China could become Thailand’s main competitor for rice export in the future, according to the Thai Rice Exporters Association.
The association’s honorary president, Chookiat Ophaswongse, said that the association was closely watching China’s rice exports, which had expanded in terms of volume over the past few years.
Last year China exported 2.7 million tonnes of rice, which is expected to reach 3.2 million tonnes this year.
He added that China’s export is expected to expand to between 5 million tonnes to 6 million tonnes in the next few years, thanks to its rice varieties and high yield.
He said that besides China, Myanmar is also rising fast as a major rice exporter. Myanmar has already exported 2 million tonnes this year and is expected to increase to 3 million tonnes next year.
He added that Thailand’s competitors have spent far higher than Thailand on rice research and development to improve quality and strains to make their rice fit well with market demand.
The association recently revised down its forecast for Thai rice exports this year from 7.5 million tonnes to 6.5 million tonnes.
Thailand’s rice exports in the first half of this year dropped 32 per cent year on year to 3.14 million tonnes, worth US$2.2 billion, according to the association.
The Transport Ministry has asked Airports of Thailand (AOT) to deliver feasibility studies on second airports to serve Phuket and Chiang Mai by next year. The AOT is ready to invest more than Bt120 billion in the airports, confident construction will be warranted by growing travel demand.
Chaiwat Thongkamkoon, Transport Ministry Permanent Secretary, said the ministry in June instructed the AOT to hire consultants for the feasibility studies.
Chula Sukmanop, director of the Civil Aviation Authority of Thailand (CAAT), said its study of Thailand’s airport master plan found that new airports should be developed in Phang Nga province to support Phuket and in Lamphun province to support Chiang Mai.
The AOT expects construction costs for both airports will be around Bt120 billion – Bt70 billion for the second Phuket airport and Bt54 billion-Bt60 billion for the second Chiang Mai airport.
The area earmarked for Phuket Airport 2 is located in Khok Kloi subdistrict, Takua Thung district, Phang Nga province. An area of 7,000 rai will be requisitioned from its 10 major landowners who must be compensated for 200-300 land title deeds.
Chiang Mai Airport 2 will be located in Huai Yab subdistrict, Ban Thi district, Lamphun province where the terminal and runway will be built on 5,000 land plots.
Several securities companies have cut listed companies’ earnings per share (EPS) and second-quarter profit forecasts this year due to the Covid-19 impact on the economy.
Tisco Securities’ senior strategist Apichat Poobunjirdkul said the company has cut listed companies’ EPS to Bt61.1 per share from Bt67 per share in May, the lowest in 10 years, adding that listed companies’ EPS was Bt53.4 per share during the hamburger crisis.
“We expect listed companies’ second-quarter performance to drop the most as their net profit would drop over 40 per cent year on year due to the Covid-19 pandemic that has caused the global economic slowdown,” he said.
He said the second-quarter profit of 43 listed companies in the SET50 Index is expected to be Bt93.3 billion, down 39 per cent year on year as lockdown measures had caused an impact on various industries, especially the tourism industry businesses, such as airports, airlines, hotels, public transportation and department stores.
“Listed companies’ second-quarter performance announcement would cause market volatility in the short term because the profit forecast in the first half of this year accounted for 37 per cent of the profit forecast this year,” he said. “However, listed companies’ profit would increase during the second half of this year in response to the easing of the lockdown and economic stimulus measures.”
He added that listed companies’ third-quarter profit would grow over 30 per cent quarter on quarter.
Sunthorn Thongthip, a senior director at Kasikorn Securities, said there is a chance that listed companies’ EPS this year will drop from the current forecast of Bt64 to Bt65 per share due to the decline in number of tourists, adding that listed companies’ EPS next year is expected to be at Bt85 per share.
“The number of tourists this year would be lower than expected because the second Covid-19 wave has caused many countries to delay reopening,” he said.
Nuttachart Mekmasin, assistant managing director at Trinity Securities’ research department, said listed companies’ second-quarter performance would not cause much impact on investment because the market had already responded to this factor.
“Investors should focus on listed companies’ third-quarter performance rather than on the second-quarter because the index rose over 20 per cent from the lowest point so far,” he said. “However, the index would face severe correction if listed companies’ third-quarter performance is lower than expected.”
Chaiyaporn Nompitakcharoen, deputy managing director of Bualuang Securities’ non-institutional broking group, said listed companies’ second-quarter profit will drop by 40 per cent year on year to the lowest point in response to countries’ lockdown due to the Covid-19 pandemic, adding that listed companies’ performance is expected to recover during the third and fourth quarters of this year and will return to normal at the end of 2021.
“Stocks whose profit will rise gradually are food export, packaging, and consumer finance stocks, while stocks whose performance will recover by the second half of this year are restaurant, petrochemical, fuel and oil refinery stocks,” he said. “Stocks whose performance will recover slowly are electric appliances, automotive parts, service, and commercial bank stocks which may recover by the end of this year or the beginning of the next year.”
However, he added that listed companies’ profit forecast this year would be cut further from the current expected drop of 25 per cent year on year as commercial banks’ second-quarter performance was lower than expected.
By Syndication Washington Post, Bloomberg · Alex Longley · BUSINESS, US-GLOBAL-MARKETS
Oil slipped to near $41 as investors weighed worsening relations between Washington and Beijing alongside flare-ups in coronavirus outbreaks across the world.
Futures in New York edged lower after a 1.7% gain last week. Chinese authorities took over the U.S. consulate in Chengdu on Monday as tit-for-tat tensions continue to simmer between Beijing and the U.S. At the same time, second waves of the pandemic are popping up from Spain to China, casting new potential clouds over the demand outlook, though the surge in cases in the U.S. was easing.
The most notable market moves in recent days have come in the shape of the oil futures curve. Brent’s prompt spread is trading in its largest contango structure since May, a sign of oversupply, while contracts based on the value of Russian and North Sea crude were both weaker last week. Its the latest signal that the market’s re-balancing appears to have taken a pause for breath in recent sessions.
Crude has been trading in a tight range near $40 a barrel since early June after its rapid recovery from lows in April petered out as many countries struggled to bring the virus under control. A drop in the dollar has also supported prices this month, although investors are bracing for fresh supply from the OPEC+ alliance when it relaxes its output curbs from August.
“On the one hand, the risks of a less robust recovery of demand due to coronavirus, and the political tensions between the US and China, are weighing on prices,” said Commerzbank analyst Carsten Fritsch. “On the other, prices are finding support from the weak U.S. dollar and hopes of further corona aid.”
The pace of the recovery in global oil demand is set to slow to below 1 million barrels a day from August through December, Goldman Sachs Group analysts wrote in a report. That stalling return is likely to leave crude prices range bound in the second half of the year, they said.
There is also evidence North American crude production may be starting to recover. U.S. output rose for the first time since March in the week through July 17 after correcting for the impact of Tropical Storm Cristobal, which tore through the Gulf of Mexico in June, while Baker Hughes data released Friday showed the first expansion in drilling in American fields in four months.
By Syndication Washington Post, Bloomberg · Joanna Ossinger · BUSINESS
Bitcoin rose above $10,000 for the first time in more than six weeks as the largest cryptocurrency breaks its recent trading range with risk assets rallying.
The digital token spiked around 6 a.m. EDT Sunday, rising as high as $10,169, according to pricing compiled by Bloomberg. The gains quickly fizzled, initially, then the coin rallied again later, climbing as high as $10,335.
Bitcoin, which crypto fans have often touted as “digital gold,” is in favor as the yellow metal nears record levels, concerns rise about the health of the world economy and the dollar falls. Also, last week, the U.S. Office of the Comptroller of the Currency said American banks can provide custody services for customers’ crypto assets, which could help boost the asset class’s appeal with some investors.
The cryptocurrency had been hovering near its 50-day moving average for weeks before pulling above it in the past couple of days.
“We remain positive on the overall precise structure for Bitcoin and do expect it push through $10,000-$10,500 as part of its longer term bullish technical profile,” said Rob Sluymer, technical strategist at Fundstrat Global Advisors LLC. Even so, that range “remains a resistance band that Bitcoin will need to break above to signal its next move to resistance at $13,800.”
If the largest cryptocurrency can take out the $10,500 level, it could catapult much higher and test this year’s high, technical indicators suggest. At the same time, another technical gauge is indicating Bitcoin might see a pullback as its 14 Day RSI is nearing 80, far above the 70 level that indicates overbought and is near the level that killed Bitcoin’s last run in early May.
Bitcoin has enjoyed above-average flows this year, and those flows are relatively high versus their five-year average when compared with those of exchange traded funds in other asset classes, according to a report from JPMorgan Chase & Co. strategist John Normand on Friday.
By Syndication Washington Post, Bloomberg · Ranjeetha Pakiam, Justina Vasquez, Elena Mazneva · BUSINESS, US-GLOBAL-MARKETS
Gold’s unrelenting march higher shows no signs of slowing after a plunge in the dollar swept prices past the previous high set in 2011 and put the metal on track for even bigger gains.
Bullion’s surge came as a gauge of the U.S. currency sank to the lowest in more than a year, the latest in a long line of bullish factors — including negative real rates in the U.S. and bets the Federal Reserve will keep policy accommodative when it meets this week — that are pushing prices ever higher.
With the world facing an extended period of unprecedented economic and political turmoil, gold’s now got $2,000 in its sights. Some in the market suggest the haven could rise even beyond that.
Nascent signs of gold’s record-breaking ascent began to show in mid-2019, when the Fed signaled a readiness to cut interest rates as uncertainty — primarily about the impact of the U.S.’s trade battles — clouded its outlook. The rally gathered pace in early 2020 as geopolitical tensions rose and the coronavirus outbreak hurt growth worldwide, pushing governments and central banks to unleash vast amounts of stimulus, and sending real interest rates slumping further into negative territory.
“Strong gains are inevitable as we enter a period much like the post-GFC environment, where gold prices soared to record levels as a result of copious amounts of Fed money being pumped into the financial system,” said Gavin Wendt, senior resource analyst at MineLife. A weak dollar and negative real rates are providing further impetus. Gold may consolidate before setting its sights on $2,000 and above in coming weeks, he said.
Investment demand has been unrelenting. Holdings in gold-backed exchange-traded funds have beaten all-time highs nearly every month since late last year and inflows this year have topped the record annual total set in 2009. The additions make up roughly one-fifth of expected mine supply for the year, according to research group Metals Focus.
Gold’s been drawing investors even as equities climbed — with the exception of a sharp selloff in March as traders liquidated bullion holdings to cover losses in other markets — and it’s U.S. bonds that have been the key metric to watch. The metal is serving as an attractive hedge as yields on Treasuries that strip out the effects of inflation fall below zero.
The environment has even raised the specter of stagflation, a rare combination of sluggish growth and rising inflation that erodes the value of fixed-income investments. In the U.S., investor expectations for annual inflation over the next decade, as measured by a bond-market metric known as breakevens, have moved higher the past four months after plunging in March.
Inflation also plays an important role in looking at prices in an historical context. Spot gold traded as high as $1,945.26 on Monday, topping its previous record by more than $20. Spot silver jumped as much as 8.1% to $24.6031 an ounce, the highest since 2013.
When adjusted for inflation, bullion remains lower than its 2011 high and far below the historic peak in 1980, in the wake of the second oil price shock.
It’s not just price moves that are proving historic. The virus shined a spotlight on a traditionally overlooked corner of the market: logistics. A chaotic period in March saw extreme distortions between London and New York gold prices due to an unprecedented snarl in the movement of physical metal, with the grounding of flights and refinery shutdowns sparking concerns about a shortage of bullion available in New York in time to deliver against Comex futures.
That crisis eased — there was enough gold — but the dislocation prompted CME Group Inc., which owns Comex, to announce that it would offer a new futures contract with expanded delivery options that included 400-ounce bars, which is the size accepted in London. It later said traders will be able to deliver gold in London vaults against the new contract.
Next up for investors and a possible fillip for gold, is this week’s Fed meeting July 28-29, where officials are expected to keep interest rates near zero and debate a possible shift in its strategy.
The meeting may be a platform for a strong message that change is coming, opening up the possibility for more unconventional policies further down the line, according to Chris Weston, head of research at Pepperstone Group. “If we think about real yields and what the Fed is doing, it just suggests to me that it’s a matter of time before real yields continue to trend lower and gold goes higher,” he said.
The Fed’s path forward will be closely watched. From December 2008 to June 2011, the Fed bought $2.3 trillion of debt and held borrowing costs near zero percent in a bid to shore up growth, helping send bullion to a record in September 2011.
Forecasts for further gains have been building even before gold’s most recent breakthrough. Bank of America . has stuck with its April forecast for $3,000 gold over the next 18 months. UBS Group sees prices reaching $2,000 by end-September, global chief investment officer Mark Haefele wrote in a note Monday. The group has added the metal to its “most preferred asset list.”
“You simply couldn’t pick a more perfect storm of events which would allow for gold to perform,” said Steve Dunn, head of ETFs at Aberdeen Standard Investments. “With low interest rate policies, negative real rates, super accommodative monetary policy, huge amounts of global fiscal spending, a weaker dollar, escalating U.S.-China tensions and no clear end in sight for the coronavirus pandemic, all of the parts of the equation are coming together.”
Rayong’s administration is working on putting in place an effective waste and waste-water disposal system before the Eastern Economic Corridor (EEC) is fully developed and brings in an influx of people.
Piya Pitutecha, chief of Rayong’s Provincial Administrative Organisation, said his team was working in collaboration with PTT’s Global Power Synergy Co (GPSC) to build a comprehensive waste-disposal centre, which will cover approximately 429 rai and overlap Nam Khok, Thapma, Map Kha and Nong Taphan subdistricts. He said a proper waste-disposal set up was necessary as the EEC will soon start attracting both industrial and business investments, which will result in a boost in population and huge amounts of waste.
The planned integrated waste-disposal centre will comprise waste-separation plants, which will then be shifted to power-generating incinerators that can eliminate 500 tonnes of waste daily and produce 10 megawatts of electricity. Construction of this plant began last year and is scheduled to be completed in 2021.
Once this is complete, a second and third waste incinerator will be built in the same area, with the second started in 2021 and completed in 2022 and third started in 2022 and finished in 2023.
Once all three incinerators are operating, they will be able to eliminate up to 1,500 tonnes of waste daily and generate a total of 30MW of power.
GPSC will be investing in the incinerators, and revenue from the electricity generated will cut down the cost of waste-disposal by Bt400 per tonne – the biggest saving compared to other waste-disposal systems.
This system will be able to handle waste generated from the growth of EEC for at least 20 years, including the more than a million tonnes of waste in Rayong’s landfills.
“Since this is a public-private joint venture, it will encourage the government to push the project forward quickly. It also makes it possible for refuse in Rayong province to be dealt with in a complete and sustainable manner that is in line with international standards, which means there will be no foul odour or pollution and this system can be a model for other provinces to follow,” Piya said.
HSBC denies ‘framing’ Huawei, says it did not prompt U.S. legal probe
CorporateJul 27. 2020Huawei CFO Meng Wanzhou leaves her home to attend an extradition hearing in Vancouver, B.C., in May 2020..
By Syndication Washington Post, Bloomberg · No Author · NATIONAL, BUSINESS, WORLD, COURTSLAW, ASIA-PACIFIC
HSBC, responding to media reports over its dealings with Huawei, denied that it “framed” the Chinese telecom giant, and said it did not spark a U.S. probe of the company.
In its first public comments about Huawei’s legal battle in North America, the U.K. bank said it has no “hostility” toward Huawei and did not “ensnare” the company. The bank said it only provided information to the U.S. Department of Justice when it was compelled to do so.
“In response to the U.S. DOJ’s requests for information, HSBC simply presented the objective facts,” the bank said in a statement Saturday. “HSBC did not ‘fabricate’ evidence or ‘hide’ facts. And HSBC would never distort the facts or seek to harm any of our clients for our own gain.”
HSBC has become embroiled in Huawei’s legal fight to block a U.S. request to extradite Chief Financial Officer Meng Wanzhou from Canada to face trial over allegedly violating U.S. sanctions on Iran. Meng has been under house arrest in Vancouver since she was detained at the request of U.S. authorities in 2018.
HSBC’s statement came after the China’s People’s Daily newspaper published an opinion piece on Friday saying the bank is an accomplice of the U.S. and fabricated evidence on Huawei, resulting in the arrest of Meng.
On the same day, China’s banking regulator approved HSBC’s application to close a sub-branch in Shenzhen, where Huawei is located. The U.K. bank said the move is part of its routine work of reviewing and optimizing its service channels. After the closure, HSBC still operates 11 outlets in the city.
Shares of HSBC fell 1.9% in early morning Hong Kong trading Monday, extending this year’s decline to 42%.
HSBC was thrust further into the spotlight with new evidence presented last week. In a filing to a Canadian court Thursday, Meng’s lawyers argued that the U.S. misled Canadian authorities by omitting key elements of a PowerPoint presentation that Meng showed to HSBC bankers at a 2013 meeting in Hong Kong, The Globe and Mail reported.
The omissions leave the impression that Meng didn’t fully explain Huawei’s dealings in Iran, according to the report. The U.S. argues that Meng deceived banks including HSBC, and that this prompted lenders to clear millions of dollars in transactions in violation of the sanctions.
In fact, Meng’s lawyers argued, she was transparent about the Iran dealings, citing two slides in the presentation made to HSBC that had been omitted from the U.S. filing, the Globe reported.
HSBC is walking a tightrope amid growing U.S.-China tensions. The London-based bank has come out in support of a controversial new security law imposed by China on Hong Kong, one of its biggest markets. The U.K. government meanwhile, has joined the U.S. and other countries in banning Huawei from developing their 5G networks.
“We will continue investing in our business, services, talents and technology in China and contributing to the sustainable development of the country,” the bank said.
Thai food exports are picking up as many countries are accelerating imports amid quarantine conditions, the Department of International Trade Promotion said.
Somdet Susomboon, director-general of the department, however added that overall Thai exports have not expanded much due to the Covid-19 impact which caused a global economic slowdown and affected trading partners.
Thai food exports have grown more than 20 per cent. Fresh, chilled, frozen chicken, canned and processed seafood, including ready-to-eat food, and foods that contain herbs are in high demand.
Canadian consumers are showing interest in immunity-boosting foods, and foods that give digestion a boost, offering opportunities for foods made from Thai herbs, fermented foods using local wisdom, such as fish sauce and fermented fish to expand the market more, he said.
This is consistent with a report from the Office of Foreign Trade Promotion in Toronto, Canada, which states that Canadian consumers are currently more attentive to healthcare, are turning to eat healthy foods, exercise, and give importance to nutritional benefits, such as eating foods that help prevent and strengthen the immune system. The office advised food manufacturers to pay more attention to products that help enhance immunity, label the products as immunity supplement or as helping strengthen immunity.
Meanwhile, a Canadian study found that supplements and functional food products will grow by 30 per cent per year from now. Canadian consumers now believe fermented foods help the digestive system, especially yoghurt, kimchi, miso, etc., including foods that contain herbs that have attributes to strengthen immunity are seeing increased sales.
“It is an opportunity for Thai herbs, tropical fruits and vegetables such as andrographis paniculata, triphala, Indian gooseberry, belleric myrobalan, and Thai samos, which are herb groups that help boost immunity and antioxidants, and can be used to produce functional foods including rice berry which is rich in minerals and various nutrients,” said the director.
The popularity of fermented products offers an opportunity for Thai fish sauce and fermented fish makers, but manufacturers and exporters should research in-depth about the nutritional benefits that are more than basic nutrients.
Jul 24. 2020AIS CEO Somchai Lertsutiwong, left, and AMATA Corporation’s Acting CEO Vikrom Kromadit at the signing ceremony.
By The Nation
Advanced Info Service (AIS) today signed a deal with industrial-estate developer Amata Corporation to roll out its 5G wireless broadband technology and facilities for hundreds of factories at Amata City Chonburi.
The move comes after the two companies formed the Amata Network joint venture in December 2016 for digital infrastructure at Amata City Chonburi.
AIS chief executive officer Somchai Lertsutiwong said: “Since 2016, AIS and Amata have been working closely together to bring the essential digital infrastructure and Internet of Things (IoT) innovation to support management, production, and utilities in Amata City Chonburi.”
AIS said it has now expanded collaboration with Amata to create “the perfect smart city” by using 5G intelligent technologies to boost more than 750 factories at the Chon Buri industrial estate. The move would lift production capability of Thai industry to a world-class level as well as developing solutions helpful for the production of modern smart cities, including management of resources, transportation, and security systems, it added.
Huawei CFO Meng Wanzhou leaves her home to attend an extradition hearing in Vancouver, B.C., in May 2020..
AIS CEO Somchai Lertsutiwong, left, and AMATA Corporation’s Acting CEO Vikrom Kromadit at the signing ceremony.
