Here's my summary of the key news overnight in 90 seconds at 9 am, including a strange set of successes and problems around the world.
As the NZ stock market reached a record high yesterday, the rest of the world is showing signs of expanding trade.
In the US, consumer credit grew at an unexpectedly strong annual rate of +9.7% in July to a record high, and its fastest growth since July 2011. American consumers look like they are back as the engine of international trade.
Germany's exports grew a surprising +8.5% in August and helped that country post a huge trade surplus.
And China’s trade surplus climbed to a record US$50 bln in August as exports rose on the back of increased shipments to America and Europe, while imports fell for a second month as a property slump hurt domestic demand.
Yesterday we noted the sharp fall in iron ore prices. Today comes news that Chinese steelmakers are really doing it tough with debt levels racing higher to "alarming levels". The other big steel user, shipbuilding, is faring little better.
The UST 10yr benchmark bond yield slipped back marginally today and is now at 2.45%.
The price of oil and gold both fell overnight. The US oil price is now just over US$92/barrel and the Brent benchmark is now just above $100/barrel. In fact, the Brent price fell below $100 for the first time in more than a year as concerns of rising oil surpluses grows. Russian leverage over Europe is diminishing. Gold is basically unchanged, now at US$1,262/oz.
We start today with our currency sharply lower against the US dollar. We are now just on 82.8 USc its lowest in seven months, but up against the Aussie at 89.2 AUc, and the TWI is at 79.0.
The British pound is taking a bit of a hit as traders position themselves for the possibility of a breakup of the United Kingdom. Interestingly, BNZ's owner NAB may have to take a big write down if Scotland does win independence in next Friday's vote.
If you want to catch up with all the changes yesterday we have an update here.
The easiest place to stay up with today's event risk is by following our Economic Calendar here »
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20 Comments
"Green Party has been accused of "subverting the democratic process" by lobbying Environment Canterbury (ECan) on behalf of individuals without their knowledge"
I've got no problem with the Greens but let's do a little social experiment; let's see if the lefties on here criticise this the way they did dirty politics.
"subverting the democratic process"
What democratic process?
Until May 2010, Canterbury Regional Council was governed by 14 elected councillors who were elected on a first-past-the-post basis from eight regional constituencies.
In March 2010, the Government sacked the Environment Canterbury councillors and replaced them with commissioners Read more
Well, reading the stuff article that came from, the Green's say they did ask for permission during the phone interviews but acknowledge that as people didn't understand it meant that they had stuffed up and apologise.
So, no, not quite like leaking SIS documents or hacking Labour computers, or working with a campaign to undermine the head of the SFO when you are the Minister in Charge.
I just read the article on stuff. It dosn't seem a deliberate attempt to mislead and it could be argued that ringing up to prompt online submissions is ok but filling them in on behalf is a questionable tactic. When asked about the issue it was dealt with immediately with an acknowledgement that they had make a mistake. The lesson is if you make a mistake acknowledge it and change.
I'm not really sure how the Greens could have handled this differently apart from not phoning people in the first place.
I'm not sure an attempt to get over human apathy is the same as the dirty politics scandal.
The Green party explained how they stuffed up and apologised. They say they will not do it again.
John Key does not explain how leaks from government departments to a partisan media occurred. Even though it was obviously directed against those that the government do not like or to divert attention away from government failings. John (and Judith) did not apologised. It seems likely John Key will repeat this behaviour if he gets re-elected because he sees himself as innocent.
Dirty politics is part of a wider strategy over a number of years to create cynacism in politics, drive down the vote and gain electoral advantage because more right wing voters than left wing voters go to the polls in this enviroment. Simon Lusk who is a political consultant for a faction in the National party has openly discussed this.
Wheras the Green party have made a one off mis-judgement. So not the same.
Nice trolling Happy 123. You can always smell you coming by the f.... matter you are spreading.
... so much oil is sloshing around the planet that in New Plymouth they have to dump 10 000 litres or more of it into the local waste water treatment plant catchment , just to get rid of the stuff ...
Someone should've told them , into 40 000 egg yolks , slowly drip your oil and beat 'like the clappers .... add a bucket of salt , juice of 30 dozen lemons , 100 litres vinegar and a barrel of Dijon mustard ...
... world's biggest mayonnaise ... beat til you reach peak oil ...
Since you brought up China's steel making David and you are now turning into a raging greenie, then this article on the the need for carbon in steel making makes for some interesting reading. I sourced that article from a bioenergy list I belong to and they guys there are experts from all over the world in the field of wood energy. The question is really how long the worlds forests would last if used for steel making once coal is exhausted. The answer is not very long.
Therefore growth in global energy consumption from wind and solar since 2000 has been approximately half of the increase in energy consumption by China's steel sector alone. A stark illustration of how little has been achieved in the transition to low carbon energy.
To answer the usual selective material of Profile this is just a snippet from the much larger email stream.
We had the privilege of being closely involved in a steel industry study and pilot trial addressing these questions a few years ago, we provided the protocols and plantation sourced raw wood for charcoal production in existing coke ovens and ultimately supplies of charcoal from a range of species through our own retorts. These charcoal samples were then used in a test blast furnace owned by BHP/Bluescope Steel which modeled exactly the behavior of the production ones in use.
The results were outstanding. Renewable carbon from these sources substantially outperformed fossil sources in both quality of end product and efficiency of production, I believe the figure was close to a 40% production enhancement due to the higher reactivity of the wood charcoal. The key though is in obtaining sustainable sources in the volumes required. I recall a figure of 1 million tonnes of wood charcoal for the local steel producers which were themselves <1% of the global industry.
And another guy from South Africa:
The main problem with replacing coke in blast furnaces is the amount of
char(coal) required. One industry we have smelts silicon. As silicon reports
to the "slag" in the furnaces, the purity is affected by all elements that
report to the slag fraction. This includes the ash fractions in coal. As a
result, coal is not suitable as a reductant. Charcoal has the double benefit
of high fixed carbon and low ash making it the only realistic carbon source
that can be used. These guys have charcoal retorts spread across the entire
country. The cost of charcoal delivered to the furnace consequently has a
high transport element. As charcoal has low density, this simply exacerbates
the transport problem. Needless to say, charcoal for the metallurgical
industry is a major challenge. I simply cannot see how the world can grow
enough biomass to be able to supply the requirements adequately as long as
there is "cheap" coal available.
We have been working with the Canadian Carbonization Research Association (CCRA) http://www.cancarb.ca/ to explore the use of biocoal (biochar), in steel making.
Preliminary tests show that with low ash and low sulfur content (feedstock and process dependant), biochar can be a viable substitute for coal.
The challenge is the massive volume of material that's required in steel making. We are talking in the 1000's of tons per day.
And one guy mentioning the pollution....
China, biggest steel producers in the world, have a very large coal reserve.
So they are able to get lower cost energy into what is an energy intensive
industry. Furthermore, just visit Beijing or Shanghai and experience the
atmospheric pollution and realise that the Chinese standards are not the
same as that in Western commercial set ups.
You have multiple experts in this field commenting on this subject, which is just a sideline issue from the normal technical discussion that occurs. Once you start using coal for transport fuel in processes such as Fischer Tropsch then the reserves will start going down hill really fast.
Scarfie - the author himself was being selective with statements like "with no prospect of a transition to low carbon methods of steel production in the short to medium term." when clearly a low carbon steel industry already exsits in Brazil. Hand wringers can just buy Brazilian steel if they want to save the world.
"...1 million tonnes of wood charcoal for the local steel producers" - so the wood consumption equivalent of one world scale pulp mill. Plus you get the added bonus of a higher grade of steel, less emmissions and half the slag.
I have seen estimates that converting to charcoal plantation forestry would, at the same levels of steel production, take somewhere between 15% and 55% of the world's land area. So the technology is "30 years away" in the same sense as fusion is. It is an interesting idea in a small scale government subsidised kind of way.
I don't think anyone is suggesting making all steel from charcoal. Given the hiding coal is taking from shale gas in the US I think cheap coal will be around for a long while yet. BTW the Brazilian industry is not subsidised its just old fashioned innovation. The tech is 30-3,000 years old depending on how you look at it - not "30 years away" and the tech is getting better and better. If you want to get your carbon out of an open pit mine or a forest then choice is there for you to make.
cool. good to know thanks. Do you have an links (just at hand, or search terms) to modern processes.
Might have been nice in fonterra went that way instead of trying to start/buy a coal mine. It might even be usuable for coal replacement in NZ if it's efficient and renewable.
The mail list to which I belong has two sides, biochar to trap carbon back into the soil and enhance fertility, and wood gasification. The processes are often mutually inclusive and include gas to liquid technology to capture what wouuld once have been a byproduct wasted to atmosphere in the form of biooil, which can them be refined.
But like a lot of renewable energy the processes are complex, expensive and often unreliable. There has also been widespread fraud where these projects have been used as vessels to attract government funding only to fall over when the funding dries up.
Another interesting angle where many work not for profit, something quite foreign to these pages, is in small scale cooking in the third world via the TLUD. This is improving the health of millions and done without corporations or central government backing, just people who care getting on with it.
The bottom line is though, these are not a solution for the same energy consumption we now enjoy (yep even me still).
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