, Minerals, and "Green" Energy: A Reality Check
https://www.manhattan-institute.org/mines-minerals-and-green-energy-reality-check
"An Environmental Disaster": An EV Battery Metals Crunch Is On The Horizon As The Industry Races To Recycle
by Tyler Durden Monday, Aug 02, 2021 - 08:40 PM
Covid-19 Corner
This section will continue until it becomes unneeded.
Omicron ‘stealth’ variant BA.2 is spreading rapidly in China
Published Thu, Mar 24 2022 4:15 AM EDT
BEIJING — As mainland China battles its worst Covid-19 outbreak since early 2020, local governments increasingly say the new omicron BA.2 variant is to blame.
That’s the new Covid subvariant, which preliminary research indicates is even more transmissible than the original omicron variant — but doesn’t necessarily cause more severe illness.
Mainland China has reported well over 1,000 new confirmed Covid cases a day since March 12, with the number holding above 2,000 for the last three days. That’s not including the asymptomatic case count, which can be just as many, or far more, than the number of daily confirmed cases.
From the northern province of Jilin — which accounts for more than half of the new daily cases — to industrial centers like Tangshan and Shenzhen, local authorities have blamed omicron BA.2 for the latest wave of Covid.
“Omicron BA.2 caused this outbreak, and spreads faster and more easily than previous viruses,” the export-heavy province of Fujian said in an online statement Tuesday, according to a CNBC translation of the Chinese text.
The subvariant is also “stealthier” and harder to find, but infections are primarily mild or asymptomatic cases, the Fujian government said.
Scientists have also described BA.2 as a “stealth” variant because it contains mutations that could make it harder to distinguish from the older delta variant using PCR tests.
Despite apparent changes in the virus’ severity, China has maintained its stringent zero-Covid policy of using swift, regional lockdowns to control outbreaks. The strategy had helped the economy quickly return to growth after the initial shock of the pandemic in early 2020.
Different provinces or cities can impose quarantines or travel restrictions on people coming from other regions, or at least require valid virus tests, adding hurdles to commercial travel.
For example, a company had to change its truck driver to a local one before the vehicle entered a city in the Guangxi region, said Klaus Zenkel, chair of the south China chapter of the EU Chamber of Commerce in China. “Otherwise he cannot enter the area where he needs to deliver the goods to.”
More
https://www.cnbc.com/2022/03/24/omicron-stealth-variant-ba2-is-spreading-rapidly-in-china.html
World Health Organization - Landscape of COVID-19 candidate vaccines. https://www.who.int/publications/m/item/draft-landscape-of-covid-19-candidate-vaccines
NY Times Coronavirus Vaccine Tracker. https://www.nytimes.com/interactive/2020/science/coronavirus-vaccine-tracker.html
Regulatory Focus COVID-19 vaccine tracker. https://www.raps.org/news-and-articles/news-articles/2020/3/covid-19-vaccine-tracker
Some more useful Covid links.
Johns Hopkins Coronavirus resource centre
https://coronavirus.jhu.edu/map.html
Rt Covid-19
The Spectator Covid-19 data tracker (UK)
https://data.spectator.co.uk/city/national
Technology Update.
With events happening fast in the development of solar power and graphene, I’ve added this section. Updates as they get reported.
Chip industry under threat with neon production set to fall off a cliff following Russia’s invasion of Ukraine
Published Fri, Mar 25 2022 2:52 AM EDT
Russia’s war in Ukraine could see the production of neon, a critical gas in advanced semiconductor manufacturing, fall to worryingly low levels at a time when the world is already grappling with a chip shortage.
Neon is required for the lasers that are used in a chip production process known as lithography, where machines carve patterns onto tiny pieces of silicon made by the likes of Samsung, Intel and TSMC.
More than half of the world’s neon is produced by a handful of companies in Ukraine, according to Peter Hanbury, a semiconductor analyst at research firm Bain & Co.
Those companies include Mariupol-based Ingas, as well as Cryoin and Iceblick, which are based in Odessa.
The firms did not immediately reply to a CNBC request for comment but Ingas and Cryoin have both ceased operations in recent weeks amid attacks from Russian forces, according to Reuters.
With world-leading Ukrainian firms having shuttered their operations, neon production is now set to fall off a cliff as the conflict drags on.
Based on estimates from consultancy firm Techcet, worldwide neon consumption for semiconductor production reached roughly 540 metric tons last year. Given Ukraine produces over half of the world’s neon, the figure could fall below 270 metric tons in 2022 if the nation’s neon producers remain shut.
“Of the materials used in chip-making that could see a hit to their supply from the Ukraine conflict, it is neon that poses the greatest potential challenge,” Hanbury told CNBC via email.
The ongoing global chip shortage has already wreaked havoc on supply chains and led to lengthy delays on products such as new cars and games consoles like the PlayStation 5.
More
This weekend’s musical diversion. Vivaldi again. The original CNN theme music from the 70s. When TV news was still news not extreme left-wing fake news or propaganda. Approx. 8 minutes.
Vivaldi Konzert für 2 Trompeten und Orchester in C
https://www.youtube.com/watch?v=e_MzVxq1_4c
This weekend’s chess update. Approx. 18 minutes.
Carlsen vs Pentala Harikrishna - Wild Game!
https://www.youtube.com/watch?v=H16Kzo04B-E
This weekend’s maths update. Functions explained. Approx. 13 minutes.
What Is A Function? (easy to understand explanation)
https://www.youtube.com/watch?v=5D5b3c1DjZw
“Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security but [also] at confidence in the equity of the existing distribution of wealth.
----As the inflation proceeds and the real
value of the currency fluctuates wildly from month to month, all permanent relations
between debtors and creditors, which form the ultimate foundation of
capitalism, become so utterly disordered as to be almost meaningless; and the
process of wealth-getting degenerates into a gamble and a lottery.
Lenin was certainly right. There is no subtler, no surer means of overturning
the existing basis of society than to debauch the currency. The process engages
all the hidden forces of economic law on the side of destruction, and does it
in a manner which not one man in a million is able to diagnose.”
The Economic Consequences of the Peace.
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