Analysts say SIA is fairly valued, with several adjusting target price
[SINGAPORE] Analysts have commented that the share price of Singapore Airlines (SIA) is fairly valued at the moment, even as several lifted their target price and recommended a 'hold' on the stock, after the airline group published its FY2025 results.
Their projections for FY2026 net profit range from S$900 million to S$1.4 billion.
On May 15, SIA announced a 3.9 per cent rise in its bottom line to a record S$2.8 billion for the full year, boosted by a one-off, non-cash gain of S$1.1 billion from the Air India-Vistara merger. Revenue was at S$19.6 billion, up 2.8 per cent.
Analysts from CGS International, DBS, UOB Kay Hian (UOBKH) and OCBC all raised their target price for the airline group to a range of S$6.40 to S$6.88, but Lorraine Tan of Morningstar cut her fair value projection by 5 per cent to S$6.10.
Tan expects SIA's operating margin cut to 4.7 per cent and 7.4 per cent for FY2026 and FY2027, respectively, from 8.7 per cent in FY2025 and 14.7 per cent in FY2024, as yields continue to normalise amid supply increases. Current yields, however, remain over 10 per cent above pre-pandemic levels.
She lowered her target price to S$6.10 to reflect lower near-term profitability, but she flagged that SIA's yields and load factors could be hit by the low-cost offerings of Chinese carriers as they ramp up their international route capacity.
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Her FY2026 net profit forecast is about S$900 million.
CGS' Raymond Yap expects that SIA could benefit from the drop in Brent oil price and an appreciation in the Singapore dollar against the greenback, as he adjusted SIA target price from S$6 to S$6.88.
He said Brent price decreased to US$66 a barrel in April to May from US$76 a barrel in January to March, while the Singapore dollar rose to S$1.30 currently from S$1.34 as at Mar 31.
However, he reduced the cargo and passenger yield assumptions for SIA, as the global business uncertainty brought about by the US 'Liberation Day' tariffs will eventually moderate business travel and cargo demand, and flagged this as the key downside risk from the quarter ending September.
Yap's FY2026 net profit estimate is about S$1.2 billion.
Analysts from DBS projected cargo could remain more resilient than previously anticipated, as they pointed out that SIA's cargo volumes rose 4 per cent year on year in April, despite trade frictions between the US and its trading partners, and global freight market volatility.
They expect the US-China truce in the tariff war to spark front-loading of shipments in the coming months. They said this might lead to upside surprises in cargo volumes and yields as SIA derives about 11 per cent of its revenue from cargo, and its US cargo exposure is about 8 per cent.
DBS' FY2026 net profit projection is about S$1.1 billion
UOBKH expects SIA's FY2026 core net profit to drop 8 per cent year on year, as it will reflect the full-year impact of Air India's negative contribution while the Indian airline undergoes a multi-year turnaround, with limited visibility on its profitability timeline.
However, the analyst expects SIA to generate S$1.4 billion in net profit for FY2026.
In 2024, Vistara was merged with Air India, resulting in SIA holding a 25.1 per cent share in the merged entity.
OCBC raised SIA's target price to S$6.80 from S$6.50, and projects the airline group's bottom line to be about S$1.2 billion for FY2026.
SIA shares were trading 0.3 per cent of S$0.02 higher at S$6.90 at 1.24 pm on Monday.
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Straits Times
42 minutes ago
- Straits Times
Singapore bak kut teh scene simmers with bold new flavours
From herbal broths to karaoke rooms, bak kut teh is back in trend with fresh spins. ST PHOTOS: KEVIN LIM. DESMOND WEE, TARYN NG SINGAPORE – Bak kut teh is back and bolder than ever. At Old Street Bak Kut Teh's newest outlet in Telok Ayer, diners can dig into peppery pork rib soup and bar bites like grilled Iberico pork jowl, washed down with Stella Artois, while singing karaoke in a private room. It is a far cry from the spartan kopitiams and hawker stalls where pork rib soup is typically slurped with sips of kungfu tea. A wave of new openings in 2024 and 2025 is reshaping the heritage dish. From Old Street's karaoke-and-bar-bites concept to En Yeoh's Japanese-accented take – complete with Chinese baijiu tipples – bak kut teh is shedding its 'uncle cuisine' image. These joints bring air-conditioned comfort, broader menus and seafood options – all crafted for wider appeal. Rise of Malaysian-style bak kut teh Making the biggest waves is Malaysian-style bak kut teh, driven by nostalgia and recalibrated for local palates. Sellers of herbal broths have toned down the bitterness, scaled back the salt and swopped intensely fatty cuts for leaner ones. 'It's more balanced now,' says Mr Low Heng Kin, 38, who co-owns and runs Pin Xiang Bak Kut Teh at BreadTalk IHQ in Tai Seng. The stall specialises in Ipoh-style bak kut teh with a lighter-textured broth compared with the Klang version . Mr Low is originally from Ipoh. 'We tested more than 20 herb combinations. Singaporeans don't want it too sweet or too bitter.' His broth, simmered for eight hours, includes 16 ingredients – 12 of them traditional Chinese herbs. At L5 Bak Kut Teh in MacPherson, which opened in July 2024, father-and-daughter duo Wayne and Michelle Gong specialise in Klang-style bak kut teh. He is originally from Klang, while she is Singaporean. Father-and-daughter team Wayne and Michelle Gong co-own L5 Bak Kut Teh. ST PHOTO: TARYN NG When they first launched their authentic Klang-style broth, complete with potent herbal aroma, fatty hind trotter cuts and a collagen-thickened texture, Malaysian customers lapped it up. But Singaporean diners – more accustomed to Teochew-style clear broths – were less receptive to the rich, slightly gelatinous mouthfeel. Two months in, Mr Gong, 55, refined the broth, now a balance of herbal depth and a soupier texture. Ms Gong, 27, says: 'We want to cater to local tastes and the Singapore market. It was challenging to honour the authenticity of the original recipe while ensuring it resonates with local palates.' Tweaked traditions These flavour tweaks reflect a broader shift in how bak kut teh is being adapted for modern tastes. Even the local versions are evolving. Ms Rebecca Koh, 49, co-owner of The Teochew Kitchenette @ Keong Saik, says: 'My bak kut teh leans towards a fusion style, using Chinese herbs and a thicker broth borrowed from Klang-style bak kut teh. I chose this style because I want to be different from other Teochew bak kut teh establishments and generate our own following.' Her broth is based on her grandmother's traditional recipe, built originally on pork bones, garlic and peppercorns. Her mother later added Solomon's seal, licorice and star anise. (Clockwise from top left) Claypot Pig's Liver, Bah Kut Teh Soup, Sliced Red Grouper Soup, Steamed Squid, and Handmade Prawn Rolls at The Teochew Kitchenette @ Keong Saik. ST PHOTO: TARYN NG When Ms Koh, who is Singaporean, opened her Keong Saik outlet in November 2024, she chose a lighter, healthier broth. But she soon learnt that customers were after a fuller-bodied version. 'Customers didn't take well to it. They wanted more concentrated flavours and a thicker texture,' she says. She now thickens the broth with more pork bones and meat, simmering it for six hours over high heat for collagen extraction, and dialling back the pepper. Seafood in the mix Another emerging trend is the introduction of seafood options, especially lala – in a nod to the popular lala pot trend that originated in Malaysia. L5 offers Lala Bak Kut Teh ($10.90++), featuring clams cooked in its herbal pork broth. The dish does not contain pork slices or ribs . L5 Bak Kut Teh's Lala Bak Kut Teh, featuring clams cooked in its herbal pork broth. ST PHOTO: TARYN NG Mr Gong says he first noticed the dish appearing in Klang several years ago. Balancing the clams' strong flavour with the broth took testing, and his solution was green chilli. En Yeoh's Bak Kut Teh offers Claypot Dry Assorted Seafood ($19.90++) to cater to customers who may not enjoy pork. The dish includes tiger prawns, asari clams, gindara (black cod), okra, sliced cuttlefish, dried chilli and green chilli, tossed in a savoury sauce. En Yeoh's Bak Kut Teh's Claypot Dry Assorted Seafood. PHOTO: EN YEOH'S BAK KUT TEH Mr Raymond Ng, 58, managing director of Japanese restaurant chain En Group, notes that the seafood trend took off in Klang a few years ago. He reckons it may have started when customers took along their own seafood for bak kut teh eateries to prepare. Eateries near the sea and port areas also began offering seafood options. The Teochew Kitchenette @ Keong Saik is tapping the trend with its new Sliced Red Grouper Soup ($14.50), listed under the Bak Kut Teh section of its menu. Slices of firm red grouper come in a light peppery bak kut teh broth served in a bowl – not claypot – to prevent the fish from being overcooked in residual heat. The Teochew Kitchenette @ Keong Saik's Sliced Red Grouper Soup, which features fish slices in bak kut teh broth. ST PHOTO: TARYN NG Old Street Bak Kut Teh was ahead of the curve. It introduced Seafood Bak Kut Teh ($13.30+ for small, $24.10+ for large) eight years ago. The dish is a medley of tiger prawns, clams and pork ribs in its signature bak kut teh broth. Broth revival Why is traditional bak kut teh, once seen as a dish for older diners, making a comeback? Sellers say it boils down to comfort. Bak kut teh offers a rich broth, familiar flavours and a sense of nourishment – qualities that outlast short-lived food trends. Ms Gong of L5 Bak Kut Teh says: 'Bak kut teh is deeply tied to memory, family and culture. Its warmth and familiarity make it a dish that feels especially comforting in uncertain times.' Mr Lim Kuan Yiou, 30, business development director of Old Street Bak Kut Teh, says: 'There are many food options on the market, especially with new eateries selling fusion food such as modern European or modern Asian fare. But diners who miss home cooking and crave local food will gravitate towards things like bak kut teh and zi char dishes.' Mr Lim Kuan Yiou, business development director of Old Street Bak Kut Teh, at its Telok Ayer outlet's private karaoke room on the third storey. ST PHOTO: DESMOND WEE He adds that while it may not be an everyday meal, some customers eat bak kut teh two to three times a week. It suits both quick solo meals and group gatherings. 'The dish conjures up nostalgia and family,' he says. 'Many people have the shared experience of eating bak kut teh on weekends with their families.' Mr Low says that it is a practical, value-for-money dish that reheats well for takeaway – ideal for diners with hectic schedules who want a hearty meal without the fuss. Pin Xiang Bak Kut Teh co-owner Low Heng Kin notes that bak kut teh lends itself to reheating for takeaway orders. ST PHOTO: KEVIN LIM Growing appeal to younger diners Ms Gong sees the rise in new bak kut teh concepts as a healthy sign of growing interest, particularly among younger diners. She welcomes the competition as motivation to stay distinctive and relevant, while contributing to the dish's evolving place in Singapore's food culture. While Ms Koh did not set out to attract younger diners, she has noted more Gen Z and millennial customers at her Keong Saik outlet. 'They do not show up just once. They return regularly with more friends in tow.' The outlet being air-conditioned lends to its appeal. Older diners, however, say the air-conditioning is too cold and causes food to lose heat more quickly. To counter this, Ms Koh did away with traditional ceramic bowls with rooster motifs and replaced them with claypots, which can retain heat longer. Old Street Bak Kut Teh's four outlets in Singapore emphasise ambience, technology – such as a QR code ordering system – and efficient service to appeal to younger diners, especially working adults who have limited time for lunch breaks. With competition heating up, Ms Koh feels that bak kut teh cannot continue in its original form and thrive. 'Customers want more variety, so people who don't eat it still have choices.' She learnt this in the first two months of operation when she named the outlet Keong Saik Bak Kut Teh, after its heritage location, even though it served more than bak kut teh. 'Some people feel bak kut teh is more of a breakfast or lunch food and do not fancy having it for dinner,' she says. That insight spurred a key branding move. She changed her eatery's name to The Teochew Kitchenette @ Keong Saik in March. This led to increased footfall, especially from families looking for home-style dishes , not just bak kut teh . The Teochew Kitchenette @ Keong Saik, co-owned by Ms Rebecca Koh, offers zi char favourites in addition to bak kut teh. ST PHOTO: TARYN NG Other operators share similar views, expanding their offerings to include zi char classics, fusion items and even cocktails and entertainment. Whether it is a nostalgic tribute to family recipes or a bold pairing of pork rib soup with karaoke and cocktails, bak kut teh is stirring up fresh interest across Singapore. As more eateries reinvent the dish with broader menus and modern touches, bak kut teh is no longer just a classic – it is becoming part of Singapore's evolving dining identity. Here is how five establishments are brewing the next chapter in Singapore's bak kut teh story. Pin Xiang Bak Kut Teh: Honouring a father's legacy with Ipoh roots Bak Kut Teh Dry, Bak Kut Teh Soup and Vinegar Pork Trotter from Pin Xiang Bak Kut Teh at Food Republic in BreakTalk IHQ. ST PHOTO: KEVIN LIM When Mr Low opened the first Pin Xiang Bak Kut Teh outlet at a coffee shop in Geylang East in June 2024, he did so with a recipe he never cooked with his father, but which his mother had preserved in writing. His father, who ran a bak kut teh stall in Ipoh from 1996 to 2017, died of cancer in 2019. 'I never had the chance to learn from him directly,' Mr Low says. 'But I grew up helping out at the stall. This is my way of continuing his legacy.' He closed the Geylang East stall due to low footfall and reopened at BreadTalk IHQ in Tai Seng in February 2025 . Mr Low Heng Kin operates Pin Xiang Bak Kut Teh at Food Republic in BreakTalk IHQ. ST PHOTO: KEVIN LIM Unlike the darker, stronger Klang version, Ipoh-style herbal broth is lighter and less medicinal. At Pin Xiang, the broth simmers for eight hours with premium herbs such as dang gui and Solomon's seal, along with fresh pork ribs and soft bone cuts. Co-owner Low Heng Kin preparing bak kut teh soup at Pin Xiang Bak Kut Teh at Food Republic in BreakTalk IHQ. ST PHOTO: KEVIN LIM The bestseller, Bak Kut Teh (Soup), which costs $8.50 for a small portion and $16 for medium, includes enoki mushrooms, tau kee, Chinese celery and tau pok. Chinese celery accents the dish with peppery pungence. Bak Kut Teh Soup from Pin Xiang Bak Kut Teh. ST PHOTO: KEVIN LIM Another standout is the Bak Kut Teh Dry (Spicy), which costs $9.50 for a small portion and $18 for medium. The dish is wok-fried with dried chillies, shredded cuttlefish and okra, and accented with red onion and garlic. Golden croutons of pork lard crown the dish. The dark sauce is savoury without being too salty. Bak Kut Teh Dry from Pin Xiang Bak Kut Teh. ST PHOTO: KEVIN LIM Vinegar Pork Trotter ($9.50), braised for two hours in sweet vinegar and brown sugar, comes with ginger slices and quail eggs. Vinegar pork trotter from Pin Xiang Bak Kut Teh. ST PHOTO: KEVIN LIM Where: Stall 5, 01-06 Food Republic, BreadTalk IHQ, 30 Tai Seng Street Open: 10am to 8.30pm daily Tel: 8209-6690 L5 Bak Kut Teh: Recreating the flavours of Klang Da Gu (big bone, top left), Xiao Gu (small bone, top right), Lala Bak Kut Teh (centre) and Penang Signature Ngoh Hiang (bottom left), with Scallion Rice and plain rice at L5 Bak Kut Teh. ST PHOTO: TARYN NG Mr Gong learnt to cook the dish from his father, who sold bak kut teh out of his kampung house's front yard in Klang. After moving to Singapore at age 18, he continued cooking the dish as a way of holding on to the taste of home. For more than three decades, he prepared it twice a month for friends and family. They enjoyed it so much that they encouraged him to open an eatery. L5 stands for Lao Wu. The numeral 5 is a play on 'Wu', which is his surname, and 'Lao' means 'old' in Chinese, representing heritage and tradition. Naming the eatery 'L5' is intended to resonate with younger diners used to shorthand and acronyms. At the 50-seat eatery, the Klang-style broth is made fresh daily with long-simmered pork bones, dark soya sauce and 18 herbs refined through months of testing. True to the style in Klang, the eatery serves Xiao Gu ($8.90++), which refers to a leaner cut of the pig's hind leg. Xiao Gu (small bone) Bak Kut Teh. ST PHOTO: TARYN NG Da Gu ($8.90++) is a fatter cut of the hind leg. The herbal broth is aromatic without being too bitter or astringent. Da Gu (big bone) Bak Kut Teh at L5 Bak Kut Teh. ST PHOTO: TARYN NG Try the Scallion Rice ($1.50++) to complete the Malaysian bak kut teh experience. A skilful home cook, Mr Gong is behind the recipes at the eatery, including Penang Signature Ngoh Hiang ($6.90++), which uses a Penang brand of five spice. Pork belly strips and yam cubes give the filling, wrapped in beancurd skin, added texture. Penang Signature Ngoh Hiang at L5 Bak Kut Teh. ST PHOTO: TARYN NG Where: 01-30 Grantal Mall @ MacPherson, 601 MacPherson Road Open: 11am to 10pm, Tuesdays to Sundays; closed on Mondays Tel: 8801-5229 En Yeoh's Bak Kut Teh: Teahouse by day, izakaya by night A collaboration between a Klang hallmark brand, Yeoh's Bak Kut Teh, and Japanese restaurant group, En Group, En Yeoh's Bak Kut Teh is the group's first concept that is not fully Japanese. Its fourth and newest outlet at Changi City Point opened in May 2025 . En Yeoh's Bak Kut Teh's newest outlet at Changi City Point. PHOTO: EN YEOH'S BAK KUT TEH 'We have 25 years of Japanese F&B experience and decided to fuse Japanese influences into the bak kut teh menu,' says Mr Ng. Hokkaido pork is used for the bak kut teh, and soumen instead of mee sua is used in the menu. Even the rice is Masshigura rice grown in Aomori prefecture. Signature 4 Types Assorted Meats Claypot Bak Kut Teh ($10.90++ for one person, $18.90++ for two people) comprises pork trotter, pork ribs, pork belly, pork collar, shiitake mushrooms, button mushrooms, tofu puffs and fried beancurd in an earthy ambrosial broth. The Signature 4 Types Assorted Meats Claypot Bak Kut Teh comes with pork trotter, pork ribs, pork belly, pork collar, shiitake mushrooms, button mushrooms, tofu puffs and fried beancurd in a herbal bak kut broth. PHOTO: EN YEOH'S BAK KUT TEH En Yeoh's Signature Edamame ($6.50++) is Japanese edamame and sliced cuttlefish stir-fried in bak kut teh sauce. En Yeoh's Signature Edamame. PHOTO: EN YEOH'S BAK KUT TEH For drinks, there is Warm Your Heart And Stomach ($20++), a cocktail of herbal bak kut teh broth mixed with Moutai Chun and Nu Er Hong. En Yeoh's Bak Kut Teh has a cocktail selection which includes Warm Your Heart And Stomach, a warm cocktail featuring herbal bak kut teh broth, Moutai Chun and Nu Er Hong. PHOTO: EN YEOH'S BAK KUT TEH Where: B1-30 Changi City Point, 5 Changi Business Park Central 1 Open: 11am to 10pm daily Info: Old Street Bak Kut Teh (Telok Ayer): Tradition meets karaoke The fourth and newest outlet of Old Street Bak Kut Teh opened in April 2025 in a conserved Telok Ayer shophouse to mark the chain's 15th anniversary. Old Street Bak Kut Teh (Telok Ayer) occupies a shophouse. ST PHOTO: DESMOND WEE Founded in 2010 by husband-and-wife team Jason Lim, 59, and Priscilia Koh, 55, the brand has evolved with each outlet. Mr Lim Kuan Yiou, who is the eldest son of the founders, says: 'Our first outlet was also a shophouse. This (newest) one has a mural of Chinatown's old street life – and a KTV room with a $500 minimum spend. My dad's a karaoke fan. That was his idea.' Mr Lim Kuan Yiou, business development director of Old Street Bak Kut Teh, at the Telok Ayer outlet's private KTV room. ST PHOTO: DESMOND WEE The chain's clear, flavoursome broth has a lightly gelatinous texture and is not too peppery. 'We don't use a central kitchen,' says Mr Lim. 'The soup is boiled in small batches throughout the day, so it stays fresh. That's how the clarity and taste stay consistent.' The Pork Ribs Soup ($10.50+ for small, $14+ for large) follows a Teochew-style recipe with white peppercorns from Sarawak and chilled pork bones flown in from Europe. Bak Kut Teh set at Old Street Bak Kut Teh (Telok Ayer). ST PHOTO: DESMOND WEE Dry Bak Kut Teh ($12.20+ for small, $15.70+ for large) is tossed in a Malaysian-style sauce with okra and cuttlefish. Dry Bak Kut Teh at Old Street Bak Kut Teh (Telok Ayer). ST PHOTO: DESMOND WEE Soya Beancurd ($3.10+) and crispy, pillowy You Tiao ($2.60+) are made from scratch at the outlet. Soya Milk and Soya Beancurd are freshly prepared at Old Street Bak Kut Teh (Telok Ayer) every morning. ST PHOTO: DESMOND WEE From 6pm, bar bites such as Grilled Iberico Pork Jowl ($28+) and Grilled Pork Skewer ($6+) are available. Where: 112 Telok Ayer When: 7.30am to 11pm daily Tel: 8512-2856 Info: The Teochew Kitchenette @ Keong Saik: Bak kut teh in a zi char restaurant More than bak kut teh is offered in this Teochew eatery, which serves up favourites such as claypot pig liver and steamed squid. The Teochew Kitchenette @ Keong Saik, which opened in November 2024 at 26 Keong Saik Road, is much bigger than its flagship at Block 7 Tanjong Pagar Plaza and also has a larger menu. The original eatery, which opened in 2017, serves Teochew Fish Soup ($7.80) and Homemade Prawn Roll ($6.50 for five pieces). Homemade Prawn Rolls at The Teochew Kitchenette @ Keong Saik. ST PHOTO: TARYN NG While business is brisk there, it seats just 20 diners indoors and 20 outdoors, compared with the 60-seat Keong Saik outlet. Run by husband-and-wife team Lee Hon Tat, 55, and Rebecca Koh, the Keong Saik outlet is fully air-conditioned – a draw for tourists and families. Its Premium Pork Loin Rib Soup ($8 for one piece, $15 for two) uses fresh chilled prime pork ribs and Sarawak pepper. The broth is based on Ms Koh's maternal grandmother's recipe, adjusted over six months for modern palates. Premium Pork Loin Rib Soup at The Teochew Kitchenette @ Keong Saik. ST PHOTO: TARYN NG Signature dishes include Claypot Pig's Liver ($13 for regular, $19 for large), with pork liver prepared to remove odour and achieve a powdery texture. Claypot Pig's Liver at The Teochew Kitchenette @ Keong Saik. ST PHOTO: TARYN NG The bouncy yet tender Steamed Squid ($16 for one, $29 for two) is popular. Steamed Squid at The Teochew Kitchenette. ST PHOTO: TARYN NG Where: 26 Keong Saik Road Open: 11am to 3.30pm and 5 to 9.30pm (Mondays to Saturdays), 11am to 3.30pm and 5 to 9pm (Sundays) Tel: 8338-7106 Hedy Khoo is senior correspondent at The Straits Times. She covers food-related news, from reviews to human interest stories. Check out ST's Food Guide for the latest foodie recommendations in Singapore.
Straits Times
an hour ago
- Straits Times
Busiest US seaport takes hit from 145% China tariffs, worries remain
May 2025 imports to the Port of Los Angeles are down 9 per cent year-on-year. PHOTO: REUTERS LOS ANGELES - Imports to the busiest US seaport in Los Angeles dropped 9 per cent year-on-year in May and could remain muted through the remainder of 2025, after companies responded to President Donald Trump's 145 per cent tariffs on China by cancelling or putting holds on shipments, according to port officials. China is the top US supplier of seaborne goods, and Los Angeles is the No. 1 port for those imports. Domestic businesses ranging from retailer Walmart to automaker Ford rely on the toys, furniture and auto parts that land on its docks. The Port of Los Angeles handled the equivalent of 355,950 20-foot shipping containers of imports in May, when the 145 per cent tariffs began to show up in data. 'May marked our lowest monthly volume in over two years,' the port's executive director Gene Seroka said on June 13 . 'Many importers just simply slammed on the brakes.' The ports of Los Angeles and Long Beach handle 31 per cent of US ocean trade and are a barometer for US economic activity. Long Beach has not reported May results. Its CEO previously forecast a more than 10 per cent drop in May imports. The world's two biggest economies agreed to a 90-day pause on tit-for-tat tariffs in May, and the US lowered the duty on many Chinese goods to 30 p er cent from 145 per cent . The US and China this week agreed to maintain that lower rate, potentially defusing a high-stakes trade dispute. Ocean shipping company Maersk in a customer advisory on June 12 said volumes from China to the US are rising following the May 12 tariff adjustment to 30 per cent. Port executives and shipping consultants also expect imports from China to rebound, albeit at a more moderate level as 30 per cent duties represent a significant cost increase for importers. Seroka said cargo for June appears to have returned to more normal levels with a dozen ships at the port on June 13 . 'It's one of the very few double-digit ship days we've had in weeks,' said Mr Seroka. Nevertheless, his outlook for the remainder of the year is muted because consumer demand is volatile and importers still face a 30 per cent cost increase on goods from China. 'I don't see the surge that some observers have called for.' Industry forecasts call for 2025 imports to drop from 2024 due to continued uncertainty over US tariffs, which also are subject to court battles. US consumer sentiment improved for the first time in six months in June as trade tensions between the US and China eased. But households remained worried about the economy as tariffs threaten to send prices even higher. Inventories are growing faster than sales at the most sensitive consumer discretionary companies , such as fitness apparel seller Lululemon, said Jefferies analysts in a client note on June 13 . Retailers are importing selectively to avoid having to discount excess stock. The full price hit from tariffs looms as US companies work through stockpiles built before the duties went into effect, said director of economics at Yale's Budget Lab Ernie Tedeschi . In January 2018, Trump's first administration put tariffs on washing machines. The effect did not show up in consumer price data until three months later, Mr Tedeschi said. 'It takes time for these tariffs to go through.' REUTERS Join ST's Telegram channel and get the latest breaking news delivered to you.
Business Times
3 hours ago
- Business Times
Trump said Nippon-US Steel deal has resolvable national security risk
US PRESIDENT Donald Trump said on Friday (Jun 13) that concerns over national security risks posed by Nippon Steel's US$14.9 billion bid for US Steel can be resolved if the companies fulfill certain conditions that his administration has laid out, paving the way for the deal's approval. Shares of US Steel rose 3.5 per cent on the news in after-the-bell trading as investors bet the deal was close to done. Trump, in an executive order, said conditions for resolving the national security concerns would be laid out in an agreement, without providing details. 'I additionally find that the threatened impairment to the national security of the United States arising as a result of the Proposed Transaction can be adequately mitigated if the conditions set forth in section 3 of this order are met,' Trump said in the order, which was released by the White House. The companies thanked Trump in a press release, saying the agreement includes US$11 billion in new investments to be made by 2028 and governance commitments including a golden share to be issued to the US government. They did not detail how much control the golden share would give the US. Shares of US Steel had dipped earlier on Friday after a Nippon Steel executive told the Japanese Nikkei newspaper that its planned takeover of US Steel required 'a degree of management freedom' to go ahead after Trump earlier had said the US would be in control with a golden share. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The bid, first announced by Nippon Steel in December 2023, has faced opposition from the start. Both Democratic former President Joe Biden and Trump, a Republican, asserted last year that US Steel should remain US-owned, as they sought to woo voters ahead of the presidential election in Pennsylvania, where the company is headquartered. Biden in January, shortly before leaving office, blocked the deal on national security grounds, prompting lawsuits by the companies, which argued the national security review they received was biased. The Biden White House disputed the charge. The steel companies saw a new opportunity in the Trump administration, which began on Jan 20 and opened a fresh 45-day national security review into the proposed merger in April. But Trump's public comments, ranging from welcoming a simple 'investment' in US Steel by the Japanese firm to floating a minority stake for Nippon Steel, spurred confusion. At a rally in Pennsylvania on May 30, Trump lauded an agreement between the companies and said Nippon Steel would make a 'great partner' for US Steel. But he later told reporters the deal still lacked his final approval, leaving unresolved whether he would allow Nippon Steel to take ownership. Nippon Steel and the Trump administration asked a US appeals court on Jun 5 for an eight-day extension of a pause in litigation to give them more time to reach a deal for the Japanese firm. The pause expires Friday, but could be extended. Jun 18 is the expiration date of the current acquisition contract between Nippon Steel and US Steel, but the firms could agree to postpone that date. REUTERS
