Baltic Dry Index. 2137 +69 Brent Crude 112.86
Spot Gold 1985
Coronavirus Cases 02/04/20 World 1,000,000
Deaths 53,100
Coronavirus Cases 18/04/22 World 504,793,802
Deaths 6,223,262
“Man is the only creature that consumes without
producing. He does not give milk, he does not lay eggs, he is too weak to pull
the plough, he cannot run fast enough to catch rabbits. Yet he is lord of all
the animals. He sets them to work, he gives back to them the bare minimum that
will prevent them from starving, and the rest he keeps for himself.”
Animal Farm.
With much of the old Anglo world closed for an Easter Bank Holiday today, Asian markets are digesting the iffy economic news out of China.
China’s Covid lockdown of Shanghai is adding to supply chain problems, falling retail sales and what looks to be rising dissent at a failing policy against the Omicron variants. Officially Shanghai has reported 3 new deaths, all attributed to comorbidities.
Well yes, it is communist China after all.
The real story for 2022 I think, is in global food supply. Will 2022 go down in history as the first of the Great 21st century food crisis?
Time will tell, but to this old dinosaur commodities follower, the signs that it will are starting to look ominous.
While our devious central banksters can print up trillions
of new fiat currency from the Magic Money Tree Forests at the push of a
computer button, if the foodstuffs aren’t available for purchase because they
weren’t produced, all that will do is generate an inflationary scramble to
hoard and start locking up available supply. Does no one remember 1972-73?
More on that in the inflation section.
Asia stocks decline as investors react to mixed Chinese economic data
SINGAPORE — Asia markets largely slipped in Monday trade, with investors reacting to the release of Chinese economic data, including first-quarter gross domestic product figures.
In Japan, the Nikkei 225 fell 1.5% as shares of Fast Retailing declined nearly 2%. The Topix index shed 1.22%.
Mainland Chinese stocks were also lower, with the Shanghai composite down 0.78% and the Shenzhen component shedding 0.2%.
China saw faster-than-expected GDP growth in the first quarter, data released by the National Bureau of Statistics showed Monday. First-quarter GDP in China rose 4.8%, above expectations for a 4.4% year-over-year increase.
Retail sales in March, however, fell by a more-than-anticipated 3.5% as compared with a year earlier. That was against expectations for a 1.6% fall in a Reuters poll.
The data come as mainland China has for weeks been battling its worst Covid wave in two years. In particular, the major city of Shanghai has been among the areas most affected.
----South Korea’s Kospi outperformed the broader region, climbing 0.67%. MSCI’s broadest index of Asia-Pacific shares outside Japan traded 0.62% lower.
Asia markets may “tread carefully to start the week” as investors digest the People’s Bank of China’s Friday announcement for a reserve requirement ratio cut on April 25, analysts at Singapore’s OCBC Treasury Research wrote in a Monday note. The RRR is the amount of funds banks need to hold in reserve.
“This is the smallest cut since China unveiled the reform on reserve requirement ratio in 1998,” the analysts said.
----Markets in Australia and Hong Kong are closed on Monday for a holiday.
----Oil prices were higher in the afternoon of Asia trading hours, with international benchmark Brent crude futures up 1.03% to $112.85 per barrel. U.S. crude futures climbed 0.92% to $107.93 per barrel.
https://www.cnbc.com/2022/04/18/asia-markets-investors-await-chinas-first-quarter-gdp.html
Finally, that Russian debt default next month looks like being “complicated,” to say the least.
Not mentioned in the article, why would any government, global corporation or billionaire leave any assets, money, gold etc., vulnerable to arbitrary seizure by Uncle Scam and underboss John Bull?
Russia's debt default will be one of the hardest in history to resolve and could see the US seize the central bank's assets, economist says
Harry Robertson Sat, April 16, 2022, 9:00 AM
The impending Russian debt default is likely to be one of the most difficult in history to resolve, and could even lead the US to permanently seize assets from the country's central bank, according to a report from the consultancy Oxford Economics.
Russia is facing its first default on its foreign-currency debt since the aftermath of the Bolshevik revolution in 1918.
The US Treasury earlier this month blocked Russia from paying $650 million due on two bonds using funds held at American banks. Russia has instead tried to pay in rubles, but credit ratings agencies have said this would constitute a default.
Russia has a 30-day grace period from April 4 in which to pay in dollars. But thoughts are now turning to the next steps, and how bondholders might recoup their money.
Tatiana Orlova, lead emerging markets economist at Oxford Economics, said investors face a "very long and difficult" legal road. "Russia's debt crisis will be among the most difficult in history to resolve, since the default has its roots in politics rather than finance," she wrote in a report that was sent to clients Thursday.
One of the key problems is that political and financial relations between Russia and the West have completely broken down. That makes the usual default process, whereby bondholders and the government enter negotiations and thrash out a deal, seem unlikely to happen.
Orlova said another problem for bondholders is that Ukraine may lay a claim to Russian assets in international courts to pay for the rebuilding of the country. In that case, investors would have to weigh up whether they want to compete with the Ukrainian government for Russian assets.
The economist said the US might eventually end up seizing the money from the Russian central bank's foreign currency reserves. Western governments have already frozen the bulk of the roughly $600 billion stockpile.
----It's not just holders of Russian sovereign debt who may have to take to the courts to try to get their money.
Orlova's report said there is likely to be an "avalanche" of Russian corporate debt defaults, given that the US is taking a hard line and banning American banks from processing payments.
An international committee of banks last week deemed state-owned Russian Railways to be in default, after sanctions stopped the company from making bond payments.
There were roughly $98 billion of Russian corporate foreign-currency bonds outstanding as the war began in February, according to JPMorgan, with $21.3 billion owned by foreign investors.
https://www.yahoo.com/news/russias-debt-default-one-hardest-080000031.html
Global Inflation/Stagflation Watch.
Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.
To this old dinosaur commodities watcher, we seem to have the worst of all food supply chain problems.
War in the Ukraine has stopped Ukraine’s grain and food oil shipments virtually 100 percent. Very little spring planting is likely taking place. The in-ground growing winter wheat crop is missing out on fertilisation leading to a poorer outcome later at harvest, assuming it can be harvested and shipped at all.
Elsewhere a North American western drought continues to threaten the 2022 grain outcome as does a lack of fertilisers and sky high prices for fertilisers.
Basically, whether we get a food chain supply crisis later this year all comes down to the northern hemisphere’s weather and growing season.
Possibly the greatest weather market for grains and other foodstuffs since the Great Soviet Grain Robbery of 1972.
FARM BUREAU'S
CHIEF ECONOMIST REPORTS ON HOW INFLATION IS IMPACTING FARMERS
Apr. 15, 2022
National Association of Farm Broadcasting (NAFB)
reports:
The Consumer Price Index increased again in March as
the nation grapples with decades-high inflation. The Bureau of Labor Statistics
reports year-over-year inflation in March was 8.5 percent. American Farm Bureau
Federation Chief Economist Roger Cryan says we're seeing the highest level of
inflation in 40 years.
"The Federal Reserve Bank has the levers to
manage the money supply, and there was a 40 percent increase in the money
supply from March 2020 to last December. So, for almost two years, a lot of
folks out in the economy had faith in the system and prices didn't move much,
but now there's so much money out there, inflationary expectations are building
and what we're seeing now is an acceleration of inflation. I'm not sure whether
or not to define this as runaway inflation, but it will start to look like
that."
Cryan says inflation has several effects for
farmers.
"Inflation creates a lot of price uncertainty,
it creates a disconnect between long-term and short-term pricing, it creates a
lot of, sort of, chaos among relative prices that you don't necessarily have
when things are stable. It also creates a disconnect between long-term and
short-term lending. Although, the long-term lending rates are rising now also,
and the 30-year mortgage rate is rising relatively quickly."
He expects inflation to linger for a year or two.
"Even if the Fed starts to get us back towards
what should be the normal rate of growth in the money supply, there's just a
lot of liquidity in the market that needs to work its way through the system.
And we certainly hope that the Fed starts paying attention to the money supply,
and I hope that they recognize that that's really the indicator that they need
to be paying attention to. Stopping inflation is really critical. It's
important that we deal with this, there may be some short-term pain to getting
this over with, but it'll be nothing like long-term pain if we don't."
https://www.agrimarketing.com/s/140568
UNION PACIFIC CURTAILS CF INDUSTRIES' FERTILIZER
SHIPMENTS, WILL NOT ACCEPT NEW ORDERS
Apr. 15, 2022
CF Industries reports:
Deerfield, IL - CF Industries Holdings, Inc. (NYSE:
CF), a leading global manufacturer of hydrogen and nitrogen products, today
informed customers it serves by Union Pacific rail lines that railroad-mandated
shipping reductions would result in nitrogen fertilizer shipment delays during
the spring application season and that it would be unable to accept new rail
sales involving Union Pacific for the foreseeable future. The Company
understands that it is one of only 30 companies to face these restrictions.
CF Industries ships to customers via Union Pacific
rail lines primarily from its Donaldsonville Complex in Louisiana and its Port
Neal Complex in Iowa. The rail lines serve key agricultural areas such as Iowa,
Illinois, Kansas, Nebraska, Texas and California. Products that will be
affected include nitrogen fertilizers such as urea and urea ammonium nitrate
(UAN) as well as diesel exhaust fluid (DEF), an emissions control product
required for diesel trucks. CF Industries is the largest producer of urea, UAN
and DEF in North America, and its Donaldsonville Complex is the largest single
production facility for the products in North America.
"The timing of this action by Union Pacific
could not come at a worse time for farmers," said Tony Will, president and
chief executive officer, CF Industries Holdings, Inc. "Not only will
fertilizer be delayed by these shipping restrictions, but additional fertilizer
needed to complete spring applications may be unable to reach farmers at all.
By placing this arbitrary restriction on just a handful of shippers, Union
Pacific is jeopardizing farmers' harvests and increasing the cost of food for
consumers."
----The
application of nitrogen fertilizer is critical to maximizing crop yields. If
farmers are unable to secure all the nitrogen fertilizer that they require in
the current season because of supply chain disruptions such as rail shipping
restrictions, the Company expects yield will be lower. This will likely extend the
timeline to replenish global grains stocks. Low global grains stocks continue
to support high front month and forward prices for nitrogen-consuming crops,
which has contributed to higher food prices.
CF Industries intends to engage directly with the federal
government to ask that fertilizer shipments be prioritized so that spring
planting is not adversely impacted.
More
https://www.agrimarketing.com/s/140562
Avian flu has spread to 27 states, sharply driving up egg prices
Laura Reiley - Saturday April 16, 2022
The price of eggs has soared in recent weeks in part because of a huge bird flu wave that has infected nearly 27 million chickens and turkeys in the United States, forcing many farmers to “depopulate” or destroy their animals to prevent a further spread.
The virus has impacted many different bird species, including penguins and bald eagles. But its spread among poultry has been tremendous, particularly among chickens raised for their eggs.
On Friday, the U.S. Department of Agriculture announced yet another outbreak, this one in two flocks in Idaho, making that the 27th state in which the virus has been found since February.
According to the USDA, the price of a dozen eggs in November hovered around $1. Right now, that price is $2.95 and rising.
More
Warmup for central, southern U.S. to spark more severe weather
April 17, 2022 / 2:40 PM
More rounds of severe weather are forecast to target the central and eastern United States the coming week, with springtime warmth set to make a come back in between.
A month into the official start of spring, residents across the country are keeping an eye out for severe weather. AccuWeather meteorologists say that more thunderstorms are expected in the middle of the week.
"The dynamics of the atmosphere could be just right for some severe weather from Tuesday night through Wednesday," according to AccuWeather Meteorologist Joseph Bauer. Areas most at risk include northern Texas, Oklahoma and Arkansas through southeastern Kansas and Missouri.
RELATED Powerful nor'easter to bring late blast of winter next week
Torrential downpours are expected to make localized flash flooding a risk in this zone, as well as large hail and damaging wind gusts.
Much of this zone has been hit by severe weather already in April in including in northern Texas and Arkansas as well as Nebraska and Iowa. Both locations have seen dozens of wind and hail reports and even a few tornadoes. Comparatively, there have been fewer severe weather reports in Kansas and Missouri.
More
https://www.upi.com/Top_News/US/2022/04/17/central-southeast-warm-severe-weather/1821650220170/
The ‘Great Grain Robbery’ of 1972
Out of the unsettling agricultural and economic events of 1972, the beginnings of a robust agricultural monitoring program were born.
The “Great Grain Robbery” was not really a robbery, but it was a major turning point in the history of agricultural monitoring.
In 1972, the U.S. and the U.S.S.R were deep in the middle of the Cold War, but that did not stop the daily business of trade among nations. In fact, given the dicey agricultural policies and poor weather of the Soviet breadbasket, crop failure was not unusual. Soviet agricultural trade representatives often turned to the foreign commodity markets to make up the difference.
In July of 1972, the Russians began buying up foreign wheat, purchasing 10 million tons from U.S. brokers by August. Richard E. Mooney’s economic analysis in a 1975 issue of The New York Times states that despite receiving reports of crop failures in the Soviet Union and elsewhere, the U.S. government failed to appreciate the significance of the global grain shortage and the effect it might have on the U.S. economy. As federal grain subsidies continued to favor bargains for the Soviets buying American wheat, the price of domestic grain rose sharply, causing a food price crisis back home. According to John A. Schnittker in a 1973 paper for the Brookings Institution, the U.S. government wasted $300 million in public funds and lost the same amount in potential revenue by unwittingly subsidizing the Russian wheat purchases.
As it turned out, the shortage in Russia was part of a worldwide shortage in grain production that almost wiped out international stockpiles. Clifton Luttrell wrote in the Federal Reserve Bank of St. Louis Review in 1973 that the U.S. government did not recognize this as it was happening because the government did not have a big-picture view of agricultural output worldwide.
At that point, sophisticated agricultural monitoring was only in its infancy. According to Gary Weir of the National Geospatial-Intelligence Agency, despite using satellites to photograph grain-growing areas, the resolution was not clear enough to reveal much information on the health of crops, leaving the probable outcomes of Russian harvests opaque to U.S. intelligence. Afterwards, the debacle was nicknamed the “Great Grain Robbery.” To prevent another such calamity, U.S. intelligence began looking at earlier technological research.
More
https://earthzine.org/the-great-grain-robbery-of-1972/
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.
Shanghai reports record level of new symptomatic COVID-19 cases
April 16, 2022 / 3:42 PM
April 16 (UPI) -- The Chinese financial capital of Shanghai reported a record 3,590 new symptomatic cases Saturday as the key industrial city remained under lockdown amid a surge in COVID-19.
Overall, the municipal health commission reported 23,513 current COVID-19 infections, including 19,923 local asymptomatic carriers, based on data covering the previous 24 hours.
The number brings total infections since March to about 326,000.
Thirteen patients have suffered severe COVID-19 symptoms, and they have been receiving treatment locally, the health commission said Saturday. Of the 13 patients, 12 are between ages 70 and 93 and had existing underlying health issues. The remaining patient is age 33.
The strict lockdown in the financial hub, known as COVID Zero approach, was instituted in late March to curb the spread of COVID-19. The measures have disrupted supply chains, hurting the economy.
In a bid to reignite the city, Shanghai's Economic and Information Technology Commission on Saturday published guidelines for resuming production in a post on its WeChat account, Bloomberg News reported.
Among the guidelines, the commission said workers should live on-site of businesses and be tested regularly. They should also apply at the district and city levels for approval to restart production, authorities said.
Many companies use Shanghai as a production base, including Tesla, which plans to partly resume production soon.
mRNA vaccination found to reduce COVID-19 infectious viral load
Rich Haridy April 13, 2022
New research published in Nature Medicine has found COVID-19 vaccination can reduce a person’s infectious viral load. The study compared the infectiousness of different SARS-CoV-2 variants between vaccinated and unvaccinated subjects.
We know the virus that causes COVID-19 initially takes hold in a person’s upper respiratory tract. In the early days of infection the virus rapidly replicates and this is the point when a person is most infectious.
The volume of virus in a person’s upper respiratory tract is generally referred to as a viral load. A high viral load is believed to be associated with greater infectiousness, and researchers have two main ways of measuring the volume of that viral load. The first, and most commonly used method, comes from tracking a specific PCR (polymerase chain reaction) testing metric.
A PCR test works by amplifying copies of the virus’ genetic material. Each cycle of the test basically doubles the genetic material present in the individual sample. Usually, if no trace of virus has been found after 30 to 40 cycles a PCR test is reported as negative.
The CT (cycle threshold) value is a measure of how many times the test cycles before finding viral genetic material. A low number means there was plenty of viral material in the original swab sample, while a higher CT value means the opposite.
So CT values are often used to determine the viral load of a COVID-19 patient, and a high viral load is generally considered to correlate with the contagiousness of a given patient at that point in time. However, research linking PCR measured viral loads and transmission has been inconsistent. Isabella Eckerle, lead researcher on the new study, says measuring viral load this way is not a good indication of how infectious that specific viral load is.
“[A PCR] test is very effective in identifying infected people, but does not indicate whether they are infectious, that is, capable of transmitting the virus to other people," explained Eckerle. "However, the notion of contagiousness is essential for deciding on collective prevention measures, such as periods of isolation."
The second way of measuring the infectiousness in a given viral sample is by isolating that virus in cell cultures and watching how rapidly it replicates. This method has been used for many years as a good measure for viral infectiousness, but it hasn’t been frequently deployed in the COVID-19 pandemic. Current safety measures require this kind of test with SARS-CoV-2 to be conducted in a biosafety level 3 laboratory. Not an easy process to routinely perform.
The new research set out to perform these tests on several hundred samples of SARS-CoV-2 including three different variants (the original strain, Delta and Omicron) spanning both unvaccinated and vaccinated infections.
The researchers first found there was very little correlation between viral load as measured by PCR CT value and infectious viral load measured from cell cultures. The researchers also found age and sex played no part in influencing a person’s infectious viral load.
“Next, we have investigated the effect of vaccination (2 doses mRNA) on infectious viral load,” Eckerle reported on Twitter. “In vaccinated individuals with a Delta breakthrough infection, infectious virus was almost 5-fold lower & was cleared more rapidly than in the unvaccinated with Delta.”
The results were quite different when the researchers looked at infectious viral loads in patients with the Omicron variant. With Omicron, those two-dose vaccinated patients were found to have similar infectious viral loads to unvaccinated patients. But a big drop in infectious viral load came with the third vaccine dose. This matches a large volume of research finding a third vaccine dose is crucial in protecting against the Omicron variant.
“This is immunologically consistent: many vaccines require 3 doses spaced several months apart to induce a sustained immune response, such as that against Hepatitis B virus," explained Eckerle.
One of the more unexpected findings in the new study was the observation that, overall, it seems the Omicron variant generated lower levels of infectious viral load compared to the Delta variant. Considering we know Omicron to be significantly more transmissible than previous SARS-CoC-2 variants the researchers conclude it is still unclear exactly what mechanism is behind the variant's increased transmissibility.
More
Next, some vaccine links kindly sent along from a LIR reader in Canada.
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 other useful Covid links.
Johns Hopkins Coronavirus resource centre
https://coronavirus.jhu.edu/map.html
Rt Covid-19
Centers for Disease Control Coronavirus
https://www.cdc.gov/coronavirus/2019-ncov/index.html
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, among other things, I’ve added this section. Updates as they get reported.
Graphene-hBN breakthrough to spur new LEDs, quantum computing
Date: April 14, 2022
Source: University of Michigan
Summary: In a discovery that could speed research into next-generation electronics and LED devices, a research team has developed a reliable, scalable method for growing single layers of hexagonal boron nitride on graphene.
The process, which can produce large sheets of high-quality hBN with the widely used molecular-beam epitaxy process, is detailed in a study in Advanced Materials.
Graphene-hBN structures can power LEDs that generate deep-UV light, which is impossible in today's LEDs, said Zetian Mi, U-M professor of electrical engineering and computer science and a corresponding author of the study. Deep-UV LEDs could drive smaller size and greater efficiency in a variety of devices including lasers and air purifiers.
"The technology used to generate deep-UV light today is mercury-xenon lamps, which are hot, bulky, inefficient and contain toxic materials," Mi said. "If we can generate that light with LEDs, we could see an efficiency revolution in UV devices similar to what we saw when LED light bulbs replaced incandescents."
Hexagonal boron nitride is the world's thinnest insulator while graphene is the thinnest of a class of materials called semimetals, which have highly malleable electrical properties and are important for their role in computers and other electronics.
Bonding hBN and graphene together in smooth, single-atom-thick layers unleashes a treasure trove of exotic properties. In addition to deep-UV LEDs, graphene-hBN structures could enable quantum computing devices, smaller and more efficient electronics and optoelectronics and a variety of other applications.
"Researchers have known about the properties of hBN for years, but in the past, the only way to get the thin sheets needed for research was to physically exfoliate them from a larger boron nitride crystal, which is labor-intensive and only yields tiny flakes of the material," Mi said. "Our process can grow atomic-scale-thin sheets of essentially any size, which opens a lot of exciting new research possibilities."
Because graphene and hBN are so thin, they can be used to build electronic devices that are much smaller and more energy-efficient than those available today. Layered structures of hBN and graphene can also exhibit exotic properties that could store information in quantum computing devices, like the ability to switch from a conductor to an insulator or support unusual electron spins.
----"Experimenting with large amounts of pristine hBN was a distant dream for many years, but this discovery changes that," Mi said. "This is a big step toward the commercialization of 2D quantum structures."
More
“No one believes more firmly than Comrade [Biden, Johnson, Trudeau, your Great Leader here,] that all animals are equal. He would be only too happy to let you make your decisions for yourselves. But sometimes you might make the wrong decisions, comrades, and then where should we be?”
Animal Farm.
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