Latest news with #CommerceDepartment
The Sun
a day ago
- Business
- The Sun
US ethane exports to China hit new road block with license requirement
SINGAPORE/HOUSTON: U.S. exporters face potential disruption to their shipments of petrochemical feedstock ethane after the Commerce Department told them to seek licenses to export to top buyer China, according to trade sources and shipping data. Chinese petrochemical producers rely on the United States for almost all their ethane imports, buying about half of the total U.S. exports of the gas. Washington ordered a broad swath of companies to stop shipping goods to China without a license and revoked licenses already granted to some suppliers, Reuters reported on Wednesday. Those goods included ethane, as well as butane gas. If U.S. exporters are unable to obtain licenses quickly, they will need to seek alternative buyers. Costs for Chinese petrochemical makers will rise as they compete for alternative sources of ethane or switch to another more expensive petrochemical feedstock such as naphtha. China imported a record 230,000 barrels per day (bpd) of ethane from the United States last year, according to the U.S. Energy Information Administration. Ethane is a byproduct of oil and gas production and is primarily used to make plastics. The exports have been caught in the trade war between the U.S. and China. Last month, China increased levies on imports of U.S. goods to 125% but waived the tariff for petrochemical producers. At least two Very Large Gas Carriers (VLGC) were waiting at U.S. ports to load ethane this week while 15 more tankers are headed to, or waiting off, the U.S. Gulf Coast, to load about 284,000 bpd of ethane in June, Kpler data showed. 'It's going to be a major issue if all exports are suspended,' said a Chinese ethane importer, who sought anonymity because he is not authorized to speak to media. 'We are cautiously watching if exporters can obtain new export licenses soon.' Petrochemical producer Ineos was scheduled to load ethane on VLGC Pacific Ineos Grenadier from Enterprise Products Partners' terminal in Morgan's Point, Texas, on May 24 for export to China, according to Kpler shipping tracking data. The ship docked on May 24 but has yet to load, according to LSEG tracking data. Enterprise, a top exporter of ethane, said in a regulatory filing on Thursday that it had received a letter from the Commerce Department on May 23 requiring a license to export ethane and butane to China. Enterprise said it was evaluating its procedures and internal controls and could not determine if it would be able to obtain a license. Enterprise and Ineos did not respond to requests for comment. The U.S. Commerce Department did not immediately respond to a request for comment. Ineos may divert the cargo to one of its European plants if it cannot ship it to China, one trade source said. The next vessel expected to load for ethane exports to China is the Stl Qianjiang, which is anchored near Energy Transfer's Nederland terminal, the data showed. That vessel is scheduled to ship ethane to Chinese petrochemical firm Satellite Chemical. Energy Transfer did not respond to requests for comment, while Satellite Chemical could not be reached for comment. 'We will continue working with the administration to ensure there are no unnecessary obstacles to these important trade flows,' said Dustin Meyer, senior vice president of Policy, Economics and Regulatory Affairs at the American Petroleum Institute trade group. 'The market disruption could be immediate,' Julian Renton, an analyst at East Daley Analytics, said in a note. Traders said there may be limited near-term impact on Chinese operators, as they have sufficient stocks to keep operations going for now. East Daley's Renton said that if the restriction holds, Chinese petrochemical plants could face critical feedstock shortfalls, while projects may stall. Shares of Enterprise were down 1.12% on Friday, while Energy Transfer shares were down 1.4%. Shares of ethane importers Satellite Chemical were down 3.1% earlier on Friday, while Wanhua Chemical stock lost 1.3%.
The Sun
a day ago
- Business
- The Sun
US ethane exports to China face new licensing hurdles
SINGAPORE/HOUSTON: U.S. exporters face potential disruption to their shipments of petrochemical feedstock ethane after the Commerce Department told them to seek licenses to export to top buyer China, according to trade sources and shipping data. Chinese petrochemical producers rely on the United States for almost all their ethane imports, buying about half of the total U.S. exports of the gas. Washington ordered a broad swath of companies to stop shipping goods to China without a license and revoked licenses already granted to some suppliers, Reuters reported on Wednesday. Those goods included ethane, as well as butane gas. If U.S. exporters are unable to obtain licenses quickly, they will need to seek alternative buyers. Costs for Chinese petrochemical makers will rise as they compete for alternative sources of ethane or switch to another more expensive petrochemical feedstock such as naphtha. China imported a record 230,000 barrels per day (bpd) of ethane from the United States last year, according to the U.S. Energy Information Administration. Ethane is a byproduct of oil and gas production and is primarily used to make plastics. The exports have been caught in the trade war between the U.S. and China. Last month, China increased levies on imports of U.S. goods to 125% but waived the tariff for petrochemical producers. At least two Very Large Gas Carriers (VLGC) were waiting at U.S. ports to load ethane this week while 15 more tankers are headed to, or waiting off, the U.S. Gulf Coast, to load about 284,000 bpd of ethane in June, Kpler data showed. 'It's going to be a major issue if all exports are suspended,' said a Chinese ethane importer, who sought anonymity because he is not authorized to speak to media. 'We are cautiously watching if exporters can obtain new export licenses soon.' Petrochemical producer Ineos was scheduled to load ethane on VLGC Pacific Ineos Grenadier from Enterprise Products Partners' terminal in Morgan's Point, Texas, on May 24 for export to China, according to Kpler shipping tracking data. The ship docked on May 24 but has yet to load, according to LSEG tracking data. Enterprise, a top exporter of ethane, said in a regulatory filing on Thursday that it had received a letter from the Commerce Department on May 23 requiring a license to export ethane and butane to China. Enterprise said it was evaluating its procedures and internal controls and could not determine if it would be able to obtain a license. Enterprise and Ineos did not respond to requests for comment. The U.S. Commerce Department did not immediately respond to a request for comment. Ineos may divert the cargo to one of its European plants if it cannot ship it to China, one trade source said. The next vessel expected to load for ethane exports to China is the Stl Qianjiang, which is anchored near Energy Transfer's Nederland terminal, the data showed. That vessel is scheduled to ship ethane to Chinese petrochemical firm Satellite Chemical. Energy Transfer did not respond to requests for comment, while Satellite Chemical could not be reached for comment. 'We will continue working with the administration to ensure there are no unnecessary obstacles to these important trade flows,' said Dustin Meyer, senior vice president of Policy, Economics and Regulatory Affairs at the American Petroleum Institute trade group. 'The market disruption could be immediate,' Julian Renton, an analyst at East Daley Analytics, said in a note. Traders said there may be limited near-term impact on Chinese operators, as they have sufficient stocks to keep operations going for now. East Daley's Renton said that if the restriction holds, Chinese petrochemical plants could face critical feedstock shortfalls, while projects may stall. Shares of Enterprise were down 1.12% on Friday, while Energy Transfer shares were down 1.4%. Shares of ethane importers Satellite Chemical were down 3.1% earlier on Friday, while Wanhua Chemical stock lost 1.3%.
CBS News
a day ago
- Business
- CBS News
Key U.S inflation gauge shows price growth cooled in April with little sign of tariff impact
A key U.S. inflation gauge slowed last month as President Donald Trump's tariffs have yet to noticeably push up prices. Spending by Americans slowed despite rising incomes, potentially an early reaction to higher prices on some imported goods. Friday's report from the Commerce Department showed that consumer prices rose just 2.1% in April compared with a year earlier, down from 2.3% in March and the lowest since September. Excluding the volatile food and energy categories, core prices rose 2.5% from a year earlier, below the March figure of 2.7%, and the lowest in more than four years. Economists track core prices because they typically provide a better read on where inflation is headed. The figures show inflation is still declining from its post-pandemic spike, which reached the highest level in four decades in July 2022. Economists and some business executives have warned that prices will likely head higher as Trump's widespread tariffs take effect, though the timing and impact of those duties are now in doubt after they were struck down late Wednesday in court, only to be temporarily reinstated by a federal appeals court in Washington, D.C. On a monthly basis, overall prices and core prices both increased just 0.1% from March to April. The cost of big-ticket manufactured goods rose a hefty 0.5%, though that increase was offset by a 0.1 decline in other goods, such as groceries. The cost of services rose just 0.1% from March to April. Americans cool off on spending The big increase in durable goods prices could reflect the early impact of tariffs. Americans also cut back their spending on longer-lasting factory goods in April, the report showed. Overall consumer spending — which includes spending on services — rose 0.2% in April from March, the report said, but that's down from a big 0.7% rise in March. The slowdown in spending could reflect some early caution on the part of consumers, economists said, in response to higher goods prices. It also suggests that some of the spending jump in March reflected consumers purchasing items like cars to get in front of the impact of tariffs. " This is unsurprising, given the implementation of tariffs," Harry Chambers, assistant economist at Capital Economics said in a research note. "While tariffs may have started to weigh on consumers, this is far from a disaster," he added. "The pulling forward of consumer spending ahead of the tariff increases will continue to dampen household spending in the coming months, especially as they face higher prices and a softening labor market," Kathy Bostjancic, chief economist at Nationwide, said in an email. "We anticipate that the improved inflation trend will reverse in the second half of the year as companies are forced to begin passing along a portion of the increased tariffs in order to protect profit margins." Walmart executives said earlier this month that the retail giant would increase prices for many products in May and June to account for the tariffs, while electronics chain Best Buy's CEO Corie Barry said Thursday the company is increasing some prices as well because of the duties, as a "last resort." At the same time, incomes — before adjusting for inflation — rose a healthy 0.8% in April. Much of that gain reflected an increase in Social Security benefits as a result of the Social Security Fairness Act. The law signed in January by former President Biden, granted retroactive benefits for some retired teachers, fire fighters, and federal workers whose incomes previously weren't fully counted toward Social Security benefits because they have pensions. The inflation-fighters at the Federal Reserve said at their most recent meeting May 6-7 that inflation is still elevated, compared with their target of 2%. Fed officials, who focus more on core prices, broadly support keeping their key interest rate steady while they evaluate the impact of the tariffs on inflation and jobs. The court ruling last Wednesday said that most of Trump's tariffs were unlawful, including his duties on imports from Canada, Mexico, and China, as well as those on more than 50 other countries. Tariffs on steel, aluminum, and cars were implemented under different laws and remain in place. But the duties were allowed to remain in effect while the Trump administration appeals the ruling against them. And administration officials say they will find other legal authorities, if needed, to implement the tariffs. As a result, what tariffs will end up in place and for how long remains highly uncertain.
Yahoo
a day ago
- Business
- Yahoo
US planning restrictions on chip design software sales to China
The US government is moving to restrict the sale of chip design software to China, Bloomberg reported, citing sources familiar with the matter. This development is part of a broader policy evaluation by the US to curb China's semiconductor industry ambitions. The focus is on electronic design automation (EDA) software, with potential implications for companies such as Cadence Design Systems, Synopsys, and Siemens. The Commerce Department's Bureau of Industry and Security has reportedly sent letters to some EDA providers, instructing them to halt shipments to Chinese customers. The policy details are not yet public, and the extent of the restrictions remains unclear, the publication said. The publication cited an agency spokesperson as saying: 'The Commerce Department is reviewing exports of strategic significance to China. 'In some cases, Commerce has suspended existing export licenses or imposed additional license requirements while the review is pending.' However, it could result in a significant impact on business operations in China, where Synopsys and Cadence derive 16% and 12% of their revenue, respectively. The US administration's approach to limiting China's semiconductor industry has been escalating, initially targeting equipment for advanced electronic components and gradually broadening the scope. Software from companies such as Cadence and Synopsys is crucial for designing high-end processors used by firms such as Nvidia and Apple, as well as simpler components for power regulation. The US has also aimed to prevent the sale of advanced semiconductors to China, with Nvidia being a primary target of export controls. Nvidia's chips are essential for training artificial intelligence models. The Trump administration banned Nvidia from selling its H20 chips to Chinese customers, marking the third round of restrictions since 2022. US export controls have become a contentious issue in trade negotiations between Washington and Beijing. Chinese officials argued that US restrictions, along with efforts to discourage allies from using Huawei Technologies' Ascend chip, contradict recent discussions in Geneva aimed at easing broader trade tensions initiated by President Donald Trump. "US planning restrictions on chip design software sales to China" was originally created and published by Verdict, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
Time of India
a day ago
- Business
- Time of India
US inflation gauge cools with little sign of tariff impact, so far
A key U.S. inflation gauge slowed last month as President Donald Trump's tariffs have yet to noticeably push up prices. Spending by Americans slowed despite rising incomes, potentially an early reaction to higher prices on some imported goods. Friday's report from the Commerce Department showed that consumer prices rose just 2.1% in April compared with a year earlier, down from 2.3% in March and the lowest since September. Excluding the volatile food and energy categories, core prices rose 2.5% from a year earlier, below the March figure of 2.7%, and the lowest in more than four years. Economists track core prices because they typically provide a better read on where inflation is headed. The figures show inflation is still declining from its post-pandemic spike, which reached the highest level in four decades in July 2022. Economists and some business executives have warned that prices will likely head higher as Trump's widespread tariffs take effect, though the timing and impact of those duties are now in doubt after they were struck down late Wednesday in court. Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Giao dịch vàng CFDs với sàn môi giới tin cậy IC Markets Tìm hiểu thêm Undo On a monthly basis, overall prices and core prices both increased just 0.1% from March to April. The cost of big-ticket manufactured goods rose a hefty 0.5%, though that increase was offset by a 0.1 decline in other goods, such as groceries. The cost of services rose just 0.1% from March to April. The big increase in durable goods prices could reflect the early impact of tariffs. Americans also cut back their spending on longer-lasting factory goods in April, the report showed. Live Events Overall consumer spending - which includes spending on services - rose 0.2% in April from March, the report said, but that's down from a big 0.7% rise in March. The slowdown in spending could reflect some early caution on the part of consumers, economists said, in response to higher goods prices. It also suggests that some of the spending jump in March reflected consumers purchasing items like cars to get in front of the impact of tariffs. "The pulling forward of consumer spending ahead of the tariff increases will continue to dampen household spending in the coming months, especially as they face higher prices and a softening labor market," Kathy Bostjancic, chief economist at Nationwide, said in an email. "We anticipate that the improved inflation trend will reverse in the second half of the year as companies are forced to begin passing along a portion of the increased tariffs in order to protect profit margins." Walmart executives said earlier this month that the retail giant would increase prices for many products in May and June to account for the tariffs, while electronics chain Best Buy's CEO Corie Barry said Thursday the company is increasing some prices as well because of the duties, as a "last resort." Makeup company E.l.f. Beauty, which sources 75% of its products from China, said earlier this week it would raise its prices by $1 a product starting Aug. 1 to offset the cost of tariffs. And on Thursday, warehouse retailer Costco said it has already raised prices for some products, but has held the line on others. The company largely absorbed the duties on pineapples and bananas "because they are key staple items" and "we felt it was important to really eliminate the impact there," said Gary Millerchip, Costco's chief financial officer. But the company did increase prices for flowers from Central and Source America, for example, "because we felt that was something that the member would be able to absorb," Millerchip added. At the same time, incomes - before adjusting for inflation - rose a healthy 0.8% in April. Much of that gain reflected an increase in Social Security benefits for some retired teachers, fire fighters, and federal workers whose incomes previously weren't fully counted toward Social Security benefits. The inflation-fighters at the Federal Reserve said at their most recent meeting May 6-7 that inflation is still elevated, compared to their target of 2%. Fed officials, who focus more on core prices, broadly support keeping their key interest rate steady while they evaluate the impact of the tariffs on inflation and jobs. The court ruling last Wednesday said that most of Trump's tariffs were unlawful, including his duties on imports from Canada, Mexico, and China, as well as those on more than 50 other countries. Tariffs on steel, aluminum, and cars were implemented under different laws and remain in place. But the duties were allowed to remain in effect while the Trump administration appeals the ruling against them. And administration officials say they will find other legal authorities, if needed, to implement the tariffs. As a result, what tariffs will end up in place and for how long remains highly uncertain.
