Ecuador Vows a Return to Debt Markets, Sending Bonds Soaring
Ecuador bonds jumped the most in emerging markets on Tuesday after the nation's top finance officer said the government plans to return to capital markets next year.
Finance Minister Sariha Moya said the Andean nation is planning a debt sale with guarantees from multilateral lenders in 2026, assuming its economic plan is working. Sovereign bonds rallied across the curve, with those due in 2035 climbing 1.4 cents on the dollar.
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Bloomberg
3 hours ago
- Bloomberg
With Friends Like Brazil, OPEC+ Doesn't Need Enemies
The Brazilian coffee and oil industries have something in common. Espresso connoisseurs know the country's coffee production follows a natural biennial cycle, alternating periods of low and high output. One year, the trees funnel most of their energy into growing new branches; another, into producing fruit. The country's oil industry also appears to follow similar cyclicality, even if arbitrarily. Disappointing years, when growth underperforms even the most pessimistic expectations, are quickly followed by spectacular expansion periods. After a very poor 2024, the Latin American oil giant is entering one of those phases of rapid growth. On current trend, Brazil will become the second-largest source of incremental non-OPEC+ oil production this year, only behind the US and ahead of Guyana, the other South American oil star that typically gathers more attention, and Canada. The timing couldn't be worse for OPEC+, already battling with an oversupplied market and falling prices. For some time, the Saudi Arabia-led oil cartel has tried to pull Brazil into its orbit, knowing that the latter nation was becoming a huge rival to its efforts to keep oil prices inflated. But all OPEC+ overtures — to successive right- and left-wing governments in Brasilia — have failed. The most Riyadh has achieved is for Brazil to cement its freeriding status: Since February, it's been a formal member of the group's so-called declaration of cooperation, joining the likes of Russia and Kazakhstan, which formed an alliance with OPEC+ nearly a decade ago. But unlike them, Brazil isn't bound by any production obligations. Effectively, it got everything it wanted: access, influence and intelligence about what other oil nations are up to without giving away anything. That the cartel accepted the deal speaks volumes about its desperation to keep ties with Brazil alive. With friends like Brazil, OPEC+ doesn't need any enemies. The Latin American nation will add about 450,000 barrels a day of extra production in 2025 and 2026, equal to about a quarter of incremental demand during the period. The increase nearly matches the record 490,000 barrels a day it added in the 2022-2023 period. With a bit of luck, Brazil may even post its fastest growth period ever. Differing from the US shale industry, where low oil prices quickly translate in less drilling, Brazilian petroleum production is largely immune to short-term changes in oil prices. Whatever the cost of Brent in 2025 and 2026, the extra Brazilian barrels are coming. Only future projects, perhaps as late as 2028 and 2029, would be affected. For now, state-run Petroleo Brasileiro SA and its foreign partners plan to develop a string of offshore oilfields, including the multiphase Buzios oilfield, which is on track to become Brazil's largest by output, overtaking Tupi. Other notable developments include the Mero and Bachalao oilfields, where Shell Plc, TotalEnergies SE and Equinor ASA hold stakes. The oil market went into 2024 also holding high expectations for Brazilian output. But a combination of delayed drilling approvals due to a strike by environmental officials, supply-chain glitches and widespread maintenance meant that production fell to an annual average of 3.44 million barrels a day, down from 3.49 million in 2023. Excluding the period during the Covid-19 pandemic, it was the largest annual decline in at least 25 years. Understandably, the events of last year meant the market felt some trepidation about betting that Brazilian output will grow this year. By now, however, it's clear a boom is following the bust. The strike by officials at the Brazilian Institute of the Environment & Renewable Natural Resources, which President Luiz Inácio Lula da Silva has described as 'a government agency that seems to be against the government,' ended last June, opening the door to drilling. Petrobras, as the national oil company is known, has largely solved its supply-chain problems, as it started to order kit well ahead of when it needs it. And the extended maintenance of last year means that Brazilian oilfields need less annual work this time.
Bloomberg
6 hours ago
- Bloomberg
New Zealand's Willis Criticizes RBNZ Handling of Orr Resignation
New Zealand Finance Minister Nicola Willis has criticized the Reserve Bank for its handling of former governor Adrian Orr's resignation, saying it should have been more transparent about his reason for quitting. 'It's my expectation that all government agencies comply with their statutory obligations and wherever possible are open and transparent with New Zealanders,' Willis told reporters on Thursday. 'Of course they need to balance that against their legal obligations when it comes to employment discussions and agreements, but on this one I think they could have pulled their socks up.'
Yahoo
8 hours ago
- Yahoo
Peru turns to China as US tariffs squeeze blueberry exports
(Refiles with new headline) By Marco Aquino PISCO, Peru (Reuters) -In Peru's Pisco Desert, rows of blueberry bushes towering as much as two meters high stretch towards the horizon, finally giving way to sand dunes. Traditional blueberries need chilly nights to bring fruit, but genetic innovations have created varieties like Eureka Sunset that can grow in this kind of arid landscape some 250 kilometers (155 miles) south of Lima. For more than a decade the healthy berries have rolled north to U.S. supermarket shelves, but there is a rival buyer in town: China. Growers in Peru are looking for new markets as production rises and their best customer, the United States, is waging a trade tariff war on partners around the world. China has insatiable demand and has built a huge new port near Lima that cuts shipping time across the Pacific in half. "There will be a rebalancing of export share to different markets," said Miguel Bentín, general manager of major producer the Valle y Pampa farm, which began production in 2012 when the blueberry harvest was a tenth of the size it is today. The desert has long been a source of grapes made for Pisco brandy, the base for Pisco Sour cocktails, but blueberry growers have transformed the landscape by drilling wells up to 100 meters (328 feet) deep to find water for the crops and bringing in workers to care for them. Now, Bentin says, they are looking for new buyers. "The full potential of the Chinese market for our products has not yet been fully realized," Bentín told Reuters at the farm. Valle y Pampa typically ships 60% of its blueberries to the United States and the rest to Europe. This year, though, it is planning its first big China shipment to mitigate the impact of a 10% U.S. tariff on all goods from Peru. Peru overtook Chile in 2021 as the world's largest exporter of blueberries and the sector has been adding new markets, according to half a dozen ministers, farming and export officials, and government presentations seen by Reuters. "The search for new markets in Asia, Europe and Oceania (Australia) for agricultural exports has intensified," Peru's Foreign Trade and Tourism Minister Úrsula León said in mid-May, explaining that U.S. tariffs could slow the deep purple fruit's booming rise that boosted Peru's exports by some $2.3 billion last year. Production during the 2025-2026 harvest is expected to grow by 25% to 400,000 tons. "If the U.S. tariff measure is maintained, there would be a drop in shipments, especially in the agricultural, textile and mining sectors," added León following a meeting with the Trump administration. She named India, Indonesia and China as markets with growth potential. Peru is negotiating to end U.S. tariffs, which it says breach a free trade agreement. If supplies from Peru decrease, U.S. consumers will likely see prices rise. The Andean country is its top supplier of blueberries ahead of Mexico and Chile. "With a significant portion of produce being imported to the U.S. and not easily produced domestically, tariffs may have an impact on product availability," said Ben Wynkoop, global industry strategist of grocery & convenience, at Blue Yonder, which provides supply chain software to global retailers. "Depending on the severity of the shortage, smaller retailers with limited negotiation power may face significant inventory shortages, particularly for blueberries," he added. "It won't be a moderate effect, it will be quite big," said Gabriel Amaro, head of the Peruvian Association of Agricultural Producers' Guilds, adding farmers were lobbying the government to find ways to soften the blow and protect the free trade deal. "Our strategy is market diversification. We have a whole list of products, especially to open up markets in Asia." David Magaña, senior research analyst at Rabobank, who specializes in the global fruit market downplayed the impact of tariffs. For one, China produces its own berries for more months of the year than the United States, he said. "I don't think anybody in the industry is expecting China to surpass the U.S. as the primary destination for Peruvian blueberries," added Magaña. CHINA-OWNED PORT A 'GAME CHANGER' Peru's wider farm exports - also including grapes and avocados - rose 22% to $12.8 billion last year, mainly to the United States and Europe. Exports of blueberries dipped 30% year-on-year in the first quarter of this year, reflecting a change in harvest timing. However, even as quarterly U.S. shipments ticked down, those to China rose, from a lower base. Peru's new Chinese-controlled port of Chancay, meanwhile, cuts the sea journey times to Asia in half to around 20 days, a big plus for keeping fruit fresh. China's Guangzhou port in April joined others by opening a direct route to Chancay. U.S. fruit firm Fruitist, which produces most of its blueberries in Peru and is one of the Andean country's top exporters of the fruit, sent some 15-18 containers of blueberries to China late last year via Chancay. "It transforms the shipping part, the logistical part for everyone who's in fresh fruit in Peru," said John Early, Fruitist's director of global sales. "There is a huge opportunity to expand that business in China." Back in the Pisco Desert, Valle y Pampa manager Bentín agreed, forecasting a noticeable increase to China as the harvest begins to peak around August. "The port of Chancay, especially with its costs and faster transit times, is a game changer," he said. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
